Document ID: SEC-2022-0688-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NYSE Arca, Inc.
Posted Date: 2022-05-18T04:00Z

[Federal Register Volume 87, Number 96 (Wednesday, May 18, 2022)]
[Notices]
[Pages 30286-30294]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-10618]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-94902; File No. SR-NYSEArca-2022-29]

Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change To List and Trade 
Shares of the IQ Winslow Large Cap Growth ETF and IQ Winslow Focused 
Large Cap Growth ETF Under NYSE Arca Rule 8.601-E (Active Proxy 
Portfolio Shares)

May 12, 2022.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given 
that on May 5, 2022, NYSE Arca, Inc. (``NYSE Arca'' or ``Exchange'') 
filed with the Securities and Exchange Commission (``Commission'') the 
proposed rule change as described in Items I and II below, which Items 
have been prepared by the self-regulatory organization. The Commission 
is publishing this notice to solicit comments on the proposed rule 
change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to list and trade shares of the following 
under NYSE Arca Rule 8.601-E: IQ Winslow

[[Page 30287]]

Large Cap Growth ETF and IQ Winslow Focused Large Cap Growth ETF. The 
proposed rule change is available on the Exchange's website at 
www.nyse.com, at the principal office of the Exchange, and at the 
Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the self-regulatory organization 
included statements concerning the purpose of, and basis for, the 
proposed rule change and discussed any comments it received on the 
proposed rule change. The text of those statements may be examined at 
the places specified in Item IV below. The Exchange has prepared 
summaries, set forth in sections A, B, and C below, of the most 
significant parts of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange has adopted NYSE Arca Rule 8.601-E for the purpose of 
permitting the listing and trading, or trading pursuant to unlisted 
trading privileges (``UTP''), of Active Proxy Portfolio Shares, which 
are securities issued by an actively managed open-end investment 
management company.\4\ Commentary .01 to Rule 8.601-E requires the 
Exchange to file separate proposals under Section 19(b) of the Act 
before listing and trading any series of Active Proxy Portfolio Shares 
on the Exchange. Therefore, the Exchange is submitting this proposal in 
order to list and trade shares (``Shares'') of Active Proxy Portfolio 
Shares of the IQ Winslow Large Cap Growth ETF and IQ Winslow Focused 
Large Cap Growth ETF (each a ``Fund'' and, collectively, the ``Funds'') 
under Rule 8.601-E.
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    \4\ See Securities Exchange Act Release No. 89185 (June 29, 
2020), 85 FR 40328 (July 6, 2020) (SR-NYSEArca-2019-95). Rule 8.601-
E(c)(1) provides that ``[t]he term ``Active Proxy Portfolio Share'' 
means a security that (a) is issued by a investment company 
registered under the Investment Company Act of 1940 (``Investment 
Company'') organized as an open-end management investment company 
that invests in a portfolio of securities selected by the Investment 
Company's investment adviser consistent with the Investment 
Company's investment objectives and policies; (b) is issued in a 
specified minimum number of shares, or multiples thereof, in return 
for a deposit by the purchaser of the Proxy Portfolio or Custom 
Basket, as applicable, and/or cash with a value equal to the next 
determined net asset value (``NAV''); (c) when aggregated in the 
same specified minimum number of Active Proxy Portfolio Shares, or 
multiples thereof, may be redeemed at a holder's request in return 
for the Proxy Portfolio or Custom Basket, as applicable, and/or cash 
to the holder by the issuer with a value equal to the next 
determined NAV; and (d) the portfolio holdings for which are 
disclosed within at least 60 days following the end of every fiscal 
quarter.'' Rule 8.601-E(c)(2) provides that ``[t]he term ``Actual 
Portfolio'' means the identities and quantities of the securities 
and other assets held by the Investment Company that shall form the 
basis for the Investment Company's calculation of NAV at the end of 
the business day.'' Rule 8.601-E(c)(3) provides that ``[t]he term 
``Proxy Portfolio'' means a specified portfolio of securities, other 
financial instruments and/or cash designed to track closely the 
daily performance of the Actual Portfolio of a series of Active 
Proxy Portfolio Shares as provided in the exemptive relief pursuant 
to the Investment Company Act of 1940 applicable to such series.'' 
Rule 8.601-E(c)(4) provides that the term ``Custom Basket'' means a 
portfolio of securities that is different from the Proxy Portfolio 
and is otherwise consistent with the exemptive relief issued 
pursuant to the Investment Company Act of 1940 applicable to a 
series of Active Proxy Portfolio Shares.
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Key Features of Active Proxy Portfolio Shares
    While funds issuing Active Proxy Portfolio Shares will be actively-
managed and, to that extent, will be similar to Managed Fund Shares, 
Active Proxy Portfolio Shares differ from Managed Fund Shares in the 
following important respects. First, in contrast to Managed Fund 
Shares, which are actively-managed funds listed and traded under NYSE 
Arca Rule 8.600-E \5\ and for which a ``Disclosed Portfolio'' is 
required to be disseminated at least once daily,\6\ the portfolio for 
an issue of Active Proxy Portfolio Shares will be publicly disclosed 
within at least 60 days following the end of every fiscal quarter in 
accordance with normal disclosure requirements otherwise applicable to 
open-end management investment companies registered under the 
Investment Company Act of 1940 (the ``1940 Act'').\7\ The composition 
of the portfolio of an issue of Active Proxy Portfolio Shares would not 
be available at commencement of Exchange listing and trading. Second, 
in connection with the creation and redemption of Active Proxy 
Portfolio Shares, such creation or redemption may be exchanged for a 
Proxy Portfolio or Custom Basket, as applicable, and/or cash with a 
value equal to the next-determined NAV. A series of Active Proxy 
Portfolio Shares will disclose the Proxy Portfolio on a daily basis, 
which, as described above, is designed to track closely the daily 
performance of the Actual Portfolio of a series of Active Proxy 
Portfolio Shares, instead of the actual holdings of the Investment 
Company, as provided by a series of Managed Fund Shares. As set forth 
in NYSE Arca Rule 8.601-E(d)(2)(B)(ii), for Active Proxy Portfolio 
Shares using a Custom Basket, each Business Day,\8\ before the opening 
of trading in the Core Trading Session (as defined in NYSE Arca Rule 
7.34-E (a)), the Investment Company shall make publicly available on 
its website the composition of any Custom Basket transacted on the 
previous Business Day, except a Custom Basket that differs from the 
applicable Proxy Portfolio only with respect to cash.
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    \5\ The Commission has previously approved listing and trading 
on the Exchange of a number of issues of Managed Fund Shares under 
NYSE Arca Rule 8.600-E. See, e.g., Securities Exchange Act Release 
Nos. 57801 (May 8, 2008), 73 FR 27878 (May 14, 2008) (SR-NYSEArca-
2008-31) (order approving Exchange listing and trading of twelve 
actively-managed funds of the WisdomTree Trust); 60460 (August 7, 
2009), 74 FR 41468 (August 17, 2009) (SR-NYSEArca-2009-55) (order 
approving listing of Dent Tactical ETF); 63076 (October 12, 2010), 
75 FR 63874 (October 18, 2010) (SR-NYSEArca-2010-79) (order 
approving Exchange listing and trading of Cambria Global Tactical 
ETF); 63802 (January 31, 2011), 76 FR 6503 (February 4, 2011) (SR-
NYSEArca-2010-118) (order approving Exchange listing and trading of 
the SiM Dynamic Allocation Diversified Income ETF and SiM Dynamic 
Allocation Growth Income ETF). The Commission also has approved a 
proposed rule change relating to generic listing standards for 
Managed Fund Shares. See Securities Exchange Act Release No. 78397 
(July 22, 2016), 81 FR 49320 (July 27, 2016) (SR-NYSEArca-2015-110) 
(amending NYSE Arca Equities Rule 8.600 to adopt generic listing 
standards for Managed Fund Shares).
    \6\ NYSE Arca Rule 8.600-E(c)(2) defines the term ``Disclosed 
Portfolio'' as the identities and quantities of the securities and 
other assets held by the Investment Company that will form the basis 
for the Investment Company's calculation of net asset value at the 
end of the business day. NYSE Arca Rule 8.600-E(d)(2)(B)(i) requires 
that the Disclosed Portfolio will be disseminated at least once 
daily and will be made available to all market participants at the 
same time.
    \7\ A mutual fund is required to file with the Commission its 
complete portfolio schedules for the second and fourth fiscal 
quarters on Form N-CSR under the 1940 Act. Information reported on 
Form N-PORT for the third month of a fund's fiscal quarter will be 
made publicly available 60 days after the end of a fund's fiscal 
quarter. Form N-PORT requires reporting of a fund's complete 
portfolio holdings on a position-by-position basis on a quarterly 
basis within 60 days after fiscal quarter end. Investors can obtain 
a series of Active Proxy Portfolio Shares' Statement of Additional 
Information (``SAI''), its Shareholder Reports, its Form N-CSR, 
filed twice a year, and its Form N-CEN, filed annually. A series of 
Active Proxy Portfolio Shares' SAI and Shareholder Reports will be 
available free upon request from the Investment Company, and those 
documents and the Form N-PORT, Form N-CSR, and Form N-CEN may be 
viewed on-screen or downloaded from the Commission's website at 
www.sec.gov.
    \8\ ``Business Day'' is defined to mean any day that the 
Exchange is open, including any day when the Fund satisfies 
redemption requests as required by Section 22(e) of the 1940 Act.
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    The Commission has previously approved \9\ and noticed for 
immediate

[[Page 30288]]

effectiveness \10\ the listing and trading on the Exchange of series of 
Active Proxy Portfolio Shares under NYSE Arca Rule 8.601-E.
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    \9\ See Securities Exchange Act Release Nos. 89185 (June 29, 
2020), 85 FR 40328 (July 6, 2020) (SR-NYSEArca-2019-95) (Notice of 
Filing of Amendment No. 6 and Order Granting Accelerated Approval of 
a Proposed Rule Change, as Modified by Amendment No. 6, to Adopt 
NYSE Arca Rule 8.601-E to Permit the Listing and Trading of Active 
Proxy Portfolio Shares and To List and Trade Shares of the Natixis 
U.S. Equity Opportunities ETF Under Proposed NYSE Arca Rule 8.601-E) 
(the ``Natixis Order''); 89192 (June 30, 2020), 85 FR 40699 (July 7, 
2020) (SR-NYSEArca-2019-96) (Notice of Filing of Amendment No. 5 and 
Order Granting Accelerated Approval of a Proposed Rule Change, as 
Modified by Amendment No. 5, to List and Trade Two Series of Active 
Proxy Portfolio Shares Issued by the American Century ETF Trust 
under NYSE Arca Rule 8.601-E); 89191 (June 30, 2020), 85 FR 40358 
(July 6, 2020) (SR-NYSEArca-2019-92) (Notice of Filing of Amendment 
No. 3 and Order Granting Accelerated Approval of a Proposed Rule 
Change, as Modified by Amendment No. 3, to List and Trade Four 
Series of Active Proxy Portfolio Shares Issued by T. Rowe Price 
Exchange-Traded Funds, Inc. under NYSE Arca Rule 8.601-E); 89438 
(July 31, 2020), 85 FR 47821 (August 6, 2020) (SR-NYSEArca-2020-51) 
(Order Granting Approval of a Proposed Rule Change, as Modified by 
Amendment No. 2, to List and Trade Shares of Natixis Vaughan Nelson 
Select ETF and Natixis Vaughan Nelson MidCap ETF under NYSE Arca 
Rule 8.601-E). See also Securities Exchange Act Release Nos. 88887 
(May 15, 2020), 85 FR 30990 (May 21, 2020) (SR-CboeBZX-2019-107) 
(Notice of Filing of Amendment No. 5 and Order Granting Accelerated 
Approval of a Proposed Rule Change, as Modified by Amendment No. 5, 
to Adopt Rule 14.11(m), Tracking Fund Shares, and to List and Trade 
Shares of the Fidelity Blue Chip Value ETF, Fidelity Blue Chip 
Growth ETF, and Fidelity New Millennium ETF).
    \10\ See Securities Exchange Act Release Nos. 92104 (June 3, 
2021), 86 FR 30635 (June 9, 2021) (NYSEArca-2021-46) (Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change to List 
and Trade Shares of the Nuveen Santa Barbara Dividend Growth ETF, 
Nuveen Small Cap Select ETF, and Nuveen Winslow Large-Cap Growth ESG 
ETF Under NYSE Arca Rule 8.601-E (Active Proxy Portfolio Shares); 
92958 (September 13, 2021), 86 FR 51933 (September 17, 2021) 
(NYSEArca-2021-77) (Notice of Filing and Immediate Effectiveness of 
Proposed Rule Change To List and Trade Shares of the Nuveen Growth 
Opportunities ETF Under NYSE Arca Rule 8.601-E (Active Proxy 
Portfolio Shares); and 93264 (October 6, 2021), 86 FR 56989 (October 
13, 2021) (SR-NYSEArca-2021-84) (Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change To List and Trade Shares of 
the Schwab Ariel ESG ETF Under NYSE Arca Rule 8.601-E (Active Proxy 
Portfolio Shares).
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    The Shares of the Funds will be issued by the IndexIQ Active ETF 
Trust (the ``Trust''), which is organized as a statutory trust under 
the laws of the state of Delaware and registered with the Commission as 
an open-end management investment company.\11\ IndexIQ Advisors LLC 
will be the investment advisor to the Funds (the ``Advisor''). Winslow 
Capital Management, LLC will be the sub-advisor (the ``Sub-Advisor'') 
for the Funds. The Bank of New York Mellon will serve as the Funds' 
custodian (the ``Custodian'') and transfer agent. ALPS Distributors, 
Inc. will act as the distributor (the ``Distributor'') for the Funds.
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    \11\ The Trust is registered under the 1940 Act. On December 29, 
2021 the Trust filed a registration statement on Form N-1A under the 
1940 Act relating to the Funds (File No. 811-22379) (the 
``Registration Statement''). The Trust filed an application for an 
order under Section 6(c) of the 1940 Act for exemptions from various 
provisions of the 1940 Act and rules thereunder (File No. 812-
15294), dated December 29, 2021 and amended on March 14, 2022 (the 
``Application''). See Investment Company Act Release No. 34554 
(April 4, 2022). On April 29, 2022, the Commission issued an order 
(the ``Exemptive Order'') under the 1940 Act granting the exemptions 
requested in the Application (Investment Company Act Release No. 
34574, April 29, 2022). Investments made by the Funds will comply 
with the conditions set forth in the Application and the Exemptive 
Order. The description of the operation of the Funds herein is 
based, in part, on the Registration Statement, Application, and 
Exemptive Order. The Exchange will not commence trading in Shares of 
the Funds until the Registration Statement is effective.
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    Commentary .04 to NYSE Arca Rule 8.601-E provides that, if the 
investment adviser to the Investment Company issuing Active Proxy 
Portfolio Shares is registered as a broker-dealer or is affiliated with 
a broker-dealer, such investment adviser will erect and maintain a 
``fire wall'' between the investment adviser and personnel of the 
broker-dealer or broker-dealer affiliate, as applicable, with respect 
to access to information concerning the composition and/or changes to 
such Investment Company's Actual Portfolio, Proxy Portfolio, and/or 
Custom Basket, as applicable. Any person related to the investment 
adviser or Investment Company who makes decisions pertaining to the 
Investment Company's Actual Portfolio, Proxy Portfolio, and/or Custom 
Basket, as applicable, or has access to non-public information 
regarding the Investment Company's Actual Portfolio, Proxy Portfolio, 
and/or Custom Basket, as applicable, or changes thereto must be subject 
to procedures reasonably designed to prevent the use and dissemination 
of material non-public information regarding the Actual Portfolio, 
Proxy Portfolio, and/or Custom Basket, as applicable, or changes 
thereto. Commentary .04 is similar to Commentary .03(a)(i) and (iii) to 
NYSE Arca Rule 5.2-E(j)(3); however, Commentary .04, in connection with 
the establishment of a ``fire wall'' between the investment adviser and 
the broker-dealer, reflects the applicable open-end fund's portfolio, 
not an underlying benchmark index, as is the case with index-based 
funds.\12\ Commentary .04 is also similar to Commentary .06 to Rule 
8.600-E related to Managed Fund Shares, except that Commentary .04 
relates to establishment and maintenance of a ``fire wall'' between the 
investment adviser and personnel of the broker-dealer or broker-dealer 
affiliate, as applicable, applicable to an Investment Company's Actual 
Portfolio, Proxy Portfolio, and/or Custom Basket, as applicable, or 
changes thereto, and not just to the underlying portfolio, as is the 
case with Managed Fund Shares.
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    \12\ An investment adviser to an open-end fund is required to be 
registered under the Investment Advisers Act of 1940 (the ``Advisers 
Act''). As a result, the Advisor and Sub-Advisor and their related 
personnel will be subject to the provisions of Rule 204A-1 under the 
Advisers Act relating to codes of ethics. This Rule requires 
investment advisers to adopt a code of ethics that reflects the 
fiduciary nature of the relationship to clients as well as 
compliance with other applicable securities laws. Accordingly, 
procedures designed to prevent the communication and misuse of non-
public information by an investment adviser must be consistent with 
Rule 204A-1 under the Advisers Act. In addition, Rule 206(4)-7 under 
the Advisers Act makes it unlawful for an investment adviser to 
provide investment advice to clients unless such investment adviser 
has (i) adopted and implemented written policies and procedures 
reasonably designed to prevent violations, by the investment adviser 
and its supervised persons, of the Advisers Act and the Commission 
rules adopted thereunder; (ii) implemented, at a minimum, an annual 
review regarding the adequacy of the policies and procedures 
established pursuant to subparagraph (i) above and the effectiveness 
of their implementation; and (iii) designated an individual (who is 
a supervised person) responsible for administering the policies and 
procedures adopted under subparagraph (i) above.
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    In addition, Commentary .05 to Rule 8.601-E provides that any 
person or entity, including a custodian, Reporting Authority, 
distributor, or administrator, who has access to non-public information 
regarding the Investment Company's Actual Portfolio, Proxy Portfolio, 
or Custom Basket, as applicable, or changes thereto, must be subject to 
procedures reasonably designed to prevent the use and dissemination of 
material non-public information regarding the applicable Investment 
Company Actual Portfolio, Proxy Portfolio, or Custom Basket, as 
applicable, or changes thereto. Moreover, if any such person or entity 
is registered as a broker-dealer or affiliated with a broker-dealer, 
such person or entity will erect and maintain a ``fire wall'' between 
the person or entity and the broker-dealer with respect to access to 
information concerning the composition and/or changes to such 
Investment Company Actual Portfolio, Proxy Portfolio, or Custom Basket, 
as applicable.
    The Advisor and Sub-Advisor are not registered as broker-dealers 
but are affiliated with broker-dealers. The Advisor and Sub-Advisor 
have implemented and will maintain a ``fire wall'' with respect to such 
broker-dealer affiliates regarding access to information concerning the 
composition of and/or changes to each Fund's Actual Portfolio, Proxy 
Portfolio, and/or Custom Basket, as applicable.

[[Page 30289]]

    In the event (a) the Advisor or Sub-Advisor becomes registered as a 
broker-dealer or becomes newly affiliated with a broker-dealer, or (b) 
any new adviser or sub-adviser is a registered broker-dealer, or 
becomes affiliated with a broker-dealer, it will implement and maintain 
a ``fire wall'' with respect to its relevant personnel or its broker-
dealer affiliate regarding access to information concerning the 
composition and/or changes to each Fund's Actual Portfolio, Proxy 
Portfolio, and/or Custom Basket, as applicable, and will be subject to 
procedures designed to prevent the use and dissemination of material 
non-public information regarding each Fund's Actual Portfolio, Proxy 
Portfolio, and/or Custom Basket, as applicable, or changes thereto. Any 
person related to the Advisor, Sub-Advisor, or the Funds who makes 
decisions pertaining to a Fund's Actual Portfolio, Proxy Portfolio, or 
Custom Basket, as applicable, or has access to non-public information 
regarding a Fund's Actual Portfolio, Proxy Portfolio, and/or Custom 
Basket, as applicable, or changes thereto are subject to procedures 
reasonably designed to prevent the use and dissemination of material 
non-public information regarding a Fund's Actual Portfolio, Proxy 
Portfolio, and/or Custom Basket, as applicable or changes thereto.
    In addition, any person or entity, including any service provider 
for the Funds, who has access to non-public information regarding a 
Fund's Actual Portfolio, Proxy Portfolio, and/or Custom Basket, as 
applicable, or changes thereto, will be subject to procedures 
reasonably designed to prevent the use and dissemination of material 
non-public information regarding a Fund's Actual Portfolio, Proxy 
Portfolio, and/or Custom Basket, as applicable, or changes thereto. 
Moreover, if any such person or entity is registered as a broker-dealer 
or affiliated with a broker-dealer, such person or entity has erected 
and will maintain a ``fire wall'' between the person or entity and the 
broker-dealer with respect to access to information concerning the 
composition and/or changes to a Fund's Actual Portfolio, Proxy 
Portfolio, and/or Custom Basket, as applicable.
Description of the Funds
    According to the Registration Statement, the Advisor will identify 
a Proxy Portfolio for each Fund, which is designed to recreate the 
daily performance of each Fund's Actual Portfolio through a factor 
model analysis of the Fund's Actual Portfolio and will only include 
securities and investments in which a Fund may invest. However, while 
the Proxy Portfolio and the Actual Portfolio will likely hold some or 
many of the same securities, the Proxy Portfolio and a Fund's Actual 
Portfolio may not include identical securities. The composition of each 
Fund's Proxy Portfolio will be published on the Funds' website 
(newyorklifeinvestments.com) each Business Day and will include the 
following information for each portfolio holding in each Fund's Proxy 
Portfolio: (1) Ticker symbol; (2) CUSIP or other identifier; (3) 
description of holding; (4) quantity of each security or other asset 
held; and (5) percentage weight of the holding in the Proxy Portfolio. 
The Proxy Portfolio will be reconstituted daily, and the Advisor will 
not make intra-day changes to the Proxy Portfolio except to correct 
errors in the published Proxy Portfolio.
    At the end of each trading day, each Fund will calculate the 
percentage weight overlap between its Proxy Portfolio and Actual 
Portfolio (the ``Proxy Overlap'') and the standard deviation over the 
past three months of the daily proxy spread (i.e., the difference, in 
percentage terms, between the Proxy Portfolio per share NAV and that of 
the Actual Portfolio at the end of the trading day) (the ``Tracking 
Error'') and publish such information on the Funds' website before the 
opening of trading each Business Day.
IQ Winslow Large Cap Growth ETF
    The Fund's holdings will conform to the permissible investments as 
set forth in the Application and Exemptive Order, and the holdings will 
be consistent with all requirements in the Application and Exemptive 
Order.\13\ Any foreign common stocks held by the Fund will be traded on 
an exchange that is a member of the Intermarket Surveillance Group 
(``ISG'') or with which the Exchange has in place a comprehensive 
surveillance sharing agreement.
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    \13\ Pursuant to the Application and Exemptive Order, the 
permissible investments for the Funds include only the following 
instruments: ETFs traded on a U.S. exchange; exchange-traded notes 
(``ETNs'') traded on a U.S. exchange; U.S. exchange-traded common 
stocks; common stocks listed on a foreign exchange that trade on 
such exchange contemporaneously with the Shares (``foreign common 
stocks'') in the Exchange's Core Trading Session (normally, 9:30 
a.m. to 4:00 p.m. Eastern time (``E.T.'')); U.S. exchange-traded 
preferred stocks; U.S. exchange-traded American Depositary Receipts 
(``ADRs''); U.S. exchange-traded real estate investment trusts; U.S. 
exchange-traded commodity pools; U.S. exchange-traded metals trusts; 
U.S. exchange-traded currency trusts; and U.S. exchange-traded 
futures that trade contemporaneously with the Funds' Shares. In 
addition, the Funds may hold cash and cash equivalents (short-term 
U.S. Treasury securities, government money market funds, and 
repurchase agreements). Pursuant to the Application and Exemptive 
Order, the Funds will not hold short positions or invest in 
derivatives other than U.S. exchange-traded futures, will not borrow 
for investment purposes, and will not purchase any securities that 
are illiquid investments at the time of purchase.
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    According to the Registration Statement, the Fund's investment 
objective is long-term growth of capital. The Fund will, under normal 
circumstances, invest at least 80% of its assets in large 
capitalization companies.\14\ The Fund will typically invest in 
domestic securities but is permitted to invest up to 20% of its net 
assets in depositary receipts issued by a trust (including ADRs) of 
foreign securities and in common stocks listed on a foreign exchange 
that trade on such exchange contemporaneously with the Shares. The Fund 
will invest in companies that the Sub-Advisor believes will provide an 
opportunity for achieving superior portfolio returns (i.e., returns in 
excess of the returns of the average stock ETF or mutual fund) over the 
long term or have the potential for above-average future earnings and 
cash flow growth with management focused on shareholder value.
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    \14\ According to the Registration Statement, large 
capitalization companies are companies having a market 
capitalization in excess of $4 billion at the time of purchase.
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IQ Winslow Focused Large Cap Growth ETF
    The Fund's holdings will conform to the permissible investments as 
set forth in the Application and Exemptive Order, and the holdings will 
be consistent with all requirements in the Application and Exemptive 
Order.\15\ Any foreign common stocks held by the Fund will be traded on 
an exchange that is a member of the ISG or with which the Exchange has 
in place a comprehensive surveillance sharing agreement.
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    \15\ See note 13, supra.
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    According to the Registration Statement, the Fund's investment 
objective is long-term capital growth. The Fund will, under normal 
circumstances, invest at least 80% of its assets in large 
capitalization companies.\16\ The Fund will typically invest in 
domestic securities but is permitted to invest up to 20% of its net 
assets in depositary receipts issued by a trust (including ADRs) of 
foreign securities and in common stocks listed on a foreign exchange 
that trade on such exchange contemporaneously with the Shares. The Fund 
will normally invest in a limited number of issuers and hold a core 
position of between 25 and 35

[[Page 30290]]

securities. The Fund will invest in companies that the Sub-Advisor 
believes will provide an opportunity for achieving superior portfolio 
returns (i.e., returns in excess of the returns of the average stock 
ETF or mutual fund) over the long term or have the potential for above-
average future earnings and cash flow growth with management focused on 
shareholder value.
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    \16\ See note 14, supra.
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Investment Restrictions
    The Shares of the Funds will conform to the initial and continued 
listing criteria under Rule 8.601-E. The Funds' holdings will be 
limited to and consistent with permissible holdings as described in the 
Application and Exemptive Order and all requirements in the Application 
and Exemptive Order.\17\
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    \17\ See note 13, supra.
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    The Funds' investments, including derivatives, will be consistent 
with their investment objectives and will not be used to enhance 
leverage (although certain derivatives and other investments may result 
in leverage). That is, each Fund's investments will not be used to seek 
performance that is the multiple or inverse multiple (e.g., 2X or -3X) 
of such Fund's primary broad-based securities benchmark index (as 
defined in Form N-1A).\18\
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    \18\ Each Fund's broad-based securities benchmark index will be 
identified in a future amendment to its Registration Statement 
following the Funds' first full calendar year of performance.
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Purchases and Redemptions
    According to the Registration Statement, the Trust will issue and 
sell Shares of the Funds only in specified minimum size ``Creation 
Units'' on a continuous basis on any Business Day through the 
Distributor at their NAV next determined after receipt of an order in 
proper form. The NAV of each Fund's Shares will be calculated each 
Business Day as of the close of regular trading on the Exchange, 
ordinarily 4:00 p.m. E.T. A Creation Unit will consist of at least 
10,000 Shares.
    According to the Registration Statement, Shares of the Funds will 
be purchased and redeemed in Creation Units. Creation Units will 
typically be purchased in-kind through the deposit of a designated 
portfolio of securities constituting a representation of the Fund's 
portfolio (the ``Deposit Securities'') together with the deposit of a 
specified cash payment (the ``Cash Component'') (collectively, the 
``Fund Deposit''). The Cash Component serves to compensate for any 
differences between the NAV per Creation Unit and the ``Deposit 
Amount,'' which is an amount equal to the market value of the Deposit 
Securities. In addition, the Trust may permit or require the 
substitution of an amount of cash (the ``cash in lieu'' amount) to be 
added to the Cash Component to replace any Deposit Security. The names 
and quantities of the instruments that constitute the Deposit 
Securities will be the same as a Fund's Proxy Portfolio, except to the 
extent purchases and redemptions are made entirely or in part on a cash 
basis. Creation Units will typically be redeemed in exchange for ``Fund 
Securities'' (which may not be identical to the Deposit Securities) and 
a ``Cash Redemption Amount,'' which represents the difference between 
the NAV of the Shares being redeemed and the value of the Fund 
Securities.
    Creation Units of the Funds may be purchased and/or redeemed 
entirely or partially for cash in the Advisor's or Sub-Advisor's 
discretion. When full or partial cash purchases or redemptions of 
Creation Units are available or specified for the Funds, they will be 
effected in essentially the same manner as in-kind purchases or 
redemptions thereof. The Funds may determine, upon receiving a purchase 
or redemption order from an Authorized Participant,\19\ to have the 
purchase or redemption, as applicable, be made entirely or in part in 
cash.\20\
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    \19\ According to the Registration Statement, an ``Authorized 
Participant'' is an institution that may engage in creation and 
redemption transactions directly with the Funds.
    \20\ The Advisor represents that, to the extent the Trust 
effects the creation or redemption of Shares in cash on any given 
day, such transactions will be effected in the same manner for all 
Authorized Participants placing trades with the Funds on that day.
---------------------------------------------------------------------------

    The identity and number of shares of the Deposit Securities 
required for a Fund Deposit may change from time to time. Each Business 
Day, prior to the opening of business on the Exchange, the Custodian 
will make available, through the National Securities Clearing 
Corporation, the names and quantities of each Deposit Security to be 
included in the Fund Deposit, as well as the estimated Cash Component. 
The published Fund Deposit will apply until such time as the next-
announced composition of the Deposit Securities is made available, and 
there will be no intra-day changes except to correct errors in the 
published Fund Deposit. The Fund Deposit will be published each 
Business Day regardless of whether a Fund decides to issue or redeem 
Creation Units entirely or in part on a cash basis. The identity of the 
Fund Securities that will be applicable to redemption requests received 
in proper form on a Business Day will also be made available prior to 
the opening of business on the Exchange on each Business Day.
    All orders to purchase or redeem Creation Units must be placed with 
the Distributor by or through an Authorized Participant. Orders to 
purchase or redeem Creation Units will be accepted until the ``Order 
Time,'' generally 3:00 p.m. E.T. The date on which an order to purchase 
or redeem Creation Units is placed is referred to as the ``Transmittal 
Date.'' All Creation Unit orders must be received by the Distributor no 
later than the Order Time in order to receive the NAV determined on the 
Transmittal Date. When the Exchange closes earlier than normal, a Fund 
may require orders for Creation Units to be placed earlier in the 
Business Day.
Availability of Information
    The Funds' website (newyorklifeinvestments.com), which will be 
publicly available prior to the public offering of Shares, will include 
a form of the prospectus for the Funds that may be downloaded. The 
Funds' website will include on a daily basis, per Share for each Fund: 
(1) The prior Business Day's NAV; (2) the prior Business Day's 
``Closing Price'' or ``Bid/Ask Price''; \21\ and (3) a calculation of 
the premium/discount of such Closing Price or Bid/Ask Price against 
such NAV.\22\ The Advisor has represented that the Funds' website will 
also provide: (1) Any other information regarding premiums/discounts as 
may be required for other ETFs under Rule 6c-11 under the 1940 Act, as 
amended, and (2) any information regarding the bid/ask spread for each 
Fund as may be required for other ETFs under Rule 6c-11 under the 1940 
Act, as amended. The Funds' website also will disclose the information 
required under Rule 8.601-E(c)(3).\23\ The website and information will 
be publicly available at no charge.
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    \21\ The ``Bid/Ask Price'' is the midpoint of the highest bid 
and lowest offer based upon the National Best Bid and Offer as of 
the time of calculation of each Fund's NAV. The ``National Best Bid 
and Offer'' is the current national best bid and national best offer 
as disseminated by the Consolidated Quotation System or UTP Plan 
Securities Information Processor. The ``Closing Price'' of Shares is 
the official closing price of the Shares on the Exchange.
    \22\ The ``premium/discount'' refers to the premium or discount 
to the NAV at the end of a trading day and will be calculated based 
on the last Bid/Ask Price on a given trading day.
    \23\ See note 4, supra. Rule 8.601-E (c)(3) provides that the 
website for each series of Active Proxy Portfolio Shares shall 
disclose the information regarding the Proxy Portfolio as provided 
in the exemptive relief pursuant to the 1940 Act applicable to such 
series, including the following, to the extent applicable:
    (i) Ticker symbol;
    (ii) CUSIP or other identifier;
    (iii) Description of holding;
    (iv) Quantity of each security or other asset held; and
    (v) Percentage weighting of the holding in the portfolio.

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[[Page 30291]]

    The identity and quantity of investments in the Proxy Portfolio for 
each Fund will be publicly available on the Funds' website before the 
commencement of trading in Shares on each Business Day. The website 
will also include information relating to the Proxy Overlap and 
Tracking Error for each Fund, as discussed above. With respect to each 
Custom Basket utilized by the Funds, each Business Day, before the 
opening of trading in the Core Trading Session (as defined in NYSE Arca 
Rule 7.34-E (a)), the Funds' website will also include the composition 
of any Custom Basket transacted on the previous business day, except a 
Custom Basket that differs from the applicable Proxy Portfolio only 
with respect to cash.
    Typical mutual fund-style annual, semi-annual and quarterly 
disclosures contained in the Funds' Commission filings will be provided 
on the Funds' website on a current basis.\24\ Thus, each Fund will 
publish the portfolio contents of its Actual Portfolio on a periodic 
basis, and no less than 60 days after the end of every fiscal quarter.
---------------------------------------------------------------------------

    \24\ See note 7, supra.
---------------------------------------------------------------------------

    Investors can also obtain the Funds' SAI, Shareholder Reports, Form 
N-CSR, N-PORT, and Form N-CEN. The prospectus, SAI, and Shareholder 
Reports are available free upon request, and those documents and the 
Form N-CSR, N-PORT, and Form N-CEN may be viewed on-screen or 
downloaded from the Commission's website. The Exchange also notes that 
pursuant to the Application, the Funds must comply with Regulation Fair 
Disclosure, which prohibits selective disclosure of any material non-
public information.
    Information regarding the market price of Shares and trading volume 
in Shares, will be continually available on a real-time basis 
throughout the day on brokers' computer screens and other electronic 
services. The previous day's closing price and trading volume 
information for the Shares will be published daily in the financial 
section of newspapers.
    Quotation and last sale information for the Shares and U.S. 
exchange-traded instruments (excluding futures contracts) will be 
available via the Consolidated Tape Association (``CTA'') high-speed 
line, from the exchanges on which such securities trade, or through 
major market data vendors or subscription services. Quotation and last 
sale information for futures contracts will be available from the 
exchanges on which they trade. Intraday price information for all 
exchange-traded instruments, which include all eligible instruments 
except cash and cash equivalents, will be available from the exchanges 
on which they trade, or through major market data vendors or 
subscription services. Intraday price information for cash equivalents 
is available through major market data vendors, subscription services 
and/or pricing services.
Trading Halts
    With respect to trading halts, the Exchange may consider all 
relevant factors in exercising its discretion to halt or suspend 
trading in the Shares of a Fund.\25\ Trading in Shares of a Fund will 
be halted if the circuit breaker parameters in NYSE Arca Rule 7.12-E 
have been reached. Trading also may be halted because of market 
conditions or for reasons that, in the view of the Exchange, make 
trading in the Shares inadvisable. Trading in the Shares will be 
subject to NYSE Arca Rule 8.601-E(d)(2)(D), which sets forth 
circumstances under which Shares of a Fund will be halted.
---------------------------------------------------------------------------

    \25\ See NYSE Arca Rule 7.12-E.
---------------------------------------------------------------------------

    Specifically, Rule 8.601-E(d)(2)(D) provides that the Exchange may 
consider all relevant factors in exercising its discretion to halt 
trading in a series of Active Proxy Portfolio Shares. Trading may be 
halted because of market conditions or for reasons that, in the view of 
the Exchange, make trading in the series of Active Proxy Portfolio 
Shares inadvisable. These may include: (a) The extent to which trading 
is not occurring in the securities and/or the financial instruments 
composing the Proxy Portfolio and/or Actual Portfolio; or (b) whether 
other unusual conditions or circumstances detrimental to the 
maintenance of a fair and orderly market are present. If the Exchange 
becomes aware that the NAV, Proxy Portfolio, or Actual Portfolio with 
respect to a series of Active Proxy Portfolio Shares is not 
disseminated to all market participants at the same time, the Exchange 
shall halt trading in such series until such time as the NAV, Proxy 
Portfolio, or Actual Portfolio is available to all market participants 
at the same time.
Trading Rules
    The Exchange deems the Shares to be equity securities, thus 
rendering trading in the Shares subject to the Exchange's existing 
rules governing the trading of equity securities. Shares will trade on 
the NYSE Arca Marketplace in all trading sessions in accordance with 
NYSE Arca Rule 7.34-E(a). As provided in NYSE Arca Rule 7.6-E, the 
minimum price variation (``MPV'') for quoting and entry of orders in 
equity securities traded on the NYSE Arca Marketplace is $0.01, with 
the exception of securities that are priced less than $1.00 for which 
the MPV for order entry is $0.0001.
    The Shares will conform to the initial and continued listing 
criteria under NYSE Arca Rule 8.601-E. The Exchange has appropriate 
rules to facilitate trading in the Shares during all trading sessions.
    A minimum of 100,000 Shares for each Fund will be outstanding at 
the commencement of trading on the Exchange. In addition, pursuant to 
Rule 8.601-E(d)(1)(B), the Exchange, prior to commencement of trading 
in the Shares, will obtain a representation from the Trust that (i) the 
NAV per Share of each Fund will be calculated daily, (ii) the NAV, 
Proxy Portfolio, and the Actual Portfolio for each Fund will be made 
publicly available to all market participants at the same time, and 
(iii) the Trust and any person acting on behalf of the Trust will 
comply with Regulation Fair Disclosure under the Act, including with 
respect to any Custom Basket.
    With respect to Active Proxy Portfolio Shares, all of the Exchange 
member obligations relating to product description and prospectus 
delivery requirements will continue to apply in accordance with 
Exchange rules and federal securities laws, and the Exchange and the 
Financial Industry Regulatory Authority, Inc. (``FINRA'') will continue 
to monitor Exchange members for compliance with such requirements.
Surveillance
    The Exchange represents that trading in the Shares will be subject 
to the existing trading surveillances, administered by the Exchange, as 
well as cross-market surveillances administered by FINRA on behalf of 
the Exchange, which are designed to detect violations of Exchange rules 
and applicable federal securities laws.\26\ The Exchange represents 
that these procedures are adequate to properly monitor Exchange trading 
of the Shares in all trading sessions and to deter and detect 
violations of Exchange rules and federal securities laws applicable to 
trading on the Exchange.
---------------------------------------------------------------------------

    \26\ FINRA conducts cross-market surveillances on behalf of the 
Exchange pursuant to a regulatory services agreement. The Exchange 
is responsible for FINRA's performance under this regulatory 
services agreement.

---------------------------------------------------------------------------

[[Page 30292]]

    The surveillances referred to above generally focus on detecting 
securities trading outside their normal patterns, which could be 
indicative of manipulative or other violative activity. When such 
situations are detected, surveillance analysis follows and 
investigations are opened, where appropriate, to review the behavior of 
all relevant parties for all relevant trading violations.
    The Exchange or FINRA, on behalf of the Exchange, or both, will 
communicate as needed regarding trading in the Shares and underlying 
exchange-traded instruments with other markets and other entities that 
are members of the ISG, and the Exchange or FINRA, on behalf of the 
Exchange, or both, may obtain trading information regarding trading 
such securities and underlying exchange-traded instruments from such 
markets and other entities. In addition, the Exchange may obtain 
information regarding trading in such securities and underlying 
exchange-traded instruments from markets and other entities that are 
members of ISG or with which the Exchange has in place a comprehensive 
surveillance sharing agreement.\27\
---------------------------------------------------------------------------

    \27\ For a list of the current members of ISG, see 
www.isgportal.org.
---------------------------------------------------------------------------

    The Advisor will make available daily to FINRA and the Exchange the 
Actual Portfolio of each Fund, upon request, in order to facilitate the 
performance of the surveillances referred to above.
    In addition, the Exchange also has a general policy prohibiting the 
distribution of material, non-public information by its employees.
    Commentary .03 to NYSE Arca Rule 8.601-E provides that the Exchange 
will implement and maintain written surveillance procedures for Active 
Proxy Portfolio Shares. As part of these surveillance procedures, the 
Investment Company's investment adviser will, upon request by the 
Exchange or FINRA, on behalf of the Exchange, make available to the 
Exchange or FINRA the daily Actual Portfolio holdings of each series of 
Active Proxy Portfolio Shares. The Exchange believes that the ability 
to access the information on an as needed basis will provide it with 
sufficient information to perform the necessary regulatory functions 
associated with listing and trading series of Active Proxy Portfolio 
Shares on the Exchange, including the ability to monitor compliance 
with the initial and continued listing requirements as well as the 
ability to surveil for manipulation of Active Proxy Portfolio Shares.
    The Exchange will utilize its existing procedures to monitor issuer 
compliance with the requirements of Rule 8.601-E. For example, the 
Exchange will continue to use intraday alerts that will notify Exchange 
personnel of trading activity throughout the day that may indicate that 
unusual conditions or circumstances are present that could be 
detrimental to the maintenance of a fair and orderly market. The 
Exchange will require from the issuer of a series of Active Proxy 
Portfolio Shares, upon initial listing and periodically thereafter, a 
representation that it is in compliance with Rule 8.601-E. The Exchange 
notes that Commentary .01 to Rule 8.601-E requires an issuer of Active 
Proxy Portfolio Shares to notify the Exchange of any failure to comply 
with the continued listing requirements of Rule 8.601-E. In addition, 
the Exchange will require issuers to represent that they will notify 
the Exchange of any failure to comply with the terms of applicable 
exemptive and no-action relief. As part of its surveillance procedures, 
the Exchange will rely on the foregoing procedures to become aware of 
any non-compliance with the requirements of Rule 8.601-E.
    With respect to the Funds, all statements and representations made 
in this filing regarding (a) the description of the portfolio, (b) 
limitations on portfolio holdings, or (c) the applicability of Exchange 
listing rules specified in this rule filing shall constitute continued 
listing requirements for listing the Shares on the Exchange. The 
Exchange will obtain a representation from the Trust, prior to 
commencement of trading in the Shares of the Funds, that it will advise 
the Exchange of any failure by the Funds to comply with the continued 
listing requirements, and, pursuant to its obligations under Section 
19(g)(1) of the Act, the Exchange will monitor for compliance with the 
continued listing requirements. If a Fund is not in compliance with the 
applicable listing requirements, the Exchange will commence delisting 
procedures under NYSE Arca Rule 5.5-E(m).
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\28\ in general, and furthers the 
objectives of Section 6(b)(5) of the Act,\29\ in particular, in that it 
is designed to prevent fraudulent and manipulative acts and practices, 
to promote just and equitable principles of trade, to remove 
impediments to and perfect the mechanism of a free and open market and 
a national market system, and, in general, to protect investors and the 
public interest.\30\
---------------------------------------------------------------------------

    \28\ 15 U.S.C. 78f(b).
    \29\ 15 U.S.C. 78f(b)(5).
    \30\ The Exchange represents that, for initial and continued 
listing, the Funds will be incompliance with Rule 10A-3 under the 
Act, as provided by NYSE Arca Rule 5.3-E.
---------------------------------------------------------------------------

    With respect to the proposed listing and trading of Shares of the 
Funds, the Exchange believes that the proposed rule change is designed 
to prevent fraudulent and manipulative acts and practices in that the 
Shares will be listed and traded on the Exchange pursuant to the 
initial and continued listing criteria in NYSE Arca Rule 8.601-E.
    The Funds' holdings will conform to the permissible investments as 
set forth in the Application and Exemptive Order, and the holdings will 
be consistent with all requirements in the Application and Exemptive 
Order.\31\
---------------------------------------------------------------------------

    \31\ See note 13, supra.
---------------------------------------------------------------------------

    The Exchange or FINRA, on behalf of the Exchange, or both, will 
communicate as needed regarding trading in the Shares and underlying 
exchange-traded instruments with other markets and other entities that 
are members of the ISG, and the Exchange or FINRA, on behalf of the 
Exchange, or both, may obtain trading information regarding trading in 
the Shares and underlying exchange-traded instruments from such markets 
and other entities. In addition, the Exchange may obtain information 
regarding trading in the Shares and underlying exchange-traded 
instruments from markets and other entities that are members of ISG or 
with which the Exchange has in place a comprehensive surveillance 
sharing agreement. Any foreign common stocks held by the Funds will be 
traded on an exchange that is a member of the ISG or with which the 
Exchange has in place a comprehensive surveillance sharing agreement.
    The daily dissemination of the identity and quantity of Proxy 
Portfolio component investments, together with the right of Authorized 
Participants to create and redeem each day at the NAV, will be 
sufficient for market participants to value and trade Shares in a 
manner that will not lead to significant deviations between the Shares' 
Closing Price or Bid/Ask Price and NAV.
    The Funds' investments, including derivatives, will be consistent 
with its investment objective and will not be used to enhance leverage 
(although certain derivatives and other investments may result in 
leverage). That is, the Funds' investments will not be used to seek 
performance that is the multiple or inverse multiple (e.g., 2X or

[[Page 30293]]

-3X) of the Funds' primary broad-based securities benchmark index (as 
defined in Form N-1A).
    The proposed rule change is designed to promote just and equitable 
principles of trade and to protect investors and the public interest in 
that the Exchange will obtain a representation from the Trust that the 
NAV per Share of each Fund will be calculated daily and that the NAV, 
Proxy Portfolio, and Actual Portfolio for each Fund will be made 
available to all market participants at the same time. Investors can 
obtain the Funds' SAI, shareholder reports, and its Form N-CSR, Form N-
PORT, and Form N-CEN. The Funds' SAI and shareholder reports will be 
available free upon request from the Funds, and those documents and the 
Form N-CSR, Form N-PORT, and Form N-CEN may be viewed on-screen or 
downloaded from the Commission's website.
    Commentary .03 to NYSE Arca Rule 8.601-E provides that the Exchange 
will implement and maintain written surveillance procedures for Active 
Proxy Portfolio Shares. As part of these surveillance procedures, the 
Investment Company's investment adviser will, upon request by the 
Exchange or FINRA, on behalf of the Exchange, make available to the 
Exchange or FINRA the daily portfolio holdings of each series of Active 
Proxy Portfolio Shares. The Exchange believes that the ability to 
access the information on an as needed basis will provide it with 
sufficient information to perform the necessary regulatory functions 
associated with listing and trading series of Active Proxy Portfolio 
Shares on the Exchange, including the ability to monitor compliance 
with the initial and continued listing requirements as well as the 
ability to surveil for manipulation of Active Proxy Portfolio Shares. 
With respect to the Funds, the Advisor will make available daily to 
FINRA and the Exchange the portfolio holdings of each Fund upon request 
in order to facilitate the performance of the surveillances referred to 
above.
    The Exchange will utilize its existing procedures to monitor 
compliance with the requirements of Rule 8.601-E. For example, the 
Exchange will continue to use intraday alerts that will notify Exchange 
personnel of trading activity throughout the day that may indicate that 
unusual conditions or circumstances are present that could be 
detrimental to the maintenance of a fair and orderly market. The 
Exchange will require from the Trust, upon initial listing and 
periodically thereafter, a representation that it is in compliance with 
Rule 8.601-E. The Exchange notes that Commentary .01 to Rule 8.601-E 
requires the issuer of Shares to notify the Exchange of any failure to 
comply with the continued listing requirements of Rule 8.601-E. In 
addition, the Exchange will require the issuer to represent that it 
will notify the Exchange of any failure to comply with the terms of 
applicable exemptive and no-action relief. The Exchange will rely on 
the foregoing procedures to become aware of any non-compliance with the 
requirements of Rule 8.601-E.
    In addition, with respect to the Funds, a large amount of 
information will be publicly available regarding the Funds and the 
Shares, thereby promoting market transparency.
    Quotation and last sale information for the Shares and U.S. 
exchange-traded instruments (excluding futures contracts) will be 
available via the CTA high-speed line, from the exchanges on which such 
securities trade, or through major market data vendors or subscription 
services. Quotation and last sale information for futures contracts 
will be available from the exchanges on which they trade. Intraday 
price information for all exchange-traded instruments, which include 
all eligible instruments except cash and cash equivalents, will be 
available from the exchanges on which they trade, or through major 
market data vendors or subscription services. Intraday price 
information for cash equivalents is available through major market data 
vendors, subscription services and/or pricing services.
    The website for the Funds will include a form of the prospectus 
that may be downloaded, and additional data relating to NAV and other 
applicable quantitative information, updated on a daily basis. Trading 
in Shares of the Funds will be halted if the circuit breaker parameters 
in NYSE Arca Rule 7.12-E have been reached or because of market 
conditions or for reasons that, in the view of the Exchange, make 
trading in the Shares inadvisable. Trading in the Shares will be 
subject to NYSE Arca Rule 8.601-E(d)(2)(D), which sets forth 
circumstances under which Shares of a Fund will be halted. In addition, 
as noted above, investors will have ready access to the Proxy Portfolio 
and quotation and last sale information for the Shares. The identity 
and quantity of investments in the Proxy Portfolio will be publicly 
available on the Funds' website before the commencement of trading in 
Shares on each Business Day. The Shares will conform to the initial and 
continued listing criteria under Rule 8.601-E.\32\
---------------------------------------------------------------------------

    \32\ See note 4, supra.
---------------------------------------------------------------------------

    The Funds' holdings will conform to the permissible investments as 
set forth in the Application and Exemptive Order, and the holdings will 
be consistent with all requirements in the Application and Exemptive 
Order.\33\ Any foreign common stocks held by the Funds will be traded 
on an exchange that is a member of the ISG or with which the Exchange 
has in place a comprehensive surveillance sharing agreement.
---------------------------------------------------------------------------

    \33\ See note 13, supra.
---------------------------------------------------------------------------

    The proposed rule change is designed to perfect the mechanism of a 
free and open market and, in general, to protect investors and the 
public interest in that it will facilitate the listing and trading of 
an additional type of actively-managed exchange-traded product that 
will enhance competition among market participants, to the benefit of 
investors and the marketplace. The Exchange will obtain a 
representation from the Advisor, prior to commencement of trading in 
the Shares of the Funds, that it will advise the Exchange of any 
failure by the Funds to comply with the continued listing requirements, 
and, pursuant to its obligations under Section 19(g)(1) of the Act, the 
Exchange will monitor for compliance with the continued listing 
requirements. If the Funds are not in compliance with the applicable 
listing requirements, the Exchange will commence delisting procedures 
under NYSE Arca Rule 5.5-E(m).
    As noted above, the Exchange has in place surveillance procedures 
relating to trading in the Shares and may obtain information via ISG 
from other exchanges that are members of ISG or with which the Exchange 
has entered into a comprehensive surveillance sharing agreement. In 
addition, as noted above, investors will have ready access to 
information regarding quotation and last sale information for the 
Shares.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purposes of the Act. The Exchange believes the 
proposed rule change would permit listing and trading of additional 
actively-managed ETFs that have characteristics different from existing 
actively-managed and index ETFs and would introduce additional 
competition among various ETF products to the benefit of investors.

[[Page 30294]]

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    No written comments were solicited or received with respect to the 
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Because the foregoing proposed rule change does not: (i) 
Significantly affect the protection of investors or the public 
interest; (ii) impose any significant burden on competition; and (iii) 
become operative for 30 days from the date on which it was filed, or 
such shorter time as the Commission may designate, it has become 
effective pursuant to Section 19(b)(3)(A) of the Act \34\ and Rule 19b-
4(f)(6) thereunder.\35\
---------------------------------------------------------------------------

    \34\ 15 U.S.C. 78s(b)(3)(A).
    \35\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
requires a self-regulatory organization to give the Commission 
written notice of its intent to file the proposed rule change, along 
with a brief description and text of the proposed rule change, at 
least five business days prior to the date of filing of the proposed 
rule change, or such shorter time as designated by the Commission. 
The Exchange has satisfied this requirement.
---------------------------------------------------------------------------

    A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the 
Act normally does not become operative for 30 days after the date of 
its filing. However, Rule 19b-4(f)(6)(iii) \36\ permits the Commission 
to designate a shorter time if such action is consistent with the 
protection of investors and the public interest. The Exchange has 
requested that the Commission waive the 30-day operative delay so that 
the proposal may become operative immediately upon filing. The Exchange 
notes that the Commission has approved and noticed for immediate 
effectiveness proposed rule changes to permit listing and trading on 
the Exchange of Active Proxy Portfolio Shares similar to the Fund.\37\ 
The proposed listing rule for the Fund raises no novel legal or 
regulatory issues. Thus, the Commission believes that waiver of the 30-
day operative delay is consistent with the protection of investors and 
the public interest. Accordingly, the Commission hereby waives the 30-
day operative delay and designates the proposed rule change operative 
upon filing.\38\
---------------------------------------------------------------------------

    \36\ 17 CFR 240.19b-4(f)(6)(iii).
    \37\ See supra notes 9 and 10.
    \38\ For purposes only of waiving the 30-day operative delay, 
the Commission has also considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
---------------------------------------------------------------------------

    At any time within 60 days of the filing of such proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-NYSEArca-2022-29 on the subject line.

Paper Comments

     Send paper comments in triplicate to: Secretary, 
Securities and Exchange Commission, 100 F Street NE, Washington, DC 
20549-1090.

All submissions should refer to File Number SR-NYSEArca-2022-29. This 
file number should be included on the subject line if email is used. To 
help the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's internet website (http://www.sec.gov/rules/sro.shtml). 
Copies of the submission, all subsequent amendments, all written 
statements with respect to the proposed rule change that are filed with 
the Commission, and all written communications relating to the proposed 
rule change between the Commission and any person, other than those 
that may be withheld from the public in accordance with the provisions 
of 5 U.S.C. 552, will be available for website viewing and printing in 
the Commission's Public Reference Room, 100 F Street NE, Washington, DC 
20549 on official business days between the hours of 10:00 a.m. and 
3:00 p.m. Copies of the filing also will be available for inspection 
and copying at the principal office of the Exchange. All comments 
received will be posted without change. Persons submitting comments are 
cautioned that we do not redact or edit personal identifying 
information from comment submissions. You should submit only 
information that you wish to make available publicly. All submissions 
should refer to File Number SR-NYSEArca-2022-29 and should be submitted 
on or before June 8, 2022.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\39\
---------------------------------------------------------------------------

    \39\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2022-10618 Filed 5-17-22; 8:45 am]
BILLING CODE 8011-01-P