Exchange-Traded Funds

Transcription

1 Exchange-Traded Funds NORTH AMERICA MICHAEL JABARA Morgan Stanley Wealth Management JOHN DUGGAN Morgan Stanley Wealth Management CHRISTOPHER K. BAXTER Morgan Stanley Wealth Management US ETF Weekly Update - Weekly Flows: $6.8 Billion Net Inflows - Over the Last 18 Weeks, $64.9 Billion Net Inflows - High-conviction ETF Recommendations Slide: No Changes - ETF Assets Stand at $2.2 Trillion, up 6% in Eight ETF Launches Last Week - AdvisorShares Announces Sub-Advisor Change for ETF - Financial Select Sector SPDR (XLF) to Remove Real Estate As with any investment, ETFs have risks. These include the general risks associated with investing in the underlying assets, potential tracking error, and the possibility that particular indices may lag other market segments or active managers. In addition, ETFs investing in international markets may include currency and geopolitical risks, while fixed income ETF risks also include credit and interest rate risk. Leveraged, Inverse, and Leveraged Inverse ETFs have unique risks, which are reviewed on slide 11. We define exchange-traded funds as encompassing passively and actively managed exchange-traded funds. This report is focused on U.S.-listed exchange-traded funds. These funds are registered with the SEC and trade as a single stock under SEC exemptions. U.S. listed, open-end fund ETFs must be offered under and sold only pursuant to a Prospectus. U.S.-listed ETFs may not be marketed or sold in a number of jurisdictions and may not be suitable for all investors. Morgan Stanley Wealth Management Sales Personnel should check with the Legal Department to clarify whether they may market the ETFs in a particular jurisdiction. Morgan Stanley Wealth Management is the trade name of Morgan Stanley Smith Barney LLC, a registered broker-dealer in the United States. Morgan Stanley Wealth Management does and seeks to do business with companies covered in Morgan Stanley Wealth Management Research. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of Morgan Stanley Wealth Management Research. Investors should consider Morgan Stanley Wealth Management Research as only a single factor in making their investment decision.

2 US-Listed ETFs: High-conviction ETF Recommendations Below are our highest-conviction ETF recommendations, drawing on published strategy from Morgan Stanley Wealth Management s Global Investment Committee and Morgan Stanley & Co. s Institutional Research group Ticker Name Fund Focus Investment Rationale VOO Vanguard S&P 500 ETF US Equity-Large-Cap May benefit from a rebound in global growth, but with lower volatility and more defensive characteristics than other equities. IJR ishares Core S&P Small-Cap ETF US Equity-Small-Cap May benefit from low energy costs, a better labor market, pick-up in consumer spending, and increased M&A. XLY Consumer Discretionary Select Sector SPDR US Equity-Sector Lower energy costs, better consumer confidence, and the potential for additional wage growth may benefit the sector. XLF Financials Select Sector SPDR US Equity-Sector Growth in shareholder return and better relative estimate achievability may drive sector higher. KRE SPDR S&P Regional Banking ETF US Equity-Sector May benefit from wage growth, housing improvement, increased consumer confidence, and rising rates. XLV Health Care Select Sector SPDR US Equity-Sector Valuations attractive following recent pullback and EPS growth should be above average. VGK Vanguard FTSE Europe ETF International Equity-Europe Expectation for improving economic outlook and attractive valuations in Europe. DBEU Deutsche X-Tracker MSCI Europe Hedged Equity Fund International Equity-Europe Expectation for improving economic outlook and attractive valuations in Europe; we anticipate European currencies to weaken. EZU ishares MSCI EMU ETF International Equity-Europe Expectation for improving economic outlook and attractive valuations in Europe. EWQ ishares MSCI France ETF International Equity-France Expectation for improving economic outlook and attractive valuations in Europe. EWG ishares MSCI Germany ETF International Equity-Germany Expectation for improving economic outlook and attractive valuations in Europe. EWJ ishares MSCI Japan ETF International Equity-Japan Positive bias amid political and structural changes as recovery appears sustainable. GXC SPDR S&P China ETF International Equity-China Signs of renewed growth, policy measures should continue to help, and government has additional tools. INDA ishares MSCI India ETF International Equity-India Anticipate monetary stimulus, lower inflation, positive longer view based on demographics, globalization, and political reforms. BKLN PowerShares Senior Loan Portfolio Fixed Income-Senior Loan Appealing asset class given floating rate exposure, long-term risk adjusted return history, and slow US recovery. SRLN SPDR Blackstone/GSO Senior Loan ETF Fixed Income-Senior Loan Appealing asset class given floating rate exposure, long-term risk adjusted return history, and slow US recovery. Source: Morgan Stanley Wealth Management ETF Research. 2

3 US-Listed ETFs: Estimated Flows by Market Segment ETFs posted net inflows of $6.8 bln last week; ETFs have generated net inflows 16 of the last 18 weeks - Over the last 18 weeks, ETFs have exhibited net inflows of $64.9 bln - Last week s net inflows were led by Fixed Income ETFs at $1.9 bln; conversely, US Sector & Industry ETFs posted net outflows of $375 mln, the most of any category that we measured - Twelve of the 15 categories that we measured posted net inflows last week - ETF assets stand at $2.2 tln, up 6% in week flows remain positive among most asset classes; combined $43.5 bln in net inflows - Over the last 13 weeks, equity ETFs have posted net inflows of $22.9 bln vs. $14.6 bln for the Fixed Income ETF category - Fixed Income ETF market share has climbed to 18% from 15% over the last year - The International - Developed and Currency ETF categories are the two areas of the market that we measure to exhibit net outflows over the last 13 weeks, totaling $4.9 bln Net Cash Flow ($ Mil) Mkt Cap Market Investment Objective Funds 1-Week 4-Week 13-Week ($ Mil) Share (%) US Broad-Market ,238 83,808 4 US Large-Cap ,524 3, , US Mid-Cap ,204 2, ,467 5 US Small- & Micro-Cap 42 (8) 1,607 1,300 99,281 4 US Sector & Industry 178 (375) 1,323 2, , US Custom ,082 4,822 55,139 2 US Dividend Income ,489 5,276 87,814 4 Leveraged/Inverse 195 (334) 442 1,972 33,635 2 International - Developed 268 1, (4,691) 297, International - Emerging 164 1,457 (225) 3, ,519 5 Global ,032 1,864 56,398 3 Fixed Income 222 1,916 4,519 14, , Commodity ,678 3,918 63,814 3 Currency (216) 2,368 0 Active ,254 1 Total 1,715 6,838 17,899 43,535 2,227, Source: Bloomberg, Morgan Stanley Wealth Management ETF Research. Flow data estimated as of 6/10/16 based on daily change in share counts and daily NAVs. 3

4 US-Listed ETFs: Estimated Largest Flows by Individual ETF The Vanguard FTSE Developed Markets ETF (VEA) posted net inflows of $1.2 bln last week, leading all ETFs - Despite International - Developed ETF market struggles as a whole the last 13 weeks, VEA has been able to generate net inflows of $2.6 bln over this time period - The ishares Core MSCI Emerging Markets ETF (IEMG) had another week of net inflows, at $767 mln; over the last 13 weeks, IEMG has posted net inflows of $2.0 bln, which accounts for 17% of its current market cap - The SPDR Gold Trust (GLD) generated net inflows of $521 mln last week; YTD, GLD has posted an impressive $9.9 bln in net inflows - Conversely, some of the largest international currency hedged equity ETFs continue to struggle; the WisdomTree Japan Hedged Equity Fund (DXJ) and the WisdomTree Europe Hedged Equity Fund (HEDJ) had a combined $816 mln in net outflows last week Net Inflows Net Outflows Net Cash Flow ($ Mil) Source: Bloomberg, Morgan Stanley Wealth Management ETF Research. Flow data estimated as of 6/10/16 based on daily change in share counts and daily NAVs. Mkt Cap ETF Name Symbol 1-Week 4-Week 13-Week ($ Mil) Vanguard FTSE Developed Markets ETF VEA 1,234 1,890 2,587 33,338 ishares Core MSCI Emerging Markets ETF IEMG 767 1,560 2,041 12,279 SPDR Gold Trust GLD 521 1,736 3,912 36,632 ishares Core US Aggregate Bond ETF AGG ,371 37,683 Vanguard Small-Cap Value ETF VBR ,195 Vanguard REIT ETF VNQ ,550 32,388 Health Care Select Sector SPDR XLV ,990 ishares Core S&P 500 ETF IVV ,854 73,315 ishares iboxx $ High Yield Corporate Bond ETF HYG 244 (571) (2,066) 14,612 ishares MSCI EAFE Value ETF EFV ,872 WisdomTree Japan Hedged Equity Fund DXJ (533) (1,092) (2,440) 7,411 ishares Russell 2000 ETF IWM (533) 240 (862) 25,768 Utilities Select Sector SPDR XLU (359) (31) (461) 8,075 Financials Select Sector SPDR XLF (354) 264 (643) 16,513 SPDR S&P 500 ETF SPY (303) (1,806) (344) 182,988 Direxion Daily Gold Miners Bull 3x Shares NUGT (285) (86) (319) 1,479 WisdomTree Europe Hedged Equity Fund HEDJ (283) (820) (2,617) 11,844 ishares 7-10 Year Treasury Bond ETF IEF (244) (562) (956) 9,473 PowerShares QQQ QQQ (218) 18 (1,840) 36,304 SPDR Oil & Gas Exploration & Production ETF XOP (196) (398) (379) 1,784 4

5 US-Listed ETFs: ETF Dollar Volume ETF monthly $ volume as a % of listed trading volume was down in May to 25% relative to April s 26% reading; over the last five years, ETF monthly $ volume as a % of listed trading volume averaged 27% May s reading was the lowest since November 2015 Over the last five years, ETF monthly $ volume as a % of listed trading volume peaked in August 2011 at 36% ETF $ volume was up $30 bln last week compared to the prior week, but is still 8% below its 13-week average International - Emerging ETFs accounted for 10% of ETF $ volume last week, which compares to its 8% 13-week average and market cap share of 5% Monthly ETF Dollar Volume as a % of Listed Trading Weekly Dollar Volume by ETF Market Segment $9,000 Non-ETF Dollars Traded ($ Bil) 45% Dollar Volume ($ Bil) $8,000 $7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 ETF Volume ($ Bil) ETF Percentage (right axis) 40% 35% 30% 25% 20% 15% 10% 5% ETF as % of Market 1-Week ETF 1-Week ETF 13-Week ETF 13-Week ETF Market Cap Investment Objective Funds Vol ($ Mil) Vol Shr (%) Avg Vol ($ Mil) Avg Vol Shr (%) Shr (%) US Broad-Market 21 1, , US Large-Cap , , US Mid-Cap 34 3, , US Small- & Micro-Cap 42 17, , US Sector & Industry , , US Custom 133 2, , US Dividend Income 32 2, , Leveraged/Inverse , , International - Developed , , International - Emerging , , Global , , Fixed Income , , Commodity 36 9, , Currency Active , Total 1, , , $0 0% May-11 Nov-11 May-12 Nov-12 May-13 Nov-13 May-14 Nov-14 May-15 Nov-15 May-16 Source: Bloomberg, Morgan Stanley Wealth Management ETF Research, NYSE Arcavision. Monthly data as of 5/31/16; weekly data as of 6/10/16. Non-ETF Dollars Traded + ETF Volume=Total Listed Volume. 5

6 US-Listed ETFs: Short Interest Data Updated: Based on data as of 5/31/16 ishares MSCI Emerging Markets ETF (EEM) had the largest increase in short interest for the second straight period - EEM s shares short at 149 mln are at their highest level since 3/31/14 - The ishares Core MSCI Emerging Markets ETF (IEMG) also had a large increase in USD short interest, at $788 mln; IEMG s shares short at 30 mln are at their highest level all-time - Conversely, the SPDR S&P 500 ETF (SPY) had the largest decline in USD short interest at $1.7 bln; SPY s shares short are at their lowest level since 1/30/ ETFs exhibited short interest increases while 747 experienced short interest declines over the last period - Aggregate ETF USD short interest decreased by $1.5 bln over the period ended 5/31/16 The average shares short/shares outstanding for ETFs is currently 2.9%, down from 3.0% from last period - For the second consecutive period, the VanEck Vectors Semiconductor ETF (SMH) was the most heavily shorted ETF as a % of shares outstanding at 266% - Based on multiple borrowings and the ability to continuously create new shares, shares short as a % of shares outstanding can exceed 100% (only five ETFs exhibited shares short as a % of shares outstanding greater than or equal to 100%) Change in Short Interest Shares Short as % of Shares Outstanding ETF Name Symbol Last Change in USD Amount Held Short ETF Name Symbol Shares Short / Shrs Out (%) ishares MSCI Emerging Markets ETF EEM 972,687,469 VanEck Vectors Semiconductor ETF SMH ishares Core MSCI Emerging Markets ETF IEMG 787,662,754 ishares North American Tech-Multimedia Networking ETF IGN Industrials Select Sector SPDR XLI 255,251,649 SPDR Retail ETF XRT Vanguard FTSE Developed Markets ETF VEA 253,774,152 ishares North American Tech-Software ETF IGV Vanguard FTSE Emerging Markets ETF VWO 237,092,432 ProShares Short VIX Short-Term Futures ETF SVXY SPDR S&P 500 ETF SPY (1,701,378,313) SPDR S&P Metals & Mining ETF XME 96.9 ishares iboxx $ High Yield Corporate Bond ETF HYG (399,570,267) SPDR Biotech ETF XBI 90.1 Financials Select Sector SPDR XLF (367,980,980) CurrencyShares Euro Trust FXE 85.6 PowerShares QQQ QQQ (352,273,470) SPDR Oil & Gas Exploration & Production ETF XOP 72.0 SPDR Oil & Gas Exploration & Production ETF XOP (307,249,172) CurrencyShares Japanese Yen Trust FXY 64.3 Source: Bloomberg, Morgan Stanley Wealth Management ETF Research. Short Interest data are only reported bi-monthly with a lag. Data compares short interest from 5/31/16 vs. 5/13/16. 6

7 US-Listed ETFs: Most Successful Recent Launches by Assets $9.1 bln in total market cap of ETFs less than 1-year old - The International - Developed ETF category has experienced 71 launches over the last year, by far the most of any segment; over the last 13 weeks, the group has generated net inflows of $550 mln - Notably, US Custom ETFs account for 37% of recently launched market share; many US Custom ETFs are considered smart beta - One hundred and one new ETF listings, 29 closures, and a merger in 2016 The top 10 most successful launches make up 49% of the market cap of ETFs launched over the past year - Five ETF sponsors and two asset classes (equity and fixed income) were represented in the top 10 most successful launches - Despite not cracking the top 10 most successful launches over the past year list, the Principal EDGE Active Income ETF (YLD) generated net inflows of $49 mln last week, the most of any recently launched ETF - The SPDR S&P North American Natural Resources ETF (NANR) is the most successful ETF launch over the past year as measured by market capitalization, at $824 mln Estimated Flows for ETF Launches Over Past Year Net Cash Flow ($ Mil) Mkt Cap Market Investment Objective Funds 1-Week 4-Week 13-Week ($ Mil) Share (%) US Broad-Market US Large-Cap (4) 19 0 US Mid-Cap US Small- & Micro-Cap US Sector & Industry (124) US Custom , US Dividend Income Leveraged/Inverse International - Developed , International - Emerging Global Fixed Income Commodity Currency Active Total ,622 9, Symbol Top 10 Successful Launches Over Past Year Fund Name Mkt Cap ($ Mil) 1-Week Flows ($ Mil) 4-Week Flows ($ Mil) NANR SPDR S&P North American Natural Resources ETF GEM Goldman Sachs ActiveBeta Emerging Markets Equity ETF GSLC Goldman Sachs ActiveBeta U.S. Large Cap Equity ETF ONEV SPDR Russell 1000 Low Volatility Focus ETF PTLC Pacer Trendpilot 750 ETF ONEY SPDR Russell 1000 Yield Focus ETF ONEO SPDR Russell 1000 Momentum Focus ETF VTEB Vanguard Tax-Exempt Bond ETF SHE SPDR SSGA Gender Diversity Index ETF DDWM WisdomTree Dynamic Currency Hedged International Equity Fund Total 4, Source: Bloomberg, Morgan Stanley Wealth Management ETF Research. Data estimated as of 6/10/16 based on daily change in share counts and daily NAVs. 7

8 US-Listed ETFs: New Listings for the Week Symbol Fund Name FITS Health and Fitness ETF 6/9/ Tracks an index of global stocks that are positioned to take advantage of the growing trend toward health and fitness consumption. OLD Long-Term Care ETF 6/9/ Tracks an index of global stocks that are positioned to profit from providing long-term care to an aging population. SLIM Obesity ETF 6/9/ Tracks an index of global stocks that are positioned to profit from the fight against obesity. ORG Organics ETF 6/9/ Tracks an index of global stocks that are positioned to profit from the desire for naturally derived food and personal care items. BEMO Aptus Behavioral Momentum ETF 6/9/ SPDN Direxion Daily S&P 500 Bear 1x Shares 6/8/ Objective: Tracks 1x the inverse daily performance of the S&P 500 Index. RFFC RiverFront Dynamic US Flex-Cap ETF 6/7/ RFDA RiverFront Dynamic US Dividend Advantage ETF 6/7/ Actively managed ETF that owns US stocks selected based on value, quality, and momentum attributes while screening securities for dividend yield. Launch Date Tracks an index of US stocks selected based on momentum and investor behavior; systematically moves to US Treasury exposure upon 10% equity drawdown. Actively managed ETF that owns US stocks selected based on value, quality, and momentum attributes. Expense Ratio (%) Source: Bloomberg, Morgan Stanley Wealth Management ETF Research. 8

9 US-Listed ETFs: News Highlights AdvisorShares Announces Sub-Advisor Change for Float Shrink ETF - In a recent press release, AdvisorShares announced a sub-advisor change for the AdvisorShares TrimTabs Float Shrink ETF (TTFS). - Wilshire Associates will serve as the new sub-advisor of TTFS, which will retain its ticker and be renamed the AdvisorShares Wilshire Buyback ETF, effective 7/1/16. Financial Select Sector SPDR (XLF) to Remove Real Estate - As announced earlier by S&P Dow Jones Indices and MSCI Inc., modifications to the Global Industry Classification Standards (GICS) will divide the current financial sector into two separate sectors: financial services and real estate. - As a result, S&P Dow Jones Indices recently announced modifications to the eligibility rules for the Financial Select Sector Index, which will remove real estate from the financial sector, effective 9/16/16 (previously the Financial Select Sector Index was going to maintain its real estate exposure despite the GICS change). - State Street Global Advisors will rebalance the Financial Select Sector SPDR (XLF) to be consistent with GICS methodology and the index it tracks; on or about 9/16/16 XLF will no longer own real estate. - Prior to 9/16/16, XLF will purchase shares of the Real Estate Select Sector SPDR (XLRE) in order to maintain its real estate exposure. - XLF will make a special distribution, with an ex-date of 9/16/16, in the form of XLRE shares, divesting itself of real estate exposure. Source: Morgan Stanley Wealth Management ETF Research, AdvisorShares, and State Street Global Advisors. 9

10 Recent Reports ETF Semi-Annual Review: $2.2 Trillion in 1,702 ETFs - June 1, Q16 ETF Fund Flows-$32.6 Billion Net Inflows; Slower Start to April 18, 2016 ETF Tracking Error: Tracking Error Reaches Decade Low - February 26, 2016 Introduction to ETFs: Market Strategies & Applications - January 5, Year-End ETF and CEF Tax Strategies - October 7, 2015 ETF Mechanics & Liquidity Update - September 14, 2015 PIMCO Receives Wells Notice on BOND - August 4, 2015 An Introduction to Smart Beta ETFs - July 21, 2015 Morgan Stanley Wealth Management and its affiliates do not provide fundamental research ratings on exchange-traded funds (ETFs). 10

11 Leveraged, Inverse & Leveraged Inverse Conclusions and Risks 1) Leveraged, Inverse, and Leveraged Inverse (L&LI) ETFs generally capture a high percentage of their expected daily returns, particularly on a net asset value basis. L&LI ETFs are not appropriate for all investors. However, we believe they can be appropriate tools for some investors looking to make short-term tactical trades if they perceive a high likelihood of a strong market move occurring in a relatively short time period. In strong trending markets, being on the right side of the trade with L or LI ETFs can lead to very strong returns. Investors should not expect these ETFs to deliver total returns linked to their benchmarks over any period other than daily. The effects of compounding and the daily re-leveraging or de-leveraging that occurs with L&LI ETFs can lead to unexpected results over the long term. As a result, we believe longer-term investors should consider regularly rebalancing positions. 4) Trendless markets, particularly those with a high level of volatility, can lead to substantial relative underperformance of L&LI ETFs. 2) Leveraged and Leveraged Inverse (L&LI) ETFs typically utilize futures and equity swap agreements. The use of these derivative instruments increases risk and enhances the possibility of tracking error. Relative to traditional ETFs, leveraged, inverse and leveraged inverse ETFs typically have higher costs and lower tax efficiency. 3) The effects of compounding can lead to significant deviations from traditional benchmarks over longer time periods. For example, if $100,000 is invested in an index that increases in value by 10% on day one and then decreases in value by 10% on day two, the investment will be worth $110,000 at the end of day one and $99,000 after day two. However, the value of a security that doubles the daily performance of the index would be worth $120,000 on day one and $96,000 after day two. Thus, the index is down 1% after two days, a doubling of which would be down 2%. However, the security attempting to double the return of the index is down 4%. Investors should consider carefully the potential impact over longer periods. MLP and MLP ETF Risks Individual MLPs are publicly traded partnerships that have unique risks related to their structure. These include, but are not limited to, their reliance on the capital markets to fund growth, adverse ruling on the current tax treatment of distributions (typically mostly tax deferred), and commodity volume risk. For tax purposes, MLP ETFs are taxed as C corporations and will be obligated to pay federal and state corporate income taxes on their taxable income, unlike traditional ETFs, which are structured as registered investment companies. These ETFs are likely to exhibit tracking error relative to their index as a result of accounting for deferred tax assets or liabilities (see funds prospectuses). The potential tax benefits from investing in MLPs depend on their being treated as partnerships for federal income tax purposes and, if the MLP is deemed to be a corporation, then its income would be subject to federal taxation at the entity level, reducing the amount of cash available for distribution to the fund which could result in a reduction of the fund s value. MLPs carry interest rate risk and may underperform in a rising interest rate environment. MLP funds accrue deferred income taxes for future tax liabilities associated with the portion of MLP distributions considered to be a tax-deferred return of capital and for any net operating gains as well as capital appreciation of its investments; this deferred tax liability is reflected in the daily NAV; and, as a result, the MLP fund s after-tax performance could differ significantly from the underlying assets even if the pre-tax performance is closely tracked. Commodity ETF Risks Commodity ETFs may be subject to greater volatility than traditional ETFs and can be affected by increased volatility of commodities prices or indexes as well as changes in supply-anddemand relationships, interest rates, monetary and other governmental policies, or factors affecting a particular sector or commodity. Currency ETF Risks Investing in foreign markets entails greater risks than those normally associated with domestic markets, such as political, currency, economic and market risks. Investing in currency involves additional special risks such as credit, interest rate fluctuations, derivative investment risk, and domestic and foreign inflation rates, which can be volatile and may be less liquid than other securities and more sensitive to the effect of varied economic conditions. In addition, international investing entails greater risk, as well as greater potential rewards compared to U.S. investing. These risks include political and economic uncertainties of foreign countries as well as the risk of currency fluctuations. These risks are magnified in countries with emerging markets, since these countries may have relatively unstable governments and less established markets and economies. 11

12 Important Disclosures The information and opinions in Morgan Stanley Wealth Management Research were prepared by Morgan Stanley Smith Barney LLC under its trade name Morgan Stanley Wealth Management. For important disclosures (including copies of historical disclosures) regarding the securities and/or companies that are the subject of this Morgan Stanley Wealth Management Research product, please contact Morgan Stanley Wealth Management Research, 522 Fifth Ave., New York, N.Y , Attention: Research Management. In addition, the same important disclosures, with the exception of the historical disclosures, are contained on the Firm's disclosure website at Historical disclosures will be provided upon request back to June 1, Morgan Stanley Wealth Management Analyst Certification The Morgan Stanley Wealth Management research analysts principally responsible for the preparation and content of all or any identified portion of this research report, hereby certify that their views about the securities and/or companies discussed in this report are accurately expressed and that they have not received and will not receive direct or indirect compensation in exchange for expressing specific recommendations or views in this report. Unless otherwise stated, the individuals listed on the cover page of this report are Morgan Stanley Wealth Management research analysts. Global Research Conflict Management Policy Morgan Stanley Wealth Management has a Conflict Management policy available at: Important US Regulatory Disclosures on Subject Issuers The following analyst or strategist (or a household member) owns securities (or related derivatives), ETFs, or Closed-End funds that he or she covers or recommends in Morgan Stanley Wealth Management Research: John Duggan - CurrencyShares Japanese Yen Trust, First Trust ISE-Revere Natural Gas Index, ishares Gold Trust, ishares MSCI Brazil Capped ETF, ishares MSCI South Korea Capped ETF, ishares MSCI Switzerland Capped ETF, ishares National AMT-Free Muni Bond ETF, ishares Russell 3000 ETF, ishares Silver Trust, PowerShares DB Agriculture Fund, PowerShares DB US Dollar Index Bearish Fund, SPDR Dow Jones Industrial Average ETF, SPDR Gold Trust, Vanguard FTSE All-World ex-us ETF. Morgan Stanley Wealth Management or an affiliate beneficially owned 1% or more of a class of common equity securities of: ishares iboxx $ Invt Grade Corp Bond ETF, PIMCO 0-5 Year High Yield Corporate Bond Index Fund, PIMCO 1-5 Year U.S. TIPS Index Fund, PIMCO Enhanced Short Maturity Strat Fund, PIMCO Intermediate Muni Bond Strat Fund, PIMCO Low Duration Active ETF, PIMCO Short Term Municipal Bond Strategy, PIMCO Total Return Active ETF. Within the last 12 months, Morgan Stanley Wealth Management or an affiliate received compensation for investment banking services from the following issuers (if the security is an ETF or Closed- End Fund, the compensation is from the fund's investment manager or advisor): First Trust Dow Jones Internet Indx Fund, First Trust Global Tactical Commodity Strategy Fund, First Trust ISE-Revere Natural Gas Index, First Trust Large Cap Core AlphaDEX Fund, First Trust Long/Short Equity ETF, First Trust Mid Cap Core AlphaDEX Fund, First Trust Morningstar Dividend Leaders Index Fund, First Trust North American Energy Infrastructure Fund, First Trust Preferred Securities and Income ETF, First Trust Tactical High Yield ETF, Victory CEMP US 500 Enhanced Volatility Weighted Index ETF. In the next 3 months, Morgan Stanley Wealth Management or an affiliate will seek compensation for investment banking services from the following issuers (if the security is an ETF or Closed-End Fund, the compensation is from the fund's investment manager or advisor): Consumer Discretionary Select Sector, Consumer Staples Select Sector SPDR, Energy Select Sector SPDR, Fidelity Limited Term Bond ETF, Financials Select Sector SPDR, FlexShares Morningstar Global Upstream Natural Resources, Fresco Dow Jones Euro STOXX 50 Fund, Health Care Select Sector SPDR, Industrials Select Sector SPDR, Market Vectors Agribusiness ETF, Market Vectors Brazil Small-Cap ETF, Market Vectors Coal ETF, Market Vectors Emerging Mkts Local CCY, Market Vectors Global Alternative Energy, Market Vectors Gold Miners ETF, Market Vectors Hard Assets Producers ETF, Market Vectors High Yield Muni Index ETF, Market Vectors Indonesia Index ETF, Market Vectors Intermediate Muni Index, Market Vectors Junior Gold Miners ETF, Market Vectors Oil Services ETF, Market Vectors Pharmaceutical ETF, Market Vectors Russia ETF, Market Vectors Semiconductor ETF, Market Vectors Vietnam ETF, Materials Select Sector SPDR, PIMCO 0-5 Year High Yield Corporate Bond Index Fund, PIMCO 1-5 Year U.S. TIPS Index Fund, PIMCO Enhanced Short Maturity Strat Fund, PIMCO Intermediate Muni Bond Strat Fund, PIMCO Low Duration Active ETF, PIMCO Short Term Municipal Bond Strategy, PIMCO Total Return Active ETF, SPDR Barclays 1-3 Month T- Bill ETF, SPDR Barclays Convertible Bond ETF, SPDR Barclays High Yield Bond ETF, SPDR Barclays Intl Treasury Bond ETF, SPDR Barclays Municipal Bond ETF, SPDR Barclays Short Term Corporate Bond ETF, SPDR Barclays Short Term High Yield Bond ETF, SPDR Barclays Short Term Municipal Bond, SPDR Biotech ETF, SPDR Blackstone/GSO Senior Loan ETF, SPDR DB Intl 12

13 Gov't Inflation-Protected, SPDR DoubleLine Total Return Tactical ETF, SPDR Dow Jones Global Real Estate ETF, SPDR Dow Jones Intl Real Estate ETF, SPDR Dow Jones REIT ETF, SPDR Oil & Gas Equipment & Services ETF, SPDR Oil & Gas Exploration & Production, SPDR Retail ETF, SPDR S&P 500 ETF, SPDR S&P 600 Small Cap ETF, SPDR S&P Bank ETF, SPDR S&P China ETF, SPDR S&P Dividend ETF, SPDR S&P Emerging Asia Pacific ETF, SPDR S&P Emerging Markets Small Cap ETF, SPDR S&P Homebuilders ETF, SPDR S&P International Dividend ETF, SPDR S&P International Small Cap ETF, SPDR S&P Metals & Mining ETF, SPDR S&P MidCap 400 ETF, SPDR S&P Pharmaceuticals ETF, SPDR S&P Regional Banking ETF, Technology Select Sector SPDR, Utilities Select Sector SPDR, VanEck Vectors Egypt Index ETF, VanEck Vectors Morningstar Wide Moat ETF, VanEck Vectors Pre-Refunded Municipal Index ETF, Vanguard 500 Index Fund, Vanguard Consumer Discretionary ETF, Vanguard Consumer Staples ETF, Vanguard Dividend Appreciation ETF, Vanguard Energy ETF, Vanguard Extended Market ETF, Vanguard Financials ETF, Vanguard FTSE All World ex-us Small-Cap, Vanguard FTSE All-World ex-us ETF, Vanguard FTSE Developed Markets ETF, Vanguard FTSE Emerging Markets ETF, Vanguard FTSE Europe ETF, Vanguard FTSE Pacific ETF, Vanguard Growth ETF, Vanguard Health Care ETF, Vanguard High Dividend Yield ETF, Vanguard Industrials ETF, Vanguard Information Technology ETF, Vanguard Intermediate-Term Bond ETF, Vanguard Intermediate-Term Corporate Bond ETF, Vanguard Large-Cap ETF, Vanguard Long-Term Bond ETF, Vanguard Long-Term Corporate Bond ETF, Vanguard Materials ETF, Vanguard Mid-Cap ETF, Vanguard Mid-Cap Growth ETF, Vanguard Mid-Cap Value ETF, Vanguard REIT ETF, Vanguard Short-Term Bond ETF, Vanguard Short-Term Corporate Bond ETF, Vanguard Small-Cap ETF, Vanguard Small-Cap Growth ETF, Vanguard Small-Cap Value ETF, Vanguard Telecom Services ETF, Vanguard Total Bond Market ETF, Vanguard Total International Bond ETF, Vanguard Total Stock Market ETF, Vanguard Total World Stock Index Fund, Vanguard Utilities ETF, Vanguard Value ETF, Victory CEMP US 500 Enhanced Volatility Weighted Index ETF. Within the last 12 months, Morgan Stanley Wealth Management or an affiliate has provided or is providing investment banking services to, or has an investment banking client relationship with, the following issuers (if the security is an ETF or Closed-End Fund, the services were or are being provided to, or the relationship is with, the fund's investment manager or advisor): Consumer Discretionary Select Sector, Consumer Staples Select Sector SPDR, Energy Select Sector SPDR, Fidelity Limited Term Bond ETF, Financials Select Sector SPDR, First Trust Dow Jones Internet Indx Fund, First Trust Global Tactical Commodity Strategy Fund, First Trust ISE-Revere Natural Gas Index, First Trust Large Cap Core AlphaDEX Fund, First Trust Long/Short Equity ETF, First Trust Mid Cap Core AlphaDEX Fund, First Trust Morningstar Dividend Leaders Index Fund, First Trust North American Energy Infrastructure Fund, First Trust Preferred Securities and Income ETF, First Trust Tactical High Yield ETF, FlexShares Morningstar Global Upstream Natural Resources, Fresco Dow Jones Euro STOXX 50 Fund, Health Care Select Sector SPDR, Industrials Select Sector SPDR, Market Vectors Agribusiness ETF, Market Vectors Brazil Small-Cap ETF, Market Vectors Coal ETF, Market Vectors Emerging Mkts Local CCY, Market Vectors Global Alternative Energy, Market Vectors Gold Miners ETF, Market Vectors Hard Assets Producers ETF, Market Vectors High Yield Muni Index ETF, Market Vectors Indonesia Index ETF, Market Vectors Intermediate Muni Index, Market Vectors Junior Gold Miners ETF, Market Vectors Oil Services ETF, Market Vectors Pharmaceutical ETF, Market Vectors Russia ETF, Market Vectors Semiconductor ETF, Market Vectors Vietnam ETF, Materials Select Sector SPDR, PIMCO 0-5 Year High Yield Corporate Bond Index Fund, PIMCO 1-5 Year U.S. TIPS Index Fund, PIMCO Enhanced Short Maturity Strat Fund, PIMCO Intermediate Muni Bond Strat Fund, PIMCO Low Duration Active ETF, PIMCO Short Term Municipal Bond Strategy, PIMCO Total Return Active ETF, SPDR Barclays 1-3 Month T-Bill ETF, SPDR Barclays Convertible Bond ETF, SPDR Barclays High Yield Bond ETF, SPDR Barclays Intl Treasury Bond ETF, SPDR Barclays Municipal Bond ETF, SPDR Barclays Short Term Corporate Bond ETF, SPDR Barclays Short Term High Yield Bond ETF, SPDR Barclays Short Term Municipal Bond, SPDR Biotech ETF, SPDR Blackstone/GSO Senior Loan ETF, SPDR DB Intl Gov't Inflation-Protected, SPDR DoubleLine Total Return Tactical ETF, SPDR Dow Jones Global Real Estate ETF, SPDR Dow Jones Intl Real Estate ETF, SPDR Dow Jones REIT ETF, SPDR Oil & Gas Equipment & Services ETF, SPDR Oil & Gas Exploration & Production, SPDR Retail ETF, SPDR S&P 500 ETF, SPDR S&P 600 Small Cap ETF, SPDR S&P Bank ETF, SPDR S&P China ETF, SPDR S&P Dividend ETF, SPDR S&P Emerging Asia Pacific ETF, SPDR S&P Emerging Markets Small Cap ETF, SPDR S&P Homebuilders ETF, SPDR S&P International Dividend ETF, SPDR S&P International Small Cap ETF, SPDR S&P Metals & Mining ETF, SPDR S&P MidCap 400 ETF, SPDR S&P Pharmaceuticals ETF, SPDR S&P Regional Banking ETF, Technology Select Sector SPDR, Utilities Select Sector SPDR, VanEck Vectors Egypt Index ETF, VanEck Vectors Morningstar Wide Moat ETF, VanEck Vectors Pre-Refunded Municipal Index ETF, Vanguard 500 Index Fund, Vanguard Consumer Discretionary ETF, Vanguard Consumer Staples ETF, Vanguard Dividend Appreciation ETF, Vanguard Energy ETF, Vanguard Extended Market ETF, Vanguard Financials ETF, Vanguard FTSE All World ex-us Small-Cap, Vanguard FTSE All-World ex-us ETF, Vanguard FTSE Developed Markets ETF, Vanguard FTSE Emerging Markets ETF, Vanguard FTSE Europe ETF, Vanguard FTSE Pacific ETF, Vanguard Growth ETF, Vanguard Health Care ETF, Vanguard High Dividend Yield ETF, Vanguard Industrials ETF, Vanguard Information Technology ETF, Vanguard Intermediate-Term Bond ETF, Vanguard Intermediate-Term Corporate Bond ETF, Vanguard Large-Cap ETF, Vanguard Long-Term Bond ETF, Vanguard Long-Term Corporate Bond ETF, Vanguard Materials ETF, Vanguard Mid-Cap ETF, Vanguard Mid-Cap Growth ETF, Vanguard Mid-Cap Value ETF, Vanguard REIT ETF, Vanguard Short-Term Bond ETF, Vanguard Short-Term Corporate Bond ETF, Vanguard Small-Cap ETF, Vanguard Small-Cap Growth ETF, Vanguard Small-Cap Value ETF, Vanguard Telecom Services ETF, Vanguard Total Bond Market ETF, Vanguard Total International Bond ETF, Vanguard Total Stock Market ETF, Vanguard Total World Stock Index Fund, Vanguard Utilities ETF, Vanguard Value ETF, Victory CEMP US 500 Enhanced Volatility Weighted Index ETF. Within the last 12 months, Morgan Stanley Wealth Management has received compensation for products or services other than investment banking services from the following issuers (if the security is an ETF or Closed-End Fund, the compensation is from the fund's investment manager or advisor): ALPS Sector Dividend Dogs ETF, Consumer Discretionary Select Sector, Consumer Staples Select Sector SPDR, Direxion Daily Financial Bear 3x Shares, Direxion Daily Financial Bull 3x Shares, EGShares Beyond BRICs ETF, EGShares India Consumer ETF, Energy Select Sector SPDR, Fidelity Limited Term Bond ETF, Financials Select Sector SPDR, FlexShares Morningstar Global Upstream Natural Resources, FlexShares STOXX Global Broad Infrastructure Index Fund, Guggenheim BRIC ETF, Guggenheim BulletShares 2018 Corporate Bond ETF, Guggenheim China Small Cap ETF, Guggenheim Enhanced Short Duration Bond ETF, Guggenheim Multi-Asset Income ETF, Guggenheim Russell Top 50 Mega Cap ETF, Guggenheim S&P 500 Pure Growth ETF, Guggenheim S&P 500 Pure Value ETF, Guggenheim S&P Equal Weight ETF, Guggenheim S&P Global Water 13

14 Index ETF, Guggenheim Solar ETF, Health Care Select Sector SPDR, Industrials Select Sector SPDR, IQ Global Resources ETF, IQ Hedge Multi-Strategy Tracker ETF, IQ Merger Arbitrage ETF, ishares 1-3 Year Credit Bond ETF, ishares 1-3 Year Treasury Bond ETF, ishares 3-7 Year Treasury Bond ETF, ishares 7-10 Year Treasury Bond ETF, ishares Agency Bond ETF, ishares Barclays 20 Year Treasury Bond F, ishares China Large-Cap ETF, ishares Cohen & Steers REIT ETF, ishares Core High Dividend ETF, ishares Core MSCI EAFE ETF, ishares Core MSCI Emerging Markets ETF, ishares Core S&P 500 ETF, ishares Core S&P Mid-Cap ETF, ishares Core S&P Small-Cap ETF, ishares Core Total US Bond Market ETF, ishares Core US Growth ETF, ishares Core US Value ETF, ishares Dow Jones U.S. ETF, ishares Edge MSCI Min Vol EAFE ETF, ishares Edge MSCI Min Vol Global ETF, ishares Edge MSCI Min Vol USA ETF, ishares Edge MSCI USA Momentum Factor ETF, ishares Edge MSCI USA Quality Factor ETF, ishares Europe ETF, ishares Floating Rate Bond ETF, ishares Global 100 ETF, ishares Global Consumer Discretionary ETF, ishares Global Consumer Staples ETF, ishares Global Energy ETF, ishares Global Financials ETF, ishares Global Healthcare ETF, ishares Global Industrials ETF, ishares Global Infrastructure ETF, ishares Global Materials ETF, ishares Global Tech ETF, ishares Global Telecom ETF, ishares Global Utilities ETF, ishares Gold Trust, ishares iboxx $ High Yield Corp Bond ETF, ishares iboxx $ Invt Grade Corp Bond ETF, ishares Intermediate Credit Bond ETF, ishares International High Yield Bond ETF, ishares International Treasury Bond ETF, ishares Intl Select Dividend ETF, ishares J.P. Morgan USD Emerging Mkts, ishares Latin America 40 ETF, ishares MBS ETF, ishares Micro-Cap ETF, ishares Morningstar Large-Cap Growth ETF, ishares Morningstar Large-Cap Value ETF, ishares Morningstar Mid-Cap Growth ETF, ishares Morningstar Mid-Cap Value ETF, ishares MSCI ACWI ETF, ishares MSCI ACWI ex U.S. ETF, ishares MSCI All Country Asia ex Japan ETF, ishares MSCI All Peru Capped ETF, ishares MSCI Australia ETF, ishares MSCI Brazil Capped ETF, ishares MSCI BRIC ETF, ishares MSCI Canada ETF, ishares MSCI Chile Capped ETF, ishares MSCI China ETF, ishares MSCI EAFE ETF, ishares MSCI EAFE Growth ETF, ishares MSCI EAFE Small-Cap ETF, ishares MSCI EAFE Value ETF, ishares MSCI Emerging Markets ETF, ishares MSCI Emerging Mkts Min Vol, ishares MSCI EMU ETF, ishares MSCI Europe Financials ETF, ishares MSCI France ETF, ishares MSCI Frontier 100 ETF, ishares MSCI Germany ETF, ishares MSCI Hong Kong ETF, ishares MSCI India ETF, ishares MSCI Indonesia ETF, ishares MSCI Israel Capped ETF, ishares MSCI Italy Capped ETF, ishares MSCI Japan ETF, ishares MSCI KLD 400 Social ETF, ishares MSCI Malaysia ETF, ishares MSCI Mexico Capped ETF, ishares MSCI Pacific ex Japan ETF, ishares MSCI Philippines ETF, ishares MSCI Poland Capped ETF, ishares MSCI Russia Capped ETF, ishares MSCI Singapore ETF, ishares MSCI South Africa ETF, ishares MSCI South Korea Capped ETF, ishares MSCI Spain Capped ETF, ishares MSCI Sweden ETF, ishares MSCI Switzerland Capped ETF, ishares MSCI Taiwan ETF, ishares MSCI Thailand Capped ETF, ishares MSCI Turkey ETF, ishares MSCI United Kingdom ETF, ishares Nasdaq Biotechnology ETF, ishares National AMT-Free Muni Bond ETF, ishares North American Natural Resources, ishares North American Tech ETF, ishares North American Tech-Software ETF, ishares PHLX Semiconductor ETF, ishares Residential Real Estate Capped ETF, ishares Russell 1000 ETF, ishares Russell 1000 Growth ETF, ishares Russell 1000 Value ETF, ishares Russell 2000 ETF, ishares Russell 2000 Growth ETF, ishares Russell 2000 Value ETF, ishares Russell 3000 ETF, ishares Russell Mid-Cap ETF, ishares Russell Mid-Cap Growth ETF, ishares Russell Mid-Cap Value ETF, ishares S&P 100 ETF, ishares S&P 500 Growth ETF, ishares S&P 500 Value ETF, ishares S&P GSCI Commodity-Indexed Trust, ishares S&P Mid-Cap 400 Growth ETF, ishares S&P Mid-Cap 400 Value ETF, ishares S&P Small-Cap 600 Growth ETF, ishares S&P Small-Cap 600 Value ETF, ishares Select Dividend ETF, ishares Short Maturity Bond ETF, ishares Short Treasury Bond ETF, ishares Short-Term Natl AMT-Free Muni, ishares Silver Trust, ishares TIPS Bond ETF, ishares Transportation Average ETF, ishares U.S. Aerospace & Defense ETF, ishares U.S. Basic Materials ETF, ishares U.S. Broker-Dealers ETF, ishares U.S. Consumer Goods ETF, ishares U.S. Consumer Services ETF, ishares U.S. Energy ETF, ishares U.S. Financial Services ETF, ishares U.S. Financials ETF, ishares U.S. Healthcare ETF, ishares U.S. Home Construction ETF, ishares U.S. Industrials ETF, ishares U.S. Medical Devices ETF, ishares U.S. Oil & Gas Exp & Prod ETF, ishares U.S. Oil Equip & Services ETF, ishares U.S. Preferred Stock ETF, ishares U.S. Real Estate ETF, ishares U.S. Technology ETF, ishares U.S. Telecommunications ETF, ishares U.S. Utilities ETF, Market Vectors Agribusiness ETF, Market Vectors Brazil Small-Cap ETF, Market Vectors Coal ETF, Market Vectors Emerging Mkts Local CCY, Market Vectors Global Alternative Energy, Market Vectors Gold Miners ETF, Market Vectors Hard Assets Producers ETF, Market Vectors High Yield Muni Index ETF, Market Vectors Indonesia Index ETF, Market Vectors Intermediate Muni Index, Market Vectors Junior Gold Miners ETF, Market Vectors Oil Services ETF, Market Vectors Pharmaceutical ETF, Market Vectors Russia ETF, Market Vectors Semiconductor ETF, Market Vectors Vietnam ETF, Materials Select Sector SPDR, Peritus High Yield ETF, PIMCO 0-5 Year High Yield Corporate Bond Index Fund, PIMCO 1-5 Year U.S. TIPS Index Fund, PIMCO Enhanced Short Maturity Strat Fund, PIMCO Intermediate Muni Bond Strat Fund, PIMCO Low Duration Active ETF, PIMCO Short Term Municipal Bond Strategy, PIMCO Total Return Active ETF, PowerShares Build America Bond Portfolio, PowerShares BuyBack Achievers Portfolio, PowerShares DB Agriculture Fund, PowerShares DB Base Metals Fund, PowerShares DB Oil Fund, PowerShares DWA Emerging Markets Technical Leaders Portfolio, PowerShares Dynamic Large Cap Value, PowerShares Dynamic Large-Cap Growth, PowerShares Dynamic Market Portfolio, PowerShares Emerging Markets Sovereign Debt Portfolio, PowerShares Financial Pref Portfolio, PowerShares FTSE RAFI US 1000 Portfolio, PowerShares FTSE RAFI US 1500 Small-Mid Portfolio, PowerShares Gbl Clean Energy Portfolio, PowerShares Global Listed Private Equity Portfolio, PowerShares Global Water Portfolio, PowerShares Intl Div Achievers Portfolio, PowerShares Multi-Strategy Alternative Portfolio, PowerShares Preferred Portfolio, PowerShares QQQ, PowerShares S&P 500 BuyWrite Portfolio, PowerShares S&P 500 High Dividend Low Volatility Portfolio, PowerShares S&P 500 Low Volatility Portf, PowerShares Senior Loan Portfolio, PowerShares VRDO Tax-Free Wkly Portfolio, PowerShares Water Resources Portfolio, PowerShares WilderHill Clean Energy, SPDR Barclays 1-3 Month T- Bill ETF, SPDR Barclays Intl Treasury Bond ETF, Technology Select Sector SPDR, Utilities Select Sector SPDR, VanEck Vectors Egypt Index ETF, VanEck Vectors Morningstar Wide Moat ETF, VanEck Vectors Pre-Refunded Municipal Index ETF, Vanguard 500 Index Fund, Vanguard Consumer Discretionary ETF, Vanguard Consumer Staples ETF, Vanguard Dividend Appreciation ETF, Vanguard Energy ETF, Vanguard Extended Market ETF, Vanguard Financials ETF, Vanguard FTSE All World ex-us Small-Cap, Vanguard FTSE All-World ex-us ETF, Vanguard FTSE Developed Markets ETF, Vanguard FTSE Emerging Markets ETF, Vanguard FTSE Europe ETF, Vanguard FTSE Pacific ETF, Vanguard Growth ETF, Vanguard Health Care ETF, Vanguard High Dividend Yield ETF, Vanguard Industrials ETF, Vanguard Information Technology ETF, Vanguard Intermediate-Term Bond ETF, Vanguard Intermediate-Term Corporate Bond ETF, Vanguard Large-Cap ETF, Vanguard Long-Term Bond ETF, Vanguard Long-Term Corporate Bond ETF, Vanguard Materials ETF, Vanguard Mid-Cap ETF, Vanguard Mid-Cap Growth ETF, Vanguard Mid-Cap Value ETF, 14

15 Vanguard REIT ETF, Vanguard Short-Term Bond ETF, Vanguard Short-Term Corporate Bond ETF, Vanguard Small-Cap ETF, Vanguard Small-Cap Growth ETF, Vanguard Small-Cap Value ETF, Vanguard Telecom Services ETF, Vanguard Total Bond Market ETF, Vanguard Total International Bond ETF, Vanguard Total Stock Market ETF, Vanguard Total World Stock Index Fund, Vanguard Utilities ETF, Vanguard Value ETF, Victory CEMP US 500 Enhanced Volatility Weighted Index ETF. Within the last 12 months, Morgan Stanley Wealth Management has either provided or is providing non-investment banking, securities-related services to and/or in the past has entered into an agreement to provide services or has a client relationship with the following issuers (if the security is an ETF or Closed-End Fund, the services were or are being provided to, or the agreement is with, the fund's investment manager or advisor): ALPS Sector Dividend Dogs ETF, Consumer Discretionary Select Sector, Consumer Staples Select Sector SPDR, Direxion Daily Financial Bear 3x Shares, Direxion Daily Financial Bull 3x Shares, EGShares Beyond BRICs ETF, EGShares India Consumer ETF, Energy Select Sector SPDR, Fidelity Limited Term Bond ETF, Financials Select Sector SPDR, FlexShares Morningstar Global Upstream Natural Resources, FlexShares STOXX Global Broad Infrastructure Index Fund, Guggenheim BRIC ETF, Guggenheim BulletShares 2018 Corporate Bond ETF, Guggenheim China Small Cap ETF, Guggenheim Enhanced Short Duration Bond ETF, Guggenheim Multi-Asset Income ETF, Guggenheim Russell Top 50 Mega Cap ETF, Guggenheim S&P 500 Pure Growth ETF, Guggenheim S&P 500 Pure Value ETF, Guggenheim S&P Equal Weight ETF, Guggenheim S&P Global Water Index ETF, Guggenheim Solar ETF, Health Care Select Sector SPDR, Industrials Select Sector SPDR, IQ Global Resources ETF, IQ Hedge Multi-Strategy Tracker ETF, IQ Merger Arbitrage ETF, ishares 1-3 Year Credit Bond ETF, ishares 1-3 Year Treasury Bond ETF, ishares 3-7 Year Treasury Bond ETF, ishares 7-10 Year Treasury Bond ETF, ishares Agency Bond ETF, ishares Barclays 20 Year Treasury Bond F, ishares China Large-Cap ETF, ishares Cohen & Steers REIT ETF, ishares Core High Dividend ETF, ishares Core MSCI EAFE ETF, ishares Core MSCI Emerging Markets ETF, ishares Core S&P 500 ETF, ishares Core S&P Mid- Cap ETF, ishares Core S&P Small-Cap ETF, ishares Core Total US Bond Market ETF, ishares Core US Growth ETF, ishares Core US Value ETF, ishares Dow Jones U.S. ETF, ishares Edge MSCI Min Vol EAFE ETF, ishares Edge MSCI Min Vol Global ETF, ishares Edge MSCI Min Vol USA ETF, ishares Edge MSCI USA Momentum Factor ETF, ishares Edge MSCI USA Quality Factor ETF, ishares Europe ETF, ishares Floating Rate Bond ETF, ishares Global 100 ETF, ishares Global Consumer Discretionary ETF, ishares Global Consumer Staples ETF, ishares Global Energy ETF, ishares Global Financials ETF, ishares Global Healthcare ETF, ishares Global Industrials ETF, ishares Global Infrastructure ETF, ishares Global Materials ETF, ishares Global Tech ETF, ishares Global Telecom ETF, ishares Global Utilities ETF, ishares Gold Trust, ishares iboxx $ High Yield Corp Bond ETF, ishares iboxx $ Invt Grade Corp Bond ETF, ishares Intermediate Credit Bond ETF, ishares International High Yield Bond ETF, ishares International Treasury Bond ETF, ishares Intl Select Dividend ETF, ishares J.P. Morgan USD Emerging Mkts, ishares Latin America 40 ETF, ishares MBS ETF, ishares Micro-Cap ETF, ishares Morningstar Large-Cap Growth ETF, ishares Morningstar Large-Cap Value ETF, ishares Morningstar Mid-Cap Growth ETF, ishares Morningstar Mid-Cap Value ETF, ishares MSCI ACWI ETF, ishares MSCI ACWI ex U.S. ETF, ishares MSCI All Country Asia ex Japan ETF, ishares MSCI All Peru Capped ETF, ishares MSCI Australia ETF, ishares MSCI Brazil Capped ETF, ishares MSCI BRIC ETF, ishares MSCI Canada ETF, ishares MSCI Chile Capped ETF, ishares MSCI China ETF, ishares MSCI EAFE ETF, ishares MSCI EAFE Growth ETF, ishares MSCI EAFE Small-Cap ETF, ishares MSCI EAFE Value ETF, ishares MSCI Emerging Markets ETF, ishares MSCI Emerging Mkts Min Vol, ishares MSCI EMU ETF, ishares MSCI Europe Financials ETF, ishares MSCI France ETF, ishares MSCI Frontier 100 ETF, ishares MSCI Germany ETF, ishares MSCI Hong Kong ETF, ishares MSCI India ETF, ishares MSCI Indonesia ETF, ishares MSCI Israel Capped ETF, ishares MSCI Italy Capped ETF, ishares MSCI Japan ETF, ishares MSCI KLD 400 Social ETF, ishares MSCI Malaysia ETF, ishares MSCI Mexico Capped ETF, ishares MSCI Pacific ex Japan ETF, ishares MSCI Philippines ETF, ishares MSCI Poland Capped ETF, ishares MSCI Russia Capped ETF, ishares MSCI Singapore ETF, ishares MSCI South Africa ETF, ishares MSCI South Korea Capped ETF, ishares MSCI Spain Capped ETF, ishares MSCI Sweden ETF, ishares MSCI Switzerland Capped ETF, ishares MSCI Taiwan ETF, ishares MSCI Thailand Capped ETF, ishares MSCI Turkey ETF, ishares MSCI United Kingdom ETF, ishares Nasdaq Biotechnology ETF, ishares National AMT-Free Muni Bond ETF, ishares North American Natural Resources, ishares North American Tech ETF, ishares North American Tech-Software ETF, ishares PHLX Semiconductor ETF, ishares Residential Real Estate Capped ETF, ishares Russell 1000 ETF, ishares Russell 1000 Growth ETF, ishares Russell 1000 Value ETF, ishares Russell 2000 ETF, ishares Russell 2000 Growth ETF, ishares Russell 2000 Value ETF, ishares Russell 3000 ETF, ishares Russell Mid-Cap ETF, ishares Russell Mid-Cap Growth ETF, ishares Russell Mid-Cap Value ETF, ishares S&P 100 ETF, ishares S&P 500 Growth ETF, ishares S&P 500 Value ETF, ishares S&P GSCI Commodity-Indexed Trust, ishares S&P Mid-Cap 400 Growth ETF, ishares S&P Mid-Cap 400 Value ETF, ishares S&P Small-Cap 600 Growth ETF, ishares S&P Small-Cap 600 Value ETF, ishares Select Dividend ETF, ishares Short Maturity Bond ETF, ishares Short Treasury Bond ETF, ishares Short-Term Natl AMT-Free Muni, ishares Silver Trust, ishares TIPS Bond ETF, ishares Transportation Average ETF, ishares U.S. Aerospace & Defense ETF, ishares U.S. Basic Materials ETF, ishares U.S. Broker-Dealers ETF, ishares U.S. Consumer Goods ETF, ishares U.S. Consumer Services ETF, ishares U.S. Energy ETF, ishares U.S. Financial Services ETF, ishares U.S. Financials ETF, ishares U.S. Healthcare ETF, ishares U.S. Home Construction ETF, ishares U.S. Industrials ETF, ishares U.S. Medical Devices ETF, ishares U.S. Oil & Gas Exp & Prod ETF, ishares U.S. Oil Equip & Services ETF, ishares U.S. Preferred Stock ETF, ishares U.S. Real Estate ETF, ishares U.S. Technology ETF, ishares U.S. Telecommunications ETF, ishares U.S. Utilities ETF, Market Vectors Agribusiness ETF, Market Vectors Brazil Small- Cap ETF, Market Vectors Coal ETF, Market Vectors Emerging Mkts Local CCY, Market Vectors Global Alternative Energy, Market Vectors Gold Miners ETF, Market Vectors Hard Assets Producers ETF, Market Vectors High Yield Muni Index ETF, Market Vectors Indonesia Index ETF, Market Vectors Intermediate Muni Index, Market Vectors Junior Gold Miners ETF, Market Vectors Oil Services ETF, Market Vectors Pharmaceutical ETF, Market Vectors Russia ETF, Market Vectors Semiconductor ETF, Market Vectors Vietnam ETF, Materials Select Sector SPDR, Peritus High Yield ETF, PIMCO 0-5 Year High Yield Corporate Bond Index Fund, PIMCO 1-5 Year U.S. TIPS Index Fund, PIMCO Enhanced Short Maturity Strat Fund, PIMCO Intermediate Muni Bond Strat Fund, PIMCO Low Duration Active ETF, PIMCO Short Term Municipal Bond Strategy, PIMCO Total Return Active ETF, PowerShares Build America Bond Portfolio, PowerShares BuyBack Achievers Portfolio, PowerShares DB Agriculture Fund, PowerShares DB Base Metals Fund, PowerShares DB Oil Fund, PowerShares DWA Emerging Markets Technical Leaders Portfolio, PowerShares Dynamic Large 15