Document ID: SEC-2013-2207-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NYSE Arca, Inc.
Posted Date: 2013-12-24T05:00Z

[Federal Register Volume 78, Number 247 (Tuesday, December 24, 2013)]
[Notices]
[Pages 77761-77765]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-30631]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-71133; File No. SR-NYSEArca-2013-111]

Self-Regulatory Organizations; NYSE Arca, Inc.; Order Approving a 
Proposed Rule Change To List and Trade Shares of Manna Core Equity 
Enhanced Dividend Income Fund Under NYSE Arca Equities Rule 8.600

December 18, 2013.

I. Introduction

    On October 23, 2013, NYSE Arca, Inc. (``Exchange'' or ``NYSE 
Arca'') filed

[[Page 77762]]

with the Securities and Exchange Commission (``Commission''), pursuant 
to Section 19(b)(1) \1\ of the Securities Exchange Act of 1934 
(``Exchange Act'') \2\ and Rule 19b-4 thereunder,\3\ a proposed rule 
change to list and trade shares (``Shares'') of the Manna Core Equity 
Enhanced Dividend Income Fund (``Fund''). The proposed rule change was 
published for comment in the Federal Register on November 7, 2013.\4\ 
The Commission received no comments on the proposal. This order 
approves the proposed rule change.
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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. 70798 (November 1, 
2013), 78 FR 66973 (``Notice'').
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II. Description of the Proposed Rule Change

    The Exchange proposes to list and trade the Shares under NYSE Arca 
Equities Rule 8.600, which governs the listing and trading of Managed 
Fund Shares on the Exchange. The Exchange makes the following 
representations and statements in describing the Fund and its 
investment strategies, including portfolio holdings and limitations. 
The Shares will be offered by ETF Actively Managed Trust (``Trust''). 
The Trust will be registered with the Commission as an open-end 
management investment company.\5\ ETF Issuer Solutions, Inc. will serve 
as the investment adviser to the Fund (``Adviser''). ETF Distributors 
LLC will be the principal distributor of the Fund's Shares. Manna ETFs 
Management LLC (the ``Sub-Adviser'') will serve as sub-adviser for the 
Fund. The Bank of New York Mellon will serve as the administrator, 
accountant, custodian, and transfer agent for the Fund. The Exchange 
represents that the Adviser and Sub-Adviser are each not registered as 
a broker-dealer, but the Adviser is affiliated with a broker-dealer and 
has implemented a fire wall with respect to its broker-dealer affiliate 
regarding access to information concerning the composition of and 
changes to the Fund's portfolio.\6\
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    \5\ The Trust is registered under the 1940 Act. On April 2, 
2013, the Trust filed a registration statement on Form N-1A under 
the Securities Act of 1933 (the ``1933 Act'') (15 U.S.C. 77a), and 
under the 1940 Act relating to the Fund (File Nos. 333-187668 and 
811-22819) (the ``Registration Statement''). The Trust filed an 
Amended and Restated 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. 812-14080), dated June 19, 2013 
(``Exemptive Application''). The Commission has issued an order 
granting certain exemptive relief to the Trust under the 1940 Act. 
See Investment Company Act Release No. 30607 (July 23, 2013) 
(``Exemptive Order''). Investments made by the Fund will comply with 
the conditions set forth in the Exemptive Application and the 
Exemptive Order.
    \6\ See Commentary .06 to NYSE Arca Equities Rule 8.600. The 
Exchange represents that in the event (a) the Adviser or any Sub-
Adviser registers 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 a fire wall with respect to its relevant personnel 
or its broker-dealer affiliate regarding access to information 
concerning the composition of or changes to the Fund's portfolio, 
and will be subject to procedures designed to prevent the misuse of 
material, non-public information regarding the Fund's portfolio.
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    The Fund will seek long-term capital appreciation and income 
primarily through purchases and short sales of U.S. and international 
equity securities. To achieve its investment objective, normally \7\ 
the Fund will invest up to 100% (but not less than 80%) of its net 
assets between its Core Position, Dividend Position and Short Position 
(each as defined below). The Fund expects to invest in a portfolio of 
U.S. common stocks or exchange traded funds (``ETFs'') selected by the 
Sub-Adviser to reflect a broad spectrum (i.e., positions in companies 
of different market capitalizations) of the U.S. equity market (the 
``Core Position''). The Fund also expects to invest in a portfolio that 
may contain U.S. and non-U.S. common stocks, American Depositary 
Receipts (``ADRs''), participation notes, or other equity securities 
listed on U.S. or non-U.S. exchanges or traded over the counter that 
the Sub-Adviser expects to generate dividend income to the Fund (the 
``Dividend Position''). The Fund also expects to sell short a portfolio 
of common stocks, index- or sector-based ETFs, other investment 
companies, exchange traded notes (``ETNs'') and other exchange traded 
products (``ETPs''),\8\ other securities or index- or sector-based 
futures contracts all of which trade on U.S. and non-U.S. exchanges 
selected for the purpose of hedging against country or currency risk 
associated with the investments in the Dividend Position, or because 
they are likely to underperform the market or lose value in the near 
term (the ``Short Position'').
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    \7\ The term ``normally'' includes, but is not limited to, the 
absence of extreme volatility or trading halts in the equity markets 
or the financial markets generally; 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. According to the 
Registration Statement, in certain adverse market, economic, 
political, or other conditions, the Fund may temporarily depart from 
its normal investment policies and strategies provided that the 
alternative is consistent with the Fund's investment objective and 
is in the best interest of the Fund. The Fund may determine that 
market conditions warrant investing in cash or cash equivalents, 
such as money market instruments, and to the extent permitted by 
applicable law and the Fund's investment restrictions, shares of 
other investment companies. Under such circumstances, the Fund may 
invest up to 100% of its assets in these investments.
    \8\ For purposes of this proposed rule change, ETPs include 
Investment Company Units (as described in NYSE Arca Equities Rule 
5.2(j)(3)); Index-Linked Securities (as described in NYSE Arca 
Equities Rule 5.2(j)(6)); Portfolio Depositary Receipts (as 
described in NYSE Arca Equities Rule 8.100); Trust Issued Receipts 
(as described in NYSE Arca Equities Rule 8.200); Commodity-Based 
Trust Shares (as described in NYSE Arca Equities Rule 8.201); 
Currency Trust Shares (as described in NYSE Arca Equities Rule 
8.202); Commodity Index Trust Shares (as described in NYSE Arca 
Equities Rule 8.203); Trust Units (as described in NYSE Arca 
Equities Rule 8.500); Managed Fund Shares (as described in NYSE Arca 
Equities Rule 8.600). The ETPs all will be listed and traded in the 
U.S. on registered exchanges. While the Funds may invest in inverse 
ETPs, the Funds will not invest in leveraged or inverse leveraged 
ETPs (e.g., 2X or 3X).
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    The Fund will be an actively managed ETF and thus does not seek to 
replicate the performance of a specific index. Instead, the Fund will 
use an active investment strategy to meet its investment objective. The 
Sub-Adviser, subject to the oversight of the Adviser and the Board of 
Trustees of the Trust, will have discretion on a daily basis to manage 
the Fund's portfolio in accordance with the Fund's investment objective 
and investment policies.
    The Sub-Adviser will typically seek to invest the Core Position in 
a portfolio of common stocks and ETPs selected by the Sub-Adviser to 
reflect a broad spectrum (i.e., positions in companies of different 
market capitalizations) of the U.S. equity market. The Core Position 
may invest in the common stock of issuers of any market capitalization 
and there are no requirements as to the number of securities the Core 
Position must hold.
    The Fund may invest in any type of ETF, including index based ETFs, 
sector based ETFs, and fixed-income ETFs. The Fund may hold ETFs with 
portfolios comprised of domestic or foreign stocks or bonds or any 
combination thereof. However, due to legal limitations, the Fund will 
be prevented from purchasing more than 3% of an ETF's outstanding 
shares unless: (i) the ETF or the Fund has received an order for 
exemptive relief from the 3% limitation from the Commission that is 
applicable to the Fund; and (ii) the ETF and the Fund take appropriate 
steps to comply with any conditions in such order.
    According to the Exchange, to implement the Dividend Position's 
strategy, the Sub-Adviser will seek to maximize the level of dividend 
income that the Dividend Position receives,

[[Page 77763]]

through the purchase of U.S. and non-U.S. securities that the Sub-
Adviser expects to generate dividend income for the Dividend Position. 
To participate in non-U.S. developed or emerging markets, the Dividend 
Position may invest in debt or equity securities, ADRs, participation 
notes, and other securities listed on U.S. or non-U.S. exchanges or 
U.S. securities traded over the counter. The Fund will invest only in 
foreign securities and ADRs that are 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.
    The Sub-Adviser expects to seek to participate in special dividend 
situations and engage in dividend capture trading. Special dividend 
situations may include those where issuers decide to return large cash 
balances to shareholders as one-time dividend payments.
    The Fund expects to establish Short Positions, representing up to 
30% of the Fund's principal investments, in securities selected by the 
Sub-Adviser for the purpose of hedging against country, currency, 
sector or other risk associated with the investments in the Dividend 
Position, in an attempt to establish, between the Dividend Position and 
the Short Positions, a market neutral position with respect to the 
countries and currency in which the Dividend Position is invested. The 
Fund may also invest in Short Positions in securities that the Sub-
Adviser believes are likely to underperform the market or lose value in 
the near term. To implement the Short Positions, the Sub-Adviser 
expects to typically sell short a portfolio of equities, index- or 
sector-based ETF's, other investment companies, index- or sector-based 
futures contracts or other securities that trade on U.S. and non-U.S. 
exchanges.\9\ According to the Registration Statement, the proceeds 
from the Short Positions (i.e., cash received from selling securities 
short) will typically be used to fund the acquisition of the Fund's 
investments in the Dividend Position.
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    \9\ To participate in non-U.S. developed or emerging markets, 
the Fund may invest in ETFs, ADRs, futures contracts and other 
securities listed on U.S. or non-U.S. exchanges or traded over the 
counter that are intended to track the non-U.S. equity markets or 
market sectors in which the Sub-Adviser seeks exposure.
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    Although the Fund expects to invest not less than 80% of its assets 
as described above, the Fund has flexibility to invest in other types 
of securities when the Sub-Adviser believes they offer more attractive 
opportunities or to meet liquidity, redemption, and short term 
investing needs. The Fund may invest up to 20% of its assets in 
securities convertible into common stock. Convertible securities 
eligible for purchase by the Fund include convertible bonds, 
convertible preferred stocks, and warrants. The Fund will not invest 
directly in real estate, but may invest in readily marketable 
securities issued by companies that invest in real estate or interests 
therein. The Fund may also invest in readily marketable interests in 
real estate investment trusts.

Investment Limitations

    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 to be illiquid by the Sub-
Adviser. 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. Illiquid 
assets include assets subject to contractual or other restrictions on 
resale and other instruments that lack readily available markets as 
determined in accordance with Commission staff guidance.
    The Fund may lend portfolio securities in an amount equal to up to 
33% of its total assets to broker-dealers, major banks, or other 
recognized domestic institutional borrowers of securities that the Sub-
Adviser has determined are creditworthy under guidelines established by 
the Board of Trustees. The Fund may not lend securities to any company 
affiliated with the Sub-Adviser. Each loan of securities will be 
collateralized by cash, securities, or letters of credit.
    The Fund will not purchase the securities of issuers conducting 
their principal business activity in the same industry if, immediately 
after the purchase and as a result thereof, the value of the Fund's 
investments in that industry would equal or exceed 25% of the current 
value of the Fund's total assets, provided that this restriction does 
not limit the Fund's: (i) Investments in securities of other investment 
companies, (ii) investments in securities issued or guaranteed by the 
U.S. government, its agencies or instrumentalities, or (iii) 
investments in repurchase agreements collateralized by U.S. government 
securities.
    The Fund will not invest in swaps, and no more than 10% of the net 
assets of the Fund will be invested in unsponsored ADRs. Additional 
information regarding the Fund; the Shares; the Fund's investment 
objective, strategies, methodology, and restrictions; the Adviser; the 
distributor; the administrator; the custodian; the transfer agent; 
risks; fees and expenses; creations and redemptions of Shares; 
availability of information; trading rules and halts; and surveillance 
procedures, among other things, can be found in the Notice and 
Registration Statement, as applicable.\10\
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    \10\ See supra notes 4 and 5 respectively.
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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.\11\ In particular, the Commission finds that the 
proposed rule change is consistent with Section 6(b)(5) of the Exchange 
Act,\12\ which requires, among other things, that the Exchange's rules 
be 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. The Commission notes that the Fund and the Shares must 
comply with the requirements of NYSE Arca Equities Rule 8.600 to be 
listed and traded on the Exchange.
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    \11\ 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).
    \12\ 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,\13\ 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 and any underlying ETPs, sponsored ADRs, and 
common stock will be available via the Consolidated Tape Association 
high-speed line, and price information for futures and non-exchange 
traded securities held by the Fund will be available from publicly-
available pricing

[[Page 77764]]

sources, including Bloomberg, IDC, and Reuters. The Exchange will 
disseminate the Indicative Optimized Portfolio Value (``IOPV''), which 
is the Portfolio Indicative Value as defined in NYSE Arca Equities Rule 
8.600(c)(3), at least every 15 seconds during the Core Trading Session 
through one or more major market data vendors.\14\ The net asset value 
(``NAV'') of the Fund will be determined as of the close of the regular 
trading session on the Exchange (ordinarily 4:00 p.m., Eastern time) on 
each day that the Exchange is open. The Fund's Web site will include a 
form of the prospectus for the Fund and additional quantitative 
information updated on a daily basis, including, (1) the prior business 
day's reported closing price, NAV, and mid-point of the bid/ask spread 
at the time of calculation of such NAV (``Bid/Ask Price''),\15\ and a 
calculation of the premium and discount of the Bid/Ask Price against 
the NAV, and (2) data in chart format displaying the frequency 
distribution of discounts and premiums of the daily Bid/Ask Price 
against the NAV, within appropriate ranges, for each of the four 
previous calendar quarters.\16\ Information regarding market price and 
trading volume of the Shares will be continually available on a real-
time basis throughout the day on brokers' computer screens and other 
electronic services.\17\ NYSE Arca expects that information regarding 
the previous day's closing price and trading volume information for the 
Shares will be published daily in the financial section of 
newspapers.\18\
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    \13\ 15 U.S.C. 78k-1(a)(1)(C)(iii).
    \14\ See Notice, supra note 4, 78 FR at 66977. The IOPV 
calculations will be estimates of the value of the Fund's NAV per 
Share using market data converted into U.S. dollars at the current 
currency rates. The IOPV price will be based on quotes and closing 
prices from the securities' local market and may not reflect events 
that occur subsequent to the local market's close. The quotations of 
certain Fund holdings may not be updated during U.S. trading hours 
if such holdings do not trade in the United States. See id.
    \15\ The Bid/Ask Price of the Fund will be determined using the 
mid-point of the highest bid and the lowest offer on the Exchange as 
of the time of calculation of the Fund's NAV. The records relating 
to Bid/Ask Prices will be retained by the Fund and its service 
providers. See id.
    \16\ See id.
    \17\ See id.
    \18\ See id.
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    Further, the Commission 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. The Fund will make available on its Web site on each business 
day before commencement of the Core Trading Session the Disclosed 
Portfolio, 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.\19\ The Commission notes that the Exchange will obtain a 
representation from the Fund that the NAV per Share will be calculated 
daily and that the NAV and the Disclosed Portfolio will be made 
available to all market participants at the same time.\20\ In addition, 
a basket composition file, which will include the security names and 
share quantities required to be delivered in exchange for the Fund's 
Shares, together with estimates and actual cash components, will be 
publicly disseminated daily prior to the opening of the New York Stock 
Exchange via the National Securities Clearing Corporation.\21\ The 
basket will represent one Creation Unit of Shares of the Fund. The 
Exchange will halt trading in the Shares under the specific 
circumstances set forth in NYSE Arca Equities Rule 8.600(d)(2)(D), and 
may halt trading in the Shares if trading is not occurring in the 
securities or financial instruments constituting the Disclosed 
Portfolio of the Fund, or if other unusual conditions or circumstances 
detrimental to the maintenance of a fair and orderly market are 
present.\22\ Further, if the IOPV is not being disseminated as 
required, the Exchange may halt trading during the day in which the 
interruption occurs; if the interruption persists past the day in which 
it occurred, the Exchange will halt trading no later than the beginning 
of the trading day following the interruption.\23\ The Exchange will 
consider the suspension of trading in or removal from listing of the 
Shares if the IOPV is no longer calculated or available or the 
Disclosed Portfolio is not made available to all market participants at 
the same time.\24\ Further, the Commission notes that the Reporting 
Authority that provides the Disclosed Portfolio must implement and 
maintain, or be subject to, procedures designed to prevent the use and 
dissemination of material non-public information regarding the actual 
components of the portfolio.\25\ The Exchange represents that the 
Adviser is affiliated with a broker-dealer and has implemented a fire 
wall with respect to such broker-dealer regarding access to information 
concerning the composition and/or changes to the portfolio, and will be 
subject to procedures designed to prevent the use and dissemination of 
material non-public information regarding the portfolio.\26\ The 
Exchange has a general policy prohibiting the distribution of material, 
non-public information by its employees. Finally, the Exchange states 
that, on its behalf, the Financial Industry Regulatory Authority 
(``FINRA'') will communicate as needed with other markets that are 
members of the ISG regarding trading in the Shares and exchange-traded 
securities held by the Fund.\27\
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    \19\ See id. On a daily basis, the Adviser will disclose for 
each portfolio security or other financial instrument of the Fund 
the following information on the Fund's Web site: ticker symbol (if 
applicable), name of security and financial instrument, number of 
shares or dollar value of financial instruments held in the 
portfolio, and percentage weighting of the security and financial 
instrument in the portfolio. The Web site information will be 
publicly available at no charge. 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. See id.
    \20\ See id. at 66978.
    \21\ See id. at 66977.
    \22\ 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. Trading in Shares of a Fund will be 
halted if the circuit breaker parameters in NYSE Arca Equities Rule 
7.12 have been reached. Trading may also be halted because of market 
conditions or for reasons that, in the view of the Exchange, make 
trading in the Shares inadvisable.
    \23\ See NYSE Arca Equities Rule 8.600(d)(2)(D).
    \24\ See NYSE Arca Equities Rule 8.600(d)(2)(C)(ii).
    \25\ See NYSE Arca Equities Rule 8.600(d)(2)(B)(ii).
    \26\ See supra note 6 and accompanying text.
    \27\ See Notice, supra note 4, 78 FR at 66979.
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    The Exchange has represented that the Shares are equity securities 
subject to the Exchange's rules governing the trading of equity 
securities.\28\ In support of this proposal, the Exchange has made 
representations, including:
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    \28\ See id. at 66978.
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    (1) The Shares will conform to the initial and continuing listing 
criteria under NYSE Arca Equities Rule 8.600.
    (2) The Exchange's surveillance 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 applicable federal 
securities laws.\29\
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    \29\ 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.
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    (3) FINRA, on behalf of the Exchange, will communicate as needed 
regarding trading in the Shares and exchange-traded securities held by 
the Fund with other markets that are members of the ISG and FINRA, on 
behalf of the Exchange, may obtain trading information regarding 
trading in the Shares and exchange-traded securities held by the Fund 
from such markets or

[[Page 77765]]

other entities. In addition, the Exchange may obtain information 
regarding trading in the Shares and exchange-traded securities held by 
the Fund from markets and other entities that are members of ISG or 
with which the Exchange has in place a comprehensive surveillance 
sharing agreement.\30\ The Fund will invest only in foreign securities 
and ADRs that are 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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    \30\ 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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    (4) The Exchange has appropriate rules to facilitate transactions 
in the Shares during all trading sessions.
    (5) Prior to the commencement of trading, the Exchange will inform 
its Equity Trading Permit Holders (``ETP Holders'') in an Information 
Bulletin of the special characteristics and risks associated with 
trading the Shares. Specifically, the Information Bulletin will discuss 
the following: (a) The procedures for purchases and redemptions of 
Creation Unit Aggregations 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) the risks involved 
in trading the Shares during the Opening and Late Trading Sessions when 
an updated IOPV will not be calculated or publicly disseminated; (d) 
how information regarding the IOPV 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.
    (6) For initial and continued listing, the Fund will be in 
compliance with Rule 10A-3 under the Exchange Act,\31\ as provided by 
NYSE Arca Equities Rule 5.3.\32\
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    \31\ 17 CFR 240.10A-3.
    \32\ See Notice, supra note 4, 78 FR at 66978.
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    (7) The Fund will not invest in swaps.
    (8) The Fund's investments will be consistent with its investment 
objective and will not be used to enhance leverage.
    (9) 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. 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.
    (10) A minimum of 100,000 Shares for the Fund will be outstanding 
at the commencement of trading on the Exchange.
    This order is based on the Exchange's representations.
    For the foregoing reasons, the Commission finds that the proposed 
rule change is consistent with the Exchange Act.

IV. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Exchange Act,\33\ that the proposed rule change (SR-NYSEArca-2013-111), 
be, and it hereby is, approved.
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    \33\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\34\
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    \34\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-30631 Filed 12-23-13; 8:45 am]
BILLING CODE 8011-01-P