UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number | 811-22255 | |||||||
| ||||||||
Columbia ETF Trust II | ||||||||
(Exact name of registrant as specified in charter) | ||||||||
| ||||||||
225 Franklin Street Boston, |
| MA 02110 | ||||||
(Address of principal executive offices) |
| (Zip code) | ||||||
| ||||||||
Christopher O. Petersen, Esq. c/o Columbia Management Investment Advisers, LLC 225 Franklin Street Boston, Massachusetts 02110
Ryan C. Larrenaga, Esq. c/o Columbia Management Investment Advisers, LLC 225 Franklin Street Boston, MA 02110 | ||||||||
(Name and address of agent for service) | ||||||||
| ||||||||
Registrant’s telephone number, including area code: | (800) 345-6611 |
| ||||||
| ||||||||
Date of fiscal year end: | March 31 |
| ||||||
| ||||||||
Date of reporting period: | September 30, 2018 |
| ||||||
Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget (“OMB”) control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.
Item 1. Reports to Stockholders.
SEMIANNUAL REPORT
September 30, 2018
COLUMBIA ETF TRUST II
Columbia Beyond BRICs ETF
Columbia EM Core ex-China ETF
Columbia EM Quality Dividend ETF
Columbia Emerging Markets Consumer ETF
Columbia India Consumer ETF
Columbia India Infrastructure ETF
Columbia India Small Cap ETF
PRESIDENT'S MESSAGE
Dear Shareholders,
Volatility exists in financial markets and this is not a comfortable fact of life. How investors deal with this reality, including how they react to short term spikes in volatility as well as to longer periods of increased or decreased volatility, may have a significant impact on their overall investing success.
Too often, investors change their investment strategy based on something that's happening at a moment in time rather than thinking about how that change in strategy might affect their ability to achieve their longer-term financial goals. Emotion replaces logic and reasoning. Investors may sell in reaction to a market drop (fear or panic), locking in low returns which means they won't be invested when the market returns, or they invest more at a market peak (greed or conviction), essentially when it is expensive to do so. In both cases, selling and buying at the exact wrong time.
We believe the best outcomes come from a consistent approach to investing. Here are five areas where advisors can help us overcome the tendency to react emotionally as we struggle to make the right choices with our investments:
Long-term focus
The further away long-term goals, aspirations and objectives are, the easier it is to stray away from the goals and priorities that we set out. Advisors help us stay focused on what we want to accomplish.
Discipline through up-and-down markets
Advisors help set rules to prevent us from making rash decisions that we may regret later. Knowing ahead of time what you should do in case of certain situations will help you get through volatile markets and not make emotional decisions.
Tax-awareness
Taxes are one of the biggest drags on investment returns and are critical attributes of investing. Yet few of us take the necessary steps to ease the corrosive effect of taxes. Advisors have tools and knowledge that may help us to manage portfolios more tax-efficiently and keep more of what we earn.
Emotional objectivity
Our emotions are very hard to manage and making investment decisions in an emotional state can lead to exceedingly bad outcomes. An objective advisor can help prevent some of the reactionary mistakes emotions often lead us to.
Education and guidance
The role of the advisor is to teach and guide us toward achieving our financial goals. In terms of working through emotions, guidance is by far the most important component.
By understanding our own behaviors and biases, we can prepare for future challenges. Your success is our priority. Talk to your advisor about how working with Columbia Threadneedle Investments may help you stay the course and position your portfolio for consistent, sustainable outcomes, regardless of market conditions.
Sincerely,
Christopher O. Petersen
President, Columbia ETF Trust II
Columbia ETF Trust II is managed by Columbia Management Investment Advisers, LLC and is distributed by ALPS Distributors, Inc., which is not affiliated with Columbia Management Investment Advisers, LLC or its parent company, Ameriprise Financial, Inc.
© 2018 Columbia Management Investment Advisers, LLC. All rights reserved.
Columbia ETF Trust II | Semiannual Report 2018
TABLE OF CONTENTS
Columbia Beyond BRICs ETF | |||||||
Fund at a Glance | 2 | ||||||
Columbia EM Core ex-China ETF | |||||||
Fund at a Glance | 4 | ||||||
Columbia EM Quality Dividend ETF | |||||||
Fund at a Glance | 6 | ||||||
Columbia Emerging Markets Consumer ETF | |||||||
Fund at a Glance | 8 | ||||||
Columbia India Consumer ETF | |||||||
Fund at a Glance | 10 | ||||||
Columbia India Infrastructure ETF | |||||||
Fund at a Glance | 12 | ||||||
Columbia India Small Cap ETF | |||||||
Fund at a Glance | 14 | ||||||
Understanding Your Fund's Expenses | 16 | ||||||
Frequency Distribution of Premiums and Discounts | 17 | ||||||
Portfolio of Investments | 19 | ||||||
Statement of Assets and Liabilities | 42 | ||||||
Statement of Operations | 45 | ||||||
Statement of Changes in Net Assets | 48 | ||||||
Financial Highlights | 52 | ||||||
Notes to Financial Statements | 59 | ||||||
Approval of Investment Management Services Agreement | 70 | ||||||
Additional Information | 73 |
Columbia ETF Trust II | Semiannual Report 2018
FUND AT A GLANCE
Columbia Beyond BRICs ETF
(Unaudited)
Investment objective
Columbia Beyond BRICs ETF (the Fund) seeks investment results that correspond (before fees and expenses) to the price and yield performance of the FTSE Beyond BRICs Net of Tax Index.
Portfolio management
Christopher Lo, CFA
Portfolio Manager
Managed Fund since 2016
Average annual total returns (%) (for period ended September 30, 2018)
Inception | 6 Months cumulative | 1 Year | 5 Years | Life | |||||||||||||||||||
Market Price | 08/15/12 | -9.64 | 1.64 | -0.01 | 0.08 | ||||||||||||||||||
Net Asset Value | 08/15/12 | -8.21 | 2.21 | 0.17 | 0.23 | ||||||||||||||||||
Tracked Index(1) | -8.03 | 2.88 | 1.86 | 1.87 |
(1) The Tracked Index reflects the Indxx Beyond BRICs Index through October 25, 2013 and the FTSE Beyond BRICs Net of Tax Index USD thereafter.
All results shown assume reinvestment of distributions during the period. Returns do not reflect the deduction of taxes that a shareholder may pay on Fund distributions or on the redemption of Fund shares. Performance results reflect the effect of any fee waivers or reimbursements of Fund expenses by the Fund's former investment manager or Columbia Management Investment Advisers, LLC (Columbia Management or the Investment Manager). Absent these fee waivers or expense reimbursement arrangements, performance results would have been lower.
The performance information shown represents past performance and is not a guarantee of future results. The investment return and principal value of your investment will fluctuate so that your shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance information shown. You may obtain performance information current to the most recent month-end by visiting columbiathreadneedleetf.com.
Columbia Management took over portfolio management in September 2016 upon its acquisition of the Fund's previous investment manager.
The price used to calculate Market Price return is based on the midpoint of the 4:00 PM Eastern (U.S.) bid/ask spread on the NYSE and does not represent returns an investor would receive if shares were traded at other times.
The Fund's shares may trade above or below their net asset value. The net asset value of the Fund will generally fluctuate with changes in the market value of the Fund's holdings. The market prices of shares, however, will generally fluctuate in accordance with changes in net asset value as well as the relative supply of, and demand for, shares on the exchange. The trading price of shares may deviate significantly from the net asset value.
The FTSE Beyond BRICs Index is a market capitalization-weighted index designed to represent the performance of a diversified basket of 90 liquid companies in emerging and frontier markets excluding Brazil, Russia, India, China (BRIC), Taiwan and Argentina as defined by FTSE's Country Classification System. The index has 75% exposure to emerging markets and 25% to frontier markets at rebalance.
Indices are not available for investment, are not professionally managed and do not reflect sales charges, fees, brokerage commissions, taxes or other expenses of investing. Securities in the Fund may not match those in an index.
Columbia ETF Trust II | Semiannual Report 2018
2
FUND AT A GLANCE (continued)
Columbia Beyond BRICs ETF
(Unaudited)
Top ten holdings (%) (at September 30, 2018)
Naspers, Ltd. N Shares (South Africa) | 3.4 | ||||||
PTT PCL NVDR (Thailand) | 2.8 | ||||||
America Movil SAB de CV Series L (Mexico) | 2.5 | ||||||
Qatar National Bank QPSC (Qatar) | 2.5 | ||||||
Fomento Economico Mexicano SAB de CV Series UBD (Mexico) | 2.4 | ||||||
Grupo Financiero Banorte SAB de CV Class O (Mexico) | 2.3 | ||||||
Public Bank Bhd (Malaysia) | 2.1 | ||||||
Vietnam Diary Products JSC (Vietnam) | 2.1 | ||||||
United Power Generation and Distribution Co. Ltd. (Bangladesh) | 2.1 | ||||||
Hoa Phat Group JSC (Vietnam) | 2.1 |
Percentages indicated are based upon total investments.
For further detail about these holdings, please refer to the section entitled "Portfolio of Investments".
Fund holdings are as of the date given, are subject to change at any time, and are not recommendations to buy or sell any security.
Equity sector breakdown (%) (at September 30, 2018)
Communication Services | 9.2 | ||||||
Consumer Discretionary | 2.1 | ||||||
Consumer Staples | 9.2 | ||||||
Energy | 5.5 | ||||||
Financials | 41.1 | ||||||
G-60 | 0.7 | ||||||
Health Care | 3.6 | ||||||
Industrials | 2.7 | ||||||
Materials | 10.1 | ||||||
Real Estate | 3.0 | ||||||
Telecommunication Services | 8.1 | ||||||
Utilities | 4.7 | ||||||
Total | 100.0 |
Percentages indicated are based upon total equity investments. The Fund's portfolio composition is subject to change.
Country breakdown (%) (at September 30, 2018)
Bangladesh | 5.4 | ||||||
Chile | 3.5 | ||||||
Colombia | 0.7 | ||||||
Czech Republic | 0.5 | ||||||
Hungary | 1.0 | ||||||
Indonesia | 8.0 | ||||||
Kenya | 2.9 | ||||||
Kuwait | 1.7 | ||||||
Malaysia | 8.7 | ||||||
Mexico | 13.1 | ||||||
Morocco | 4.0 | ||||||
Nigeria | 4.0 | ||||||
Philippines | 3.2 | ||||||
Qatar | 3.8 | ||||||
Romania | 1.9 | ||||||
South Africa | 15.3 | ||||||
Thailand | 12.9 | ||||||
United Arab Emirates | 3.0 | ||||||
Vietnam | 6.4 | ||||||
Total | 100.0 |
Country Breakdown is based primarily on issuer's place of risk. Percentages indicated are based upon total investments. The Fund's portfolio composition is subject to change.
Columbia ETF Trust II | Semiannual Report 2018
3
FUND AT A GLANCE
Columbia EM Core ex-China ETF
(Unaudited)
Investment objective
Columbia EM Core ex-China ETF (the Fund) seeks investment results that correspond (before fees and expenses) to the price and yield performance of the Beta Thematic Emerging Markets ex-China Index.
Portfolio management
Christopher Lo, CFA
Portfolio Manager
Managed Fund since 2016
Average annual total returns (%) (for period ended September 30, 2018)
Inception | 6 Months cumulative | 1 Year | Life | ||||||||||||||||
Market Price | 09/02/15 | -9.00 | 0.90 | 13.20 | |||||||||||||||
Net Asset Value | 09/02/15 | -7.49 | 2.27 | 13.34 | |||||||||||||||
MSCI Emerging Markets Index (Net) | -8.97 | -0.81 | 11.70 | ||||||||||||||||
Beta Thematic Emerging Markets ex-China Index | -8.39 | -0.74 | 11.96 |
All results shown assume reinvestment of distributions during the period. Returns do not reflect the deduction of taxes that a shareholder may pay on Fund distributions or on the redemption of Fund shares. Performance results reflect the effect of any fee waivers or reimbursements of Fund expenses by the Fund's former investment manager or Columbia Management Investment Advisors, LLC (Columbia Management or the Investment Manager). Absent these fee waivers or expense reimbursement arrangements, performance results would have been lower.
The performance information shown represents past performance and is not a guarantee of future results. The investment return and principal value of your investment will fluctuate so that your shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance information shown. You may obtain performance information current to the most recent month-end by visiting columbiathreadneedleetf.com.
Columbia Management took over portfolio management in September 2016 upon its acquisition of the Fund's previous investment manager.
The price used to calculate Market Price return is based on the midpoint of the 4:00 PM Eastern (U.S.) bid/ask spread on the NYSE and does not represent returns an investor would receive if shares were traded at other times.
The Fund's shares may trade above or below their net asset value. The net asset value of the Fund will generally fluctuate with changes in the market value of the Fund's holdings. The market prices of shares, however, will generally fluctuate in accordance with changes in net asset value as well as the relative supply of, and demand for, shares on the exchange. The trading price of shares may deviate significantly from the net asset value.
The MSCI Emerging Markets Index (Net) is a free float-adjusted market capitalization index that is designed to measure market performance of emerging markets.
The Beta Thematic Emerging Markets ex-China Index is a market capitalization-weighted index designed to provide broad, core emerging markets equity exposure by measuring the stock performance of up to 700 companies, excluding those listed or domiciled in China or Hong Kong.
Indices are not available for investment, are not professionally managed and do not reflect sales charges, fees, brokerage commissions, taxes (except the MSCI Emerging Markets Index (Net), which reflects reinvested dividends net of withholding taxes) or other expenses of investing. Securities in the Fund may not match those in an index.
Columbia ETF Trust II | Semiannual Report 2018
4
FUND AT A GLANCE (continued)
Columbia EM Core ex-China ETF
(Unaudited)
Top ten holdings (%) (at September 30, 2018)
Samsung Electronics Co., Ltd. (South Korea) | 6.4 | ||||||
Taiwan Semiconductor Manufacturing Co., Ltd. (Taiwan) | 5.8 | ||||||
Infosys, Ltd. ADR (India) | 4.1 | ||||||
Vale SA (Brazil) | 3.1 | ||||||
ICICI Bank, Ltd. ADR (India) | 2.8 | ||||||
LUKOIL PJSC ADR (Russia) | 2.5 | ||||||
Petroleo Brasileiro SA Preference Shares (Brazil) | 2.4 | ||||||
Naspers, Ltd. N Shares (South Africa) | 2.3 | ||||||
Celltrion, Inc. (South Korea) | 2.1 | ||||||
Itau Unibanco Holding SA Preference Shares (Brazil) | 2.1 |
Percentages indicated are based upon total investments.
For further detail about these holdings, please refer to the section entitled "Portfolio of Investments".
Fund holdings are as of the date given, are subject to change at any time, and are not recommendations to buy or sell any security.
Equity sector breakdown (%) (at September 30, 2018)
Communication Services | 6.6 | ||||||
Consumer Discretionary | 6.2 | ||||||
Consumer Staples | 9.5 | ||||||
Energy | 10.1 | ||||||
Financials | 22.3 | ||||||
Health Care | 3.3 | ||||||
Industrials | 6.1 | ||||||
Information Technology | 21.0 | ||||||
Materials | 11.6 | ||||||
Real Estate | 0.6 | ||||||
Utilities | 2.7 | ||||||
Total | 100.0 |
Percentages indicated are based upon total equity investments. The Fund's portfolio composition is subject to change.
Country breakdown (%) (at September 30, 2018)
Brazil | 11.8 | ||||||
Chile | 1.2 | ||||||
India | 8.7 | ||||||
Indonesia | 3.3 | ||||||
Malaysia | 4.7 | ||||||
Mexico | 4.7 | ||||||
Philippines | 2.2 | ||||||
Poland | 2.6 | ||||||
Russia | 4.8 | ||||||
South Africa | 8.6 | ||||||
South Korea | 18.4 | ||||||
Taiwan | 21.3 | ||||||
Thailand | 6.5 | ||||||
Turkey | 0.8 | ||||||
United States(a) | 0.4 | ||||||
Total | 100.0 |
Country Breakdown is based primarily on issuer's place of risk. Percentages indicated are based upon total investments. The Fund's portfolio composition is subject to change.
(a) Includes investments in Money Market Funds.
Columbia ETF Trust II | Semiannual Report 2018
5
FUND AT A GLANCE
Columbia EM Quality Dividend ETF
(Unaudited)
Investment objective
Columbia EM Quality Dividend ETF (the Fund) seeks investment results that correspond (before fees and expenses) to the price and yield performance of the Beta Advantage® Emerging Markets Quality Dividend Index.
Portfolio management
Christopher Lo, CFA
Portfolio Manager
Managed Fund since 2016
Average annual total returns (%) (for period ended September 30, 2018)
Inception | 6 Months cumulative | 1 Year | 5 Years | Life | |||||||||||||||||||
Market Price | 08/04/11 | -9.18 | 0.11 | -1.08 | -1.09 | ||||||||||||||||||
Net Asset Value | 08/04/11 | -7.28 | 0.38 | -0.92 | -0.97 | ||||||||||||||||||
MSCI Emerging Markets Index (Net) | -8.97 | -0.81 | 3.61 | 1.74 | |||||||||||||||||||
Tracked Index(1) | -6.49 | 1.86 | 0.56 | 0.56 |
(1) The Tracked Index reflects the Indxx Emerging Market High Income Low Beta Index through January 31, 2014, the FTSE Emerging All Cap ex Taiwan Low Volatility Dividend Net Tax Index from February 3, 2014 through January 23, 2015, and the Beta Advantage® Emerging Markets Quality Dividend Index thereafter.
All results shown assume reinvestment of distributions during the period. Returns do not reflect the deduction of taxes that a shareholder may pay on Fund distributions or on the redemption of Fund shares. Performance results reflect the effect of any fee waivers or reimbursements of Fund expenses by the Fund's former investment manager or Columbia Management Investment Advisers, LLC (Columbia Management or the Investment Manager). Absent these fee waivers or expense reimbursement arrangements, performance results would have been lower.
The performance information shown represents past performance and is not a guarantee of future results. The investment return and principal value of your investment will fluctuate so that your shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance information shown. You may obtain performance information current to the most recent month-end by visiting columbiathreadneedleetf.com.
Columbia Management took over portfolio management in September 2016 upon its acquisition of the Fund's previous investment manager.
The price used to calculate Market Price return is based on the midpoint of the 4:00 PM Eastern (U.S.) bid/ask spread on the NYSE and does not represent returns an investor would receive if shares were traded at other times.
The Fund's shares may trade above or below their net asset value. The net asset value of the Fund will generally fluctuate with changes in the market value of the Fund's holdings. The market prices of shares, however, will generally fluctuate in accordance with changes in net asset value as well as the relative supply of, and demand for, shares on the exchange. The trading price of shares may deviate significantly from the net asset value.
The MSCI Emerging Markets Index (Net) is a free float-adjusted market capitalization index that is designed to measure market performance of emerging markets.
The Beta Advantage® Emerging Markets Quality Dividend Index is an equal-weighted index designed to represent a portfolio of approximately 50 companies in developing markets, which is expected to have a higher dividend yield than the average dividend yield of companies included in the developing markets universe as defined by Columbia Management.
Indices are not available for investment, are not professionally managed and do not reflect sales charges, fees, brokerage commissions, taxes (except the MSCI Emerging Markets Index (Net), which reflects reinvested dividends net of withholding taxes) or other expenses of investing. Securities in the Fund may not match those in an index.
Columbia ETF Trust II | Semiannual Report 2018
6
FUND AT A GLANCE (continued)
Columbia EM Quality Dividend ETF
(Unaudited)
Top ten holdings (%) (at September 30, 2018)
Ecopetrol SA (Colombia) | 2.2 | ||||||
S-Oil Corp. (South Korea) | 2.1 | ||||||
Suzano Pepel e Celulose SA (Brazil) | 2.1 | ||||||
Link REIT (Hong Kong) | 2.1 | ||||||
Wal-Mart de Mexico SAB de CV (Mexico) | 2.1 | ||||||
Emaar Properties PJSC (United Arab Emirates) | 2.1 | ||||||
Infosys, Ltd. (India) | 2.1 | ||||||
Polski Koncern Naftoey Orlem SA (Poland) | 2.1 | ||||||
Uni-President Enterprises Corp. (Taiwan) | 2.1 | ||||||
KB Financial Group, Inc. (South Korea) | 2.1 |
Percentages indicated are based upon total investments.
For further detail about these holdings, please refer to the section entitled "Portfolio of Investments".
Fund holdings are as of the date given, are subject to change at any time, and are not recommendations to buy or sell any security.
Equity sector breakdown (%) (at September 30, 2018)
Communications Services | 10.1 | ||||||
Consumer Discretionary | 2.0 | ||||||
Consumer Staples | 10.1 | ||||||
Energy | 12.3 | ||||||
Financials | 20.0 | ||||||
Information Technology | 9.7 | ||||||
Materials | 18.0 | ||||||
Real Estate | 6.1 | ||||||
Utilities | 11.7 | ||||||
Total | 100.0 |
Percentages indicated are based upon total equity investments. The Fund's portfolio composition is subject to change.
Country breakdown (%) (at September 30, 2018)
Brazil | 6.0 | ||||||
Chile | 3.8 | ||||||
China | 10.0 | ||||||
Colombia | 2.2 | ||||||
Hong Kong | 10.0 | ||||||
India | 11.8 | ||||||
Indonesia | 8.0 | ||||||
Kenya | 2.0 | ||||||
Malaysia | 11.9 | ||||||
Mexico | 4.0 | ||||||
Poland | 2.1 | ||||||
Qatar | 2.0 | ||||||
South Africa | 4.0 | ||||||
South Korea | 6.1 | ||||||
Taiwan | 11.8 | ||||||
Thailand | 2.0 | ||||||
United Arab Emirates | 2.1 | ||||||
United States(a) | 0.2 | ||||||
Total | 100.0 |
Country Breakdown is based primarily on issuer's place of risk. Percentages indicated are based upon total investments. The Fund's portfolio composition is subject to change.
(a) Includes investments in Money Market Funds.
Columbia ETF Trust II | Semiannual Report 2018
7
FUND AT A GLANCE
Columbia Emerging Markets Consumer ETF
(Unaudited)
Investment objective
Columbia Emerging Markets Consumer ETF (the Fund) seeks investment results that correspond (before fees and expenses) to the price and yield performance of the Dow Jones Emerging Markets Consumer Titans 30TM Index.
Portfolio management
Christopher Lo, CFA
Portfolio Manager
Managed Fund since 2016
Average annual total returns (%) (for period ended September 30, 2018)
Inception | 6 Months cumulative | 1 Year | 5 Years | Life | |||||||||||||||||||
Market Price | 09/14/10 | -15.96 | -18.86 | -2.92 | 2.00 | ||||||||||||||||||
Net Asset Value | 09/14/10 | -14.96 | -18.34 | -2.78 | 2.07 | ||||||||||||||||||
Dow Jones Emerging Markets Consumer Titans 30TM Index | -14.66 | -17.68 | -1.79 | 3.24 |
All results shown assume reinvestment of distributions during the period. Returns do not reflect the deduction of taxes that a shareholder may pay on Fund distributions or on the redemption of Fund shares. Performance results reflect the effect of any fee waivers or reimbursements of Fund expenses by the Fund's former investment manager or Columbia Management Investment Advisers, LLC (Columbia Management or the Investment Manager). Absent these fee waivers or expense reimbursement arrangements, performance results would have been lower.
The performance information shown represents past performance and is not a guarantee of future results. The investment return and principal value of your investment will fluctuate so that your shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance information shown. You may obtain performance information current to the most recent month-end by visiting columbiathreadneedleetf.com.
Columbia Management took over portfolio management in September 2016 upon its acquisition of the Fund's previous investment manager.
The price used to calculate Market Price return is based on the midpoint of the 4:00 PM Eastern (U.S.) bid/ask spread on the NYSE and does not represent returns an investor would receive if shares were traded at other times.
The Fund's shares may trade above or below their net asset value. The net asset value of the Fund will generally fluctuate with changes in the market value of the Fund's holdings. The market prices of shares, however, will generally fluctuate in accordance with changes in net asset value as well as the relative supply of, and demand for, shares on the exchange. The trading price of shares may deviate significantly from the net asset value.
The Dow Jones Emerging Markets Consumer Titans 30TM Index is a free-float market capitalization-weighted index that measures the performance of 30 leading emerging market companies in the Consumer Goods and Consumer Services Industries as defined by S&P Dow Jones Indexes.
Indices are not available for investment, are not professionally managed and do not reflect sales charges, fees, brokerage commissions, taxes or other expenses of investing. Securities in the Fund may not match those in an index.
Columbia ETF Trust II | Semiannual Report 2018
8
FUND AT A GLANCE (continued)
Columbia Emerging Markets Consumer ETF
(Unaudited)
Top ten holdings (%) (at September 30, 2018)
Naspers, Ltd. N Shares (South Africa) | 10.3 | ||||||
Ambev SA ADR (Brazil) | 4.6 | ||||||
JD.com, Inc. ADR (China) | 4.6 | ||||||
Fomento Economico Mexicano SAB de CV Series UBD (Mexico) | 4.4 | ||||||
Wal-Mart de Mexico SAB de CV (Mexico) | 4.1 | ||||||
Hindustan Unilever, Ltd. (India) | 4.0 | ||||||
Yum China Holdings, Inc. (China) | 3.8 | ||||||
Ctrip.com International, Ltd. ADR (China) | 3.8 | ||||||
Geely Automobile Holdings, Ltd. (China) | 3.6 | ||||||
ITC, Ltd. (India) | 3.5 |
Percentages indicated are based upon total investments.
For further detail about these holdings, please refer to the section entitled "Portfolio of Investments".
Fund holdings are as of the date given, are subject to change at any time, and are not recommendations to buy or sell any security.
Equity sector breakdown (%) (at September 30, 2018)
Communication Services | 13.0 | ||||||
Consumer Discretionary | 43.3 | ||||||
Consumer Staples | 40.9 | ||||||
Industrials | 2.8 | ||||||
Total | 100.0 |
Percentages indicated are based upon total equity investments. The Fund's portfolio composition is subject to change.
Country breakdown (%) (at September 30, 2018)
Brazil | 9.5 | ||||||
Chile | 2.3 | ||||||
China | 33.4 | ||||||
India | 13.2 | ||||||
Indonesia | 3.2 | ||||||
Malaysia | 2.1 | ||||||
Mexico | 11.3 | ||||||
Philippines | 2.8 | ||||||
Russia | 2.1 | ||||||
South Africa | 14.6 | ||||||
Thailand | 5.5 | ||||||
United States(a) | 0.0 | (b) | |||||
Total | 100.0 |
Country Breakdown is based primarily on issuer's place of risk. Percentages indicated are based upon total investments. The Fund's portfolio composition is subject to change.
(a) Includes investments in Money Market Funds.
(b) Rounds to zero.
Columbia ETF Trust II | Semiannual Report 2018
9
FUND AT A GLANCE
Columbia India Consumer ETF
(Unaudited)
Investment objective
Columbia India Consumer ETF (the Fund) seeks investment results that correspond (before fees and expenses) to the price and yield performance of the Indxx India Consumer Index.
Portfolio management
Christopher Lo, CFA
Portfolio Manager
Managed Fund since 2016
Average annual total returns (%) (for period ended September 30, 2018)
Inception | 6 Months cumulative | 1 Year | 5 Years | Life | |||||||||||||||||||
Market Price | 08/10/11 | -11.22 | -3.46 | 14.66 | 10.61 | ||||||||||||||||||
Net Asset Value | 08/10/11 | -10.06 | -3.03 | 14.79 | 10.68 | ||||||||||||||||||
Indxx India Consumer Index | -9.73 | -2.10 | 16.53 | 12.27 |
All results shown assume reinvestment of distributions during the period. Returns do not reflect the deduction of taxes that a shareholder may pay on Fund distributions or on the redemption of Fund shares. Performance results reflect the effect of any fee waivers or reimbursements of Fund expenses by the Fund's former investment manager or Columbia Management Investment Advisers, LLC (Columbia Management or the Investment Manager). Absent these fee waivers or expense reimbursement arrangements, performance results would have been lower.
The performance information shown represents past performance and is not a guarantee of future results. The investment return and principal value of your investment will fluctuate so that your shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance information shown. You may obtain performance information current to the most recent month-end by visiting columbiathreadneedleetf.com.
Columbia Management took over portfolio management in September 2016 upon its acquisition of the Fund's previous investment manager.
The price used to calculate Market Price return is based on the midpoint of the 4:00 PM Eastern (U.S.) bid/ask spread on the NYSE and does not represent returns an investor would receive if shares were traded at other times.
The Fund's shares may trade above or below their net asset value. The net asset value of the Fund will generally fluctuate with changes in the market value of the Fund's holdings. The market prices of shares, however, will generally fluctuate in accordance with changes in net asset value as well as the relative supply of, and demand for, shares on the exchange. The trading price of shares may deviate significantly from the net asset value.
The Indxx India Consumer Index is a maximum 30-stock free-float adjusted market capitalization-weighted index designed to measure the market performance of companies in the consumer industry in India, as defined by Indxx's proprietary methodology.
Indices are not available for investment, are not professionally managed and do not reflect sales charges, fees, brokerage commissions, taxes or other expenses of investing. Securities in the Fund may not match those in an index.
Columbia ETF Trust II | Semiannual Report 2018
10
FUND AT A GLANCE (continued)
Columbia India Consumer ETF
(Unaudited)
Top ten holdings (%) (at September 30, 2018)
Nestle India, Ltd. | 6.1 | ||||||
Hindustan Unilever, Ltd. | 6.0 | ||||||
Britannia Industries, Ltd. | 5.8 | ||||||
Mahindra & Mahindra, Ltd. | 5.7 | ||||||
ITC, Ltd. | 5.5 | ||||||
Godrej Consumer Products, Ltd. | 5.0 | ||||||
Titan Co., Ltd. | 4.8 | ||||||
Dabur India, Ltd. | 4.5 | ||||||
Bajaj Auto, Ltd. | 4.4 | ||||||
Maruti Suzuki India, Ltd. | 4.1 |
Percentages indicated are based upon total investments.
For further detail about these holdings, please refer to the section entitled "Portfolio of Investments".
Fund holdings are as of the date given, are subject to change at any time, and are not recommendations to buy or sell any security.
Equity sector breakdown (%) (at September 30, 2018)
Communication Services | 4.5 | ||||||
Consumer Discretionary | 44.9 | ||||||
Consumer Staples | 50.6 | ||||||
Total | 100.0 |
Percentages indicated are based upon total equity investments. The Fund's portfolio composition is subject to change.
Columbia ETF Trust II | Semiannual Report 2018
11
FUND AT A GLANCE
Columbia India Infrastructure ETF
(Unaudited)
Investment objective
Columbia India Infrastructure ETF (the Fund) seeks investment results that correspond (before fees and expenses) to the price and yield performance of the Indxx India Infrastructure Index.
Portfolio management
Christopher Lo, CFA
Portfolio Manager
Managed Fund since 2016
Average annual total returns (%) (for period ended September 30, 2018)
Inception | 6 Months cumulative | 1 Year | 5 Years | Life | |||||||||||||||||||
Market Price | 08/11/10 | -16.10 | -15.62 | 6.45 | -4.03 | ||||||||||||||||||
Net Asset Value | 08/11/10 | -14.95 | -15.54 | 6.47 | -4.02 | ||||||||||||||||||
Indxx India Infrastructure Index | -14.35 | -14.58 | 7.77 | -2.91 |
All results shown assume reinvestment of distributions during the period. Returns do not reflect the deduction of taxes that a shareholder may pay on Fund distributions or on the redemption of Fund shares. Performance results reflect the effect of any fee waivers or reimbursements of Fund expenses by the Fund's former investment manager or Columbia Management Investment Advisers, LLC (Columbia Management or the Investment Manager). Absent these fee waivers or expense reimbursement arrangements, performance results would have been lower.
The performance information shown represents past performance and is not a guarantee of future results. The investment return and principal value of your investment will fluctuate so that your shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance information shown. You may obtain performance information current to the most recent month-end by visiting columbiathreadneedleetf.com.
Columbia Management took over portfolio management in September 2016 upon its acquisition of the Fund's previous investment manager.
The price used to calculate Market Price return is based on the midpoint of the 4:00 PM Eastern (U.S.) bid/ask spread on the NYSE and does not represent returns an investor would receive if shares were traded at other times.
The Fund's shares may trade above or below their net asset value. The net asset value of the Fund will generally fluctuate with changes in the market value of the Fund's holdings. The market prices of shares, however, will generally fluctuate in accordance with changes in net asset value as well as the relative supply of, and demand for, shares on the exchange. The trading price of shares may deviate significantly from the net asset value.
The Indxx India Infrastructure Index is a maximum 30-stock free-float adjusted market capitalization-weighted index designed to measure the market performance of companies in the infrastructure industry in India, as defined by Indxx's proprietary methodology. The index consists of common stocks listed on the primary exchange of India and ADRs & GDRs.
Indices are not available for investment, are not professionally managed and do not reflect sales charges, fees, brokerage commissions, taxes or other expenses of investing. Securities in the Fund may not match those in an index.
Columbia ETF Trust II | Semiannual Report 2018
12
FUND AT A GLANCE (continued)
Columbia India Infrastructure ETF
(Unaudited)
Top ten holdings (%) (at September 30, 2018)
Vedanta, Ltd. | 5.3 | ||||||
GAIL India, Ltd. | 5.3 | ||||||
Grasim Industries Ltd. | 5.3 | ||||||
NTPC, Ltd. | 5.2 | ||||||
Power Grid Corp. of India, Ltd. | 5.1 | ||||||
UltraTech Cement, Ltd. | 5.0 | ||||||
Hindalco Industries, Ltd. | 5.0 | ||||||
Larsen & Toubro, Ltd. | 5.0 | ||||||
JSW Steel, Ltd. | 5.0 | ||||||
Tata Steel, Ltd. | 5.0 |
Percentages indicated are based upon total investments.
For further detail about these holdings, please refer to the section entitled "Portfolio of Investments".
Fund holdings are as of the date given, are subject to change at any time, and are not recommendations to buy or sell any security.
Equity sector breakdown (%) (at September 30, 2018)
Communication Services | 12.3 | ||||||
Consumer Discretionary | 4.5 | ||||||
Energy | 2.8 | ||||||
Industrials | 24.3 | ||||||
Materials | 35.8 | ||||||
Real Estate | 1.2 | ||||||
Utilities | 19.1 | ||||||
Total | 100.0 |
Percentages indicated are based upon total equity investments. The Fund's portfolio composition is subject to change.
Columbia ETF Trust II | Semiannual Report 2018
13
FUND AT A GLANCE
Columbia India Small Cap ETF
(Unaudited)
Investment objective
Columbia India Small Cap ETF (the Fund) seeks investment results that correspond (before fees and expenses) to the price and yield performance of the Indxx India Small Cap Index.
Portfolio management
Christopher Lo, CFA
Portfolio Manager
Managed Fund since 2016
Average annual total returns (%) (for period ended September 30, 2018)
Inception | 6 Months cumulative | 1 Year | 5 Years | Life | |||||||||||||||||||
Market Price | 07/07/10 | -28.04 | -26.48 | 9.10 | -3.25 | ||||||||||||||||||
Net Asset Value | 07/07/10 | -27.69 | -26.65 | 8.85 | -3.35 | ||||||||||||||||||
Indxx India Small Cap Index | -26.99 | -25.52 | 10.56 | -2.03 |
All results shown assume reinvestment of distributions during the period. Returns do not reflect the deduction of taxes that a shareholder may pay on Fund distributions or on the redemption of Fund shares. Performance results reflect the effect of any fee waivers or reimbursements of Fund expenses by the Fund's former investment manager or Columbia Management Investment Advisers, LLC (Columbia Management or the Investment Manager). Absent these fee waivers or expense reimbursement arrangements, performance results would have been lower.
The performance information shown represents past performance and is not a guarantee of future results. The investment return and principal value of your investment will fluctuate so that your shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance information shown. You may obtain performance information current to the most recent month-end by visiting columbiathreadneedleetf.com.
Columbia Management took over portfolio management in September 2016 upon its acquisition of the Fund's previous investment manager.
The price used to calculate Market Price return is based on the midpoint of the 4:00 PM Eastern (U.S.) bid/ask spread on the NYSE and does not represent returns an investor would receive if shares were traded at other times.
The Fund's shares may trade above or below their net asset value. The net asset value of the Fund will generally fluctuate with changes in the market value of the Fund's holdings. The market prices of shares, however, will generally fluctuate in accordance with changes in net asset value as well as the relative supply of, and demand for, shares on the exchange. The trading price of shares may deviate significantly from the net asset value.
The Indxx India Small Cap Index is a maximum 75-stock free-float adjusted market capitalization-weighted index designed to measure the market performance of companies in the small cap segment in India. The index consists of securities listed on the primary stock exchange of India.
Indices are not available for investment, are not professionally managed and do not reflect sales charges, fees, brokerage commissions, taxes or other expenses of investing. Securities in the Fund may not match those in an index.
Columbia ETF Trust II | Semiannual Report 2018
14
FUND AT A GLANCE (continued)
Columbia India Small Cap ETF
(Unaudited)
Top ten holdings (%) (at September 30, 2018)
KPIT Technologies, Ltd. | 4.6 | ||||||
Multi Commodity Exchange of India, Ltd. | 3.9 | ||||||
Karnataka Bank, Ltd. (The) | 3.6 | ||||||
Deepak Nitrite, Ltd. | 2.8 | ||||||
Meghmani Organics, Ltd. | 2.7 | ||||||
Repco Home Finance, Ltd. | 2.4 | ||||||
PTC India, Ltd. | 2.3 | ||||||
Firstsource Solutions, Ltd. | 2.3 | ||||||
Phillips Carbon Black, Ltd. | 2.2 | ||||||
Just Dial, Ltd. | 2.2 |
Percentages indicated are based upon total investments.
For further detail about these holdings, please refer to the section entitled "Portfolio of Investments".
Fund holdings are as of the date given, are subject to change at any time, and are not recommendations to buy or sell any security.
Equity sector breakdown (%) (at September 30, 2018)
Communication Services | 3.8 | ||||||
Consumer Discretionary | 7.3 | ||||||
Consumer Staples | 7.7 | ||||||
Energy | 1.4 | ||||||
Financials | 18.5 | ||||||
Health Care | 6.5 | ||||||
Industrials | 13.8 | ||||||
Information Technology | 10.9 | ||||||
Materials | 25.7 | ||||||
Real Estate | 2.1 | ||||||
Utilities | 2.3 | ||||||
Total | 100.0 |
Percentages indicated are based upon total equity investments. The Fund's portfolio composition is subject to change.
Columbia ETF Trust II | Semiannual Report 2018
15
UNDERSTANDING YOUR FUND'S EXPENSES
(Unaudited)
As a shareholder of a Fund, you incur ongoing costs, including investment management fees. The following example is intended to help you understand your ongoing costs (in dollars and cents) of investing in a fund and to compare these costs with the ongoing costs of investing in other funds.
The examples are based on an initial investment of $1,000 invested at the beginning of the period and held for the period ended September 30, 2018.
Actual Expenses
The information under each column in the table below entitled "Actual" provides information about actual account values and actual expenses. You may use the information in these columns, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number for your Fund under the heading entitled "Expenses paid for the period" to estimate the expenses you paid on your account during this period.
Hypothetical Example For Comparison Purposes
The information under each column in the table entitled "Hypothetical" provides information about hypothetical account values and hypothetical expenses based on each Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as brokerage commissions paid on purchases and sales of Fund shares. Therefore, the ending account values and expenses paid for the period in the table is useful in comparing ongoing Fund costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
April 1, 2018 — September 30, 2018
Beginning account value ($) | Ending account value ($) | Expenses paid for the period ($) | Annualized expense ratios for the period (%) | ||||||||||||||||||||||||||||
Actual | Hypothetical | Actual | Hypothetical | Actual | Hypothetical | Actual | |||||||||||||||||||||||||
Columbia Beyond BRICs ETF | 1,000.00 | 1,000.00 | 917.90 | 1,022.16 | 2.79 | 2.94 | 0.58 | ||||||||||||||||||||||||
Columbia EM Core ex-China ETF | 1,000.00 | 1,000.00 | 925.10 | 1,023.31 | 1.69 | 1.78 | 0.35 | ||||||||||||||||||||||||
Columbia EM Quality Dividend ETF | 1,000.00 | 1,000.00 | 927.20 | 1,022.11 | 2.85 | 2.99 | 0.59 | ||||||||||||||||||||||||
Columbia Emerging Markets Consumer ETF | 1,000.00 | 1,000.00 | 850.40 | 1,022.06 | 2.78 | 3.04 | 0.60 | ||||||||||||||||||||||||
Columbia India Consumer ETF | 1,000.00 | 1,000.00 | 899.40 | 1021.26 | 3.62 | 3.85 | 0.76 | ||||||||||||||||||||||||
Columbia India Infrastructure ETF | 1,000.00 | 1,000.00 | 850.50 | 1020.86 | 3.90 | 4.26 | 0.84 | ||||||||||||||||||||||||
Columbia India Small Cap ETF | 1,000.00 | 1,000.00 | 723.10 | 1021.16 | 3.37 | 3.95 | 0.78 |
Expenses are calculated using the Fund's annualized expense ratio, multiplied by the average account value over the period, then multiplied by the number of days in the Fund's most recent fiscal half-year and divided by 365.
Expense ratios reflect investment management fee caps for Columbia Beyond BRICs ETF and Columbia EM Core ex-China ETF through the period ended August 31, 2018.
Had the Investment Manager not waived fees or reimbursed a portion of expenses for Columbia Beyond BRICs ETF and Columbia EM Core ex-China ETF, account values at the end of the period would have been reduced.
Columbia ETF Trust II | Semiannual Report 2018
16
FREQUENCY DISTRIBUTION OF PREMIUMS
AND DISCOUNTS (Unaudited)
The tables that follow present information about the differences between the daily market price on secondary markets for shares of a Fund and that Fund's net asset value. Net asset value, or "NAV", is the price per share at which each Fund issues and redeems shares. It is calculated in accordance with the standard formula for valuing fund shares. The "Market Price" of each Fund generally is determined using the midpoint between the highest bid and the lowest offer on the stock exchange on which the shares of such Fund are listed for trading, as of the time that the Fund's NAV is calculated. Each Fund's Market Price may be at, above or below its NAV. The NAV of each Fund will fluctuate with changes in the market value of its portfolio holdings. The Market Price of each Fund will fluctuate in accordance with changes in its NAV, as well as market supply and demand.
Premiums or discounts are the differences (expressed as a percentage) between the NAV and Market Price of a Fund on a given day, generally at the time NAV is calculated. A premium is the amount that a Fund is trading above the reported NAV, expressed as a percentage of the NAV. A discount is the amount that a Fund is trading below the reported NAV, expressed as a percentage of the NAV. The following information shows the frequency distributions of premiums and discounts for each of the Funds.
The information shown for each Fund is for the period from inception date of such Fund through September 30, 2018.
Each line in the table shows the number of trading days in which the Fund traded within the premium/discount range indicated. All data presented here represents past performance, which cannot be used to predict future results.
Market Price Above or Equal to NAV | Market Price Below NAV | ||||||||||||||
Basis Point Differential | Number of Days | Number of Days | |||||||||||||
Columbia Beyond BRICs ETF August 15, 2012 – September 30, 2018 | |||||||||||||||
0 - 49.9 | 340 | 329 | |||||||||||||
50 - 99.9 | 332 | 293 | |||||||||||||
100 - 199.9 | 117 | 118 | |||||||||||||
> 200 | 5 | 7 | |||||||||||||
Total | 794 | 747 | |||||||||||||
Market Price Above or Equal to NAV | Market Price Below NAV | ||||||||||||||
Basis Point Differential | Number of Days | Number of Days | |||||||||||||
Columbia EM Core ex-China ETF September 2, 2015 – September 30, 2018 | |||||||||||||||
0 - 49.9 | 212 | 142 | |||||||||||||
50 - 99.9 | 228 | 51 | |||||||||||||
100 - 199.9 | 119 | 13 | |||||||||||||
> 200 | 9 | 1 | |||||||||||||
Total | 568 | 207 | |||||||||||||
Market Price Above or Equal to NAV | Market Price Below NAV | ||||||||||||||
Basis Point Differential | Number of Days | Number of Days | |||||||||||||
Columbia EM Quality Dividend ETF August 4, 2011 – September 30, 2018 | |||||||||||||||
0 - 49.9 | 420 | 507 | |||||||||||||
50 - 99.9 | 185 | 424 | |||||||||||||
100 - 199.9 | 50 | 189 | |||||||||||||
> 200 | 8 | 18 | |||||||||||||
Total | 663 | 1138 |
Columbia ETF Trust II | Semiannual Report 2018
17
FREQUENCY DISTRIBUTION OF PREMIUMS
AND DISCOUNTS (continued) (Unaudited)
Market Price Above or Equal to NAV | Market Price Below NAV | ||||||||||||||
Basis Point Differential | Number of Days | Number of Days | |||||||||||||
Columbia Emerging Markets Consumer ETF September 14, 2010 – September 30, 2018 | |||||||||||||||
0 - 49.9 | 886 | 502 | |||||||||||||
50 - 99.9 | 353 | 174 | |||||||||||||
100 - 199.9 | 49 | 51 | |||||||||||||
> 200 | 6 | 5 | |||||||||||||
Total | 1294 | 732 | |||||||||||||
Market Price Above or Equal to NAV | Market Price Below NAV | ||||||||||||||
Basis Point Differential | Number of Days | Number of Days | |||||||||||||
Columbia India Consumer ETF August 10, 2011 – September 30, 2018 | |||||||||||||||
0 - 49.9 | 482 | 377 | |||||||||||||
50 - 99.9 | 344 | 182 | |||||||||||||
100 - 199.9 | 247 | 92 | |||||||||||||
> 200 | 59 | 14 | |||||||||||||
Total | 1132 | 665 | |||||||||||||
Market Price Above or Equal to NAV | Market Price Below NAV | ||||||||||||||
Basis Point Differential | Number of Days | Number of Days | |||||||||||||
Columbia India Infrastructure ETF August 11, 2010 – September 30, 2018 | |||||||||||||||
0 - 49.9 | 491 | 411 | |||||||||||||
50 - 99.9 | 343 | 297 | |||||||||||||
100 - 199.9 | 240 | 188 | |||||||||||||
> 200 | 39 | 40 | |||||||||||||
Total | 1113 | 936 | |||||||||||||
Market Price Above or Equal to NAV | Market Price Below NAV | ||||||||||||||
Basis Point Differential | Number of Days | Number of Days | |||||||||||||
Columbia India Small Cap ETF July 7, 2010 – September 30, 2018 | |||||||||||||||
0 - 49.9 | 463 | 414 | |||||||||||||
50 - 99.9 | 291 | 317 | |||||||||||||
100 - 199.9 | 227 | 271 | |||||||||||||
> 200 | 36 | 55 | |||||||||||||
Total | 1017 | 1057 |
Columbia ETF Trust II | Semiannual Report 2018
18
PORTFOLIO OF INVESTMENTS
Columbia Beyond BRICs ETF
September 30, 2018 (Unaudited)
(Percentages represent value of investments compared to net assets)
Investments in Securities
Common Stocks 99.3%
Issuer | Shares | Value ($) | |||||||||
Bangladesh 5.4% | |||||||||||
BRAC Bank Ltd.(a) | 372,176 | 311,126 | |||||||||
GrameenPhone, Ltd. | 93,700 | 409,613 | |||||||||
Square Pharmaceuticals, Ltd. | 313,592 | 1,009,395 | |||||||||
United Power Generation and Distribution Co. Ltd. | 284,800 | 1,094,093 | |||||||||
Total Bangladesh | 2,824,227 | ||||||||||
Chile 3.5% | |||||||||||
Banco de Chile | 1,672,693 | 254,023 | |||||||||
Banco Santander Chile | 3,732,305 | 297,804 | |||||||||
Empresas CMPC SA | 67,206 | 270,495 | |||||||||
Empresas COPEC SA | 29,337 | 451,975 | |||||||||
Enel Americas SA | 1,660,668 | 255,092 | |||||||||
S.A.C.I. Falabella | 37,752 | 306,434 | |||||||||
Total Chile | 1,835,823 | ||||||||||
Colombia 0.7% | |||||||||||
Ecopetrol SA | 285,530 | 387,516 | |||||||||
Czech Republic 0.5% | |||||||||||
CEZ AS | 9,512 | 243,191 | |||||||||
Hungary 1.0% | |||||||||||
OTP Bank Nyrt. | 13,751 | 509,604 | |||||||||
Indonesia 7.9% | |||||||||||
PT Astra International Tbk | 1,218,730 | 601,125 | |||||||||
PT Bank Central Asia Tbk | 581,210 | 941,934 | |||||||||
PT Bank Mandiri Persero Tbk | 1,115,109 | 503,245 | |||||||||
PT Bank Negara Indonesia Persero Tbk | 445,596 | 221,280 | |||||||||
PT Bank Rakyat Indonesia Persero Tbk | 3,186,847 | 673,662 | |||||||||
PT Hanjaya Mandala Sampoerna Tbk | 526,410 | 136,005 | |||||||||
PT Telekomunikasi Indonesia Persero Tbk | 2,849,780 | 696,118 | |||||||||
PT Unilever Indonesia Tbk | 69,061 | 217,937 | |||||||||
PT United Tractors Tbk | 91,200 | 201,966 | |||||||||
Total Indonesia | 4,193,272 | ||||||||||
Kenya 2.9% | |||||||||||
Equity Group Holdings, Ltd. | 1,572,779 | 624,119 | |||||||||
Safaricom PLC | 3,748,798 | 911,166 | |||||||||
Total Kenya | 1,535,285 |
Common Stocks (continued)
Issuer | Shares | Value ($) | |||||||||
Kuwait 1.6% | |||||||||||
Kuwait Finance House KSCP | 186,512 | 367,857 | |||||||||
National Bank of Kuwait SAKP | 182,119 | 496,743 | |||||||||
Total Kuwait | 864,600 | ||||||||||
Malaysia 8.7% | |||||||||||
Axiata Group Bhd | 267,513 | 294,759 | |||||||||
CIMB Group Holdings Bhd | 397,306 | 576,974 | |||||||||
DiGi.Com Bhd | 220,625 | 256,956 | |||||||||
IHH Healthcare Bhd | 168,206 | 211,756 | |||||||||
Malayan Banking Bhd | 351,813 | 832,246 | |||||||||
Petronas Chemicals Group Bhd | 170,399 | 385,390 | |||||||||
Public Bank Bhd | 185,624 | 1,121,324 | |||||||||
Tenaga Nasional Bhd | 238,196 | 889,818 | |||||||||
Total Malaysia | 4,569,223 | ||||||||||
Mexico 13.0% | |||||||||||
America Movil SAB de CV Series L | 1,652,439 | 1,329,074 | |||||||||
Arca Continental SAB de CV | 23,421 | 151,403 | |||||||||
Cemex SAB de CV Series CPO(a) | 909,017 | 638,768 | |||||||||
Fomento Economico Mexicano SAB de CV Series UBD | 126,574 | 1,253,471 | |||||||||
Grupo Elektra, SAB de CV | 3,897 | 177,856 | |||||||||
Grupo Financiero Banorte SAB de CV Class O | 169,403 | 1,225,730 | |||||||||
Grupo Mexico SAB de CV Series B | 215,913 | 622,940 | |||||||||
Grupo Televisa SAB Series CPO | 149,942 | 533,558 | |||||||||
Wal-Mart de Mexico SAB de CV | 310,720 | 947,651 | |||||||||
Total Mexico | 6,880,451 | ||||||||||
Morocco 3.9% | |||||||||||
Attijariwafa Bank | 21,568 | 1,029,608 | |||||||||
Maroc Telecom | 69,415 | 1,050,080 | |||||||||
Total Morocco | 2,079,688 | ||||||||||
Nigeria 4.0% | |||||||||||
Guaranty Trust Bank PLC | 10,515,407 | 1,054,064 | |||||||||
Zenith Bank PLC | 17,609,533 | 1,038,341 | |||||||||
Total Nigeria | 2,092,405 |
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
19
PORTFOLIO OF INVESTMENTS (continued)
Columbia Beyond BRICs ETF
September 30, 2018 (Unaudited)
(Percentages represent value of investments compared to net assets)
Common Stocks (continued)
Issuer | Shares | Value ($) | |||||||||
Philippines 3.2% | |||||||||||
Ayala Corp. | 14,840 | 254,886 | |||||||||
Ayala Land, Inc. | 417,577 | 309,531 | |||||||||
BDO Unibank, Inc. | 117,907 | 261,434 | |||||||||
SM Investments Corp. | 29,071 | 486,400 | |||||||||
SM Prime Holdings, Inc. | 544,060 | 364,016 | |||||||||
Total Philippines | 1,676,267 | ||||||||||
Qatar 3.8% | |||||||||||
Industries Qatar QSC | 12,129 | 415,336 | |||||||||
Qatar Islamic Bank SAQ | 7,026 | 270,112 | |||||||||
Qatar National Bank QPSC | 26,941 | 1,309,467 | |||||||||
Total Qatar | 1,994,915 | ||||||||||
Romania 1.9% | |||||||||||
Banca Transilvania SA | 1,737,105 | 1,005,084 | |||||||||
South Africa 15.2% | |||||||||||
Absa Group Ltd. | 37,614 | 403,697 | |||||||||
Aspen Pharmacare Holdings, Ltd. | 19,786 | 236,824 | |||||||||
FirstRand, Ltd. | 169,055 | 810,795 | |||||||||
MTN Group, Ltd. | 95,687 | 592,193 | |||||||||
Naspers, Ltd. N Shares | 8,355 | 1,801,710 | |||||||||
Nedbank Group, Ltd. | 11,519 | 215,407 | |||||||||
Old Mutual Ltd. | 256,710 | 549,474 | |||||||||
Remgro, Ltd. | 27,367 | 381,460 | |||||||||
Sanlam, Ltd. | 92,509 | 517,155 | |||||||||
Sasol, Ltd. | 28,083 | 1,086,567 | |||||||||
Shoprite Holdings, Ltd. | 23,646 | 320,237 | |||||||||
Standard Bank Group, Ltd. | 67,887 | 839,518 | |||||||||
Vodacom Group, Ltd. | 31,646 | 281,613 | |||||||||
Total South Africa | 8,036,650 | ||||||||||
Thailand 12.9% | |||||||||||
Advanced Info Service PCL NVDR | 67,371 | 418,725 | |||||||||
Airports of Thailand PCL NVDR | 258,628 | 523,814 | |||||||||
Bangkok Bank PCL NVDR | 28,775 | 186,851 |
Common Stocks (continued)
Issuer | Shares | Value ($) | |||||||||
Bangkok Dusit Medical Services PCL NVDR | 523,507 | 412,784 | |||||||||
Central Pattana PCL NVDR | 148,947 | 382,270 | |||||||||
CP ALL PCL NVDR | 314,345 | 670,680 | |||||||||
Indorama Ventures PCL NVDR | 106,226 | 193,795 | |||||||||
Kasikornbank PCL NVDR | 70,703 | 472,228 | |||||||||
PTT Exploration & Production PCL NVDR | 83,189 | 398,710 | |||||||||
PTT Global Chemical PCL NVDR | 122,417 | 307,556 | |||||||||
PTT PCL NVDR | 861,730 | 1,445,543 | |||||||||
Siam Cement PCL (The) NVDR | 50,688 | 699,037 | |||||||||
Siam Commercial Bank PCL NVDR | 145,100 | 668,519 | |||||||||
Total Thailand | 6,780,512 | ||||||||||
United Arab Emirates 2.9% | |||||||||||
Dubai Islamic Bank PJSC | 99,754 | 146,383 | |||||||||
Emaar Properties PJSC | 212,875 | 286,882 | |||||||||
Emirates Telecommunications Group Co. PJSC | 105,540 | 479,851 | |||||||||
First Abu Dhabi Bank PJSC | 164,727 | 641,319 | |||||||||
Total United Arab Emirates | 1,554,435 | ||||||||||
Vietnam 6.3% | |||||||||||
Bank for Foreign Trade of Vietnam JSC(a) | 195,910 | 529,089 | |||||||||
Hoa Phat Group JSC(a) | 600,916 | 1,089,647 | |||||||||
No Va Land Investment Group Corp.(a) | 212,934 | 607,014 | |||||||||
Vietnam Dairy Products JSC | 187,694 | 1,104,721 | |||||||||
Total Vietnam | 3,330,471 | ||||||||||
Total Investments in Securities (Cost: $50,201,288) | 52,393,619 | ||||||||||
Other Assets & Liabilities, Net | 391,869 | ||||||||||
Net Assets | 52,785,488 |
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
20
PORTFOLIO OF INVESTMENTS (continued)
Columbia Beyond BRICs ETF
September 30, 2018 (Unaudited)
Notes to Portfolio of Investments
(a) Non-income producing security.
Abbreviation Legend
NVDR Non-Voting Depositary Receipts
PJSC Private Joint Stock Company
Fair Value Measurements
The Fund categorizes its fair value measurements according to a three-level hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs by prioritizing that the most observable input be used when available. Observable inputs are those that market participants would use in pricing an investment based on market data obtained from sources independent of the reporting entity. Unobservable inputs are those that reflect the Fund's assumptions about the information market participants would use in pricing an investment. An investment's level within the fair value hierarchy is based on the lowest level of any input that is deemed significant to the asset's or liability's fair value measurement. The input levels are not necessarily an indication of the risk or liquidity associated with investments at that level. For example, certain U.S. government securities are generally high quality and liquid, however, they are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
Fair value inputs are summarized in the three broad levels listed below:
• Level 1 – Valuations based on quoted prices for investments in active markets that the Fund has the ability to access at the measurement date. Valuation adjustments are not applied to Level 1 investments.
• Level 2 – Valuations based on other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risks, etc.).
• Level 3 – Valuations based on significant unobservable inputs (including the Fund's own assumptions and judgment in determining the fair value of investments).
Inputs that are used in determining fair value of an investment may include price information, credit data, volatility statistics, and other factors. These inputs can be either observable or unobservable. The availability of observable inputs can vary between investments, and is affected by various factors such as the type of investment, and the volume and level of activity for that investment or similar investments in the marketplace. The inputs will be considered by the Investment Manager, along with any other relevant factors in the calculation of an investment's fair value. The Fund uses prices and inputs that are current as of the measurement date, which may include periods of market dislocations. During these periods, the availability of prices and inputs may be reduced for many investments. This condition could cause an investment to be reclassified between the various levels within the hierarchy.
Investments falling into the Level 3 category are primarily supported by quoted prices from brokers and dealers participating in the market for those investments. However, these may be classified as Level 3 investments due to lack of market transparency and corroboration to support these quoted prices. Additionally, valuation models may be used as the pricing source for any remaining investments classified as Level 3. These models may rely on one or more significant unobservable inputs and/or significant assumptions by the Investment Manager. Inputs used in valuations may include, but are not limited to, financial statement analysis, capital account balances, discount rates and estimated cash flows, and comparable company data.
Under the direction of the Fund's Board of Trustees (the Board), the Investment Manager's Valuation Committee (the Committee) is responsible for overseeing the valuation procedures approved by the Board. The Committee consists of voting and non-voting members from various groups within the Investment Manager's organization, including operations and accounting, trading and investments, compliance, risk management and legal.
The Committee meets at least monthly to review and approve valuation matters, which may include a description of specific valuation determinations, data regarding pricing information received from approved pricing vendors and brokers and the results of Board-approved valuation control policies and procedures (the Policies). The Policies address, among other things, instances when market quotations are or are not readily available, including recommendation of third party pricing vendors and a determination of appropriate pricing methodologies; events that require specific valuation determinations and assessment of fair value techniques; securities with a potential for stale pricing, including those that are illiquid, restricted, or in default; and the effectiveness of third-party pricing vendors, including periodic reviews of vendors. The Committee meets more frequently, as needed, to discuss additional valuation matters, which may include the need to review back-testing results, review time-sensitive information or approve related valuation actions. The Committee reports to the Board, with members of the Committee meeting with the Board at each of its regularly scheduled meetings to discuss valuation matters and actions during the period, similar to those described earlier.
For investments categorized as Level 3, the Committee monitors information similar to that described above, which may include: (i) data specific to the issuer or comparable issuers, (ii) general market or specific sector news and (iii) quoted prices and specific or similar security transactions. The Committee considers this data and any changes from prior periods in order to assess the reasonableness of observable and unobservable inputs, any assumptions or internal models used to value those securities and changes in fair value. This data is also used to corroborate, when available, information received from approved pricing vendors and brokers. Various factors impact the frequency of monitoring this information (which may occur as often as daily). However, the Committee may determine that changes to inputs, assumptions and models are not required as a result of the monitoring procedures performed.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
21
PORTFOLIO OF INVESTMENTS (continued)
Columbia Beyond BRICs ETF
September 30, 2018 (Unaudited)
Fair Value Measurements (continued)
The following table is a summary of the inputs used to value the Fund's investments as of September 30, 2018:
Level 1 quoted prices in active markets for identical assets ($) | Level 2 other significant observable inputs ($) | Level 3 significant unobservable inputs ($) | Total ($) | ||||||||||||||||
Investments in Securities | |||||||||||||||||||
Common Stocks | |||||||||||||||||||
Bangladesh | 2,824,227 | — | — | 2,824,227 | |||||||||||||||
Chile | 1,835,823 | — | — | 1,835,823 | |||||||||||||||
Colombia | 387,516 | — | — | 387,516 | |||||||||||||||
Czech Republic | 243,191 | — | — | 243,191 | |||||||||||||||
Hungary | 509,604 | — | — | 509,604 | |||||||||||||||
Indonesia | 4,193,272 | — | — | 4,193,272 | |||||||||||||||
Kenya | 1,535,285 | — | — | 1,535,285 | |||||||||||||||
Kuwait | 864,600 | — | — | 864,600 | |||||||||||||||
Malaysia | 4,569,223 | — | — | 4,569,223 | |||||||||||||||
Mexico | 6,880,451 | — | — | 6,880,451 | |||||||||||||||
Morocco | 2,079,688 | — | — | 2,079,688 | |||||||||||||||
Nigeria | 2,092,405 | — | — | 2,092,405 | |||||||||||||||
Philippines | 1,676,267 | — | — | 1,676,267 | |||||||||||||||
Qatar | 1,994,915 | — | — | 1,994,915 | |||||||||||||||
Romania | 1,005,084 | — | — | 1,005,084 | |||||||||||||||
South Africa | 8,036,650 | — | — | 8,036,650 | |||||||||||||||
Thailand | 6,780,512 | — | — | 6,780,512 | |||||||||||||||
United Arab Emirates | 1,554,435 | — | — | 1,554,435 | |||||||||||||||
Vietnam | 3,330,471 | — | — | 3,330,471 | |||||||||||||||
Total Common Stocks | 52,393,619 | — | — | 52,393,619 | |||||||||||||||
Total Investments in Securities | 52,393,619 | — | — | 52,393,619 |
See the Portfolio of Investments for all investment classifications not indicated in the table.
There were no transfers of financial assets between levels during the period.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
22
PORTFOLIO OF INVESTMENTS
Columbia EM Core ex-China ETF
September 30, 2018 (Unaudited)
(Percentages represent value of investments compared to net assets)
Investments in Securities
Common Stocks 93.0%
Issuer | Shares | Value ($) | |||||||||
Brazil 5.4% | |||||||||||
Ambev SA | 16,795 | 77,129 | |||||||||
B3 SA — Brasil Bolsa Balcao | 8,134 | 47,661 | |||||||||
Banco do Brasil SA | 3,447 | 25,419 | |||||||||
BRF SA(a) | 3,697 | 20,339 | |||||||||
Kroton Educacional SA | 8,894 | 25,389 | |||||||||
Ultrapar Participacoes SA | 1,610 | 15,050 | |||||||||
Vale SA | 18,769 | 281,144 | |||||||||
Total Brazil | 492,131 | ||||||||||
Chile 1.2% | |||||||||||
Cia Cervecerias Unidas SA | 3,456 | 48,040 | |||||||||
Empresas COPEC SA | 4,163 | 64,137 | |||||||||
Total Chile | 112,177 | ||||||||||
India 8.7% | |||||||||||
ICICI Bank, Ltd. ADR | 30,293 | 257,187 | |||||||||
Infosys, Ltd. ADR | 36,745 | 373,697 | |||||||||
Tata Motors, Ltd. ADR(a) | 10,275 | 157,824 | |||||||||
Total India | 788,708 | ||||||||||
Indonesia 3.3% | |||||||||||
PT Astra International Tbk | 94,956 | 46,836 | |||||||||
PT Bank Central Asia Tbk | 84,396 | 136,776 | |||||||||
PT Bank Mandiri Persero Tbk | 144,682 | 65,294 | |||||||||
PT Telekomunikasi Indonesia Persero Tbk | 208,129 | 50,840 | |||||||||
Total Indonesia | 299,746 | ||||||||||
Malaysia 4.6% | |||||||||||
Dialog Group Bhd | 210,100 | 177,178 | |||||||||
IHH Healthcare Bhd | 66,700 | 83,969 | |||||||||
Petronas Dagangan Bhd | 11,500 | 72,971 | |||||||||
Tenaga Nasional Bhd | 23,400 | 87,414 | |||||||||
Total Malaysia | 421,532 | ||||||||||
Mexico 4.7% | |||||||||||
Cemex SAB de CV Series CPO(a) | 81,765 | 57,456 | |||||||||
Coca-Cola Femsa SAB de CV Series L | 11,499 | 70,264 | |||||||||
Grupo Bimbo SAB de CV Series A | 24,276 | 51,813 |
Common Stocks (continued)
Issuer | Shares | Value ($) | |||||||||
Grupo Mexico SAB de CV Series B | 28,804 | 83,104 | |||||||||
Grupo Televisa SAB Series CPO | 14,926 | 53,113 | |||||||||
Wal-Mart de Mexico SAB de CV | 34,910 | 106,470 | |||||||||
Total Mexico | 422,220 | ||||||||||
Philippines 2.2% | |||||||||||
Aboitiz Power Corp. | 62,300 | 38,570 | |||||||||
JG Summit Holdings, Inc. | 27,370 | 27,330 | |||||||||
Jollibee Foods Corp. | 7,760 | 36,911 | |||||||||
Manila Electric Co. | 4,710 | 29,639 | |||||||||
Puregold Price Club, Inc. | 38,000 | 31,649 | |||||||||
SM Investments Corp. | 2,370 | 39,654 | |||||||||
Total Philippines | 203,753 | ||||||||||
Poland 2.6% | |||||||||||
Powszechna Kasa Oszczednosci Bank Polski SA | 11,495 | 133,782 | |||||||||
Powszechny Zaklad Ubezpieczen SA | 9,088 | 97,880 | |||||||||
Total Poland | 231,662 | ||||||||||
Russia 4.8% | |||||||||||
Gazprom PJSC ADR | 16,873 | 84,365 | |||||||||
LUKOIL PJSC ADR | 2,897 | 222,200 | |||||||||
Sberbank of Russia PJSC ADR | 10,236 | 129,792 | |||||||||
Total Russia | 436,357 | ||||||||||
South Africa 8.6% | |||||||||||
AngloGold Ashanti, Ltd. | 4,027 | 34,831 | |||||||||
Aspen Pharmacare Holdings, Ltd. | 2,132 | 25,518 | |||||||||
Bid Corp., Ltd. | 5,325 | 110,976 | |||||||||
Bidvest Group, Ltd. (The) | 5,472 | 71,536 | |||||||||
FirstRand, Ltd. | 8,220 | 39,424 | |||||||||
MTN Group, Ltd. | 6,479 | 40,098 | |||||||||
Naspers, Ltd. N Shares | 974 | 210,038 | |||||||||
Remgro, Ltd. | 2,066 | 28,797 | |||||||||
Sanlam, Ltd. | 10,355 | 57,888 | |||||||||
Sasol, Ltd. | 2,639 | 102,106 | |||||||||
Standard Bank Group, Ltd. | 4,458 | 55,129 | |||||||||
Total South Africa | 776,341 |
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
23
PORTFOLIO OF INVESTMENTS (continued)
Columbia EM Core ex-China ETF
September 30, 2018 (Unaudited)
(Percentages represent value of investments compared to net assets)
Common Stocks (continued)
Issuer | Shares | Value ($) | |||||||||
South Korea 18.4% | |||||||||||
Celltrion, Inc.(a) | 705 | 188,763 | |||||||||
Hana Financial Group, Inc. | 1,191 | 47,833 | |||||||||
Hyundai Motor Co. | 905 | 105,655 | |||||||||
KB Financial Group, Inc. | 3,065 | 149,761 | |||||||||
Kia Motors Corp. | 2,044 | 64,678 | |||||||||
Korea Electric Power Corp. | 1,654 | 43,764 | |||||||||
KT&G Corp. | 646 | 60,567 | |||||||||
POSCO | 394 | 104,605 | |||||||||
Samsung C&T Corp. | 337 | 39,343 | |||||||||
Samsung Electronics Co., Ltd. | 13,895 | 581,855 | |||||||||
Shinhan Financial Group Co., Ltd. | 2,947 | 119,554 | |||||||||
SK Hynix, Inc. | 2,470 | 162,774 | |||||||||
Total South Korea | 1,669,152 | ||||||||||
Taiwan 21.2% | |||||||||||
ASE Industrial Holding Co., Ltd.(a) | 15,124 | 36,902 | |||||||||
Chang Hwa Commercial Bank, Ltd. | 73,840 | 45,707 | |||||||||
China Steel Corp. | 87,904 | 73,414 | |||||||||
Chipbond Technology Corp. | 25,000 | 48,308 | |||||||||
Chunghwa Telecom Co., Ltd. | 24,465 | 88,139 | |||||||||
CTBC Financial Holding Co., Ltd. | 70,546 | 53,141 | |||||||||
Eva Airways Corp. | 87,150 | 42,386 | |||||||||
Far Eastern New Century Corp. | 71,765 | 83,910 | |||||||||
Far EasTone Telecommunications Co., Ltd. | 28,248 | 67,352 | |||||||||
Formosa Chemicals & Fibre Corp. | 11,882 | 49,811 | |||||||||
Formosa Petrochemical Corp. | 12,000 | 58,167 | |||||||||
Formosa Plastics Corp. | 27,233 | 104,355 | |||||||||
Formosa Taffeta Co., Ltd. | 37,000 | 45,140 | |||||||||
Hon Hai Precision Industry Co., Ltd. | 45,985 | 119,281 | |||||||||
Makalot Industrial Co., Ltd. | 5,000 | 24,809 | |||||||||
MediaTek, Inc. | 6,409 | 51,741 | |||||||||
Nan Ya Plastics Corp. | 38,576 | 107,138 | |||||||||
President Chain Store Corp. | 10,375 | 121,817 | |||||||||
Standard Foods Corp. | 23,536 | 39,159 |
Common Stocks (continued)
Issuer | Shares | Value ($) | |||||||||
Taiwan Business Bank | 130,000 | 47,260 | |||||||||
Taiwan Mobile Co., Ltd. | 13,986 | 50,158 | |||||||||
Taiwan Semiconductor Manufacturing Co., Ltd. | 60,614 | 521,114 | |||||||||
Uni-President Enterprises Corp. | 18,833 | 49,160 | |||||||||
Total Taiwan | 1,928,369 | ||||||||||
Thailand 6.4% | |||||||||||
Airports of Thailand PCL NVDR | 48,200 | 97,622 | |||||||||
BTS Group Holdings PCL NVDR | 506,655 | 145,699 | |||||||||
CP ALL PCL NVDR | 19,700 | 42,031 | |||||||||
Home Product Center PCL NVDR | 110,500 | 53,986 | |||||||||
Ratchaburi Electricity Generating Holding PCL | 26,700 | 42,725 | |||||||||
Siam Cement PCL (The) | 3,500 | 48,268 | |||||||||
Siam Commercial Bank PCL (The) | 15,800 | 72,795 | |||||||||
Tesco Lotus Retail Growth Freehold & Leasehold Property Fund | 81,400 | 50,592 | |||||||||
Thai Union Group PCL NVDR | 55,796 | 30,883 | |||||||||
Total Thailand | 584,601 | ||||||||||
Turkey 0.9% | |||||||||||
Haci Omer Sabanci Holding AS | 15,682 | 19,918 | |||||||||
Turkiye Garanti Bankasi AS | 26,183 | 33,604 | |||||||||
Turkiye Is Bankasi AS Class C | 31,575 | 23,232 | |||||||||
Total Turkey | 76,754 | ||||||||||
Total Common Stocks (Cost: $7,304,144) | 8,443,503 |
Preferred Stocks 6.4%
Issuer | Shares | Value ($) | |||||||||
Brazil 6.4% | |||||||||||
Banco Bradesco SA Preference Shares | 7,221 | 51,840 | |||||||||
Itau Unibanco Holding SA Preference Shares | 16,852 | 186,220 | |||||||||
Itausa — Investimentos Itau SA Preference Shares | 36,106 | 91,315 | |||||||||
Petroleo Brasileiro SA Preference Shares | 40,792 | 215,423 | |||||||||
Telefonica Brasil SA Preference Shares | 3,634 | 35,671 | |||||||||
Total Brazil | 580,469 | ||||||||||
Total Preferred Stocks (Cost: $440,005) | 580,469 |
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
24
PORTFOLIO OF INVESTMENTS (continued)
Columbia EM Core ex-China ETF
September 30, 2018 (Unaudited)
(Percentages represent value of investments compared to net assets)
Warrant 0.0%
Issuer | Shares | Value ($) | |||||||||
Thailand 0.0% | |||||||||||
BTS Group Holdings PCL, expiring 12/31/19(b) (Cost: $0) | 56,295 | 0 |
Money Market Fund 0.4%
Shares | Value ($) | ||||||||||
Goldman Sachs Financial Square Funds — Treasury Instruments Fund, Institutional Shares, 1.914%(c) (Cost: $39,106) | 39,106 | 39,106 | |||||||||
Total Investments in Securities (Cost: $7,783,255) | 9,063,078 | ||||||||||
Other Assets & Liabilities, Net | 13,985 | ||||||||||
Net Assets | 9,077,063 |
Notes to Portfolio of Investments
(a) Non-income producing security.
(b) Negligible market value.
(c) The rate shown is the seven-day current annualized yield at September 30, 2018.
Abbreviation Legend
ADR American Depositary Receipts
NVDR Non-Voting Depositary Receipts
PJSC Private Joint Stock Company
Fair Value Measurements
The Fund categorizes its fair value measurements according to a three-level hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs by prioritizing that the most observable input be used when available. Observable inputs are those that market participants would use in pricing an investment based on market data obtained from sources independent of the reporting entity. Unobservable inputs are those that reflect the Fund's assumptions about the information market participants would use in pricing an investment. An investment's level within the fair value hierarchy is based on the lowest level of any input that is deemed significant to the asset's or liability's fair value measurement. The input levels are not necessarily an indication of the risk or liquidity associated with investments at that level. For example, certain U.S. government securities are generally high quality and liquid, however, they are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
Fair value inputs are summarized in the three broad levels listed below:
• Level 1 – Valuations based on quoted prices for investments in active markets that the Fund has the ability to access at the measurement date. Valuation adjustments are not applied to Level 1 investments.
• Level 2 – Valuations based on other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risks, etc.).
• Level 3 – Valuations based on significant unobservable inputs (including the Fund's own assumptions and judgment in determining the fair value of investments).
Inputs that are used in determining fair value of an investment may include price information, credit data, volatility statistics, and other factors. These inputs can be either observable or unobservable. The availability of observable inputs can vary between investments, and is affected by various factors such as the type of investment, and the volume and level of activity for that investment or similar investments in the marketplace. The inputs will be considered by the Investment Manager, along with any other relevant factors in the calculation of an investment's fair value. The Fund uses prices and inputs that are current as of the measurement date, which may include periods of market dislocations. During these periods, the availability of prices and inputs may be reduced for many investments. This condition could cause an investment to be reclassified between the various levels within the hierarchy.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
25
PORTFOLIO OF INVESTMENTS (continued)
Columbia EM Core ex-China ETF
September 30, 2018 (Unaudited)
Fair Value Measurements (continued)
Investments falling into the Level 3 category are primarily supported by quoted prices from brokers and dealers participating in the market for those investments. However, these may be classified as Level 3 investments due to lack of market transparency and corroboration to support these quoted prices. Additionally, valuation models may be used as the pricing source for any remaining investments classified as Level 3. These models may rely on one or more significant unobservable inputs and/or significant assumptions by the Investment Manager. Inputs used in valuations may include, but are not limited to, financial statement analysis, capital account balances, discount rates and estimated cash flows, and comparable company data.
Under the direction of the Fund's Board of Trustees (the Board), the Investment Manager's Valuation Committee (the Committee) is responsible for overseeing the valuation procedures approved by the Board. The Committee consists of voting and non-voting members from various groups within the Investment Manager's organization, including operations and accounting, trading and investments, compliance, risk management and legal.
The Committee meets at least monthly to review and approve valuation matters, which may include a description of specific valuation determinations, data regarding pricing information received from approved pricing vendors and brokers and the results of Board-approved valuation control policies and procedures (the Policies). The Policies address, among other things, instances when market quotations are or are not readily available, including recommendations of third party pricing vendors and a determination of appropriate pricing methodologies; events that require specific valuation determinations and assessment of fair value techniques; securities with a potential for stale pricing, including those that are illiquid, restricted, or in default; and the effectiveness of third-party pricing vendors, including periodic reviews of vendors. The Committee meets more frequently, as needed, to discuss additional valuation matters, which may include the need to review back-testing results, review time-sensitive information or approve related valuation actions. The Committee reports to the Board, with members of the Committee meeting with the Board at each of its regularly scheduled meetings to discuss valuation matters and actions during the period, similar to those described earlier.
For investments categorized as Level 3, the Committee monitors information similar to that described above, which may include: (i) data specific to the issuer or comparable issuers, (ii) general market or specific sector news and (iii) quoted prices and specific or similar security transactions. The Committee considers this data and any changes from prior periods in order to assess the reasonableness of observable and unobservable inputs, any assumptions or internal models used to value those securities and changes in fair value. This data is also used to corroborate, when available, information received from approved pricing vendors and brokers. Various factors impact the frequency of monitoring this information (which may occur as often as daily). However, the Committee may determine that changes to inputs, assumptions and models are not required as a result of the monitoring procedures performed.
The following table is a summary of the inputs used to value the Fund's investments as of September 30, 2018:
Level 1 quoted prices in active markets for identical assets ($) | Level 2 other significant observable inputs ($) | Level 3 significant unobservable inputs ($) | Total ($) | ||||||||||||||||
Investments in Securities | |||||||||||||||||||
Common Stocks | |||||||||||||||||||
Brazil | 492,131 | — | — | 492,131 | |||||||||||||||
Chile | 112,177 | — | — | 112,177 | |||||||||||||||
India | 788,708 | — | — | 788,708 | |||||||||||||||
Indonesia | 299,746 | — | — | 299,746 | |||||||||||||||
Malaysia | 421,532 | — | — | 421,532 | |||||||||||||||
Mexico | 422,220 | — | — | 422,220 | |||||||||||||||
Philippines | 203,753 | — | — | 203,753 | |||||||||||||||
Poland | 231,662 | — | — | 231,662 | |||||||||||||||
Russia | 436,357 | — | — | 436,357 | |||||||||||||||
South Africa | 776,341 | — | — | 776,341 | |||||||||||||||
South Korea | 1,669,152 | — | — | 1,669,152 | |||||||||||||||
Taiwan | 1,928,369 | — | — | 1,928,369 | |||||||||||||||
Thailand | 584,601 | — | — | 584,601 | |||||||||||||||
Turkey | 76,754 | — | — | 76,754 | |||||||||||||||
Total Common Stocks | 8,443,503 | — | — | 8,443,503 | |||||||||||||||
Preferred Stocks | |||||||||||||||||||
Brazil | 580,469 | — | — | 580,469 | |||||||||||||||
Total Preferred Stocks | 580,469 | — | — | 580,469 | |||||||||||||||
Warrant | |||||||||||||||||||
Thailand | — | — | (a) | — | — | (a) | |||||||||||||
Total Warrant | — | — | (a) | — | — | (a) | |||||||||||||
Money Market Fund | 39,106 | — | — | 39,106 | |||||||||||||||
Total Investments in Securities | 9,063,078 | — | — | 9,063,078 |
(a) Negligible market value.
See the Portfolio of Investments for all investment classifications not indicated in the table.
There were no transfers of financial assets between levels during the period.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
26
PORTFOLIO OF INVESTMENTS
Columbia EM Quality Dividend ETF
September 30, 2018 (Unaudited)
(Percentages represent value of investments compared to net assets)
Investments in Securities
Common Stocks 97.5%
Issuer | Shares | Value ($) | |||||||||
Brazil 6.0% | |||||||||||
Cielo SA | 50,338 | 154,409 | |||||||||
Suzano Papel e Celulose SA | 13,800 | 166,144 | |||||||||
Vale SA | 10,600 | 158,779 | |||||||||
Total Brazil | 479,332 | ||||||||||
Chile 1.9% | |||||||||||
Enel Americas SA | 990,093 | 152,086 | |||||||||
China 10.0% | |||||||||||
Bank of China, Ltd. Class H | 354,878 | 157,826 | |||||||||
China Construction Bank Corp. Class H | 181,039 | 158,252 | |||||||||
China Mobile, Ltd. | 16,383 | 161,529 | |||||||||
Industrial & Commercial Bank of China, Ltd. Class H | 217,625 | 159,084 | |||||||||
Ping An Insurance Group Co. of China, Ltd. Class H | 15,832 | 160,851 | |||||||||
Total China | 797,542 | ||||||||||
Colombia 2.2% | |||||||||||
Ecopetrol SA | 130,361 | 176,924 | |||||||||
Hong Kong 9.9% | |||||||||||
CK Asset Holdings Ltd. | 20,562 | 154,381 | |||||||||
CLP Holdings, Ltd. | 13,526 | 158,425 | |||||||||
Hang Seng Bank Ltd. | 5,948 | 161,605 | |||||||||
Hong Kong Exchanges & Clearing, Ltd. | 5,455 | 156,158 | |||||||||
Link REIT | 16,858 | 165,997 | |||||||||
Total Hong Kong | 796,566 | ||||||||||
India 11.7% | |||||||||||
Bharat Petroleum Corp., Ltd. | 30,688 | 158,393 | |||||||||
GAIL India, Ltd. | 29,615 | 154,836 | |||||||||
Indian Oil Corp., Ltd. | 73,058 | 154,552 | |||||||||
Infosys, Ltd. | 16,382 | 164,984 | |||||||||
ITC, Ltd. | 38,013 | 156,137 | |||||||||
Power Grid Corp. of India, Ltd. | 57,655 | 149,844 | |||||||||
Total India | 938,746 | ||||||||||
Indonesia 8.0% | |||||||||||
PT Astra International Tbk | 326,899 | 161,239 | |||||||||
PT Gudang Garam Tbk | 31,590 | 156,980 |
Common Stocks (continued)
Issuer | Shares | Value ($) | |||||||||
PT Telekomunikasi Indonesia Persero Tbk | 658,338 | 160,813 | |||||||||
PT United Tractors Tbk | 71,200 | 157,676 | |||||||||
Total Indonesia | 636,708 | ||||||||||
Kenya 2.0% | |||||||||||
Safaricom PLC | 665,909 | 161,853 | |||||||||
Malaysia 11.9% | |||||||||||
Malayan Banking Bhd | 67,400 | 159,441 | |||||||||
Maxis Bhd | 112,258 | 158,411 | |||||||||
Nestle Malaysia Bhd | 4,500 | 159,188 | |||||||||
Petronas Chemicals Group Bhd | 69,490 | 157,165 | |||||||||
Petronas Gas Bhd | 34,800 | 158,927 | |||||||||
Tenaga Nasional Bhd | 42,131 | 157,387 | |||||||||
Total Malaysia | 950,519 | ||||||||||
Mexico 4.0% | |||||||||||
Grupo Mexico SAB de CV Series B | 54,562 | 157,419 | |||||||||
Wal-Mart de Mexico SAB de CV | 54,276 | 165,534 | |||||||||
Total Mexico | 322,953 | ||||||||||
Poland 2.1% | |||||||||||
Polski Koncern Naftowy Orlen SA | 6,004 | 164,511 | |||||||||
Qatar 2.0% | |||||||||||
Qatar National Bank QPSC | 3,328 | 161,757 | |||||||||
South Africa 3.9% | |||||||||||
Standard Bank Group, Ltd. | 12,466 | 154,160 | |||||||||
Vodacom Group, Ltd. | 18,100 | 161,069 | |||||||||
Total South Africa | 315,229 | ||||||||||
South Korea 6.1% | |||||||||||
KB Financial Group, Inc. | 3,349 | 163,638 | |||||||||
Samsung Electronics Co., Ltd. | 3,759 | 157,409 | |||||||||
S-Oil Corp. | 1,365 | 168,587 | |||||||||
Total South Korea | 489,634 | ||||||||||
Taiwan 11.7% | |||||||||||
Formosa Chemicals & Fibre Corp. | 38,289 | 160,515 | |||||||||
Formosa Plastics Corp. | 41,710 | 159,829 | |||||||||
Nan Ya Plastics Corp. | 57,321 | 159,199 |
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
27
PORTFOLIO OF INVESTMENTS (continued)
Columbia EM Quality Dividend ETF
September 30, 2018 (Unaudited)
(Percentages represent value of investments compared to net assets)
Common Stocks (continued)
Issuer | Shares | Value ($) | |||||||||
Taiwan Semiconductor Manufacturing Co., Ltd. | 18,742 | 161,130 | |||||||||
Uni-President Enterprises Corp. | 62,752 | 163,801 | |||||||||
Yageo Corp. | 9,000 | 135,296 | |||||||||
Total Taiwan | 939,770 | ||||||||||
Thailand 2.0% | |||||||||||
PTT Global Chemical PCL NVDR | 65,008 | 163,324 | |||||||||
United Arab Emirates 2.1% | |||||||||||
Emaar Properties PJSC | 122,647 | 165,286 | |||||||||
Total Common Stocks (Cost: $7,614,578) | 7,812,740 |
Preferred Stock 1.8%
Issuer | Shares | Value ($) | |||||||||
Chile 1.8% | |||||||||||
Sociedad Quimica y Minera de Chile SA Class B (Cost: $172,523) | 3,276 | 149,983 |
Money Market Fund 0.2%
Shares | Value ($) | ||||||||||
Goldman Sachs Financial Square Funds — Treasury Instruments Fund, Institutional Shares, 1.914%(a) (Cost: $12,456) | 12,456 | 12,456 | |||||||||
Total Investments in Securities (Cost: $7,799,557) | 7,975,179 | ||||||||||
Other Assets & Liabilities, Net | 37,156 | ||||||||||
Net Assets | 8,012,335 |
Notes to Portfolio of Investments
(a) The rate shown is the seven-day current annualized yield at September 30, 2018.
Abbreviation Legend
NVDR Non-Voting Depositary Receipts
PJSC Private Joint Stock Company
Fair Value Measurements
The Fund categorizes its fair value measurements according to a three-level hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs by prioritizing that the most observable input be used when available. Observable inputs are those that market participants would use in pricing an investment based on market data obtained from sources independent of the reporting entity. Unobservable inputs are those that reflect the Fund's assumptions about the information market participants would use in pricing an investment. An investment's level within the fair value hierarchy is based on the lowest level of any input that is deemed significant to the asset's or liability's fair value measurement. The input levels are not necessarily an indication of the risk or liquidity associated with investments at that level. For example, certain U.S. government securities are generally high quality and liquid, however, they are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
Fair value inputs are summarized in the three broad levels listed below:
• Level 1 – Valuations based on quoted prices for investments in active markets that the Fund has the ability to access at the measurement date. Valuation adjustments are not applied to Level 1 investments.
• Level 2 – Valuations based on other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risks, etc.).
• Level 3 – Valuations based on significant unobservable inputs (including the Fund's own assumptions and judgment in determining the fair value of investments).
Inputs that are used in determining fair value of an investment may include price information, credit data, volatility statistics, and other factors. These inputs can be either observable or unobservable. The availability of observable inputs can vary between investments, and is affected by various factors such as the type of investment, and the volume and level of activity for that investment or similar investments in the marketplace. The inputs will be considered by the Investment Manager, along with any other relevant factors in the calculation of an investment's fair value. The Fund uses prices and inputs that are current as of the measurement date, which may include periods of market dislocations. During these periods, the availability of prices and inputs may be reduced for many investments. This condition could cause an investment to be reclassified between the various levels within the hierarchy.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
28
PORTFOLIO OF INVESTMENTS (continued)
Columbia EM Quality Dividend ETF
September 30, 2018 (Unaudited)
Fair Value Measurements (continued)
Investments falling into the Level 3 category are primarily supported by quoted prices from brokers and dealers participating in the market for those investments. However, these may be classified as Level 3 investments due to lack of market transparency and corroboration to support these quoted prices. Additionally, valuation models may be used as the pricing source for any remaining investments classified as Level 3. These models may rely on one or more significant unobservable inputs and/or significant assumptions by the Investment Manager. Inputs used in valuations may include, but are not limited to, financial statement analysis, capital account balances, discount rates and estimated cash flows, and comparable company data.
Under the direction of the Fund's Board of Trustees (the Board), the Investment Manager's Valuation Committee (the Committee) is responsible for overseeing the valuation procedures approved by the Board. The Committee consists of voting and non-voting members from various groups within the Investment Manager's organization, including operations and accounting, trading and investments, compliance, risk management and legal.
The Committee meets at least monthly to review and approve valuation matters, which may include a description of specific valuation determinations, data regarding pricing information received from approved pricing vendors and brokers and the results of Board-approved valuation control policies and procedures (the Policies). The Policies address, among other things, instances when market quotations are or are not readily available, including recommendations of third party pricing vendors and a determination of appropriate pricing methodologies; events that require specific valuation determinations and assessment of fair value techniques; securities with a potential for stale pricing, including those that are illiquid, restricted, or in default; and the effectiveness of third-party pricing vendors, including periodic reviews of vendors. The Committee meets more frequently, as needed, to discuss additional valuation matters, which may include the need to review back-testing results, review time-sensitive information or approve related valuation actions. The Committee reports to the Board, with members of the Committee meeting with the Board at each of its regularly scheduled meetings to discuss valuation matters and actions during the period, similar to those described earlier.
For investments categorized as Level 3, the Committee monitors information similar to that described above, which may include: (i) data specific to the issuer or comparable issuers, (ii) general market or specific sector news and (iii) quoted prices and specific or similar security transactions. The Committee considers this data and any changes from prior periods in order to assess the reasonableness of observable and unobservable inputs, any assumptions or internal models used to value those securities and changes in fair value. This data is also used to corroborate, when available, information received from approved pricing vendors and brokers. Various factors impact the frequency of monitoring this information (which may occur as often as daily). However, the Committee may determine that changes to inputs, assumptions and models are not required as a result of the monitoring procedures performed.
The following table is a summary of the inputs used to value the Fund's investments as of September 30, 2018:
Level 1 quoted prices in active markets for identical assets ($) | Level 2 other significant observable inputs ($) | Level 3 significant unobservable inputs ($) | Total ($) | ||||||||||||||||
Investments in Securities | |||||||||||||||||||
Common Stocks | |||||||||||||||||||
Brazil | 479,332 | — | — | 479,332 | |||||||||||||||
Chile | 152,086 | — | — | 152,086 | |||||||||||||||
China | 797,542 | — | — | 797,542 | |||||||||||||||
Colombia | 176,924 | — | — | 176,924 | |||||||||||||||
Hong Kong | 796,566 | — | — | 796,566 | |||||||||||||||
India | 938,746 | — | — | 938,746 | |||||||||||||||
Indonesia | 636,708 | — | — | 636,708 | |||||||||||||||
Kenya | 161,853 | — | — | 161,853 | |||||||||||||||
Malaysia | 950,519 | — | — | 950,519 | |||||||||||||||
Mexico | 322,953 | — | — | 322,953 | |||||||||||||||
Poland | 164,511 | — | — | 164,511 | |||||||||||||||
Qatar | 161,757 | — | — | 161,757 | |||||||||||||||
South Africa | 315,229 | — | — | 315,229 | |||||||||||||||
South Korea | 489,634 | — | — | 489,634 | |||||||||||||||
Taiwan | 939,770 | — | — | 939,770 | |||||||||||||||
Thailand | 163,324 | — | — | 163,324 | |||||||||||||||
United Arab Emirates | 165,286 | — | — | 165,286 | |||||||||||||||
Total Common Stocks | 7,812,740 | — | — | 7,812,740 | |||||||||||||||
Preferred Stocks | |||||||||||||||||||
Chile | 149,983 | — | — | 149,983 | |||||||||||||||
Total Preferred Stocks | 149,983 | — | — | 149,983 | |||||||||||||||
Money Market Fund | 12,456 | — | — | 12,456 | |||||||||||||||
Total Investments in Securities | 7,975,179 | — | — | 7,975,179 |
See the Portfolio of Investments for all investment classifications not indicated in the table.
There were no transfers of financial assets between levels during the period.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
29
PORTFOLIO OF INVESTMENTS (Consolidated)
Columbia Emerging Markets Consumer ETF
September 30, 2018 (Unaudited)
(Percentages represent value of investments compared to net assets)
Investments in Securities
Common Stocks 99.9%
Issuer | Shares | Value ($) | |||||||||
Brazil 9.4% | |||||||||||
Ambev SA ADR | 4,541,591 | 20,755,071 | |||||||||
Kroton Educacional SA | 3,692,958 | 10,541,929 | |||||||||
Lojas Renner SA | 1,468,043 | 11,395,709 | |||||||||
Total Brazil | 42,692,709 | ||||||||||
Chile 2.3% | |||||||||||
S.A.C.I. Falabella | 1,289,293 | 10,465,244 | |||||||||
China 33.4% | |||||||||||
China Mengniu Dairy Co., Ltd.(a) | 4,513,898 | 15,027,290 | |||||||||
Ctrip.com International, Ltd. ADR(a) | 463,683 | 17,235,097 | |||||||||
Geely Automobile Holdings, Ltd. | 8,072,219 | 16,093,064 | |||||||||
Hengan International Group Co., Ltd. | 1,306,178 | 12,052,046 | |||||||||
JD.com, Inc. ADR(a) | 788,781 | 20,579,296 | |||||||||
New Oriental Education & Technology Group, Inc. ADR(a) | 185,780 | 13,749,578 | |||||||||
Shenzhou International Group Holdings, Ltd. | 1,140,483 | 14,633,349 | |||||||||
TAL Education Group ADR(a) | 533,682 | 13,720,964 | |||||||||
Want Want China Holdings, Ltd. | 12,632,065 | 10,638,514 | |||||||||
Yum China Holdings, Inc. | 494,735 | 17,370,146 | |||||||||
Total China | 151,099,344 | ||||||||||
India 13.2% | |||||||||||
Hindustan Unilever, Ltd. | 818,178 | 18,153,642 | |||||||||
ITC, Ltd. | 3,804,997 | 15,628,885 | |||||||||
Maruti Suzuki India, Ltd. | 147,089 | 14,909,679 | |||||||||
Tata Motors, Ltd. ADR(a) | 712,823 | 10,948,961 | |||||||||
Total India | 59,641,167 | ||||||||||
Indonesia 3.2% | |||||||||||
PT Astra International Tbk | 29,468,458 | 14,534,991 | |||||||||
Malaysia 2.1% | |||||||||||
Genting Bhd | 5,074,494 | 9,576,368 |
Common Stocks (continued)
Issuer | Shares | Value ($) | |||||||||
Mexico 11.3% | |||||||||||
Fomento Economico Mexicano SAB de CV Series UBD | 2,016,854 | 19,973,048 | |||||||||
Grupo Televisa SAB Series CPO | 3,519,315 | 12,523,241 | |||||||||
Wal-Mart de Mexico SAB de CV | 6,053,011 | 18,460,806 | |||||||||
Total Mexico | 50,957,095 | ||||||||||
Philippines 2.8% | |||||||||||
SM Investments Corp. | 754,199 | 12,618,839 | |||||||||
Russia 2.1% | |||||||||||
Magnit PJSC GDR | 679,939 | 9,658,533 | |||||||||
South Africa 14.6% | |||||||||||
Naspers, Ltd. N Shares | 215,304 | 46,429,135 | |||||||||
Shoprite Holdings, Ltd. | 836,705 | 11,331,474 | |||||||||
Tiger Brands, Ltd. | 434,339 | 8,134,159 | |||||||||
Total South Africa | 65,894,768 | ||||||||||
Thailand 5.5% | |||||||||||
CP ALL PCL | 6,738,305 | 14,376,718 | |||||||||
Thai Beverage PCL | 20,950,944 | 10,426,788 | |||||||||
Total Thailand | 24,803,506 | ||||||||||
Total Common Stocks (Cost: $477,999,805) | 451,942,564 |
Money Market Fund 0.0%
Shares | Value ($) | ||||||||||
Goldman Sachs Financial Square Funds — Treasury Instruments Fund, Institutional Shares, 1.914%(b) (Cost: $83,704) | 83,704 | 83,704 | |||||||||
Total Investments in Securities (Cost: $478,083,509) | 452,026,268 | ||||||||||
Other Assets & Liabilities, Net | 497,380 | ||||||||||
Net Assets | 452,523,648 |
Notes to Consolidated Portfolio of Investments
(a) Non-income producing security.
(b) The rate shown is the seven-day current annualized yield at September 30, 2018.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
30
PORTFOLIO OF INVESTMENTS (Consolidated) (continued)
Columbia Emerging Markets Consumer ETF
September 30, 2018 (Unaudited)
Abbreviation Legend
ADR American Depositary Receipts
GDR Global Depositary Receipts
PJSC Private Joint Stock Company
Fair Value Measurements
The Fund categorizes its fair value measurements according to a three-level hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs by prioritizing that the most observable input be used when available. Observable inputs are those that market participants would use in pricing an investment based on market data obtained from sources independent of the reporting entity. Unobservable inputs are those that reflect the Fund's assumptions about the information market participants would use in pricing an investment. An investment's level within the fair value hierarchy is based on the lowest level of any input that is deemed significant to the asset's or liability's fair value measurement. The input levels are not necessarily an indication of the risk or liquidity associated with investments at that level. For example, certain U.S. government securities are generally high quality and liquid, however, they are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
Fair value inputs are summarized in the three broad levels listed below:
• Level 1 – Valuations based on quoted prices for investments in active markets that the Fund has the ability to access at the measurement date. Valuation adjustments are not applied to Level 1 investments.
• Level 2 – Valuations based on other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risks, etc.).
• Level 3 – Valuations based on significant unobservable inputs (including the Fund's own assumptions and judgment in determining the fair value of investments).
Inputs that are used in determining fair value of an investment may include price information, credit data, volatility statistics, and other factors. These inputs can be either observable or unobservable. The availability of observable inputs can vary between investments, and is affected by various factors such as the type of investment, and the volume and level of activity for that investment or similar investments in the marketplace. The inputs will be considered by the Investment Manager, along with any other relevant factors in the calculation of an investment's fair value. The Fund uses prices and inputs that are current as of the measurement date, which may include periods of market dislocations. During these periods, the availability of prices and inputs may be reduced for many investments. This condition could cause an investment to be reclassified between the various levels within the hierarchy.
Investments falling into the Level 3 category are primarily supported by quoted prices from brokers and dealers participating in the market for those investments. However, these may be classified as Level 3 investments due to lack of market transparency and corroboration to support these quoted prices. Additionally, valuation models may be used as the pricing source for any remaining investments classified as Level 3. These models may rely on one or more significant unobservable inputs and/or significant assumptions by the Investment Manager. Inputs used in valuations may include, but are not limited to, financial statement analysis, capital account balances, discount rates and estimated cash flows, and comparable company data.
Under the direction of the Fund's Board of Trustees (the Board), the Investment Manager's Valuation Committee (the Committee) is responsible for overseeing the valuation procedures approved by the Board. The Committee consists of voting and non-voting members from various groups within the Investment Manager's organization, including operations and accounting, trading and investments, compliance, risk management and legal.
The Committee meets at least monthly to review and approve valuation matters, which may include a description of specific valuation determinations, data regarding pricing information received from approved pricing vendors and brokers and the results of Board-approved valuation control policies and procedures (the Policies). The Policies address, among other things, instances when market quotations are or are not readily available, including recommendations of third party pricing vendors and a determination of appropriate pricing methodologies; events that require specific valuation determinations and assessment of fair value techniques; securities with a potential for stale pricing, including those that are illiquid, restricted, or in default; and the effectiveness of third-party pricing vendors, including periodic reviews of vendors. The Committee meets more frequently, as needed, to discuss additional valuation matters, which may include the need to review back-testing results, review time-sensitive information or approve related valuation actions. The Committee reports to the Board, with members of the Committee meeting with the Board at each of its regularly scheduled meetings to discuss valuation matters and actions during the period, similar to those described earlier.
For investments categorized as Level 3, the Committee monitors information similar to that described above, which may include: (i) data specific to the issuer or comparable issuers, (ii) general market or specific sector news and (iii) quoted prices and specific or similar security transactions. The Committee considers this data and any changes from prior periods in order to assess the reasonableness of observable and unobservable inputs, any assumptions or internal models used to value those securities and changes in fair value. This data is also used to corroborate, when available, information received from approved pricing vendors and brokers. Various factors impact the frequency of monitoring this information (which may occur as often as daily). However, the Committee may determine that changes to inputs, assumptions and models are not required as a result of the monitoring procedures performed.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
31
PORTFOLIO OF INVESTMENTS (Consolidated) (continued)
Columbia Emerging Markets Consumer ETF
September 30, 2018 (Unaudited)
Fair Value Measurements (continued)
The following table is a summary of the inputs used to value the Fund's investments as of September 30, 2018:
Level 1 quoted prices in active markets for identical assets ($) | Level 2 other significant observable inputs ($) | Level 3 significant unobservable inputs ($) | Total ($) | ||||||||||||||||
Investments in Securities | |||||||||||||||||||
Common Stocks | |||||||||||||||||||
Brazil | 42,692,709 | — | — | 42,692,709 | |||||||||||||||
Chile | 10,465,244 | — | — | 10,465,244 | |||||||||||||||
China | 151,099,344 | — | — | 151,099,344 | |||||||||||||||
India | 59,641,167 | — | — | 59,641,167 | |||||||||||||||
Indonesia | 14,534,991 | — | — | 14,534,991 | |||||||||||||||
Malaysia | 9,576,368 | — | — | 9,576,368 | |||||||||||||||
Mexico | 50,957,095 | — | — | 50,957,095 | |||||||||||||||
Philippines | 12,618,839 | — | — | 12,618,839 | |||||||||||||||
Russia | 9,658,533 | — | — | 9,658,533 | |||||||||||||||
South Africa | 65,894,768 | — | — | 65,894,768 | |||||||||||||||
Thailand | 24,803,506 | — | — | 24,803,506 | |||||||||||||||
Total Common Stocks | 451,942,564 | — | — | 451,942,564 | |||||||||||||||
Money Market Fund | 83,704 | — | — | 83,704 | |||||||||||||||
Total Investments in Securities | 452,026,268 | — | — | 452,026,268 |
See the Consolidated Portfolio of Investments for all investment classifications not indicated in the table.
There were no transfers of financial assets between levels during the period.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
32
PORTFOLIO OF INVESTMENTS (Consolidated)
Columbia India Consumer ETF
September 30, 2018 (Unaudited)
(Percentages represent value of investments compared to net assets)
Investments in Securities
Common Stocks 99.4%
Issuer | Shares | Value ($) | |||||||||
Communication Services 4.4% | |||||||||||
Sun TV Network, Ltd. | 107,185 | 908,241 | |||||||||
Zee Entertainment Enterprises, Ltd. | 799,247 | 4,835,836 | |||||||||
Total | 5,744,077 | ||||||||||
Consumer Discretionary 44.7% | |||||||||||
Bajaj Auto, Ltd. | 154,637 | 5,732,918 | |||||||||
Balkrishna Industries, Ltd. | 134,907 | 1,895,565 | |||||||||
Bharat Forge, Ltd. | 431,089 | 3,574,667 | |||||||||
Bosch, Ltd. | 16,031 | 4,408,381 | |||||||||
Future Retail, Ltd.(a) | 242,332 | 1,558,326 | |||||||||
Hero MotoCorp, Ltd. | 126,660 | 5,125,196 | |||||||||
Mahindra & Mahindra, Ltd. | 623,268 | 7,402,436 | |||||||||
Maruti Suzuki India, Ltd. | 52,436 | 5,315,176 | |||||||||
Motherson Sumi Systems, Ltd. | 1,392,326 | 4,932,395 | |||||||||
MRF, Ltd. | 4,449 | 3,903,296 | |||||||||
Page Industries, Ltd. | 6,510 | 2,953,263 | |||||||||
Rajesh Exports, Ltd. | 96,718 | 901,736 | |||||||||
Tata Motors, Ltd.(a) | 1,329,622 | 4,103,138 | |||||||||
Titan Co., Ltd. | 555,146 | 6,169,480 | |||||||||
Total | 57,975,973 | ||||||||||
Consumer Staples 50.3% | |||||||||||
Avenue Supermarts, Ltd.(a)(b) | 173,265 | 3,336,588 | |||||||||
Britannia Industries, Ltd. | 93,857 | 7,540,023 |
Common Stocks (continued)
Issuer | Shares | Value ($) | |||||||||
Colgate-Palmolive India, Ltd. | 237,185 | 3,538,470 | |||||||||
Dabur India, Ltd. | 1,002,930 | 5,906,343 | |||||||||
Emami, Ltd. | 223,384 | 1,523,689 | |||||||||
GlaxoSmithKline Consumer Healthcare, Ltd. | 20,615 | 2,062,837 | |||||||||
Godrej Consumer Products, Ltd. | 616,768 | 6,539,919 | |||||||||
Hindustan Unilever, Ltd. | 349,325 | 7,750,784 | |||||||||
ITC, Ltd. | 1,751,472 | 7,194,107 | |||||||||
Marico, Ltd. | 861,026 | 3,955,921 | |||||||||
Nestle India, Ltd. | 59,385 | 7,946,113 | |||||||||
Procter & Gamble Hygiene & Health Care, Ltd. | 16,962 | 2,274,274 | |||||||||
United Breweries, Ltd. | 117,384 | 2,197,974 | |||||||||
United Spirits, Ltd.(a) | 491,595 | 3,487,754 | |||||||||
Total | 65,254,796 | ||||||||||
Total Common Stocks (Cost: $109,334,116) | 128,974,846 |
Money Market Fund 0.7%
Shares | Value ($) | ||||||||||
Goldman Sachs Financial Square Funds — Treasury Instruments Fund, Institutional Shares, 1.914%(c) (Cost: $902,610) | 902,610 | 902,610 | |||||||||
Total Investments in Securities (Cost: $110,236,726) | 129,877,456 | ||||||||||
Other Assets & Liabilities, Net | (93,921 | ) | |||||||||
Net Assets | 129,783,535 |
Notes to Consolidated Portfolio of Investments
(a) Non-income producing security.
(b) Represents privately placed and other securities and instruments exempt from SEC registration (collectively, private placements), such as Section 4(a)(2) and Rule 144A eligible securities, which are often sold only to qualified institutional buyers. The Fund may invest in private placements determined to be liquid as well as those determined to be illiquid. Private placements may be determined to be liquid under guidelines established by the Fund's Board of Trustees. At September 30, 2018, the value of this security amounted to $3,336,588, which represents 2.57% of net assets.
(c) The rate shown is the seven-day current annualized yield at September 30, 2018.
Fair Value Measurements
The Fund categorizes its fair value measurements according to a three-level hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs by prioritizing that the most observable input be used when available. Observable inputs are those that market participants would use in pricing an investment based on market data obtained from sources independent of the reporting entity. Unobservable inputs are those that reflect the Fund's assumptions about the information market participants would use in pricing an investment. An investment's level within the fair value hierarchy is based on the lowest level of any input that is deemed significant to the asset's or liability's fair value measurement. The input levels are not necessarily an indication of the risk or liquidity associated with investments at that level. For example, certain U.S. government securities are generally high quality and liquid, however, they are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
33
PORTFOLIO OF INVESTMENTS (Consolidated) (continued)
Columbia India Consumer ETF
September 30, 2018 (Unaudited)
Fair Value Measurements (continued)
Fair value inputs are summarized in the three broad levels listed below:
• Level 1 – Valuations based on quoted prices for investments in active markets that the Fund has the ability to access at the measurement date. Valuation adjustments are not applied to Level 1 investments.
• Level 2 – Valuations based on other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risks, etc.).
• Level 3 – Valuations based on significant unobservable inputs (including the Fund's own assumptions and judgment in determining the fair value of investments).
Inputs that are used in determining fair value of an investment may include price information, credit data, volatility statistics, and other factors. These inputs can be either observable or unobservable. The availability of observable inputs can vary between investments, and is affected by various factors such as the type of investment, and the volume and level of activity for that investment or similar investments in the marketplace. The inputs will be considered by the Investment Manager, along with any other relevant factors in the calculation of an investment's fair value. The Fund uses prices and inputs that are current as of the measurement date, which may include periods of market dislocations. During these periods, the availability of prices and inputs may be reduced for many investments. This condition could cause an investment to be reclassified between the various levels within the hierarchy.
Investments falling into the Level 3 category are primarily supported by quoted prices from brokers and dealers participating in the market for those investments. However, these may be classified as Level 3 investments due to lack of market transparency and corroboration to support these quoted prices. Additionally, valuation models may be used as the pricing source for any remaining investments classified as Level 3. These models may rely on one or more significant unobservable inputs and/or significant assumptions by the Investment Manager. Inputs used in valuations may include, but are not limited to, financial statement analysis, capital account balances, discount rates and estimated cash flows, and comparable company data.
Under the direction of the Fund's Board of Trustees (the Board), the Investment Manager's Valuation Committee (the Committee) is responsible for overseeing the valuation procedures approved by the Board. The Committee consists of voting and non-voting members from various groups within the Investment Manager's organization, including operations and accounting, trading and investments, compliance, risk management and legal.
The Committee meets at least monthly to review and approve valuation matters, which may include a description of specific valuation determinations, data regarding pricing information received from approved pricing vendors and brokers and the results of Board-approved valuation control policies and procedures (the Policies). The Policies address, among other things, instances when market quotations are or are not readily available, including recommendation of third party pricing vendors and a determination of appropriate pricing methodologies; events that require specific valuation determinations and assessment of fair value techniques; securities with a potential for stale pricing, including those that are illiquid, restricted, or in default; and the effectiveness of third-party pricing vendors, including periodic reviews of vendors. The Committee meets more frequently, as needed, to discuss additional valuation matters, which may include the need to review back-testing results, review time-sensitive information or approve related valuation actions. The Committee reports to the Board, with members of the Committee meeting with the Board at each of its regularly scheduled meetings to discuss valuation matters and actions during the period, similar to those described earlier.
For investments categorized as Level 3, the Committee monitors information similar to that described above, which may include: (i) data specific to the issuer or comparable issuers, (ii) general market or specific sector news and (iii) quoted prices and specific or similar security transactions. The Committee considers this data and any changes from prior periods in order to assess the reasonableness of observable and unobservable inputs, any assumptions or internal models used to value those securities and changes in fair value. This data is also used to corroborate, when available, information received from approved pricing vendors and brokers. Various factors impact the frequency of monitoring this information (which may occur as often as daily). However, the Committee may determine that changes to inputs, assumptions and models are not required as a result of the monitoring procedures performed.
The following table is a summary of the inputs used to value the Fund's investments as of September 30, 2018:
Level 1 quoted prices in active markets for identical assets ($) | Level 2 other significant observable inputs ($) | Level 3 significant unobservable inputs ($) | Total ($) | ||||||||||||||||
Investments in Securities | |||||||||||||||||||
Common Stocks | |||||||||||||||||||
Communication Services | 5,744,077 | — | — | 5,744,077 | |||||||||||||||
Consumer Discretionary | 57,975,973 | — | — | 57,975,973 | |||||||||||||||
Consumer Staples | 65,254,796 | — | — | 65,254,796 | |||||||||||||||
Total Common Stocks | 128,974,846 | — | — | 128,974,846 | |||||||||||||||
Money Market Fund | 902,610 | — | — | 902,610 | |||||||||||||||
Total Investments in Securities | 129,877,456 | — | — | 129,877,456 |
See the Consolidated Portfolio of Investments for all investment classifications not indicated in the table.
There were no transfers of financial assets between levels during the period.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
34
PORTFOLIO OF INVESTMENTS (Consolidated)
Columbia India Infrastructure ETF
September 30, 2018 (Unaudited)
(Percentages represent value of investments compared to net assets)
Investments in Securities
Common Stocks 99.6%
Issuer | Shares | Value ($) | |||||||||
Communication Services 12.3% | |||||||||||
Bharti Airtel, Ltd. | 319,732 | 1,493,244 | |||||||||
Bharti Infratel, Ltd. | 279,575 | 1,014,130 | |||||||||
Tata Communications, Ltd. | 26,597 | 183,636 | |||||||||
Vodafone Idea Ltd.(a) | 2,476,978 | 1,317,251 | |||||||||
Total | 4,008,261 | ||||||||||
Consumer Discretionary 4.4% | |||||||||||
Eicher Motors, Ltd. | 4,361 | 1,454,994 | |||||||||
Energy 2.8% | |||||||||||
Petronet LNG, Ltd. | 294,775 | 913,929 | |||||||||
Industrials 24.2% | |||||||||||
Adani Ports and Special Economic Zone, Ltd. | 313,546 | 1,422,614 | |||||||||
Ashok Leyland, Ltd. | 754,736 | 1,240,020 | |||||||||
Bharat Heavy Electricals, Ltd. | 545,697 | 515,661 | |||||||||
Container Corp. of India, Ltd. | 86,611 | 749,677 | |||||||||
Cummins India, Ltd. | 54,652 | 507,466 | |||||||||
Havells India, Ltd. | 87,969 | 721,445 | |||||||||
Larsen & Toubro, Ltd. | 92,642 | 1,625,740 | |||||||||
Siemens, Ltd. | 34,787 | 453,565 | |||||||||
Voltas, Ltd. | 90,318 | 663,088 | |||||||||
Total | 7,899,276 | ||||||||||
Materials 35.7% | |||||||||||
Grasim Industries Ltd. | 121,975 | 1,718,823 | |||||||||
Hindalco Industries, Ltd. | 515,369 | 1,632,701 | |||||||||
JSW Steel, Ltd. | 307,989 | 1,621,520 | |||||||||
NMDC, Ltd. | 342,084 | 534,196 |
Common Stocks (continued)
Issuer | Shares | Value ($) | |||||||||
Shree Cement, Ltd. | 3,352 | 781,112 | |||||||||
Steel Authority of India, Ltd.(a) | 407,362 | 383,535 | |||||||||
Tata Steel, Ltd. | 201,860 | 1,618,584 | |||||||||
UltraTech Cement, Ltd. | 29,256 | 1,638,542 | |||||||||
Vedanta, Ltd. | 540,797 | 1,733,027 | |||||||||
Total | 11,662,040 | ||||||||||
Real Estate 1.2% | |||||||||||
DLF, Ltd. | 179,983 | 403,590 | |||||||||
Utilities 19.0% | |||||||||||
GAIL India, Ltd. | 331,172 | 1,731,469 | |||||||||
Indraprastha Gas, Ltd. | 140,828 | 471,985 | |||||||||
NTPC, Ltd. | 737,393 | 1,697,255 | |||||||||
Power Grid Corp. of India, Ltd. | 638,320 | 1,658,980 | |||||||||
Tata Power Co., Ltd. (The) | 725,896 | 659,405 | |||||||||
Total | 6,219,094 | ||||||||||
Total Common Stocks (Cost: $29,800,161) | 32,561,184 |
Money Market Fund 0.3%
Shares | Value ($) | ||||||||||
Goldman Sachs Financial Square Funds — Treasury Instruments Fund, Institutional Shares, 1.914%(b) (Cost: $105,080) | 105,080 | 105,080 | |||||||||
Total Investments in Securities (Cost: $29,905,241) | 32,666,264 | ||||||||||
Other Assets & Liabilities, Net | 18,107 | ||||||||||
Net Assets | 32,684,371 |
Notes to Consolidated Portfolio of Investments
(a) Non-income producing security.
(b) The rate shown is the seven-day current annualized yield at September 30, 2018.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
35
PORTFOLIO OF INVESTMENTS (Consolidated) (continued)
Columbia India Infrastructure ETF
September 30, 2018 (Unaudited)
Fair Value Measurements
The Fund categorizes its fair value measurements according to a three-level hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs by prioritizing that the most observable input be used when available. Observable inputs are those that market participants would use in pricing an investment based on market data obtained from sources independent of the reporting entity. Unobservable inputs are those that reflect the Fund's assumptions about the information market participants would use in pricing an investment. An investment's level within the fair value hierarchy is based on the lowest level of any input that is deemed significant to the asset's or liability's fair value measurement. The input levels are not necessarily an indication of the risk or liquidity associated with investments at that level. For example, certain U.S. government securities are generally high quality and liquid, however, they are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
Fair value inputs are summarized in the three broad levels listed below:
• Level 1 – Valuations based on quoted prices for investments in active markets that the Fund has the ability to access at the measurement date. Valuation adjustments are not applied to Level 1 investments.
• Level 2 – Valuations based on other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risks, etc.).
• Level 3 – Valuations based on significant unobservable inputs (including the Fund's own assumptions and judgment in determining the fair value of investments).
Inputs that are used in determining fair value of an investment may include price information, credit data, volatility statistics, and other factors. These inputs can be either observable or unobservable. The availability of observable inputs can vary between investments, and is affected by various factors such as the type of investment, and the volume and level of activity for that investment or similar investments in the marketplace. The inputs will be considered by the Investment Manager, along with any other relevant factors in the calculation of an investment's fair value. The Fund uses prices and inputs that are current as of the measurement date, which may include periods of market dislocations. During these periods, the availability of prices and inputs may be reduced for many investments. This condition could cause an investment to be reclassified between the various levels within the hierarchy.
Investments falling into the Level 3 category are primarily supported by quoted prices from brokers and dealers participating in the market for those investments. However, these may be classified as Level 3 investments due to lack of market transparency and corroboration to support these quoted prices. Additionally, valuation models may be used as the pricing source for any remaining investments classified as Level 3. These models may rely on one or more significant unobservable inputs and/or significant assumptions by the Investment Manager. Inputs used in valuations may include, but are not limited to, financial statement analysis, capital account balances, discount rates and estimated cash flows, and comparable company data.
Under the direction of the Fund's Board of Trustees (the Board), the Investment Manager's Valuation Committee (the Committee) is responsible for overseeing the valuation procedures approved by the Board. The Committee consists of voting and non-voting members from various groups within the Investment Manager's organization, including operations and accounting, trading and investments, compliance, risk management and legal.
The Committee meets at least monthly to review and approve valuation matters, which may include a description of specific valuation determinations, data regarding pricing information received from approved pricing vendors and brokers and the results of Board-approved valuation control policies and procedures (the Policies). The Policies address, among other things, instances when market quotations are or are not readily available, including recommendation of third party pricing vendors and a determination of appropriate pricing methodologies; events that require specific valuation determinations and assessment of fair value techniques; securities with a potential for stale pricing, including those that are illiquid, restricted, or in default; and the effectiveness of third-party pricing vendors, including periodic reviews of vendors. The Committee meets more frequently, as needed, to discuss additional valuation matters, which may include the need to review back-testing results, review time-sensitive information or approve related valuation actions. The Committee reports to the Board, with members of the Committee meeting with the Board at each of its regularly scheduled meetings to discuss valuation matters and actions during the period, similar to those described earlier.
For investments categorized as Level 3, the Committee monitors information similar to that described above, which may include: (i) data specific to the issuer or comparable issuers, (ii) general market or specific sector news and (iii) quoted prices and specific or similar security transactions. The Committee considers this data and any changes from prior periods in order to assess the reasonableness of observable and unobservable inputs, any assumptions or internal models used to value those securities and changes in fair value. This data is also used to corroborate, when available, information received from approved pricing vendors and brokers. Various factors impact the frequency of monitoring this information (which may occur as often as daily). However, the Committee may determine that changes to inputs, assumptions and models are not required as a result of the monitoring procedures performed.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
36
PORTFOLIO OF INVESTMENTS (Consolidated) (continued)
Columbia India Infrastructure ETF
September 30, 2018 (Unaudited)
Fair Value Measurements (continued)
The following table is a summary of the inputs used to value the Fund's investments as of September 30, 2018:
Level 1 quoted prices in active markets for identical assets ($) | Level 2 other significant observable inputs ($) | Level 3 significant unobservable inputs ($) | Total ($) | ||||||||||||||||
Investments in Securities | |||||||||||||||||||
Common Stocks | |||||||||||||||||||
Communication Services | 4,008,261 | — | — | 4,008,261 | |||||||||||||||
Consumer Discretionary | 1,454,994 | — | — | 1,454,994 | |||||||||||||||
Energy | 913,929 | — | — | 913,929 | |||||||||||||||
Industrials | 7,899,276 | — | — | 7,899,276 | |||||||||||||||
Materials | 11,662,040 | — | — | 11,662,040 | |||||||||||||||
Real Estate | 403,590 | — | — | 403,590 | |||||||||||||||
Utilities | 6,219,094 | — | — | 6,219,094 | |||||||||||||||
Total Common Stocks | 32,561,184 | — | — | 32,561,184 | |||||||||||||||
Money Market Fund | 105,080 | — | — | 105,080 | |||||||||||||||
Total Investments in Securities | 32,666,264 | — | — | 32,666,264 |
See the Consolidated Portfolio of Investments for all investment classifications not indicated in the table.
There were no transfers of financial assets between levels during the period.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
37
PORTFOLIO OF INVESTMENTS
Columbia India Small Cap ETF
September 30, 2018 (Unaudited)
(Percentages represent value of investments compared to net assets)
Investments in Securities
Common Stocks 99.9%
Issuer | Shares | Value ($) | |||||||||
Communication Services 3.8% | |||||||||||
Eros International Media, Ltd.(a) | 87,811 | 87,460 | |||||||||
Himachal Futuristic Communications, Ltd. | 611,742 | 166,670 | |||||||||
Just Dial, Ltd.(a) | 51,342 | 338,195 | |||||||||
Total | 592,325 | ||||||||||
Consumer Discretionary 7.3% | |||||||||||
Indo Count Industries, Ltd. | 107,793 | 95,986 | |||||||||
Jamna Auto Industries, Ltd. | 229,890 | 220,883 | |||||||||
JK Tyre & Industries, Ltd. | 137,488 | 184,259 | |||||||||
Kesoram Industries, Ltd.(a) | 161,044 | 149,403 | |||||||||
Shankara Building Products, Ltd. | 15,559 | 263,906 | |||||||||
Sintex Industries, Ltd. | 690,943 | 107,707 | |||||||||
Trident, Ltd. | 145,132 | 114,320 | |||||||||
Total | 1,136,464 | ||||||||||
Consumer Staples 7.7% | |||||||||||
Balrampur Chini Mills, Ltd.(a) | 214,677 | 210,412 | |||||||||
Dwarikesh Sugar Industries, Ltd.(a) | 254,847 | 74,883 | |||||||||
Kaveri Seed Co., Ltd.(a) | 41,961 | 335,474 | |||||||||
Kwality, Ltd. | 93,951 | 17,237 | |||||||||
LT Foods, Ltd. | 201,077 | 126,210 | |||||||||
Parag Milk Foods, Ltd.(b) | 59,614 | 196,548 | |||||||||
Venky's India, Ltd. | 7,483 | 225,564 | |||||||||
Total | 1,186,328 | ||||||||||
Energy 1.4% | |||||||||||
Aban Offshore, Ltd.(a) | 47,101 | 53,475 | |||||||||
Hindustan Oil Exploration Co., Ltd.(a) | 90,290 | 156,441 | |||||||||
Total | 209,916 | ||||||||||
Financials 18.5% | |||||||||||
Andhra Bank(a) | 420,173 | 158,818 | |||||||||
Central Depository Services India, Ltd. | 62,195 | 192,788 | |||||||||
IFCI, Ltd.(a) | 1,121,060 | 184,034 | |||||||||
Karnataka Bank, Ltd. (The) | 417,256 | 559,488 | |||||||||
Lakshmi Vilas Bank, Ltd. (The)(a) | 325,421 | 322,324 | |||||||||
Multi Commodity Exchange of India, Ltd. | 63,849 | 606,385 | |||||||||
Oriental Bank of Commerce(a) | 229,457 | 194,670 |
Common Stocks (continued)
Issuer | Shares | Value ($) | |||||||||
Repco Home Finance, Ltd. | 62,634 | 371,881 | |||||||||
SREI Infrastructure Finance, Ltd. | 278,330 | 124,210 | |||||||||
Tourism Finance Corp. of India, Ltd. | 93,656 | 156,007 | |||||||||
Total | 2,870,605 | ||||||||||
Health Care 6.5% | |||||||||||
Granules India, Ltd. | 203,930 | 267,678 | |||||||||
Marksans Pharma, Ltd. | 329,836 | 133,773 | |||||||||
Morepen Laboratories, Ltd.(a) | 407,304 | 130,074 | |||||||||
Suven Life Sciences, Ltd. | 76,014 | 282,968 | |||||||||
Unichem Laboratories, Ltd. | 72,341 | 195,248 | |||||||||
Total | 1,009,741 | ||||||||||
Industrials 13.7% | |||||||||||
Future Enterprises, Ltd.(a) | 360,349 | 172,494 | |||||||||
Gati, Ltd. | 106,991 | 110,622 | |||||||||
Gayatri Projects, Ltd.(a) | 123,997 | 286,772 | |||||||||
Hindustan Construction Co., Ltd.(a) | 835,253 | 122,713 | |||||||||
KEI Industries Ltd. | 59,561 | 294,970 | |||||||||
Mercator, Ltd.(a) | 312,638 | 73,534 | |||||||||
Praj Industries, Ltd. | 163,095 | 197,091 | |||||||||
Reliance Naval and Engineering, Ltd.(a) | 352,855 | 58,898 | |||||||||
Shipping Corp. of India, Ltd.(a) | 263,811 | 151,758 | |||||||||
Sintex Plastics Technology, Ltd.(a) | 655,107 | 262,531 | |||||||||
Texmaco Rail & Engineering, Ltd. | 166,947 | 136,916 | |||||||||
Titagarh Wagons, Ltd. | 90,557 | 88,321 | |||||||||
Welspun Enterprises, Ltd. | 100,646 | 173,829 | |||||||||
Total | 2,130,449 | ||||||||||
Information Technology 10.9% | |||||||||||
8K Miles Software Services, Ltd.(a) | 15,251 | 40,258 | |||||||||
Firstsource Solutions, Ltd. | 413,937 | 353,465 | |||||||||
HCL Infosystems, Ltd.(a) | 312,651 | 101,356 | |||||||||
Intellect Design Arena, Ltd.(a) | 109,798 | 307,477 | |||||||||
KPIT Technologies, Ltd. | 244,608 | 720,090 | |||||||||
NIIT, Ltd.(a) | 166,545 | 168,521 | |||||||||
Total | 1,691,167 |
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
38
PORTFOLIO OF INVESTMENTS (continued)
Columbia India Small Cap ETF
September 30, 2018 (Unaudited)
(Percentages represent value of investments compared to net assets)
Common Stocks (continued)
Issuer | Shares | Value ($) | |||||||||
Materials 25.7% | |||||||||||
Advanced Enzyme Technologies, Ltd. | 118,344 | 308,308 | |||||||||
Bhansali Engineering Polymers, Ltd. | 112,490 | 176,905 | |||||||||
Camlin Fine Sciences, Ltd.(a) | 129,384 | 82,103 | |||||||||
Deepak Nitrite, Ltd. | 105,452 | 430,013 | |||||||||
GHCL, Ltd. | 86,005 | 258,584 | |||||||||
Jai Corp., Ltd. | 76,703 | 119,938 | |||||||||
Jindal Saw, Ltd. | 188,359 | 190,594 | |||||||||
JK Paper, Ltd. | 109,496 | 217,285 | |||||||||
Kiri Industries, Ltd.(a) | 24,173 | 167,734 | |||||||||
Maithan Alloys, Ltd. | 11,610 | 85,029 | |||||||||
Meghmani Organics, Ltd. | 402,836 | 419,285 | |||||||||
Nilkamal, Ltd. | 9,235 | 216,505 | |||||||||
NOCIL, Ltd. | 152,961 | 319,785 | |||||||||
Phillips Carbon Black, Ltd. | 123,718 | 349,872 | |||||||||
Prakash Industries, Ltd.(a) | 112,038 | 176,426 | |||||||||
Tata Metaliks, Ltd. | 19,605 | 183,122 | |||||||||
Tata Sponge Iron, Ltd. | 11,159 | 124,682 | |||||||||
Thirumalai Chemicals, Ltd. | 93,316 | 158,402 | |||||||||
Total | 3,984,572 |
Common Stocks (continued)
Issuer | Shares | Value ($) | |||||||||
Real Estate 2.1% | |||||||||||
Housing Development & Infrastructure, Ltd.(a) | 421,246 | 120,871 | |||||||||
Omaxe, Ltd. | 69,467 | 208,094 | |||||||||
Total | 328,965 | ||||||||||
Utilities 2.3% | |||||||||||
PTC India, Ltd. | 388,869 | 357,809 | |||||||||
Total Common Stocks (Cost: $22,111,517) | 15,498,341 |
Money Market Fund 0.7%
Shares | Value ($) | ||||||||||
Goldman Sachs Financial Square Funds — Treasury Instruments Fund, Institutional Shares, 1.914%(c) (Cost: $108,016) | 108,016 | 108,016 | |||||||||
Total Investments in Securities (Cost: $22,219,533) | 15,606,357 | ||||||||||
Other Assets & Liabilities, Net | (91,915 | ) | |||||||||
Net Assets | 15,514,442 |
Notes to Portfolio of Investments
(a) Non-income producing security.
(b) Represents privately placed and other securities and instruments exempt from SEC registration (collectively, private placements), such as Section 4(a)(2) and Rule 144A eligible securities, which are often sold only to qualified institutional buyers. The Fund may invest in private placements determined to be liquid as well as those determined to be illiquid. Private placements may be determined to be liquid under guidelines established by the Fund's Board of Trustees. At September 30, 2018, the value of this security amounted to $196,548, which represents 1.27% of net assets.
(c) The rate shown is the seven-day current annualized yield at September 30, 2018.
Fair Value Measurements
The Fund categorizes its fair value measurements according to a three-level hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs by prioritizing that the most observable input be used when available. Observable inputs are those that market participants would use in pricing an investment based on market data obtained from sources independent of the reporting entity. Unobservable inputs are those that reflect the Fund's assumptions about the information market participants would use in pricing an investment. An investment's level within the fair value hierarchy is based on the lowest level of any input that is deemed significant to the asset's or liability's fair value measurement. The input levels are not necessarily an indication of the risk or liquidity associated with investments at that level. For example, certain U.S. government securities are generally high quality and liquid, however, they are reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
39
PORTFOLIO OF INVESTMENTS (continued)
Columbia India Small Cap ETF
September 30, 2018 (Unaudited)
Fair Value Measurements (continued)
Fair value inputs are summarized in the three broad levels listed below:
• Level 1 – Valuations based on quoted prices for investments in active markets that the Fund has the ability to access at the measurement date. Valuation adjustments are not applied to Level 1 investments.
• Level 2 – Valuations based on other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risks, etc.).
• Level 3 – Valuations based on significant unobservable inputs (including the Fund's own assumptions and judgment in determining the fair value of investments).
Inputs that are used in determining fair value of an investment may include price information, credit data, volatility statistics, and other factors. These inputs can be either observable or unobservable. The availability of observable inputs can vary between investments, and is affected by various factors such as the type of investment, and the volume and level of activity for that investment or similar investments in the marketplace. The inputs will be considered by the Investment Manager, along with any other relevant factors in the calculation of an investment's fair value. The Fund uses prices and inputs that are current as of the measurement date, which may include periods of market dislocations. During these periods, the availability of prices and inputs may be reduced for many investments. This condition could cause an investment to be reclassified between the various levels within the hierarchy.
Investments falling into the Level 3 category are primarily supported by quoted prices from brokers and dealers participating in the market for those investments. However, these may be classified as Level 3 investments due to lack of market transparency and corroboration to support these quoted prices. Additionally, valuation models may be used as the pricing source for any remaining investments classified as Level 3. These models may rely on one or more significant unobservable inputs and/or significant assumptions by the Investment Manager. Inputs used in valuations may include, but are not limited to, financial statement analysis, capital account balances, discount rates and estimated cash flows, and comparable company data.
Under the direction of the Fund's Board of Trustees (the Board), the Investment Manager's Valuation Committee (the Committee) is responsible for overseeing the valuation procedures approved by the Board. The Committee consists of voting and non-voting members from various groups within the Investment Manager's organization, including operations and accounting, trading and investments, compliance, risk management and legal.
The Committee meets at least monthly to review and approve valuation matters, which may include a description of specific valuation determinations, data regarding pricing information received from approved pricing vendors and brokers and the results of Board-approved valuation control policies and procedures (the Policies). The Policies address, among other things, instances when market quotations are or are not readily available, including recommendations of third party pricing vendors and a determination of appropriate pricing methodologies; events that require specific valuation determinations and assessment of fair value techniques; securities with a potential for stale pricing, including those that are illiquid, restricted, or in default; and the effectiveness of third-party pricing vendors, including periodic reviews of vendors. The Committee meets more frequently, as needed, to discuss additional valuation matters, which may include the need to review back-testing results, review time-sensitive information or approve related valuation actions. The Committee reports to the Board, with members of the Committee meeting with the Board at each of its regularly scheduled meetings to discuss valuation matters and actions during the period, similar to those described earlier.
For investments categorized as Level 3, the Committee monitors information similar to that described above, which may include: (i) data specific to the issuer or comparable issuers, (ii) general market or specific sector news and (iii) quoted prices and specific or similar security transactions. The Committee considers this data and any changes from prior periods in order to assess the reasonableness of observable and unobservable inputs, any assumptions or internal models used to value those securities and changes in fair value. This data is also used to corroborate, when available, information received from approved pricing vendors and brokers. Various factors impact the frequency of monitoring this information (which may occur as often as daily). However, the Committee may determine that changes to inputs, assumptions and models are not required as a result of the monitoring procedures performed.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
40
PORTFOLIO OF INVESTMENTS (continued)
Columbia India Small Cap ETF
September 30, 2018 (Unaudited)
Fair Value Measurements (continued)
The following table is a summary of the inputs used to value the Fund's investments as of September 30, 2018:
Level 1 quoted prices in active markets for identical assets ($) | Level 2 other significant observable inputs ($) | Level 3 significant unobservable inputs ($) | Total ($) | ||||||||||||||||
Investments in Securities | |||||||||||||||||||
Common Stocks | |||||||||||||||||||
Communication Services | 592,325 | — | — | 592,325 | |||||||||||||||
Consumer Discretionary | 1,136,464 | — | — | 1,136,464 | |||||||||||||||
Consumer Staples | 1,186,328 | — | — | 1,186,328 | |||||||||||||||
Energy | 209,916 | — | — | 209,916 | |||||||||||||||
Financials | 2,870,605 | — | — | 2,870,605 | |||||||||||||||
Health Care | 1,009,741 | — | — | 1,009,741 | |||||||||||||||
Industrials | 2,130,449 | — | — | 2,130,449 | |||||||||||||||
Information Technology | 1,691,167 | — | — | 1,691,167 | |||||||||||||||
Materials | 3,984,572 | — | — | 3,984,572 | |||||||||||||||
Real Estate | 328,965 | — | — | 328,965 | |||||||||||||||
Utilities | 357,809 | — | — | 357,809 | |||||||||||||||
Total Common Stocks | 15,498,341 | — | — | 15,498,341 | |||||||||||||||
Money Market Fund | 108,016 | — | — | 108,016 | |||||||||||||||
Total Investments in Securities | 15,606,357 | — | — | 15,606,357 |
See the Portfolio of Investments for all investment classifications not indicated in the table.
Financial assets were transferred from Level 3 to Level 1 as the market for these assets was deemed to be active during the period and fair values were consequently obtained using quoted prices for identical assets rather than being based upon other observable market inputs as of period-end.
The following table shows transfers between Level 1 and Level 3 of the fair value hierarchy:
Transfers In | Transfers Out | ||||||||||||||
Level 1 ($) | Level 3 ($) | Level 1 ($) | Level 3 ($) | ||||||||||||
10,167 | — | — | 10,167 |
Transfers between Level 1 and Level 3 are determined based on the fair value at the beginning of the period for security positions held throughout the period.
There were no transfers of financial assets between Levels 1 and 2 during the period.
There were no transfers of financial assets between Levels 2 and 3 during the period.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
41
STATEMENT OF ASSETS AND LIABILITIES
September 30, 2018 (Unaudited)
Columbia Beyond BRICs ETF | Columbia EM Core ex-China ETF | Columbia EM Quality Dividend ETF | |||||||||||||
Assets | |||||||||||||||
Investments in securities, at value | |||||||||||||||
Unaffiliated issuers (cost $50,201,288, $7,783,255 and $7,799,557, respectively) | $ | 52,393,619 | $ | 9,063,078 | $ | 7,975,179 | |||||||||
Cash | — | — | — | ||||||||||||
Foreign cash (cost $1,142,309, $1 and $4,362, respectively) | 1,142,551 | 1 | 4,364 | ||||||||||||
Receivable for: | |||||||||||||||
Investment sold | 133,091 | — | 9,118 | ||||||||||||
Capital shares sold | 4,917 | — | — | ||||||||||||
Dividends | 137,925 | 16,845 | 19,017 | ||||||||||||
Foreign tax reclaims | 22,766 | 548 | 9,579 | ||||||||||||
Reimbursement due from Investment Manager | — | — | — | ||||||||||||
Total assets | 53,834,869 | 9,080,472 | 8,017,257 | ||||||||||||
Liabilities | |||||||||||||||
Payable for: | |||||||||||||||
Investment purchased | — | — | 904 | ||||||||||||
Capital shares purchased | — | — | — | ||||||||||||
Investment management fees | 28,887 | 2,560 | 3,976 | ||||||||||||
Due to custodian | 1,017,749 | — | — | ||||||||||||
Income payable | — | — | — | ||||||||||||
Deferred foreign tax payable | — | — | — | ||||||||||||
Accrued expenses and other liabilities | 2,745 | 849 | 42 | ||||||||||||
Total liabilities | 1,049,381 | 3,409 | 4,922 | ||||||||||||
Net assets applicable to outstanding capital stock | $ | 52,785,488 | $ | 9,077,063 | $ | 8,012,335 | |||||||||
Represented by: | |||||||||||||||
Paid-in capital | $ | 113,829,762 | $ | 7,630,250 | $ | 35,089,068 | |||||||||
Undistributed (accumulated) net investment income (loss) | 1,451,907 | 179,807 | 48,496 | ||||||||||||
Undistributed (accumulated) net realized gain (loss) on investments and foreign currency transactions | (64,687,296 | ) | (12,659 | ) | (27,300,692 | ) | |||||||||
Net unrealized appreciation (depreciation) on: | |||||||||||||||
Investments — unaffiliated issuers | 2,192,331 | 1,279,823 | 175,622 | ||||||||||||
Foreign curency translations | (1,216 | ) | (158 | ) | (159 | ) | |||||||||
Total — representing net assets applicable to outstanding capital stock | $ | 52,785,488 | $ | 9,077,063 | $ | 8,012,335 | |||||||||
Shares outstanding | 2,950,000 | 350,000 | 550,000 | ||||||||||||
Net asset value per share | $ | 17.89 | $ | 25.93 | $ | 14.57 |
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
42
STATEMENT OF ASSETS AND LIABILITIES (continued)
September 30, 2018 (Unaudited)
Columbia Emerging Markets Consumer ETF (Consolidated) | Columbia India Consumer ETF (Consolidated) | Columbia India Infrastructure ETF (Consolidated) | |||||||||||||
Assets | |||||||||||||||
Investments in securities, at value | |||||||||||||||
Unaffiliated issuers (cost $478,083,509, $110,236,726 and $29,905,241, respectively) | $ | 452,026,268 | $ | 129,877,456 | $ | 32,666,264 | |||||||||
Cash | 762 | 211 | — | ||||||||||||
Foreign cash (cost $367,521, $3 and $484, respectively) | 368,750 | 3 | 48 | ||||||||||||
Receivable for: | |||||||||||||||
Investment sold | 1,538,661 | — | — | ||||||||||||
Capital shares sold | 1,655 | — | — | ||||||||||||
Dividends | 422,155 | 4,929 | 59,605 | ||||||||||||
Foreign tax reclaims | 12,774 | — | — | ||||||||||||
Reimbursement due from Investment Manager | — | — | — | ||||||||||||
Total assets | 454,371,025 | 129,882,599 | 32,725,917 | ||||||||||||
Liabilities | |||||||||||||||
Payable for: | |||||||||||||||
Investment purchased | — | — | — | ||||||||||||
Capital shares purchased | 1,546,901 | — | — | ||||||||||||
Investment management fees | 234,267 | 85,851 | 21,616 | ||||||||||||
Due to custodian | — | — | 241 | ||||||||||||
Income payable | — | — | — | ||||||||||||
Deferred foreign tax payable | 65,202 | 13,029 | 19,633 | ||||||||||||
Accrued expenses and other liabilities | 1,007 | 184 | 56 | ||||||||||||
Total liabilities | 1,847,377 | 99,064 | 41,546 | ||||||||||||
Net assets applicable to outstanding capital stock | $ | 452,523,648 | $ | 129,783,535 | $ | 32,684,371 | |||||||||
Represented by: | |||||||||||||||
Paid-in capital | $ | 649,910,091 | $ | 117,585,548 | $ | 89,763,812 | |||||||||
Undistributed (accumulated) net investment income (loss) | 3,001,739 | 235,286 | 395,640 | ||||||||||||
Undistributed (accumulated) net realized gain (loss) on investments and foreign currency transactions | (174,258,276 | ) | (7,664,964 | ) | (60,216,035 | ) | |||||||||
Net unrealized appreciation (depreciation) on: | |||||||||||||||
Investments — unaffiliated issuers | (26,057,241 | ) | 19,640,730 | 2,761,023 | |||||||||||
Foreign capital gains tax | (65,201 | ) | (13,029 | ) | (19,633 | ) | |||||||||
Foreign curency translations | (7,464 | ) | (36 | ) | (436 | ) | |||||||||
Total — representing net assets applicable to outstanding capital stock | $ | 452,523,648 | $ | 129,783,535 | $ | 32,684,371 | |||||||||
Shares outstanding | 20,200,000 | 3,150,000 | 2,750,000 | ||||||||||||
Net asset value per share | $ | 22.40 | $ | 41.20 | $ | 11.89 |
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
43
STATEMENT OF ASSETS AND LIABILITIES (continued)
September 30, 2018 (Unaudited)
Columbia India Small Cap ETF | |||||||
Assets | |||||||
Investments in securities, at value | |||||||
Unaffiliated issuers (cost $22,219,533) | $ | 15,606,357 | |||||
Cash | — | ||||||
Foreign cash (cost $1,304) | 1,311 | ||||||
Receivable for: | |||||||
Investment sold | — | ||||||
Capital shares sold | — | ||||||
Dividends | 11,030 | ||||||
Foreign tax reclaims | — | ||||||
Reimbursement due from Investment Manager | 33,558 | ||||||
Total assets | 15,652,256 | ||||||
Liabilities | |||||||
Payable for: | |||||||
Investment purchased | — | ||||||
Capital shares purchased | — | ||||||
Investment management fees | 11,295 | ||||||
Due to custodian | — | ||||||
Income payable | — | ||||||
Deferred foreign tax payable | 126,519 | ||||||
Accrued expenses and other liabilities | — | ||||||
Total liabilities | 137,814 | ||||||
Net assets applicable to outstanding capital stock | $ | 15,514,442 | |||||
Represented by: | |||||||
Paid-in capital | $ | 31,484,232 | |||||
Undistributed (accumulated) net investment income (loss) | (350,062 | ) | |||||
Undistributed (accumulated) net realized gain (loss) on investments and foreign currency transactions | (8,880,036 | ) | |||||
Net unrealized appreciation (depreciation) on: | |||||||
Investments — unaffiliated issuers | (6,613,176 | ) | |||||
Foreign capital gains tax | (126,519 | ) | |||||
Foreign curency translations | 3 | ||||||
Total — representing net assets applicable to outstanding capital stock | $ | 15,514,442 | |||||
Shares outstanding | 1,100,000 | ||||||
Net asset value per share | $ | 14.10 |
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
44
STATEMENT OF OPERATIONS
For the Six Months Ended September 30, 2018 (Unaudited)
Columbia Beyond BRICs ETF | Columbia EM Core ex-China ETF | Columbia EM Quality Dividend ETF | |||||||||||||
Investment Income: | |||||||||||||||
Dividends — unaffiliated issuers | $ | 1,333,242 | $ | 186,757 | $ | 273,368 | |||||||||
Foreign taxes withheld | (136,957 | ) | (29,488 | ) | (29,338 | ) | |||||||||
Total income | 1,196,285 | 157,269 | 244,030 | ||||||||||||
Expenses: | |||||||||||||||
Investment management fees | 253,295 | 26,888 | 28,998 | ||||||||||||
Mauritius taxes paid | — | — | — | ||||||||||||
Line of credit interest | — | — | — | ||||||||||||
Overdraft expense | 50 | 22 | 56 | ||||||||||||
Total expenses | 253,345 | 26,910 | 29,054 | ||||||||||||
Fees waived by the Investment Manager and its affiliates | (61,339 | ) | (10,831 | ) | — | ||||||||||
Total net expenses | 192,006 | 16,079 | 29,054 | ||||||||||||
Net investment income | 1,004,279 | 141,190 | 214,976 | ||||||||||||
Realized and unrealized gain (loss) — net | |||||||||||||||
Net realized gain (loss) on: | |||||||||||||||
Investments — unaffiliated issuers | (2,860,171 | ) | 64,908 | (378,718 | ) | ||||||||||
In-kind transactions | (475,484 | ) | — | 67,004 | |||||||||||
Foreign currency translations | (44,163 | ) | (2,981 | ) | (25,137 | ) | |||||||||
Net realized gain (loss) | (3,379,818 | ) | 61,927 | (336,851 | ) | ||||||||||
Change in net unrealized appreciation (depreciation) on: | |||||||||||||||
Investments — unaffiliated issuers | (3,598,074 | ) | (936,332 | ) | (691,517 | ) | |||||||||
Foreign currency translations | (1,704 | ) | (231 | ) | (901 | ) | |||||||||
Net change in unrealized appreciation (depreciation) | (3,599,778 | ) | (936,563 | ) | (692,418 | ) | |||||||||
Net realized and unrealized (loss) | (6,979,596 | ) | (874,636 | ) | (1,029,269 | ) | |||||||||
Net decrease in net assets resulting from operations | $ | (5,975,317 | ) | $ | (733,446 | ) | $ | (814,293 | ) |
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
45
STATEMENT OF OPERATIONS (continued)
For the Six Months Ended September 30, 2018 (Unaudited)
Columbia Emerging Markets Consumer ETF (Consolidated) | Columbia India Consumer ETF (Consolidated) | Columbia India Infrastructure ETF (Consolidated) | |||||||||||||
Investment Income: | |||||||||||||||
Dividends — unaffiliated issuers | $ | 6,085,996 | $ | 1,018,394 | $ | 365,451 | |||||||||
Foreign taxes withheld | (483,936 | ) | — | — | |||||||||||
Total income | 5,602,060 | 1,018,394 | 365,451 | ||||||||||||
Expenses: | |||||||||||||||
Investment management fees | 1,886,513 | 550,640 | 151,532 | ||||||||||||
Mauritius taxes paid | 36,677 | 21,400 | 30,200 | ||||||||||||
Line of credit interest | — | — | 2,168 | ||||||||||||
Overdraft expense | 10,896 | — | — | ||||||||||||
Total expenses | 1,934,086 | 572,040 | 183,900 | ||||||||||||
Fees waived by the Investment Manager and its affiliates | — | — | — | ||||||||||||
Total net expenses | 1,934,086 | 572,040 | 183,900 | ||||||||||||
Net investment income | 3,667,974 | 446,354 | 181,551 | ||||||||||||
Realized and unrealized gain (loss) — net | |||||||||||||||
Net realized gain (loss) on: | |||||||||||||||
Investments — unaffiliated issuers | (12,738,320 | ) | 58,395 | 1,231,699 | |||||||||||
In-kind transactions | 23,378,255 | — | — | ||||||||||||
Foreign currency translations | (3,978,806 | ) | (45,302 | ) | (110,189 | ) | |||||||||
Net realized gain (loss) | 6,661,129 | 13,093 | 1,121,510 | ||||||||||||
Change in net unrealized appreciation (depreciation) on: | |||||||||||||||
Investments — unaffiliated issuers | (109,110,107 | ) | (14,928,730 | ) | (7,503,043 | ) | |||||||||
Foreign capital gains tax | (65,201 | ) | (13,029 | ) | (19,633 | ) | |||||||||
Foreign currency translations | (11,881 | ) | (29 | ) | (338 | ) | |||||||||
Net change in unrealized appreciation (depreciation) | (109,187,189 | ) | (14,941,788 | ) | (7,523,014 | ) | |||||||||
Net realized and unrealized (loss) | (102,526,060 | ) | (14,928,695 | ) | (6,401,504 | ) | |||||||||
Net decrease in net assets resulting from operations | $ | (98,858,086 | ) | $ | (14,482,341 | ) | $ | (6,219,953 | ) |
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
46
STATEMENT OF OPERATIONS (continued)
For the Six Months Ended September 30, 2018 (Unaudited)
Columbia India Small Cap ETF (Consolidated) | |||||||
Investment Income: | |||||||
Dividends — unaffiliated issuers | $ | 169,894 | |||||
Foreign taxes withheld | — | ||||||
Total income | 169,894 | ||||||
Expenses: | |||||||
Investment management fees | 88,381 | ||||||
Mauritius taxes paid | 1,010 | ||||||
Line of credit interest | — | ||||||
Overdraft expense | 3,020 | ||||||
Total expenses | 92,411 | ||||||
Fees waived by the Investment Manager and its affiliates | — | ||||||
Total net expenses | 92,411 | ||||||
Net investment income | 77,483 | ||||||
Realized and unrealized gain (loss) — net | |||||||
Net realized gain (loss) on: | |||||||
Investments — unaffiliated issuers | (2,195,237 | ) | |||||
In-kind transactions | — | ||||||
Foreign currency translations | (36,660 | ) | |||||
Net realized gain (loss) | (2,231,897 | ) | |||||
Change in net unrealized appreciation (depreciation) on: | |||||||
Investments — unaffiliated issuers | (4,008,328 | ) | |||||
Foreign capital gains tax | (126,519 | ) | |||||
Foreign currency translations | 1,426 | ||||||
Net change in unrealized appreciation (depreciation) | (4,133,421 | ) | |||||
Net realized and unrealized (loss) | (6,365,318 | ) | |||||
Net decrease in net assets resulting from operations | $ | (6,287,835 | ) |
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
47
STATEMENT OF CHANGES IN NET ASSETS
Columbia Beyond BRICs ETF | Columbia EM Core ex-China ETF | ||||||||||||||||||
Six Months Ended September 30, 2018 (Unaudited) | For the Year Ended March 31, 2018 | Six Months Ended September 30, 2018 (Unaudited) | For the Year Ended March 31, 2018 | ||||||||||||||||
Operations | |||||||||||||||||||
Net investment income | $ | 1,004,279 | $ | 1,947,687 | $ | 141,190 | $ | 230,653 | |||||||||||
Net realized gain (loss) | (3,379,818 | ) | (1,284,006 | ) | 61,927 | 1,044,388 | |||||||||||||
Net change in unrealized appreciation (depreciation) | (3,599,778 | ) | 14,501,873 | (936,563 | ) | 663,520 | |||||||||||||
Net increase (decrease) in net assets resulting from operations | (5,975,317 | ) | 15,165,554 | (733,446 | ) | 1,938,561 | |||||||||||||
Distributions to shareholders | |||||||||||||||||||
Net investment income | — | (1,818,029 | ) | — | (212,870 | ) | |||||||||||||
Net realized gain | — | — | — | (617,043 | ) | ||||||||||||||
Total distributions to shareholders | — | (1,818,029 | ) | — | (829,913 | ) | |||||||||||||
Shareholder transactions | |||||||||||||||||||
Proceeds from shares sold | — | — | — | 3,931,470 | |||||||||||||||
Cost of shares redeemed | (12,366,408 | ) | (13,238,286 | ) | — | (6,438,578 | ) | ||||||||||||
Transaction fees | — | — | — | — | |||||||||||||||
Net increase (decrease) in net assets resulting from shareholder transactions | (12,366,408 | ) | (13,238,286 | ) | — | (2,507,108 | ) | ||||||||||||
Increase (decrease) in net assets | (18,341,725 | ) | 109,239 | (733,446 | ) | (1,398,460 | ) | ||||||||||||
Net Assets: | |||||||||||||||||||
Net assets at beginning of period | 71,127,213 | 71,017,974 | 9,810,509 | 11,208,969 | |||||||||||||||
Net assets at end of period | $ | 52,785,488 | $ | 71,127,213 | $ | 9,077,063 | $ | 9,810,509 | |||||||||||
Undistributed (accumulated) net investment income (loss) | $ | 1,451,907 | $ | 447,628 | $ | 179,807 | $ | 38,617 | |||||||||||
Capital stock activity | |||||||||||||||||||
Shares outstanding, beginning of period | 3,650,000 | 4,400,000 | 350,000 | 450,000 | |||||||||||||||
Subsciptions | — | — | — | 150,000 | |||||||||||||||
Redemptions | (700,000 | ) | (750,000 | ) | — | (250,000 | ) | ||||||||||||
Shares outstanding, end of period | 2,950,000 | 3,650,000 | 350,000 | 350,000 |
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
48
STATEMENT OF CHANGES IN NET ASSETS (continued)
Columbia EM Quality Dividend ETF | Columbia Emerging Markets Consumer ETF (Consolidated) | ||||||||||||||||||
Six Months Ended September 30, 2018 (Unaudited) | For the Year Ended March 31, 2018 | Six Months Ended September 30, 2018 (Unaudited) | For the Year Ended March 31, 2018 | ||||||||||||||||
Operations | |||||||||||||||||||
Net investment income | $ | 214,976 | $ | 312,749 | $ | 3,667,974 | $ | 3,316,550 | |||||||||||
Net realized gain (loss) | (336,851 | ) | 1,193,776 | 6,661,129 | (11,616,922 | ) | |||||||||||||
Net change in unrealized appreciation (depreciation) | (692,418 | ) | 662,997 | (109,187,189 | ) | 64,475,955 | |||||||||||||
Net increase (decrease) in net assets resulting from operations | (814,293 | ) | 2,169,522 | (98,858,086 | ) | 56,175,583 | |||||||||||||
Distributions to shareholders | |||||||||||||||||||
Net investment income | (156,482 | ) | (279,712 | ) | — | (3,335,918 | ) | ||||||||||||
Net realized gain | — | — | — | — | |||||||||||||||
Total distributions to shareholders | (156,482 | ) | (279,712 | ) | — | (3,335,918 | ) | ||||||||||||
Shareholder transactions | |||||||||||||||||||
Proceeds from shares sold | — | — | — | 102,899,683 | |||||||||||||||
Cost of shares redeemed | (2,219,722 | ) | (3,767,028 | ) | (258,530,918 | ) | (87,000,586 | ) | |||||||||||
Transaction fees | — | — | 1,625 | 1,275 | |||||||||||||||
Net increase (decrease) in net assets resulting from shareholder transactions | (2,219,722 | ) | (3,767,028 | ) | (258,529,293 | ) | 15,900,372 | ||||||||||||
Increase (decrease) in net assets | (3,190,497 | ) | (1,877,218 | ) | (357,387,379 | ) | 68,740,037 | ||||||||||||
Net Assets: | |||||||||||||||||||
Net assets at beginning of period | 11,202,832 | 13,080,050 | 809,911,027 | 741,170,990 | |||||||||||||||
Net assets at end of period | $ | 8,012,335 | $ | 11,202,832 | $ | 452,523,648 | $ | 809,911,027 | |||||||||||
Undistributed (accumulated) net investment income (loss) | $ | 48,496 | $ | (9,998 | ) | $ | 3,001,739 | $ | (666,235 | ) | |||||||||
Capital stock activity | |||||||||||||||||||
Shares outstanding, beginning of period | 700,000 | 950,000 | 30,750,000 | 29,950,000 | |||||||||||||||
Subsciptions | — | — | — | 3,900,000 | |||||||||||||||
Redemptions | (150,000 | ) | (250,000 | ) | (10,550,000 | ) | (3,100,000 | ) | |||||||||||
Shares outstanding, end of period | 550,000 | 700,000 | 20,200,000 | 30,750,000 |
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
49
STATEMENT OF CHANGES IN NET ASSETS (continued)
Columbia India Consumer ETF (Consolidated) | Columbia India Infrastructure ETF (Consolidated) | ||||||||||||||||||
Six Months Ended September 30, 2018 (Unaudited) | For the Year Ended March 31, 2018 | Six Months Ended September 30, 2018 (Unaudited) | For the Year Ended March 31, 2018 | ||||||||||||||||
Operations | |||||||||||||||||||
Net investment income | $ | 446,354 | $ | 16,257 | $ | 181,551 | $ | 655,425 | |||||||||||
Net realized gain (loss) | 13,093 | 1,435,618 | 1,121,510 | 1,537,495 | |||||||||||||||
Net change in unrealized appreciation (depreciation) | (14,941,788 | ) | 18,166,972 | (7,523,014 | ) | 956,065 | |||||||||||||
Net increase (decrease) in net assets resulting from operations | (14,482,341 | ) | 19,618,847 | (6,219,953 | ) | 3,148,985 | |||||||||||||
Distributions to shareholders | |||||||||||||||||||
Net investment income | — | (79,763 | ) | — | (363,029 | ) | |||||||||||||
Shareholder transactions | |||||||||||||||||||
Proceeds from shares sold | — | 52,477,343 | — | 23,501,348 | |||||||||||||||
Cost of shares redeemed | (22,967 | ) | (15,827,789 | ) | (10,706,361 | ) | (18,202,473 | ) | |||||||||||
Transaction fees | (325 | ) | (975 | ) | (1,625 | ) | (1,199 | ) | |||||||||||
Net increase (decrease) in net assets reulting from shareholder transactions | (23,292 | ) | 36,648,579 | (10,707,986 | ) | 5,297,676 | |||||||||||||
Increase (decrease) in net assets | (14,505,633 | ) | 56,187,663 | (16,927,939 | ) | 8,083,632 | |||||||||||||
Net Assets | |||||||||||||||||||
Net assets at beginning of period | 144,289,168 | 88,101,505 | 49,612,310 | 41,528,678 | |||||||||||||||
Net assets at end of period | $ | 129,783,535 | $ | 144,289,168 | $ | 32,684,371 | $ | 49,612,310 | |||||||||||
Undistributed (accumulated) net investment income (loss) | $ | 235,286 | $ | (211,068 | ) | $ | 395,640 | $ | 214,089 | ||||||||||
Capital stock activity | |||||||||||||||||||
Shares outstanding, beginning of period | 3,150,000 | 2,300,000 | 3,550,000 | 3,200,000 | |||||||||||||||
Subsciptions | — | 1,200,000 | — | 1,600,000 | |||||||||||||||
Redemptions | — | (350,000 | ) | (800,000 | ) | (1,250,000 | ) | ||||||||||||
Shares outstanding, end of period | 3,150,000 | 3,150,000 | 2,750,000 | 3,550,000 |
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
50
STATEMENT OF CHANGES IN NET ASSETS (continued)
Columbia India Small Cap ETF (Consolidated) | |||||||||||
Six Months Ended September 30, 2018 (Unaudited) | For the Year Ended March 31, 2018 | ||||||||||
Operations | |||||||||||
Net investment income | $ | 77,483 | $ | 4,915 | |||||||
Net realized gain (loss) | (2,231,897 | ) | 5,356,315 | ||||||||
Net change in unrealized appreciation (depreciation) | (4,133,421 | ) | (3,725,155 | ) | |||||||
Net increase (decrease) in net assets resulting from operations | (6,287,835 | ) | 1,636,075 | ||||||||
Distributions to shareholders | |||||||||||
Net investment income | — | (247,725 | ) | ||||||||
Shareholder transactions | |||||||||||
Proceeds from shares sold | — | 7,647,176 | |||||||||
Cost of shares redeemed | (6,478,642 | ) | (6,314,661 | ) | |||||||
Transaction fees | (1,125 | ) | (3,706 | ) | |||||||
Net increase (decrease) in net assets reulting from shareholder transactions | (6,479,767 | ) | 1,328,809 | ||||||||
Increase (decrease) in net assets | (12,767,602 | ) | 2,717,159 | ||||||||
Net Assets | |||||||||||
Net assets at beginning of period | 28,282,044 | 25,564,885 | |||||||||
Net assets at end of period | $ | 15,514,442 | $ | 28,282,044 | |||||||
Undistributed (accumulated) net investment income (loss) | $ | (350,062 | ) | $ | (427,545 | ) | |||||
Capital stock activity | |||||||||||
Shares outstanding, beginning of period | 1,450,000 | 1,400,000 | |||||||||
Subsciptions | — | 350,000 | |||||||||
Redemptions | (350,000 | ) | (300,000 | ) | |||||||
Shares outstanding, end of period | 1,100,000 | 1,450,000 |
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
51
FINANCIAL HIGHLIGHTS
The following tables are intended to help you understand each Fund's financial performance. Per share net investment income (loss) amounts are calculated based on average shares outstanding during the period. Total return assumes reinvestment of all dividends and distributions, if any. Total Return at NAV is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period and redemption on the last day of the period. Total Return at Market is calculated assuming an initial investment made at the market price at the beginning of the period, reinvestment of all dividends and distributions at market price during the period and redemption on the last day of the period. The total return would have been lower if certain expenses had not been reimbursed/waived by the Investment Manager. The price used to calculate Total Return at Market is based on the midpoint of the 4:00 PM Eastern (U.S.) bid/ask spread on the NYSE and does not represent returns an investor would receive if shares were traded at other times. Total return and portfolio turnover are not annualized for periods of less than one year. The portfolio turnover rate is calculated without regard to purchase and sales transactions of short-term instruments, certain derivatives and in-kind transactions, if any. If such transactions were included, the Fund's portfolio turnover rate may be higher.
Columbia Beyond BRICs ETF
Six Months Ended September 30, 2018 | Year Ended March 31, | ||||||||||||||||||||||||||
(Unaudited) | 2018 | 2017 | 2016 | 2015 | 2014 | ||||||||||||||||||||||
Per share data | |||||||||||||||||||||||||||
Net asset value, beginning of period | $ | 19.49 | $ | 16.14 | $ | 15.77 | $ | 19.87 | $ | 21.01 | $ | 21.97 | |||||||||||||||
Net investment income | 0.28 | 0.49 | 0.34 | 0.40 | 0.56 | 0.99 | |||||||||||||||||||||
Net realized and unrealized gain (loss) | (1.88 | ) | 3.36 | 0.43 | (3.83 | ) | (1.43 | ) | (1.77 | ) | |||||||||||||||||
Total from investment operations | (1.60 | ) | 3.85 | 0.77 | (3.43 | ) | (0.87 | ) | (0.78 | ) | |||||||||||||||||
Less distributions to shareholders: | |||||||||||||||||||||||||||
Net investment income | — | (0.50 | ) | (0.40 | ) | (0.67 | ) | (0.25 | ) | (0.18 | ) | ||||||||||||||||
Net realized gains | — | — | — | — | (0.02 | ) | — | ||||||||||||||||||||
Total distribution to shareholders | — | (0.50 | ) | (0.40 | ) | (0.67 | ) | (0.27 | ) | (0.18 | ) | ||||||||||||||||
Net asset value, end of period | $ | 17.89 | $ | 19.49 | $ | 16.14 | $ | 15.77 | $ | 19.87 | $ | 21.01 | |||||||||||||||
Total Return at NAV | (8.21 | )% | 24.11 | % | 5.12 | % | (17.05 | )% | (4.16 | )% | (3.51 | )% | |||||||||||||||
Total Return at Market | (9.64 | )% | 25.97 | % | 4.01 | % | (17.00 | )% | (4.78 | )% | (3.66 | )% | |||||||||||||||
Ratios to average net assets of: | |||||||||||||||||||||||||||
Expenses, prior to expense reimbursements/waivers | 0.77 | %(a)(b) | 0.86 | %(c) | 0.85 | % | 0.85 | % | 0.85 | % | 0.85 | % | |||||||||||||||
Expenses, net of expense reimbursements/waivers(d) | 0.58 | %(a)(b) | 0.59 | %(c) | 0.58 | % | 0.58 | % | 0.58 | % | 0.66 | % | |||||||||||||||
Net Investment income, net of reimbursement/waivers | 3.04 | %(a) | 2.69 | % | 2.18 | % | 2.26 | % | 2.65 | % | 4.92 | % | |||||||||||||||
Supplemental data | |||||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 52,785 | $ | 71,127 | $ | 71,018 | $ | 92,242 | $ | 301,041 | $ | 49,385 | |||||||||||||||
Portfolio turnover rate | 17 | % | 34 | % | 36 | % | 32 | % | 33 | % | 63 | % |
(a) Annualized.
(b) The ratio includes less than 0.01% for the six months ended September 30, 2018 attributed to overdraft expense, which is outside the Unitary Fee (as defined in Note 3).
(c) The ratio includes 0.01% for the year ended March 31, 2018 attributed to line of credit interest expense, overdraft expense and tax expense, which is outside the Unitary Fee (as defined in Note 3).
(d) Total net expenses include the impact of certain fee waivers/expense reimbursements made by the Investment Manager and certain of its affiliates, if applicable.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
52
FINANCIAL HIGHLIGHTS
Columbia EM Core ex-China ETF
Six Months Ended September 30, 2018 | Year Ended March 31, | ||||||||||||||||||
(Unaudited) | 2018 | 2017 | 2016(a) | ||||||||||||||||
Per share data | |||||||||||||||||||
Net asset value, beginning of period | $ | 28.03 | $ | 24.91 | $ | 21.23 | $ | 20.00 | |||||||||||
Net investment income | 0.40 | 0.66 | 0.41 | 0.22 | |||||||||||||||
Net realized and unrealized gain (loss) | (2.50 | ) | 4.83 | 3.55 | 1.52 | ||||||||||||||
Total from investment operations | (2.10 | ) | 5.49 | 3.96 | 1.74 | ||||||||||||||
Less distributions to shareholders: | |||||||||||||||||||
Net investment income | — | (0.61 | ) | (0.28 | ) | (0.51 | ) | ||||||||||||
Net realized gains | — | (1.76 | ) | — | — | ||||||||||||||
Total distribution to shareholders | — | (2.37 | ) | (0.28 | ) | (0.51 | ) | ||||||||||||
Net asset value, end of period | $ | 25.93 | $ | 28.03 | $ | 24.91 | $ | 21.23 | |||||||||||
Total Return at NAV | (7.49 | )% | 22.76 | % | 18.83 | % | 8.98 | % | |||||||||||
Total Return at Market | (9.00 | )% | 20.45 | % | 23.20 | % | 8.49 | % | |||||||||||
Ratios to average net assets of: | |||||||||||||||||||
Expenses, prior to expense reimbursements/waivers | 0.59 | %(b)(c) | 0.70 | %(d) | 0.70 | % | 0.70 | %(b) | |||||||||||
Expenses, net of expense reimbursements/waivers(e) | 0.35 | %(b)(c) | 0.35 | %(d) | 0.35 | % | 0.35 | %(b) | |||||||||||
Net Investment income, net of reimbursement/waivers | 3.08 | %(b) | 2.40 | % | 1.80 | % | 1.92 | %(b) | |||||||||||
Supplemental data | |||||||||||||||||||
Net assets, end of period (in thousands) | $ | 9,077 | $ | 9,811 | $ | 11,209 | $ | 1,062 | |||||||||||
Portfolio turnover rate | 7 | % | 37 | % | 30 | % | 45 | % |
(a) Based on operations from September 2, 2015 (commencement of operations) through the stated period end.
(b) Annualized.
(c) The ratio includes less than 0.01% for the six months ended September 30, 2018 attributed to overdraft expense, which is outside the Unitary Fee (as defined in Note 3).
(d) The ratio includes less than 0.01% for the year ended March 31, 2018 attributed to line of credit interest expense, overdraft expense and tax expense, which is outside the Unitary Fee (as defined in Note 3).
(e) Total net expenses include the impact of certain fee waivers/expense reimbursements made by the Investment Manager and certain of its affiliates, if applicable.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
53
FINANCIAL HIGHLIGHTS
Columbia EM Quality Dividend ETF
Six Months Ended September 30, 2018 | Year Ended March 31, | ||||||||||||||||||||||||||
(Unaudited) | 2018 | 2017 | 2016 | 2015 | 2014 | ||||||||||||||||||||||
Per share data | |||||||||||||||||||||||||||
Net asset value, beginning of period | $ | 16.00 | $ | 13.77 | $ | 12.81 | $ | 14.25 | $ | 16.15 | $ | 19.80 | |||||||||||||||
Net investment income | 0.33 | 0.38 | 0.37 | 0.38 | 0.77 | 0.64 | |||||||||||||||||||||
Net realized and unrealized gain (loss) | (1.50 | ) | 2.21 | 0.90 | (1.45 | ) | (2.08 | ) | (3.61 | ) | |||||||||||||||||
Total from investment operations | (1.17 | ) | 2.59 | 1.27 | (1.07 | ) | (1.31 | ) | (2.97 | ) | |||||||||||||||||
Less distributions to shareholders: | |||||||||||||||||||||||||||
Net investment income | (0.26 | ) | (0.36 | ) | (0.31 | ) | (0.37 | ) | (0.59 | ) | (0.65 | ) | |||||||||||||||
Return of capital | — | — | — | — | — | (0.03 | ) | ||||||||||||||||||||
Total distribution to shareholders | (0.26 | ) | (0.36 | ) | (0.31 | ) | (0.37 | ) | (0.59 | ) | (0.68 | ) | |||||||||||||||
Net asset value, end of period | $ | 14.57 | $ | 16.00 | $ | 13.77 | $ | 12.81 | $ | 14.25 | $ | 16.15 | |||||||||||||||
Total Return at NAV | (7.28 | )% | 18.96 | % | 10.05 | % | (7.38 | )% | (8.37 | )% | (15.14 | )% | |||||||||||||||
Total Return at Market | (9.18 | )% | 20.31 | % | 11.09 | % | (7.78 | )% | (8.34 | )% | (15.98 | )% | |||||||||||||||
Ratios to average net assets of: | |||||||||||||||||||||||||||
Expenses, prior to expense reimbursements/waivers | 0.59 | %(a)(b) | 0.82 | %(c) | 0.85 | % | 0.85 | % | 0.89 | %(d) | 0.85 | % | |||||||||||||||
Expenses, net of expense reimbursements/waivers(e) | 0.59 | %(a)(b) | 0.82 | %(c) | 0.85 | % | 0.85 | % | 0.89 | %(d) | 0.85 | % | |||||||||||||||
Net Investment income, net of reimbursement/waivers | 4.37 | %(a) | 2.55 | % | 2.79 | % | 2.88 | % | 4.76 | % | 3.54 | % | |||||||||||||||
Supplemental data | |||||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 8,012 | $ | 11,203 | $ | 13,080 | $ | 16,012 | $ | 24,935 | $ | 57,335 | |||||||||||||||
Portfolio turnover rate | 54 | % | 91 | % | 100 | % | 85 | % | 168 | % | 137 | % |
(a) Annualized.
(b) The ratio includes less than 0.01% for the six months ended September 30, 2018 attributed to overdraft expense, which is outside the Unitary Fee (as defined in Note 3).
(c) The ratio includes 0.01% for the year ended March 31, 2018 attributed to overdraft expense and tax expense, which is outside the Unitary Fee (as defined in Note 3).
(d) The ratio includes 0.04% for the year ended March 31, 2015 attributed to tax expense, which is outside the Unitary Fee (as defined in Note 3).
(e) Total net expenses include the impact of certain fee waivers/expense reimbursements made by the Investment Manager and certain of its affiliates, if applicable.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
54
FINANCIAL HIGHLIGHTS
Columbia Emerging Markets Consumer ETF (Consolidated)
Six Months Ended September 30, 2018 | Year Ended March 31, | ||||||||||||||||||||||||||
(Unaudited) | 2018 | 2017 | 2016 | 2015 | 2014 | ||||||||||||||||||||||
Per share data | |||||||||||||||||||||||||||
Net asset value, beginning of period | $ | 26.34 | $ | 24.75 | $ | 22.60 | $ | 26.45 | $ | 26.53 | $ | 26.51 | |||||||||||||||
Net investment income | 0.14 | 0.10 | 0.18 | 0.21 | 0.25 | 0.31 | |||||||||||||||||||||
Net realized and unrealized gain (loss) | (4.08 | ) | 1.59 | 2.13 | (3.83 | ) | (0.03 | ) | (0.09 | ) | |||||||||||||||||
Total from investment operations | (3.94 | ) | 1.69 | 2.31 | (3.62 | ) | 0.22 | 0.22 | |||||||||||||||||||
Less distributions to shareholders: | |||||||||||||||||||||||||||
Net investment income | — | (0.10 | ) | (0.16 | ) | (0.23 | ) | (0.30 | ) | (0.20 | ) | ||||||||||||||||
Net asset value, end of period | $ | 22.40 | $ | 26.34 | $ | 24.75 | $ | 22.60 | $ | 26.45 | $ | 26.53 | |||||||||||||||
Total Return at NAV | (14.96 | )% | 6.81 | % | 10.35 | % | (13.63 | )% | 0.88 | % | 0.82 | % | |||||||||||||||
Total Return at Market | (15.96 | )% | 7.16 | % | 10.75 | % | (13.64 | )% | 0.74 | % | 0.59 | % | |||||||||||||||
Ratios to average net assets of: | |||||||||||||||||||||||||||
Expenses, prior to expense reimbursements/waivers | 0.60 | %(a)(b) | 0.81 | %(c) | 0.85 | %(d) | 0.85 | % | 0.83 | % | 0.84 | % | |||||||||||||||
Expenses, net of expense reimbursements/waivers(e) | 0.60 | %(a)(b) | 0.81 | %(c) | 0.85 | %(d) | 0.85 | % | 0.83 | % | 0.84 | % | |||||||||||||||
Net Investment income, net of reimbursement/waivers | 1.15 | %(a) | 0.37 | % | 0.77 | % | 0.86 | % | 0.92 | % | 1.20 | % | |||||||||||||||
Supplemental data | |||||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 452,524 | $ | 809,911 | $ | 741,171 | $ | 612,360 | $ | 1,145,158 | $ | 1,233,683 | |||||||||||||||
Portfolio turnover rate | 9 | % | 27 | % | 17 | % | 32 | % | 12 | % | 14 | % |
(a) Annualized.
(b) The ratio includes 0.01% for the six months ended September 30, 2018 attributed to overdraft expense and tax expense, which is outside the Unitary Fee (as defined in Note 3).
(c) The ratio includes less than 0.01% for the year ended March 31, 2018 attributed to overdraft expense and tax expense, which is outside the Unitary Fee (as defined in Note 3).
(d) The ratio includes less than 0.01% for the year ended March 31, 2017 attributed to tax expense, which is outside the Unitary Fee (as defined in Note 3).
(e) Total net expenses include the impact of certain fee waivers/expense reimbursements made by the Investment Manager and certain of its affiliates, if applicable.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
55
FINANCIAL HIGHLIGHTS
Columbia India Consumer ETF (Consolidated)
Six Months Ended September 30, 2018 | Year Ended March 31, | ||||||||||||||||||||||||||
(Unaudited) | 2018 | 2017 | 2016 | 2015 | 2014 | ||||||||||||||||||||||
Per share data | |||||||||||||||||||||||||||
Net asset value, beginning of period | $ | 45.81 | $ | 38.31 | $ | 31.16 | $ | 35.48 | $ | 24.72 | $ | 22.10 | |||||||||||||||
Net investment income (loss) | 0.14 | 0.01 | (0.03 | ) | 0.04 | (0.12 | ) | 0.11 | |||||||||||||||||||
Net realized and unrealized gain (loss) | (4.75 | ) | 7.52 | 7.21 | (4.36 | ) | 10.91 | 2.51 | |||||||||||||||||||
Total from investment operations | (4.61 | ) | 7.53 | 7.18 | (4.32 | ) | 10.79 | 2.62 | |||||||||||||||||||
Less distributions to shareholders: | |||||||||||||||||||||||||||
Net investment income | — | (0.03 | ) | (0.03 | ) | — | (0.03 | ) | — | ||||||||||||||||||
Net asset value, end of period | $ | 41.20 | $ | 45.81 | $ | 38.31 | $ | 31.16 | $ | 35.48 | $ | 24.72 | |||||||||||||||
Total Return at NAV | (10.06 | )% | 19.64 | % | 23.06 | % | (12.18 | )% | 43.64 | % | 11.86 | % | |||||||||||||||
Total Return at Market | (11.22 | )% | 19.98 | % | 23.67 | % | (12.57 | )% | 44.04 | % | 12.08 | % | |||||||||||||||
Ratios to average net assets of: | |||||||||||||||||||||||||||
Expenses, prior to expense reimbursements/waivers | 0.76 | %(a)(b) | 0.87 | %(c) | 0.89 | %(d) | 0.89 | % | 0.90 | %(e) | 0.89 | % | |||||||||||||||
Expenses, net of expense reimbursements/waivers(f) | 0.76 | %(a)(b) | 0.87 | %(c) | 0.89 | %(d) | 0.89 | % | 0.90 | %(e) | 0.89 | % | |||||||||||||||
Net Investment income (loss), net of reimbursement/waivers | 0.61 | %(a) | 0.01 | % | (0.09 | )% | 0.13 | % | (0.36 | )% | 0.50 | % | |||||||||||||||
Supplemental data | |||||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 129,784 | $ | 144,289 | $ | 88,102 | $ | 71,679 | $ | 88,710 | $ | 4,945 | |||||||||||||||
Portfolio turnover rate | 0 | % | 28 | % | 31 | % | 47 | % | 82 | % | 43 | % |
(a) Annualized.
(b) The ratio includes 0.01% for the six months ended September 30, 2018 attributed to tax expense, which is outside the Unitary Fee (as defined in Note 3).
(c) The ratio includes 0.01% for the year ended March 31, 2018 attributed to line of credit interest expense and tax expense, which is outside the Unitary Fee (as defined in Note 3).
(d) The ratio includes less than 0.01% for the year ended March 31, 2017 attributed to tax expense, which is outside the Unitary Fee (as defined in Note 3).
(e) The ratio includes 0.01% for the year ended March 31, 2015 attributed to tax expense, which is outside the Unitary Fee (as defined in Note 3).
(f) Total net expenses include the impact of certain fee waivers/expense reimbursements made by the Investment Manager and certain of its affiliates, if applicable.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
56
FINANCIAL HIGHLIGHTS
Columbia India Infrastructure ETF (Consolidated)
Six Months Ended September 30, 2018 | Year Ended March 31, | ||||||||||||||||||||||||||
(Unaudited) | 2018 | 2017 | 2016 | 2015 | 2014 | ||||||||||||||||||||||
Per share data | |||||||||||||||||||||||||||
Net asset value, beginning of period | $ | 13.98 | $ | 12.98 | $ | 10.24 | $ | 13.08 | $ | 11.35 | $ | 12.27 | |||||||||||||||
Net investment income | 0.06 | 0.18 | 0.03 | 0.30 | 0.12 | 0.13 | |||||||||||||||||||||
Net realized and unrealized gain (loss) | (2.15 | ) | 0.92 | 3.03 | (3.04 | ) | 1.65 | (a) | 0.27 | ||||||||||||||||||
Total from investment operations | (2.09 | ) | 1.10 | 3.06 | (2.74 | ) | 1.77 | 0.40 | |||||||||||||||||||
Less distributions to shareholders: | |||||||||||||||||||||||||||
Net investment income | — | (0.10 | ) | (0.32 | ) | (0.10 | ) | (0.04 | ) | (1.32 | ) | ||||||||||||||||
Net asset value, end of period | $ | 11.89 | $ | 13.98 | $ | 12.98 | $ | 10.24 | $ | 13.08 | $ | 11.35 | |||||||||||||||
Total Return at NAV | (14.95 | )% | 8.41 | % | 30.61 | % | (21.00 | )% | 15.59 | % | 4.04 | % | |||||||||||||||
Total Return at Market | (16.10 | )% | 9.13 | % | 30.93 | % | (21.41 | )% | 15.93 | % | 4.49 | % | |||||||||||||||
Ratios to average net assets of: | |||||||||||||||||||||||||||
Expenses, prior to expense reimbursements/waivers | 0.84 | %(b)(c) | 0.84 | %(d) | 0.98 | %(e) | 0.88 | %(f) | 0.88 | %(g) | 0.86 | %(h) | |||||||||||||||
Expenses, net of expense reimbursements/waivers(i) | 0.84 | %(b)(c) | 0.84 | %(d) | 0.98 | %(e) | 0.88 | %(f) | 0.88 | %(g) | 0.86 | %(h) | |||||||||||||||
Net Investment income, net of reimbursement/waivers | 0.90 | %(b) | 1.25 | % | 0.28 | % | 2.68 | % | 0.90 | % | 1.18 | % | |||||||||||||||
Supplemental data | |||||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 32,684 | $ | 49,612 | $ | 41,529 | $ | 39,938 | $ | 47,736 | $ | 17,586 | |||||||||||||||
Portfolio turnover rate | 21 | % | 54 | % | 34 | % | 59 | % | 75 | % | 76 | % |
(a) The realized and unrealized gain on investments and foreign currency transactions does not accord with the amounts reported in the Statement of Operations due to the timing of subscriptions of fund shares in relation to the investment performance during the period and contributions made by Authorized Participants to compensate the Fund for additional costs incurred in purchasing securities that were not transferred in kind (See Note 1).
(b) Annualized.
(c) The ratio includes 0.09% for the six months ended September 30, 2018 attributed to line of credit interest expense and tax expense, which is outside the Unitary Fee (as defined in Note 3).
(d) The ratio includes 0.01% for the year ended March 31, 2018 attributed to overdraft expense and tax expense, which is outside the Unitary Fee (as defined in Note 3).
(e) The ratio includes 0.13% for the year ended March 31, 2017 attributed to tax expense, which is outside the Unitary Fee (as defined in Note 3).
(f) The ratio includes 0.03% for the year ended March 31, 2016 attributed to tax expense, which is outside the Unitary Fee (as defined in Note 3).
(g) The ratio includes 0.03% for the year ended March 31, 2015 attributed to tax expense, which is outside the Unitary Fee (as defined in Note 3).
(h) The ratio includes 0.01% for the year ended March 31, 2014 attributed to tax expense, which is outside the Unitary Fee (as defined in Note 3).
(i) Total net expenses include the impact of certain fee waivers/expense reimbursements made by the Investment Manager and certain of its affiliates, if applicable.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
57
FINANCIAL HIGHLIGHTS
Columbia India Small Cap ETF (Consolidated)
Six Months Ended September 30, 2018 | Year Ended March 31, | ||||||||||||||||||||||||||
(Unaudited) | 2018 | 2017 | 2016 | 2015 | 2014 | ||||||||||||||||||||||
Per share data | |||||||||||||||||||||||||||
Net asset value, beginning of period | $ | 19.50 | $ | 18.26 | $ | 13.59 | $ | 17.48 | $ | 12.74 | $ | 12.45 | |||||||||||||||
Net investment income (loss) | 0.06 | 0.00 | (a) | (0.02 | ) | 0.06 | 0.05 | 0.26 | |||||||||||||||||||
Net realized and unrealized gain (loss) | (5.46 | ) | 1.41 | 4.82 | (3.86 | ) | 4.77 | 0.25 | |||||||||||||||||||
Total from investment operations | (5.40 | ) | 1.41 | 4.80 | (3.80 | ) | 4.82 | 0.51 | |||||||||||||||||||
Less distributions to shareholders: | |||||||||||||||||||||||||||
Net investment income | — | (0.17 | ) | (0.13 | ) | (0.09 | ) | (0.08 | ) | (0.22 | ) | ||||||||||||||||
Net asset value, end of period | $ | 14.10 | $ | 19.50 | $ | 18.26 | $ | 13.59 | $ | 17.48 | $ | 12.74 | |||||||||||||||
Total Return at NAV | (27.69 | )% | 7.61 | % | 35.62 | % | (21.78 | )% | 37.86 | % | 4.29 | % | |||||||||||||||
Total Return at Market | (28.04 | )% | 8.51 | % | 36.29 | % | (22.27 | )% | 39.17 | % | 4.30 | % | |||||||||||||||
Ratios to average net assets of: | |||||||||||||||||||||||||||
Expenses, prior to expense reimbursements/waivers | 0.78 | %(b)(c) | 0.86 | %(d) | 0.86 | %(e) | 0.86 | %(f) | 0.92 | %(g) | 0.86 | %(h) | |||||||||||||||
Expenses, net of expense reimbursements/waivers(i) | 0.78 | %(b)(c) | 0.86 | %(d) | 0.86 | %(e) | 0.86 | %(f) | 0.92 | %(g) | 0.86 | %(h) | |||||||||||||||
Net Investment income (loss), net of reimbursement/waivers | 0.66 | %(b) | 0.02 | % | (0.12 | )% | 0.40 | % | 0.33 | % | 2.36 | % | |||||||||||||||
Supplemental data | |||||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 15,514 | $ | 28,282 | $ | 25,565 | $ | 19,027 | $ | 28,850 | $ | 16,560 | |||||||||||||||
Portfolio turnover rate | 16 | % | 107 | % | 71 | % | 45 | % | 117 | % | 56 | % |
(a) Rounds to zero.
(b) Annualized.
(c) The ratio includes 0.03% for the six months ended September 30, 2018 attributed to overdraft expense and tax expense, which is outside the Unitary Fee (as defined in Note 3).
(d) The ratio includes 0.02% for the year ended March 31, 2018 attributed to line of credit interest expense, overdraft expense and tax expense, which is outside the Unitary Fee (as defined in Note 3).
(e) The ratio includes 0.01% for the year ended March 31, 2017 attributed to tax expense, which is outside the Unitary Fee (as defined in Note 3).
(f) The ratio includes 0.01% for the year ended March 31, 2016 attributed to tax expense, which is outside the Unitary Fee (as defined in Note 3).
(g) The ratio includes 0.07% for the year ended March 31, 2015 attributed to tax expense, which is outside the Unitary Fee (as defined in Note 3).
(h) The ratio includes 0.01% for the year ended March 31, 2014 attributed to tax expense, which is outside the Unitary Fee (as defined in Note 3).
(i) Total net expenses include the impact of certain fee waivers/expense reimbursements made by the Investment Manager and certain of its affiliates, if applicable.
The accompanying Notes to Financial Statements are an integral part of these financial statements.
Columbia ETF Trust II | Semiannual Report 2018
58
NOTES TO FINANCIAL STATEMENTS
September 30, 2018 (Unaudited)
Note 1. Organization
Columbia ETF Trust II (the Trust) is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end registered investment company organized as a Delaware statutory trust. The Trust may issue an unlimited number of shares (without par value).
Information presented in these financial statements pertains to the following series of the Trust (each, a Fund and collectively, the Funds): Columbia Beyond BRICs ETF, Columbia EM Core ex-China ETF, Columbia EM Quality Dividend ETF, Columbia Emerging Markets Consumer ETF, Columbia India Consumer ETF, Columbia India Infrastructure ETF, and Columbia India Small Cap ETF. Columbia Beyond BRICs ETF and Columbia EM Quality Dividend ETF are currently classified as diversified funds. Columbia EM Core ex-China ETF, Columbia Emerging Markets Consumer ETF, Columbia India Consumer ETF, Columbia India Infrastructure ETF and Columbia India Small Cap ETF are currently classified as non-diversified funds.
Basis for Consolidation
The Consolidated Portfolio of Investments; Consolidated Statements of Assets and Liabilities, of Operations and of Changes in Net Assets; and the Consolidated Financial Highlights of the Funds listed below include the accounts of wholly owned subsidiaries (each, a Subsidiary and collectively, the Subsidiaries) located in the Republic of Mauritius (Mauritius). All inter-company accounts and transactions have been eliminated in consolidations.
Fund | Wholly owned subsidiary | ||||||
Columbia Emerging Markets Consumer ETF | EG Shares Consumer Mauritius | ||||||
Columbia India Consumer ETF | EG Shares India Consumer Mauritius | ||||||
Columbia India Infrastructure ETF | EG Shares India Infrastructure Mauritius | ||||||
Columbia India Small Cap ETF | EG Shares India Small Cap Mauritius |
As of the date of this report, Columbia Emerging Markets Consumer ETF may invest its assets in its corresponding Subsidiary, which in turn invests substantially all (but at least 90%) of its assets in Indian securities.
As of the date of this report, Columbia India Consumer ETF and Columbia India Infrastructure ETF invest in Indian securities both directly (in India), and through their corresponding Subsidiary, which in turn invests virtually all of its assets in Indian securities.
As of the date of this report, Columbia India Small Cap ETF transitioned all its Indian securities out of its corresponding Subsidiary and holds its investments in Indian securities directly in the Fund.
Columbia India Infrastructure ETF and Columbia Emerging Markets Consumer ETF each intend to transition their investments in Indian securities out of their corresponding Subsidiary by the end of the 2018 calendar year and will hold investments in Indian securities directly in the Fund.
Each Fund listed in the table above has historically relied on a tax treaty between India and Mauritius for relief from certain Indian taxes. The enactment of general anti-avoidance rules in India, the signing of a protocol amending the India-Mauritius tax treaty, and enactment of a 10% tax on long-term capital gains from sales of Indian shares after March 31, 2018 (not otherwise exempt under a tax treaty) will result in the imposition of additional taxes by India on the Subsidiary and each Fund listed in the table above which will result in higher taxes paid indirectly by the Funds and lower returns for the Funds and their shareholders. For more information, see India-Mauritius Tax Treaty Risk.
Columbia ETF Trust II | Semiannual Report 2018
59
NOTES TO FINANCIAL STATEMENTS (continued)
September 30, 2018 (Unaudited)
A summary of each Fund's investment in its corresponding Subsidiary is as follows:
Funds | % of consolidated fund net assets | Net assets ($) | Net investment income (loss) ($) | Net realized gain (loss) ($) | Net change in unrealized appreciation (depreciation) ($) | ||||||||||||||||||
Columbia Emerging Markets Consumer ETF | 10.8 | 48,992,067 | 859,943 | 16,653,375 | (18,031,130 | ) | |||||||||||||||||
Columbia India Consumer ETF | 84.6 | 109,856,661 | 831,680 | 18,726 | (12,496,879 | ) | |||||||||||||||||
Columbia India Infrastructure ETF | 76.4 | 24,981,347 | 364,846 | 1,065,094 | (6,790,817 | ) | |||||||||||||||||
Columbia India Small Cap ETF | — | — | 17,642 | (1,565,514 | ) | 1,278,558 |
Fund shares
The market prices of each Fund's shares may differ to some degree from the Fund's net asset value (NAV). Unlike conventional mutual funds, each Fund issues and redeems shares on a continuous basis, at NAV, only in a large specified number of shares, each called a "Creation Unit." A Creation Unit consists of 50,000 shares. Creation Units are issued and redeemed generally in-kind for a basket of securities and/or for cash. Investors such as market makers, large investors and institutions who wish to deal in Creation Units directly with a Fund must have entered into an authorized participant agreement (Authorized Participants) with the Fund's principal underwriter and the transfer agent, or purchase through a dealer that has entered into such an agreement. Authorized participants may purchase or redeem Fund shares directly from the Fund only in Creation Units. The Funds' shares are also listed on the New York Stock Exchange for which investors can purchase and sell shares on the secondary market through a broker at market prices which may differ from the NAV of the Fund.
Note 2. Summary of significant accounting policies
Basis of preparation
Each Fund is an investment company that applies the accounting and reporting guidance in the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946, Financial Services — Investment Companies (ASC 946). The financial statements are prepared in accordance with U.S. generally accepted accounting principles (GAAP), which requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates.
The following is a summary of significant accounting policies followed by the Funds in the preparation of their financial statements.
Security valuation
All equity securities and exchange-traded funds are valued at the close of business of the New York Stock Exchange. Equity securities and exchange-traded funds are valued at the last quoted sales price on the principal exchange or market on which they trade, except for securities traded on the NASDAQ Stock Market, which are valued at the NASDAQ official close price. Unlisted securities or listed securities for which there were no sales during the day are valued at the mean of the latest quoted bid and ask prices on such exchanges or markets.
Foreign equity securities are valued based on the closing price on the foreign exchange in which such securities are primarily traded. If any foreign equity security closing prices are not readily available, the securities are valued at the mean of the latest quoted bid and ask prices on such exchanges or markets. Foreign currency exchange rates are generally determined at the close of London's exchange at 11:00 a.m. Eastern (U.S.) time.
Investments for which market quotations are not readily available, or that have quotations which management believes are not reflective of market value or reliable, are valued at fair value as determined in good faith under procedures approved by and under the general supervision of the Board of Trustees. If a security or class of securities (such as foreign securities) is valued at fair value, such value is likely to be different from the quoted or published price for the security.
Columbia ETF Trust II | Semiannual Report 2018
60
NOTES TO FINANCIAL STATEMENTS (continued)
September 30, 2018 (Unaudited)
The determination of fair value often requires significant judgment. To determine fair value, management may use assumptions including but not limited to future cash flows and estimated risk premiums. Multiple inputs from various sources may be used to determine fair value.
GAAP requires disclosure regarding the inputs and valuation techniques used to measure fair value and any changes in valuation inputs or techniques. In addition, investments shall be disclosed by major category. This information is disclosed following the Funds' Portfolio of Investments.
Foreign currency transactions and translation
The values of all assets and liabilities denominated in foreign currencies are generally translated into U.S. dollars at exchange rates determined at the close of the London Stock Exchange on any given day. Net realized and unrealized gains (losses) on foreign currency transactions and translations include gains (losses) arising from the fluctuation in exchange rates between trade and settlement dates on securities transactions, gains (losses) arising from the disposition of foreign currency and currency gains (losses) between the accrual and payment dates on dividends, interest income and foreign withholding taxes.
For financial statement purposes, the Funds do not distinguish that portion of gains (losses) on investments which is due to changes in foreign exchange rates from that which is due to changes in market prices of the investments. Such fluctuations are included with the net realized and unrealized gains (losses) on investments in the Statement of Operations.
Security transactions
Security transactions are accounted for on the trade date. Cost is determined and gains (losses) are based upon the specific identification method for both financial statement and federal income tax purposes.
Income recognition
Corporate actions and dividend income are generally recorded net of any non-reclaimable tax withholdings, on the ex-dividend date or upon receipt of ex-dividend notification in the case of certain foreign securities.
Interest income is recorded on an accrual basis.
Awards from class action litigation are recorded as a reduction of cost basis if the Fund still owns the applicable securities on the payment date. If the Fund no longer owns the applicable securities, the proceeds are recorded as realized gains.
Expenses
General expenses of the Trust are allocated to the Funds based upon relative net assets or other expense allocation methodologies determined by the nature of the expense. Expenses directly attributable to a Fund are charged to that Fund.
Determination of net asset value
The NAV per share of each Fund is computed by dividing the value of the net assets of a Fund by the total number of outstanding shares of that Fund, rounded to the nearest cent, at the close of regular trading (ordinarily 4:00 p.m. Eastern Time) every day the New York Stock Exchange is open.
Federal income tax status
For federal income tax purposes, each Fund is treated as a separate entity. Each Fund intends to qualify each year as a regulated investment company under Subchapter M of the Internal Revenue Code, as amended, and will distribute substantially all of its investment company taxable income and net capital gain, if any, for its tax year, and as such will not
Columbia ETF Trust II | Semiannual Report 2018
61
NOTES TO FINANCIAL STATEMENTS (continued)
September 30, 2018 (Unaudited)
be subject to federal income taxes. In addition, each Fund intends to distribute in each calendar year substantially all of its ordinary income, capital gain net income and certain other amounts, if any, such that the Fund should not be subject to federal excise tax. Therefore, no federal income or excise tax provisions are recorded.
Foreign taxes
The Funds may be subject to foreign taxes on income, gains on investments or currency repatriation, a portion of which may be recoverable. The Fund will accrue such taxes and recoveries, as applicable, based upon its current interpretation of tax rules and regulations that exist in the markets in which it invests.
Realized gains in certain countries may be subject to foreign taxes at the Fund level, based on statutory rates. The Fund accrues for such foreign taxes on realized and unrealized gains at the appropriate rate for each jurisdiction, as applicable. The amount, if any, is disclosed as a liability on the Statement of Assets and Liabilities.
Distributions to shareholders
Distributions from net investment income, if any, are declared and paid each calendar quarter for Columbia EM Quality Dividend ETF. The remaining Funds declare and distribute net investment income annually. Net realized capital gains, if any, are distributed at least annually. Income distributions and capital gain distributions are determined in accordance with federal income tax regulations, which may differ from GAAP.
Guarantees and indemnifications
Under the Trust's organizational documents and, in some cases, by contract, its officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust or its funds. In addition, certain of the Funds' contracts with their service providers contain general indemnification clauses. The Funds' maximum exposure under these arrangements is unknown since the amount of any future claims that may be made against the Funds cannot be determined, and the Funds have no historical basis for predicting the likelihood of any such claims.
Recent accounting pronouncements
Accounting Standards Update 2017-08 Premium Amortization on Purchased Callable Debt Securities
In March 2017, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2017-08 Premium Amortization on Purchased Callable Debt Securities. ASU No. 2017-08 updates the accounting standards to shorten the amortization period for certain purchased callable debt securities, held at a premium, to be amortized to the earliest call date. The update applies to securities with explicit, noncontingent call features that are callable at fixed prices and on preset dates. The standard is effective for annual periods beginning after December 15, 2018 and interim periods within those fiscal years. At this time, management is evaluating the implication of this guidance and the impact it will have on the financial statement amounts and footnote disclosures, if any.
Accounting Standards Update 2018-13 Disclosure Framework — Changes to the Disclosure Requirements for Fair Value Measurement
In August 2018, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2018-13 Disclosure Framework — Changes to the Disclosure Requirements for Fair Value Measurement. ASU No. 2018-13, in addition to other modifications and additions, removes the requirement to disclose the amount and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy and the policy for the timing of transfers between levels. The standard is effective for annual periods beginning after December 15, 2019 and interim periods within those fiscal years. At this time, management is evaluating the implication of this guidance and the impact it will have on the financial statement disclosures, if any.
Columbia ETF Trust II | Semiannual Report 2018
62
NOTES TO FINANCIAL STATEMENTS (continued)
September 30, 2018 (Unaudited)
Note 3. Investment management fees
Under an Investment Management Services Agreement, Columbia Management Investment Advisers, LLC (the Investment Manager), a wholly-owned subsidiary of Ameriprise Financial, Inc. (Ameriprise Financial), determines which securities will be purchased, held or sold. The investment management fee is a unitary fee paid monthly to the Investment Manager at an annual rate based on each Fund's average daily net assets. In return for this fee, the Investment Manager pays the operating costs and expenses of each Fund other than the following expenses (which will be paid by the Fund): taxes; interest incurred on borrowing by the Funds (including but not limited to overdraft fees), if any; brokerage expenses, fees, commissions and other portfolio transaction expenses (including but not limited to service fees charged by custodians of depository receipts and scrip fees related to registrations on foreign exchanges); interest and fee expense related to the Funds' participation in inverse floater structures; infrequent and/or unusual expenses, including without limitation litigation expenses (including but not limited to arbitrations and indemnification expenses); distribution and/or service fees; expenses incurred in connection with lending securities; and any other expenses approved by the Board of Trustees.
The investment management fee is an annual fee that is equal to a percentage of each Fund's average daily net assets and is paid as follows:
Effective August 1, 2018 | Prior to August 1, 2018 | ||||||||||||||||||
Funds | Assets (billions) | Investment management fee rate (%) | Assets (billions) | Investment management fee rate (%) | |||||||||||||||
Columbia Beyond BRICs ETF | All | 0.59 | All | 0.85 | |||||||||||||||
Columbia EM Core ex-China ETF | All | 0.35 | All | 0.70 | |||||||||||||||
Columbia EM Quality Dividend ETF | All | 0.59 | All | 0.59 | |||||||||||||||
Columbia Emerging Markets Consumer ETF | All | 0.59 | All | 0.59 | |||||||||||||||
Columbia India Consumer ETF | All | 0.75 | All | 0.75 | |||||||||||||||
Columbia India Infrastructure ETF | All | 0.75 | All | 0.75 | |||||||||||||||
Columbia India Small Cap ETF | All | 0.75 | All | 0.75 |
The annualized effective management services fee rate for the six months ended September 30, 2018 was as follows:
Funds | Effective investment management fee rate (%) | ||||||
Columbia Beyond BRICs ETF | 0.77 | ||||||
Columbia EM Core ex-China ETF | 0.59 | ||||||
Columbia EM Quality Dividend ETF | 0.59 | ||||||
Columbia Emerging Markets Consumer ETF | 0.59 | ||||||
Columbia India Consumer ETF | 0.75 | ||||||
Columbia India Infrastructure ETF | 0.75 | ||||||
Columbia India Small Cap ETF | 0.75 |
The Investment Manager had contractually agreed to waive all or a portion of the investment management fee for the periods disclosed below, so that each Fund's investment management fee was limited as a percentage of the respective Fund's average daily net assets to the annual rate noted below:
Funds | Prior to September 1, 2018 | ||||||
Columbia Beyond BRICs ETF | 0.58 | % | |||||
Columbia EM Core ex-China ETF | 0.35 |
Columbia ETF Trust II | Semiannual Report 2018
63
NOTES TO FINANCIAL STATEMENTS (continued)
September 30, 2018 (Unaudited)
Compensation of board members
Members of the Board of Trustees who are not officers or employees of the Investment Manager or Ameriprise Financial are compensated for their services to the Funds as disclosed in the Statement of Operations. Under a Deferred Compensation Plan (the Plan), these members of the Board of Trustees may elect to defer payment of up to 100% of their compensation. Deferred amounts are treated as though equivalent dollar amounts had been invested in shares of certain funds managed by the Investment Manager. Each Fund's liability for these amounts is adjusted for market value changes and remains in the Fund until distributed in accordance with the Plan. All amounts payable under the Plan constitute a general unsecured obligation of the Funds. The expenses of the compensation of the members of the Board of Trustees that are allocated to the Fund are payable by the Investment Manager.
Compensation of Chief Compliance Officer
The Board of Trustees has appointed a Chief Compliance Officer to the Funds in accordance with federal securities regulations. A portion of the Chief Compliance Officer's total compensation is allocated to the Funds, along with other allocations to affiliated funds governed by the Board of Trustees, based on relative net assets. The expenses of the Chief Compliance Officer allocated to the Funds are payable by the Investment Manager.
Distribution and service fees
ALPS Distributors, Inc., (the Distributor) serves as the distributor for the Funds. The Funds have adopted a distribution and service plan (the Plan). Under the Plan, the Funds are authorized to pay distribution fees to the Distributor and other firms that provide distribution and shareholder services at the maximum annual rate of 0.25% of average daily net assets of each Fund. No distribution or service fees are currently paid by the Funds or have been approved for payment by the Board of Trustees, however, and there are no current plans to impose these fees.
Note 4. Federal tax information
The timing and character of income and capital gain distributions are determined in accordance with income tax regulations, which may differ from GAAP because of temporary or permanent book to tax differences.
At September 30, 2018, the approximate cost of all investments for federal income tax purposes and the aggregate gross approximate unrealized appreciation and depreciation based on that cost was:
Net | |||||||||||||||||||
Funds | Tax cost ($) | Gross unrealized appreciation ($) | Gross unrealized (depreciation) ($) | unrealized appreciation (depreciation) ($) | |||||||||||||||
Columbia Beyond BRICs ETF | 50,201,288 | 6,968,022 | (4,775,691 | ) | 2,192,331 | ||||||||||||||
Columbia EM Core ex-China ETF | 7,783,255 | 1,881,139 | (601,316 | ) | 1,279,823 | ||||||||||||||
Columbia EM Quality Dividend ETF | 7,799,557 | 578,493 | (402,871 | ) | 175,622 | ||||||||||||||
Columbia Emerging Markets Consumer ETF | 478,083,509 | 68,741,867 | (94,799,108 | ) | (26,057,241 | ) | |||||||||||||
Columbia India Consumer ETF | 110,236,726 | 26,803,770 | (7,163,040 | ) | 19,640,730 | ||||||||||||||
Columbia India Infrastructure ETF | 29,905,241 | 5,584,784 | (2,823,761 | ) | 2,761,023 | ||||||||||||||
Columbia India Small Cap ETF | 22,219,533 | 144,363 | (6,757,539 | ) | (6,613,176 | ) |
Tax cost of investments and unrealized appreciation/(depreciation) may also include timing differences that do not constitute adjustments to tax basis.
The following capital loss carryforwards, determined at March 31, 2018, may be available to reduce taxable income arising from future net realized gains on investments, if any, to the extent permitted by the Internal Revenue Code. Capital loss carryforwards with no expiration are required to be utilized prior to any capital losses which carry an expiration date. As a result of this ordering rule, capital loss carryforwards which carry an expiration date may be more likely to expire unused.
Columbia ETF Trust II | Semiannual Report 2018
64
NOTES TO FINANCIAL STATEMENTS (continued)
September 30, 2018 (Unaudited)
Carryforwards with no expiration | |||||||||||
Funds | Short-term capital loss carryforward ($) | Long-term capital loss carryforward ($) | |||||||||
Columbia Beyond BRICs ETF | 17,608,572 | 40,436,947 | |||||||||
Columbia EM Core ex-China ETF | — | — | |||||||||
Columbia EM Quality Dividend ETF | 20,946,356 | 5,998,667 | |||||||||
Columbia Emerging Markets Consumer ETF | — | 167,735,557 | |||||||||
Columbia India Consumer ETF | 4,835,874 | 686,546 | |||||||||
Columbia India Infrastructure ETF | 15,926,335 | 40,131,846 | |||||||||
Columbia India Small Cap ETF | — | 6,095,120 |
Management of the Funds has concluded that there are no significant uncertain tax positions in the Funds that would require recognition in the financial statements. However, management's conclusion may be subject to review and adjustment at a later date based on factors including, but not limited to, new tax laws, regulations, and administrative interpretations (including relevant court decisions). Generally, the Funds' federal tax returns for the prior three fiscal years remain subject to examination by the Internal Revenue Service.
Note 5. Portfolio information
The cost of purchases and proceeds from sales of securities, excluding short-term investments and in-kind transactions, for the six months ended September 30, 2018, were as follows:
Funds | Purchases ($) | Sales ($) | |||||||||
Columbia Beyond BRICs ETF | 11,006,932 | 15,611,006 | |||||||||
Columbia EM Core ex-China ETF | 811,140 | 650,132 | |||||||||
Columbia EM Quality Dividend ETF | 5,214,270 | 6,406,505 | |||||||||
Columbia Emerging Markets Consumer ETF | 59,803,231 | 114,279,367 | |||||||||
Columbia India Consumer ETF | — | 2,301,253 | |||||||||
Columbia India Infrastructure ETF | 8,581,318 | 19,774,418 | |||||||||
Columbia India Small Cap ETF | 3,607,661 | 10,123,662 |
The amount of purchase and sale activity impacts the portfolio turnover rate reported in the Financial Highlights.
Note 6. In-kind transactions
The Funds may accept in-kind contributions and redemptions. In-kind contributions are accounted for at the fair market value of the in-kind securities contributed on the date of contribution. For the six months ended September 30, 2018, the cost basis of in-kind purchases and sales was as follows:
Funds | Purchases ($) | Sales ($) | |||||||||
Columbia Beyond BRICs ETF | — | 6,657,539 | |||||||||
Columbia EM Core ex-China ETF | — | — | |||||||||
Columbia EM Quality Dividend ETF | — | 971,746 | |||||||||
Columbia Emerging Markets Consumer ETF | — | 200,032,770 | |||||||||
Columbia India Consumer ETF | — | — | |||||||||
Columbia India Infrastructure ETF | — | — | |||||||||
Columbia India Small Cap ETF | — | — |
Note 7. Line of credit
Each Fund has access to a revolving credit facility with a syndicate of banks led by Citibank, N.A., HSBC Bank USA, N.A. and JPMorgan Chase Bank, N.A. whereby the Fund may borrow for the temporary funding of shareholder redemptions or
Columbia ETF Trust II | Semiannual Report 2018
65
NOTES TO FINANCIAL STATEMENTS (continued)
September 30, 2018 (Unaudited)
for other temporary or emergency purposes. The credit facility, which is a collective agreement between the Fund and certain other funds managed by the Investment Manager, severally and not jointly, permits collective borrowings up to $1 billion. Interest is charged to each participating fund based on its borrowings at a rate equal to the higher of (i) the overnight federal funds rate plus 1.00% or (ii) the one-month LIBOR rate plus 1.00%. Each borrowing under the credit facility matures no later than 60 days after the date of borrowing. Each Fund will pay a commitment fee equal to its pro rata share of the amount of the credit facility at a rate of 0.15% per annum. This agreement expires annually in December unless extended or renewed.
During the six months ended September 30, 2018, Columbia Beyond BRICs ETF, Columbia EM Core ex-China ETF, Columbia EM Quality Dividend ETF, Columbia Emerging Markets Consumer ETF, Columbia India Consumer ETF and Columbia India Small Cap ETF had no borrowings.
During the six months ended September 30, 2018, the following Fund had borrowings:
Fund | Average daily loan balance ($) | Weighted average interest rate (%) | Days outstanding | ||||||||||||
Columbia India Infrastructure ETF | 8,200,000 | 3.17 | 3 |
Interest expense incurred by the Funds is recorded as a line of credit interest expense in the Statement of Operations. There were no outstanding borrowings at September 30, 2018.
Note 8. Significant risks
Concentration risk
Each Fund concentrates its investments in a particular sector or a group of sectors to approximately the same extent as its respective underlying index, and as such, may be adversely affected by increased price volatility of securities in those sectors, and may be more susceptible to adverse economic, market, political or regulatory occurrences affecting those sectors.
Consumer concentration risk
Because Columbia Emerging Markets Consumer ETF and Columbia India Consumer ETF concentrate their investments in the consumer goods and consumer services sectors (specifically the consumer goods and consumer services sectors of India for the Columbia India Consumer ETF), these Funds may be adversely affected by increased price volatility of securities in those sectors, and may be more susceptible to adverse economic, market, political or regulatory occurrences affecting those sectors. The success of consumer goods and consumer services suppliers and retailers is tied closely to the performance of the domestic and international economy, interest rates, currency exchange rates, competition, preferences, and consumer confidence.
Country and regional risk
Each Fund will invest in specific countries or geographic regions to approximately the same extent as its underlying index. To the extent that a Fund invests a significant portion of its assets in a particular country or a specific geographic region, the Fund will generally have more exposure to that country's or region's economic risks. In the event of economic or political turmoil or a deterioration of diplomatic relations in a country or region where a substantial portion of a Fund's assets are invested, the Fund may experience increased volatility or illiquidity of its portfolio holdings, which may adversely affect that Fund's performance.
Emerging markets risk
The Funds are subject to emerging markets risk. Investments in emerging market securities are subject to even greater risks than for foreign investments generally, including increased risks of: illiquidity of securities; price volatility; inflation or deflation; restrictions on foreign investment; nationalization; higher taxation; economic and political instability; pervasive
Columbia ETF Trust II | Semiannual Report 2018
66
NOTES TO FINANCIAL STATEMENTS (continued)
September 30, 2018 (Unaudited)
corruption and crime; less governmental regulation; and less developed legal systems. These risks may be greater for investments in frontier markets.
Financial concentration risk
Columbia Beyond BRICs ETF, Columbia EM Core ex-China ETF and Columbia EM Quality Dividend ETF have concentrated investments in the financials sector. Because companies in the financials sector are subject to extensive governmental regulation, which may adversely affect the scope of their activities, the prices they can charge and the amount of capital they must maintain, these Funds may be adversely affected.
India concentration risk
Because Columbia India Consumer ETF, Columbia India Infrastructure ETF and Columbia India Small Cap ETF invest predominantly in Indian securities, their NAVs will be much more sensitive to changes in economic, political and other factors within India than would a fund that invested in a greater variety of countries. Special risks include, among others, political and legal uncertainty, persistent religious, ethnic and border disputes, greater government control over the economy, currency fluctuations or blockage and the risk of nationalization or expropriation of assets.
India-Mauritius tax treaty risk
Each of Columbia Emerging Markets Consumer ETF, Columbia India Consumer ETF, Columbia India Infrastructure ETF and Columbia India Small Cap ETF and the respective Subsidiary of each has historically relied on a tax treaty between India and Mauritius for relief from certain Indian taxes. As of the date of this report Columbia India Small Cap ETF has transitioned all its Indian securities out of its corresponding Subsidiary and holds its investments in Indian securities directly in the Fund. Columbia India Infrastructure ETF and Columbia Emerging Markets Consumer ETF each intend to transition their investments in Indian securities out of their corresponding Subsidiary by the end of the 2018 calendar year and will hold investments in Indian securities directly in the Fund. India and Mauritius have agreed to an amended protocol with respect to gains resulting from the alienation of shares in Indian companies acquired on or after April 1, 2017, which will result in higher taxes paid indirectly by a Fund and, therefore, lower returns for a Fund and its shareholders. Gains resulting from the alienation of shares acquired prior to April 1, 2017 will continue to be exempt from Indian tax under the India- Mauritius tax treaty. Additionally, India has enacted general anti-avoidance rules, and a 10% tax on long-term capital gains resulting from the alienation of Indian shares after March 31, 2018, to the extent that such gains are not otherwise exempt or reduced under a tax treaty, which could result in the imposition by India of various additional taxes on Indian securities invested in by a Subsidiary and a Fund.
Industrials concentration risk
Columbia India Infrastructure ETF may be more susceptible to the particular risks that may affect companies in the industrials sector than if it was invested in a wider variety of companies in unrelated sectors. The performance of companies in the industrials sector may be affected by government regulation, world events and economic conditions.
Infrastructure concentration risk
Because Columbia India Infrastructure ETF concentrates its investments in the infrastructure sectors of India, the Fund may be adversely affected by increased price volatility of securities in that sector, and may be more susceptible to adverse economic, market, political or regulatory occurrences affecting that sector.
Materials concentration risk
Columbia India Infrastructure ETF and Columbia India Small Cap ETF may be more susceptible to the particular risks that may affect companies in the materials sector than if they were invested in a wider variety of companies in unrelated sectors. Companies in the materials sector are subject to certain risks, including that many materials companies are significantly affected by the level and volatility of commodity prices, exchange rates, import controls, worldwide competition, environmental policies and consumer demand. Performance of such companies may be affected by factors
Columbia ETF Trust II | Semiannual Report 2018
67
NOTES TO FINANCIAL STATEMENTS (continued)
September 30, 2018 (Unaudited)
including, among others, that at times worldwide production of industrial materials has exceeded demand as a result of overbuilding or economic downturns, leading to poor investment returns or losses. Other risks may include liabilities for environmental damage and general civil liabilities, depletion of resources, and mandated expenditures for safety and pollution control. The materials sector may also be affected by economic cycles, technical progress, labor relations, and government regulations.
Non-diversification risk
Columbia EM Core ex-China ETF, Columbia Emerging Markets Consumer ETF, Columbia India Consumer ETF, Columbia India Infrastructure ETF and Columbia India Small Cap ETF are non-diversified funds. A non-diversified fund is permitted to invest a greater percentage of its total assets in fewer issuers than a diversified fund. The Fund may, therefore, have a greater risk of loss from a few issuers than a similar fund that invests more broadly.
Small cap companies risk
Columbia India Small Cap ETF primarily invests in small capitalization companies. Small cap companies may have greater volatility in price than the stocks of large cap companies due to limited product lines or resources or a dependency upon a particular market niche.
Technology and technology-related investment risk
Columbia EM Core ex-China ETF may be more susceptible to the particular risks that may affect companies in the information technology sector, as well as other technology-related sectors (collectively, the technology sectors) than if it was invested in a wider variety of companies in unrelated sectors. Companies in the technology sectors are subject to certain risks, including the risk that new services, equipment or technologies will not be accepted by consumers and businesses or will become rapidly obsolete. Performance of such companies may be affected by factors including obtaining and protecting patents (or the failure to do so) and significant competitive pressures, including aggressive pricing of their products or services, new market entrants, competition for market share and short product cycles due to an accelerated rate of technological developments. Such competitive pressures may lead to limited earnings and/or falling profit margins. As a result, the value of their securities may fall or fail to rise. In addition, many technology sector companies have limited operating histories and prices of these companies' securities historically have been more volatile than other securities, especially over the short term.
Note 9. Subsequent events
Management has evaluated the events and transactions that have occurred through the date the financial statements were issued and noted no items requiring adjustment of the financial statements or additional disclosure.
Note 10. Information regarding pending and settled legal proceedings
Ameriprise Financial and certain of its affiliates have historically been involved in a number of legal, arbitration and regulatory proceedings, including routine litigation, class actions, and governmental actions, concerning matters arising in connection with the conduct of their business activities. Ameriprise Financial believes that the Funds are not currently the subject of, and that neither Ameriprise Financial nor any of its affiliates are the subject of, any pending legal, arbitration or regulatory proceedings that are likely to have a material adverse effect on the Funds or the ability of Ameriprise Financial or its affiliates to perform under their contracts with the Funds. Ameriprise Financial is required to make quarterly (10-Q), annual (10-K) and, as necessary, 8-K filings with the Securities and Exchange Commission (SEC) on legal and regulatory matters that relate to Ameriprise Financial and its affiliates. Copies of these filings may be obtained by accessing the SEC website at www.sec.gov.
There can be no assurance that these matters, or the adverse publicity associated with them, will not result in increased Fund redemptions, reduced sale of Fund shares or other adverse consequences to the Funds. Further, although we believe proceedings are not likely to have a material adverse effect on the Funds or the ability of Ameriprise Financial or
Columbia ETF Trust II | Semiannual Report 2018
68
NOTES TO FINANCIAL STATEMENTS (continued)
September 30, 2018 (Unaudited)
its affiliates to perform under their contracts with the Funds, these proceedings are subject to uncertainties and, as such, we are unable to estimate the possible loss or range of loss that may result. An adverse outcome in one or more of these proceedings could result in adverse judgments, settlements, fines, penalties or other relief that could have a material adverse effect on the consolidated financial condition or results of operations of Ameriprise Financial.
Columbia ETF Trust II | Semiannual Report 2018
69
APPROVAL OF INVESTMENT MANAGEMENT SERVICES AGREEMENT
Columbia Management Investment Advisers, LLC (Columbia Threadneedle or the Investment Manager, and together with its domestic and global affiliates, Columbia Threadneedle Investments), a wholly-owned subsidiary of Ameriprise Financial, Inc. (Ameriprise Financial), serves as the investment manager to Columbia Beyond BRICs ETF, Columbia EM Core ex-China ETF, Columbia EM Quality Dividend ETF, Columbia Emerging Markets Consumer ETF, Columbia India Consumer ETF, Columbia India Infrastructure ETF and Columbia India Small Cap ETF (each, an ETF and collectively, the ETFs). Under an investment management services agreement (collectively, the IMS Agreement), Columbia Threadneedle provides investment advice and other services to each ETF and other funds in the Columbia Fund family (collectively, the Funds).
On an annual basis, each ETF's Board of Trustees (the Board), including the independent Board members (the Independent Trustees), considers renewal of the IMS Agreement. Columbia Threadneedle prepared detailed reports for the Board and its Contracts Committee in November 2017 and February, March, April and June 2018, including reports providing the results of analyses performed by an independent organization, Broadridge Financial Solutions, Inc. (Broadridge), and a comprehensive response to items of information requested by independent legal counsel to the Independent Trustees (Independent Legal Counsel) in a letter to the Investment Manager, to assist the Board in making this determination. Many of the materials presented at these meetings were first supplied in draft form to designated independent Board representatives, i.e., Independent Legal Counsel, Fund Counsel, the Chair of the Board (who is an Independent Trustee) and the Chair of the Contracts Committee (who is an Independent Trustee), and the final materials were revised to include information reflective of discussion and subsequent requests made by the Contracts Committee. In addition, throughout the year, the Board (or its committees) regularly meets with portfolio management teams and senior management personnel and reviews information prepared by Columbia Threadneedle addressing the services Columbia Threadneedle provides and Fund performance. The Board also accords appropriate weight to the work, deliberations and conclusions of the various committees, such as the Contracts Committee, the Investment Review Committee, the Audit Committee and the Compliance Committee in determining whether to continue the IMS Agreement.
The Board, at its June 18-20, 2018 in-person Board meeting (the June Meeting), considered the renewal of the IMS Agreement for an additional one-year term. At the June Meeting, Independent Legal Counsel reviewed with the Independent Trustees various factors relevant to the Board's consideration of management agreements and the Board's legal responsibilities related to such consideration. Following an analysis and discussion of the factors identified below, the Board, including all of the Independent Trustees, approved the renewal of the IMS Agreement.
Nature, extent and quality of services provided by Columbia Threadneedle
The Board analyzed various reports and presentations it had received detailing the services performed by Columbia Threadneedle, as well as its history, reputation, expertise, resources and capabilities, and the qualifications of its personnel.
The Board specifically considered the many developments during recent years concerning the services provided by Columbia Threadneedle, including, in particular, the organization and depth of the equity and credit research departments and the various technological enhancements that have been made or are anticipated. The Board further observed the enhancements to the investment risk management department's processes, systems and oversight, as well as planned 2018 initiatives in this regard. The Board also took into account the broad scope of services provided by Columbia Threadneedle to each ETF, including, among other services, investment, risk and compliance oversight. The Board also took into account the information it received concerning Columbia Threadneedle's ability to attract and retain key portfolio management personnel and that it has sufficient resources to provide competitive and adequate compensation to investment personnel.
In connection with the Board's evaluation of the overall package of services provided by Columbia Threadneedle, the Board also considered the nature, quality and range of administrative services provided to the ETFs by Columbia Threadneedle, as well as the achievements in 2017 in the performance of administrative services, and noted the various enhancements anticipated for 2018. In evaluating the quality of services provided under the IMS Agreement, the Board also took into account the organization and strength of the ETFs and their service providers' compliance programs. In
Columbia ETF Trust II | Semiannual Report 2018
70
APPROVAL OF INVESTMENT MANAGEMENT SERVICES AGREEMENT (continued)
addition, the Board reviewed the financial condition of Columbia Threadneedle and its affiliates and each entity's ability to carry out its responsibilities under the IMS Agreement observing the financial strength of Ameriprise Financial, with its strong cash position and solid balance sheet.
The Board also discussed the acceptability of the terms of the IMS Agreement (including the relatively broad scope of services required to be performed by Columbia Threadneedle), noting that no material changes are proposed from the form of agreement previously approved. They also noted the wide array of legal and compliance services provided to the Funds under the IMS Agreement. It was also observed that the services being performed under the IMS Agreement were of a reasonably high quality.
Based on the foregoing, and based on other information received (both oral and written, including the information on investment performance referenced below) and other considerations, the Board concluded that Columbia Threadneedle and its affiliates are in a position to continue to provide a high quality and level of services to the ETFs.
Investment performance
For purposes of evaluating the nature, extent and quality of services provided under the IMS Agreement, the Board carefully reviewed the investment performance of each ETF. In this regard, the Board considered detailed reports providing the results of analyses performed by an independent organization showing, for various periods, including since manager inception, the performance of each ETF and their net assets. The Board also observed the passive nature of the ETFs and that the objective of each ETF is to seek investment results that, before fees and expenses, correspond to the performance of each ETF's index. The Board observed that each ETF's gross performance met expectations.
Comparative fees, costs of services provided and the profits realized by Columbia Threadneedle and its affiliates from their relationships with the ETFs
The Board reviewed comparative fees and the costs of services provided under the IMS Agreement. In considering the proposed level of fees under the IMS Agreement, the Board accorded particular weight to the unified/all-inclusive fee structure utilized by each ETF. In this regard, they observed that many of the competitors of the ETFs have adopted similar unified/all-inclusive fee structures.
The Board considered the reports of its independent fee consultant, JDL Consultants, LLC (JDL), which assisted in the Board's analysis of the reasonableness of the Funds' fee rates, and JDL's conclusion that the management fees being charged to the Funds are reasonable. The Board accorded particular weight to the notion that the level of fees should generally reflect a rational pricing model applied consistently across the various product lines in the Fund family, while assuring that the overall fees for each Fund (with certain defined exceptions) are generally in line with the "pricing philosophy" currently in effect (i.e., that Fund total expense ratios, in general, approximate or are lower than median expense ratios of funds in an agreed upon Lipper or customized comparison universe). The Board observed that the ETFs' unified fee rates were approximately equal to or less than the median expenses paid by funds in each ETF's comparative peer universe. Based on its review, the Board concluded that each ETF's investment management services fee was fair and reasonable in light of the extent and quality of services that each ETF receives.
The Board also considered the profitability of Columbia Threadneedle and its affiliates in connection with Columbia Threadneedle providing management services to each ETF. In this regard, the Independent Trustees referred to their detailed analysis of the Profitability Report, discussing the profitability to Columbia Threadneedle and Ameriprise Financial from managing and operating the Funds. The Board considered that in 2017 the Board had concluded that 2016 profitability was reasonable and that Columbia Threadneedle generated 2017 profitability that only increased slightly from 2016 levels. It also took into account the indirect economic benefits flowing to Columbia Threadneedle or its affiliates in connection with managing the Funds, such as the enhanced ability to offer various other financial products to Ameriprise Financial customers, soft dollar benefits and overall reputational advantages. The Board noted that the fees paid by the ETFs should permit the Investment Manager to offer competitive compensation to its personnel, make necessary investments in its business and earn an appropriate profit. The Board concluded that profitability levels were reasonable.
Columbia ETF Trust II | Semiannual Report 2018
71
APPROVAL OF INVESTMENT MANAGEMENT SERVICES AGREEMENT (continued)
Economies of scale to be realized
The Board also considered the economies of scale that might be realized by Columbia Threadneedle as the ETFs grow and took note of the extent to which ETF shareholders might also benefit from such growth. The Board considered that the IMS Agreement provides for a unified fee level that does not include pre-established breakpoints, and management's observation that the ETF fee structures often do not include breakpoints due to the more volatile nature of their inflows/outflows.
Based on the foregoing, the Board, including all of the Independent Trustees, concluded that the investment management services fees were fair and reasonable in light of the extent and quality of services provided. In reaching this conclusion, no single factor was determinative. On June 20, 2018, the Board, including all of the Independent Trustees, approved the renewal of the IMS Agreement.
Columbia ETF Trust II | Semiannual Report 2018
72
ADDITIONAL INFORMATION
Proxy voting policies and procedures
A description of the Trust's proxy voting policies and procedures that the Trust uses to determine how to vote proxies relating to portfolio securities, and each Fund's proxy voting record for the most recent twelve-month period ended June 30 is available, without charge, by visiting columbiathreadneedleetf.com or searching the website of the Securities and Exchange Commission (the SEC) at sec.gov.
Quarterly schedule of investments
The Funds file a complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q or Form N-PORT (available for filings after March 31, 2019). The Funds' Form N-Q or Form N-PORT is available on the SEC's website at sec.gov and may be reviewed and copied at the SEC's Public Reference Room in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling 800.SEC.0330.
Additional Fund information
For more information about the Funds, please visit columbiathreadneedleetf.com or call 888.800.4347.
Fund investment manager
Columbia Management Investment Advisers, LLC
225 Franklin Street
Boston, MA 02110
Fund distributor
ALPS Distributors, Inc.
1290 Broadway
Suite 1100
Denver, CO 80203
ALPS Distributors, Inc. is not affiliated with Columbia Management Investment Advisers, LLC.
Fund administrator, custodian & transfer agent
The Bank of New York Mellon Corp.
101 Barclay Street
New York, NY 102869
The Bank of New York Mellon Corp. is not affiliated with Columbia Management Investment Advisers, LLC.
Columbia ETF Trust II | Semiannual Report 2018
73
Columbia ETF Trust II
225 Franklin Street
Boston, MA 02110
Investors should consider the investment objectives, risks, charges and expenses of an exchange-traded fund (ETF) carefully before investing. For a free prospectus and summary prospectus, which contains this and other important information about the ETFs, visit columbiathreadneedleetf.com. Read the prospectus and summary prospectus carefully before investing. Columbia Management Investment Advisers, LLC serves as the investment manager to the ETFs. The ETFs are distributed by ALPS Distributors, Inc., which is not affiliated with Columbia Management Investment Advisers, LLC, or its parent company, Ameriprise Financial, Inc.
© 2018 Columbia Management Investment Advisers, LLC.
columbiathreadneedleetf.com
SAR280_03_H01_(11/18)
Item 2. Code of Ethics.
Not applicable for the semi-annual reporting period.
Item 3. Audit Committee Financial Expert.
Not applicable for the semi-annual reporting period.
Item 4. Principal Accountant Fees and Services.
Not applicable for the semi-annual reporting period.
Item 5. Audit Committee of Listed Registrants.
Not applicable for the semi-annual reporting period.
Item 6. Investments.
(a) The registrant’s “Schedule I — Investments in securities of unaffiliated issuers” (as set forth in 17 CFR 210.12-12) is included in Item 1 of this Form N-CSR.
(b) Not applicable.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not applicable.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable.
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
Not applicable.
Item 10. Submission of Matters to a Vote of Security Holders.
There were no material changes to the procedures by which shareholders may recommend nominees to the registrant’s board of directors.
Item 11. Controls and Procedures.
(a) The registrant’s principal executive officer and principal financial officers, based on their evaluation of the registrant’s disclosure controls and procedures as of a date within 90 days of the filing of this report, have concluded that such controls and procedures are adequately designed to ensure that material information required to be disclosed by the registrant in Form N-CSR is accumulated and communicated to the registrant’s management, including the principal executive officer and principal financial officer, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
(b) There was no change in the registrant’s internal control over financial reporting that occurred during the registrant’s last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.
Not applicable.
Item 13. Exhibits.
(a)(1) Code of ethics required to be disclosed under Item 2 of Form N-CSR: Not applicable for semiannual reports.
(a)(2) Certifications pursuant to Rule 30a-2(a) under the Investment Company Act of 1940 (17 CFR 270.30a-2(a)) attached hereto as Exhibit 99.CERT.
(a)(3) Not applicable.
(a)(4) Not applicable.
(b) Certification pursuant to Rule 30a-2(b) under the Investment Company Act of 1940 (17 CFR 270.30a-2(b)) attached hereto as Exhibit 99.906CERT.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) | Columbia ETF Trust II |
By (Signature and Title)* | /s/ Christopher O. Petersen | |
| Christopher O. Petersen, President and Principal Executive Officer | |
Date | 11/20/2018 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By (Signature and Title)* | /s/ Christopher O. Petersen | |
| Christopher O. Petersen, President and Principal Executive Officer | |
Date | 11/20/2018 |
By (Signature and Title)* | /s/ Michael G. Clarke | |
| Michael G. Clarke, Treasurer and Chief Financial Officer | |
Date | 11/20/2018 |
* Print the name and title of each signing officer under his or her signature.