Document ID: SEC-2015-0780-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NYSE Arca, Inc.
Posted Date: 2015-05-08T04:00Z

[Federal Register Volume 80, Number 89 (Friday, May 8, 2015)]
[Notices]
[Pages 26595-26599]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-11080]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-74866; File No. SR-NYSEArca-2015-15]

Self-Regulatory Organizations; NYSE Arca, Inc.; Order Approving a 
Proposed Rule Change, as Modified by Amendment No. 1, to the List and 
Trade Shares of the Principal EDGE Active Income ETF Under NYSE Arca 
Equities Rule 8.600

May 4, 2015.

I. Introduction

    On March 12, 2015, NYSE Arca, Inc. (the ``Exchange'' or ``NYSE 
Arca'') filed with the Securities and Exchange Commission (the 
``Commission''), pursuant to Section 19(b)(1) \1\ of the Securities 
Exchange Act of 1934 (the ``Act'' or ``Exchange Act'') \2\ and Rule 
19b-4 thereunder,\3\ a proposed rule change to list and trade shares 
(``Shares'') of the Principal EDGE Active Income ETF (``Fund'') under 
NYSE Arca Equities Rule 8.600. The proposed rule change was published 
for comment in the Federal Register on March 27, 2015.\4\ On April 14, 
2015, the Exchange filed Amendment No. 1 to the proposal.\5\ The 
Commission received no

[[Page 26596]]

comments on the proposal. This order approves the proposed rule change, 
as modified by Amendment No.1.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
    \4\ See Securities Exchange Act Release No. 74562 (March 23, 
2015), 80 FR 16477 (``Notice'').
    \5\ In Amendment No. 1, the Exchange: (1) Clarifies that the 
Fund's investments in restricted securities (Rule 144A securities) 
will be limited to fixed income securities; and (2) specifies that 
the Fund will not invest in debt that is in default at the time of 
purchase. Amendment No. 1 is not subject to notice and comment 
because it is a technical amendment that does not materially alter 
the substance of the proposed rule change or raise any novel 
regulatory issues.
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II. The Exchange's Description of the Proposal \6\
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    \6\ Additional information regarding, among other things, the 
Shares, the Fund, its investment objective, its investments, its 
investment strategies, its investment methodology, its investment 
restrictions, its fees, its creation and redemption procedures, 
availability of information, trading rules and halts, and 
surveillance procedures can be found in the Notice and in the 
Registration Statement. See Notice, supra note 4, and Registration 
Statement, infra note 8, respectively.
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    NYSE Arca proposes to list and trade shares of the Fund under NYSE 
Arca Equities Rule 8.600, which governs the listing and trading of 
Managed Fund Shares.\7\ The Fund is a series of the Principal Exchange-
Traded Funds (``Trust''), a statutory trust organized under the laws of 
the State of Delaware and registered with the Commission as an open-end 
management investment company.\8\ Principal Management Corporation will 
be the investment manager for the Fund (``Adviser''). Principal Global 
Investors, LLC and Edge Asset Management, LLC will each serve as a sub-
adviser and portfolio manager (each referred to as a ``Sub-Adviser'' 
and collectively as the ``Sub-Advisers'').\9\ The Adviser and Sub-
Advisers are not registered as broker-dealers but are affiliated with 
three broker-dealers and have implemented and will maintain a fire wall 
with respect to each such broker-dealer affiliate regarding access to 
information concerning the composition and/or changes to the 
portfolios.\10\
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    \7\ A Managed Fund Share is a security that represents an 
interest in an investment company registered under the Investment 
Company Act of 1940 (15 U.S.C. 80a-1) (``1940 Act'') organized as an 
open-end investment company or similar entity that invests in a 
portfolio of securities selected by its investment adviser 
consistent with its investment objectives and policies.
    \8\ The Trust is registered under the 1940 Act. On February 6, 
2015, the Trust filed with the Commission a registration statement 
on Form N-1A under the Securities Act of 1933 (15 U.S.C. 77a) 
(``Securities Act'') and the 1940 Act relating to the Fund (File 
Nos. 333-201935 and 811-23029) (the ``Registration Statement''). The 
description of the operation of the Trust and the Fund herein is 
based, in part, on the Registration Statement. In addition, the 
Commission has issued an order granting certain exemptive relief to 
the Adviser (as defined herein) under the 1940 Act. See Investment 
Company Act Release No. 30742 (File No. 812-14136) (``Exemptive 
Order''). The Fund will be offered in reliance upon the Exemptive 
Order issued to the Adviser.
    \9\ 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 Adviser and Sub-Advisers and their related 
personnel are 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 violation, 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.
    \10\ See Notice, supra note 4, at 16478. In the event that (a) 
the Adviser or Sub-Advisers become registered broker-dealers or 
newly affiliated with one or more broker-dealers, or (b) any new 
adviser or sub-adviser is a registered broker-dealer or becomes 
affiliated with a broker-dealer, it will implement 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 the portfolios, and will be subject to procedures 
designed to prevent the use and dissemination of material non-public 
information regarding such portfolios. See id.
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A. Principal Investments of the Fund

    The Fund will seek to provide current income, and will invest in a 
manner designed to provide shareholders with regular cash flow from 
their investment in the Fund. With regard to each investment category, 
the Fund will carry out its investment strategy by investing in the 
securities listed in each investment category below and/or through the 
purchase of shares issued by U.S. exchange-traded funds (``ETFs'') \11\ 
or other investment companies, including shares in unit investment 
trusts and open-end investment companies, that invest a majority of 
their assets in the securities listed in the Principal Investment 
categories below. Under normal market circumstances,\12\ the Fund will 
invest a majority of its net assets in the following financial 
instruments listed in sections II.A.1 and 2, below:
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    \11\ All ETF shares held by the Fund will be listed and traded 
in the U.S. on a national securities exchange. See id., n.8.
    \12\ The term ``under normal market circumstances'' includes, 
but is not limited to, the absence of extreme volatility or trading 
halts in the equity and fixed income markets or the financial 
markets generally; events or circumstances causing a disruption in 
market liquidity or orderly markets; operational issues causing 
dissemination of inaccurate market information; or force majeure 
type events such as systems failure, natural or man-made disaster, 
act of God, armed conflict, act of terrorism, riot or labor 
disruption or any similar intervening circumstance. See id., n.9.
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1. Investment Grade and Non-Investment Grade U.S. and Non-U.S. Fixed 
Income Securities
    Under normal market circumstances, at least 20% but no more than 
90% of the Fund's net assets will be invested in investment grade and 
non-investment grade fixed income securities \13\ which will consist of 
the following: U.S. Treasuries; agency securities; asset-backed 
securities; residential mortgage-backed securities; commercial 
mortgage-backed securities; zero-coupon securities; variable and 
floating rate instruments including inverse floaters; covered 
securities; sinking fund securities; equipment trust certificates; 
sovereign bonds; convertible bonds; pay-in-kind securities; step-coupon 
securities; stripped securities; inflation-indexed bonds; inflation 
protected debt securities; bank loans; municipal bonds; and corporate 
bonds issued by U.S., supranational and non-U.S. issuers (including 
issuers located in emerging markets) and denominated in U.S. 
dollars.\14\
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    \13\ The Fund will limit its investments in non-investment grade 
fixed income securities to 75% or less of the Fund's net assets. See 
id., n.10.
    \14\ Under normal market circumstances, the Fund will generally 
seek to invest in corporate bond issuances that have at least 
$100,000,000 par amount outstanding in developed countries and at 
least $200,000,000 par amount outstanding in emerging market 
countries. See Notice, supra note 4, 80 FR at 16479, n.24.
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2. Equity Securities Including U.S. and Non-U.S. Issues
    Under normal market circumstances, at least 20% but no more than 
90% of the Fund's net assets will be invested in a diversified 
portfolio of equity securities issued by companies located in the U.S. 
and/or foreign countries, including emerging markets, which trade on a 
U.S. or foreign exchange. The Fund may carry out its investment in 
foreign securities by purchasing American Depositary Receipts 
(``ADRs''), European Depositary Receipts (``EDRs'') and Global 
Depositary Receipts (``GDRs'', together with EDRs and ADRs, 
``Depositary Receipts'').\15\ The equity securities will be common 
stocks and preferred stocks as well as master limited partnerships and 
real estate investment trusts.
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    \15\ Not more than 10% of the net assets of the Fund will be 
invested in non-exchange-listed ADRs. See id. at 16483.
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    The Fund may engage in short sales.

B. Non-Principal Investments

    While the Fund, under normal market circumstances, will invest a 
majority of

[[Page 26597]]

its assets in the securities and financial instruments described above, 
the Fund may invest in other securities and financial instruments, as 
described below. With regard to each non-principal investment category, 
the Fund may carry out its investment strategy by investing in the 
securities listed in each investment category below and/or through the 
purchase of shares issued by ETFs or other investment companies that 
invest a majority of their assets in the securities listed in the 
investment categories below.
    The Fund may invest in the following money market instruments: 
commercial paper issued by U.S. and foreign corporations; bank 
obligations; certificates of deposit; time deposits and bankers' 
acceptances of U.S. commercial banks and overseas branches of U.S. 
commercial banks and foreign banks; and short-term corporate debt, all 
of which have, at the time of purchase, 397 days or less remaining to 
maturity issued by U.S. and foreign issuers.
    A portion of the Fund's assets may be invested in cross currency 
positions of the currencies of developed and emerging markets through 
spot foreign exchange currency contracts, forward foreign exchange 
currency contracts, and foreign exchange currency options that trade on 
U.S. exchanges.
    The Fund may invest in the following derivative instruments: 
Futures contracts (consisting of futures contracts based on equity or 
fixed income securities and/or equity or fixed income indices, 
commodities, interest rates and currencies); swap agreements on any of 
the following asset classes: equity, fixed income, currency and 
interest rates (such swaps may be based on the price return or total 
return of the referenced asset); credit default swaps (consisting of 
credit default swaps in which the referenced asset is a single fixed 
income security or a group of fixed income securities); options 
(consisting of long and short positions in call options and put options 
on indices based on equities, fixed income securities, interest rates, 
currencies or commodities, individual securities or currencies, 
swaptions and options on futures contracts); and forward contracts 
(consisting of forward contracts based on equity or fixed income 
securities and/or equity or fixed income indices, currencies, interest 
rates, swap forwards and non-deliverable forwards). Futures contracts 
and options on futures contracts in which the Fund may invest will be 
traded on U.S. exchanges regulated by the Commodity Futures Trading 
Commission (``CFTC''),\16\ all of which will be members of the ISG or 
exchanges with which the Exchange has in place a CSSA. All other 
options contracts will be listed on a U.S. national securities exchange 
or a non-U.S. securities exchange that is a member of ISG or a party to 
a CSSA with the Exchange.
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    \16\ According to the Exchange, the Fund has claimed an 
exclusion from the definition of a ``commodity pool operator'' under 
the Commodity Exchange Act (``CEA'') (7 U.S.C. 1) and is not subject 
to registration or regulation as a commodity pool operator under the 
CEA.
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    The Fund may use repurchase agreements, reverse repurchase 
agreements, and mortgage dollar rolls for temporary or emergency 
purposes or to earn additional income on portfolio securities, such as 
Treasury bills or notes.\17\
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    \17\ The Fund will enter into reverse repurchase agreements only 
with parties that the Sub-Advisers deems creditworthy.
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    With respect to its investments in fixed income securities, the 
Fund may invest in restricted securities (Rule 144A securities), which 
are subject to legal restrictions on their sale.\18\
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    \18\ See Amendment No. 1, supra note 5.
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C. Investment Restrictions

    The Exchange represents that the Fund will limit its investment in 
non-government sponsored residential mortgage-backed securities, 
commercial mortgage-backed securities and asset-backed securities 
(including equipment trust certificates) as well as bank loans and 
illiquid restricted securities, in the aggregate, to 20% or less of the 
Fund's net assets.
    The Exchange represents that the Fund may hold up to an aggregate 
amount of 15% of its net assets in illiquid assets (calculated at the 
time of investment), including Rule 144A securities deemed illiquid by 
the Adviser, consistent with Commission guidance. The Fund will monitor 
its portfolio liquidity on an ongoing basis to determine whether, in 
light of current circumstances, an adequate level of liquidity is being 
maintained, and will consider taking appropriate steps in order to 
maintain adequate liquidity if, through a change in values, net assets, 
or other circumstances, more than 15% of the Fund's net assets are held 
in illiquid assets.
    Not more than 10% of the net assets of the Fund in the aggregate 
invested in exchange-listed equity securities shall consist of equity 
securities whose principal market is not a member of the Intermarket 
Surveillance Group (``ISG'') or a party to a comprehensive surveillance 
sharing agreement (``CSSA'') with the Exchange.
    The Fund's investments will be consistent with its investment 
objective and will not be used to enhance leverage.
    While the Fund may invest in inverse ETFs, the Fund will not invest 
in leveraged (e.g., 2X, -2X, 3X or -3X) ETFs.

III. Discussion and Commission Findings

    After careful review, the Commission finds that the Exchange's 
proposal to list and trade the Shares is consistent with the Exchange 
Act and the rules and regulations thereunder applicable to a national 
securities exchange.\19\ In particular, the Commission finds that the 
proposed rule change is consistent with Section 6(b)(5) of the Exchange 
Act,\20\ which requires, among other things, that the Exchange's rules 
be designed 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.
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    \19\ In approving this proposed rule change, the Commission has 
considered the proposed rule's impact on efficiency, competition and 
capital formation. See 15 U.S.C. 78c(f).
    \20\ 15 U.S.C. 78f(b)(5).
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    The Commission finds that the proposal to list and trade the Shares 
on the Exchange is consistent with Section 11A(a)(1)(C)(iii) of the 
Exchange Act,\21\ which sets forth Congress' finding that it is in the 
public interest and appropriate for the protection of investors and the 
maintenance of fair and orderly markets to assure the availability to 
brokers, dealers, and investors of information with respect to 
quotations for and transactions in securities. Quotation and last-sale 
information for the Shares will be available via the Consolidated Tape 
Association (``CTA'') high speed line. The Exchange represents that 
quotation and last-sale information for the portfolio holdings of the 
Fund that are U.S. exchange-listed will be available via the CTA high 
speed line. Quotation and last sale information for such U.S. exchange-
listed securities, as well as futures, will also be available from the 
exchange on which they are listed. Quotation and last-sale information 
for exchange-listed options cleared via the Options Clearing 
Corporation will be available via the Options Price Reporting 
Authority. In addition, quotation information for OTC-traded 
securities, OTC-traded derivative instruments, investment company 
securities (excluding ETFs), Rule 144A

[[Page 26598]]

securities, U.S. Treasuries, agency securities, asset-backed 
securities, residential mortgage-backed securities, commercial 
mortgage-backed securities, zero-coupon securities, variable and 
floating rate instruments including inverse floaters, covered 
securities, sinking fund securities, equipment trust certificates, 
sovereign bonds, convertible bonds, pay-in-kind securities, step-coupon 
securities, stripped securities, inflation-indexed bonds, inflation 
protected debt securities, bank loans, municipal bonds, corporate 
bonds, and money market instruments may be obtained from brokers and 
dealers who make markets in such securities or through nationally 
recognized pricing services through subscription agreements. The U.S. 
dollar value of foreign securities, instruments and currencies can be 
derived by using foreign currency exchange rate quotations obtained 
from nationally recognized pricing services.
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    \21\ 15 U.S.C. 78k-1(a)(1)(C)(iii).
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    The Commission also believes that the proposal to list and trade 
the Shares is reasonably designed to promote fair disclosure of 
information that may be necessary to price the Shares appropriately and 
to prevent trading when a reasonable degree of transparency cannot be 
assured. On each business day, before commencement of trading in Shares 
in the Core Trading Session on the Exchange, the Adviser will disclose 
on the Fund's Web site the Disclosed Portfolio for the Fund as defined 
in NYSE Arca Equities Rule 8.600(c)(2) that will form the basis for the 
Fund's calculation of NAV at the end of the business day.\22\ The 
Exchange will obtain a representation from the issuer of the Shares 
that the NAV and the Disclosed Portfolio will be made available to all 
market participants at the same time.\23\ In addition, the Portfolio 
Indicative Value (``PIV''), as defined in NYSE Arca Equities Rule 
8.600(c)(3), will be widely disseminated by one or more major market 
data vendors at least every 15 seconds during the Core Trading 
Session.\24\ The Fund will make available, prior to the opening of 
trading on the NYSE (currently 9:30 a.m. Eastern Time), through the 
National Securities Clearing Corporation the names and quantities of 
the instruments comprising the in-kind deposit of specified 
instruments, as well as the difference in market value of the aggregate 
market value of the in-kind deposit and the NAV attributable to a 
creation unit (if any), for that day. The NAV of the Shares will be 
calculated after 4:00 p.m. Eastern Time each trading day. The Fund's 
Web site will include a form of the prospectus for the Fund that may be 
downloaded and additional information relating to NAV and other 
applicable information.
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    \22\ Under accounting procedures to be followed by the Fund, 
trades made on the prior business day (``T'') will be booked and 
reflected in NAV on the current business day (``T+1''). Accordingly, 
the Fund will be able to disclose at the beginning of the business 
day the portfolio that will form the basis for the NAV calculation 
at the end of the business day.
    \23\ See NYSE Arca Equities Rule 8.600(d)(1)(B).
    \24\ Currently, it is the Exchange's understanding that several 
major market data vendors display and/or make widely available PIVs 
taken from the CTA or other data feeds.
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    The Exchange represents that trading in the Shares will be halted 
if the circuit breaker parameters in NYSE Arca Equities Rule 7.12 have 
been reached or because of market conditions or for reasons that, in 
the view of the Exchange, make trading in the Shares inadvisable.\25\ 
Trading in the Shares will be subject to NYSE Arca Equities Rule 
8.600(d)(2)(D), which sets forth circumstances under which Shares may 
be halted.
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    \25\ These may include: (1) The extent to which trading is not 
occurring in the securities and/or the financial instruments 
comprising the Disclosed Portfolio of the Fund; or (2) whether other 
unusual conditions or circumstances detrimental to the maintenance 
of a fair and orderly market are present.
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    The Exchange states that it has a general policy prohibiting the 
distribution of material, non-public information by its employees. The 
Exchange represents that the Adviser and Sub-Advisers are not 
registered as broker-dealers but are affiliated with three broker-
dealers and have implemented and will maintain a ``fire wall'' with 
respect to each such broker-dealer affiliate regarding access to 
information concerning the composition and/or changes to the 
portfolios. Prior to the commencement of trading, the Exchange will 
inform its Equity Trading Permit Holders in an Information Bulletin 
(``Bulletin'') of the special characteristics and risks associated with 
trading the Shares. The Exchange states that trading in the Shares will 
be subject to the existing trading surveillances, administered by the 
Financial Industry Regulatory Authority (``FINRA'') on behalf of the 
Exchange, which are designed to detect violations of Exchange rules and 
applicable federal securities laws.\26\ On behalf of the Exchange, 
FINRA will communicate as needed regarding trading in the Shares, ETFs, 
other exchange-traded equity securities (including exchange-listed 
Depositary Receipts), options, futures, and options on futures with 
other markets and other entities that are members of the ISG, and 
FINRA, on behalf of the Exchange, may obtain trading information 
regarding trading in such financial instruments, as applicable, from 
such markets and other entities. In addition, the Exchange may obtain 
information regarding trading in such financial instruments, as 
applicable, from markets and other entities that are members of ISG or 
with which the Exchange has in place a comprehensive surveillance 
sharing agreement.\27\ FINRA, on behalf of the Exchange, is able to 
access, as needed, trade information for certain fixed income 
securities held by the Fund reported to FINRA's Trade Reporting and 
Compliance Engine.
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    \26\ FINRA surveils trading on the Exchange pursuant to a 
regulatory services agreement. The Exchange is responsible for 
FINRA's performance under this regulatory services agreement.
    \27\ For a list of the current members of ISG, see 
www.isgportal.org. The Exchange notes that not all components of the 
Disclosed Portfolio for the Fund may trade on markets that are 
members of ISG or with which the Exchange has in place a 
comprehensive surveillance sharing agreement.
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    The Exchange represents that it 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. 
In support of this proposal, the Exchange has also made the following 
representations:
    (1) The Shares of the Fund will conform to the initial and 
continued listing criteria under NYSE Arca Equities Rule 8.600.
    (2) The Exchange has appropriate rules to facilitate transactions 
in the Shares during all trading sessions.
    (3) Trading in the Shares will be subject to the existing trading 
surveillances, administered by FINRA on behalf of the Exchange, which 
are designed to detect violations of Exchange rules and applicable 
federal securities laws, and 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.
    (4) Prior to the commencement of trading, the Exchange will inform 
its Equity Trading Permit Holders in a Bulletin of the special 
characteristics and risks associated with trading the Shares. 
Specifically, the Bulletin will discuss the following: (a) The 
procedures for purchases and redemptions of Shares in Creation Units 
(and that Shares are not individually redeemable); (b) NYSE Arca 
Equities Rule 9.2(a), which imposes a duty of due diligence on its ETP 
Holders to learn the essential facts relating to every customer prior 
to trading the Shares; (c)

[[Page 26599]]

the risks involved in trading the Shares during the Opening and Late 
Trading Sessions when an updated PIV will not be calculated or publicly 
disseminated; (d) how information regarding the PIV and the Disclosed 
Portfolio is disseminated; (e) the requirement that ETP Holders deliver 
a prospectus to investors purchasing newly issued Shares prior to or 
concurrently with the confirmation of a transaction; and (f) trading 
information.
    (5) For initial and/or continued listing, the Fund will be in 
compliance with Rule 10A-3 \28\ under the Act, as provided by NYSE Arca 
Equities Rule 5.3.
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    \28\ 17 CFR 240 10A-3.
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    (6) The Fund may hold up to an aggregate amount of 15% of its net 
assets in illiquid assets (calculated at the time of investment), 
including Rule 144A securities deemed illiquid by the Adviser, 
consistent with Commission guidance. The Fund will monitor its 
portfolio liquidity on an ongoing basis to determine whether, in light 
of current circumstances, an adequate level of liquidity is being 
maintained, and will consider taking appropriate steps in order to 
maintain adequate liquidity if, through a change in values, net assets, 
or other circumstances, more than 15% of the Fund's net assets are held 
in illiquid assets.
    (7) The Fund will limit its investment in non-government sponsored 
residential mortgage-backed securities, commercial mortgage-backed 
securities and asset-backed securities (including equipment trust 
certificates) as well as bank loans and illiquid restricted securities, 
in the aggregate, to 20% or less of the Fund's net assets.
    (8) Not more than 10% of the net assets of the Fund will be 
invested in non-exchange-listed ADRs.
    (9) Not more than 10% of the net assets of the Fund in the 
aggregate invested in exchange-traded equity securities shall consist 
of equity securities whose principal market is not a member of the ISG 
or party to a CSSA with the Exchange.
    (10) A minimum of 100,000 Shares will be outstanding at the 
commencement of trading on the Exchange.
    This approval order is based on all of the Exchange's 
representations, including those set forth above and in the Notice.
    For the foregoing reasons, the Commission finds that the proposed 
rule change, as modified by Amendment No. 1, is consistent with Section 
6(b)(5) of the Act \29\ and the rules and regulations thereunder 
applicable to a national securities exchange.
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    \29\ 15 U.S.C. 78f(b)(5).
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IV. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Exchange Act, that the proposed rule change (SR-NYSEArca-2015-15), as 
modified by Amendment No. 1, is hereby approved.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\30\
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    \30\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2015-11080 Filed 5-7-15; 8:45 am]
 BILLING CODE 8011-01-P