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: 811-23167
OSI ETF Trust
(Exact name of registrant as specified in charter)
60 State Street
Suite 700
Boston, MA 02109
(Address of principal executive offices) (Zip code)
Connor O’Brien
60 State Street
Suite 700
Boston, MA 02109
(Name and Address of Agent for Service)
Registrant’s telephone number, including area code: (617) 855-7670
Date of fiscal year end: June 30
Date of reporting period: December 31, 2017
Item 1. Reports To Stockholders.
The following is a copy of the report transmitted to shareholders pursuant to Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1).
Semiannual Report
December 31, 2017
Before investing you should carefully consider a Fund’s investment objectives, risks, charges and expenses. This and other information is available in the Fund’s prospectus, a copy of which may be obtained by visiting the Fund’s website at www.oshares.com. Please read the prospectus carefully before you invest.
There are risks involved with investing, including possible loss of principal. Concentration in a particular industry or sector may subject the Funds to loss due to adverse occurrences that may affect that industry or sector. The Funds’ emphasis on dividend paying stocks involves the risk that such stocks may fall out of favor with investors and underperform the market. Also, a company may reduce or eliminate its dividend after a Fund’s purchase of such a company’s securities. See the prospectus for specific risks regarding the Funds.
Individual shares of the Fund may be purchased or sold in the secondary market throughout the regular trading day on the NYSE Arca through a brokerage account. However, shares are not individually redeemable directly from the Fund. Each Fund issues and redeems shares on a continuous basis, at net asset value, only in large blocks of shares (“Creation Units”), principally in-kind for securities included in the relevant Index.
Distributor: Foreside Fund Services, LLC
Table of Contents
The O’Shares FTSE Russell Small Cap Quality Dividend ETF, O’Shares FTSE Russell International Quality Dividend ETF (the “Funds”) are not in any way sponsored, endorsed, sold or promoted by the London Stock Exchange Group companies, which include FTSE International Limited (“FTSE”), Frank Russell Company (“Russell”), MTS Next Limited (“MTS”) and FTSE TMX Global Debt Capital Markets Inc. (“FTSE TMX”) (together “LSEG”). LSEG makes no claim, prediction, warranty or representation whatsoever, expressly or impliedly, either as to (i) the results to be obtained from the use of the FTSE USA Small Cap Qual/Vol/Yield 3% Capped Factor Index, FTSE Developed ex US Qual/Vol/Yield 5% Capped Factor Index (the “Indexes”) (upon which the Fund is based), (ii) the figure at which the Index is said to stand at any particular time on any particular day or otherwise, or (iii) the suitability of the Index for the purpose to which it is being put in connection with the Fund. LSEG has not provided nor will provide any financial or investment advice or recommendation in relation to the Index to the adviser or to its clients. The Index is calculated by FTSE or its agent. LSEG shall not be (a) liable (whether in negligence or otherwise) to any person for any error in the Index or (b) under any obligation to advise any person of any error therein.
All rights in the Index vest in FTSE. “FTSE®”, “Russell®”, “MTS®”, “FTSE TMX®” and “FTSE-Russell” and other service marks and trademarks related to the FTSE or Russell indexes are trademarks of the London Stock Exchange Group companies and are used by FTSE, MTS, FTSE TMX and Russell under license.
OSI ETF Trust
Allocation of Portfolio Holdings and Industries
December 31, 2017 (Unaudited)
O’Shares FTSE Russell Small Cap Quality Dividend ETF (OUSM)
The Fund seeks to track the performance, before fees and expenses, of the FTSE USA Small Cap Qual/Vol/Yield 3% Capped Factor Index (the “U.S. Small Cap Target Index”). The U.S. Small Cap Target Index is designed to reflect the performance of publicly-listed small capitalization dividend-paying issuers in the United States exhibiting high quality, low volatility and high dividend yields, as determined by FTSE-Russell (the “Index Provider”). The quality and low volatility factors are designed to reduce exposure to high dividend equities that have experienced large price declines, as may occur with some dividend investing strategies.
Market Exposure
Investment Type | % of Net Assets | |||
Equity Securities | 100 | % |
“Market Exposure” includes the value of total investments (including the contract value of any derivatives) and excludes any short-term investments and cash equivalents.
Largest Equity Holdings
Company | % of Net Assets | |||
STERIS plc | 1.8 | % | ||
HealthSouth Corp. | 1.4 | % | ||
Watsco, Inc. | 1.4 | % | ||
Vail Resorts, Inc. | 1.3 | % | ||
Healthcare Services Group, Inc. | 1.3 | % | ||
Hubbell, Inc. | 1.2 | % | ||
OGE Energy Corp. | 1.2 | % | ||
FactSet Research Systems, Inc. | 1.1 | % | ||
Williams-Sonoma, Inc. | 1.1 | % | ||
Six Flags Entertainment Corp. | 1.0 | % |
Sector Exposure
Sectors | % of Net Assets | |||
Consumer Discretionary | 17.2 | % | ||
Consumer Staples | 3.5 | % | ||
Energy | 0.3 | % | ||
Financials | 11.0 | % | ||
Health Care | 5.1 | % | ||
Industrials | 17.8 | % | ||
Information Technology | 7.2 | % | ||
Materials | 6.6 | % | ||
Real Estate | 20.0 | % | ||
Telecommunication Services | 1.4 | % | ||
Utilities | 9.6 | % | ||
Other(1) | 0.3 | % | ||
100.0 | % |
(1) | Includes any non-equity securities and net other assets (liabilities). |
i
OSI ETF Trust
Allocation of Portfolio Holdings and Industries
December 31, 2017 (Unaudited)
O’Shares FTSE Russell International Quality Dividend ETF (ONTL)
The Fund seeks to track the performance, before fees and expenses, of the FTSE Developed ex US Qual/Vol/Yield 5% Capped Factor Index (the “International Target Index”). The International Target Index is designed to reflect the performance of publicly-listed large capitalization and mid-capitalization dividend-paying international issuers exhibiting high quality, low volatility and high dividend yields, as determined by FTSE-Russell (the “Index Provider”). The quality and low volatility factors are designed to reduce exposure to high dividend equities that have experienced large price declines, as may occur with some dividend investing strategies.
Market Exposure
Investment Type | % of Net Assets | |||
Equity Securities | 99 | % | ||
Exchange Traded Fund | 1 | % |
“Market Exposure” includes the value of total investments (including the contract value of any derivatives) and excludes any short-term investments and cash equivalents.
Largest Equity Holdings
Company | % of Net Assets | |||
Nestle SA (Registered) | 3.7 | % | ||
Roche Holding AG – Genusschein | 3.4 | % | ||
Novartis AG (Registered) | 3.2 | % | ||
Samsung Electronics Co. Ltd. | 2.6 | % | ||
TOTAL SA | 2.0 | % | ||
GlaxoSmithKline plc | 2.0 | % | ||
Sanofi | 1.8 | % | ||
British American Tobacco plc | 1.6 | % | ||
Siemens AG (Registered) | 1.5 | % | ||
Novo Nordisk A/S, Class B | 1.5 | % |
Sector Exposure
Sectors | % of Net Assets | |||
Consumer Discretionary | 8.6 | % | ||
Consumer Staples | 14.7 | % | ||
Energy | 5.3 | % | ||
Financials | 8.3 | % | ||
Health Care | 15.8 | % | ||
Industrials | 15.3 | % | ||
Information Technology | 3.9 | % | ||
Materials | 5.1 | % | ||
Real Estate | 8.4 | % | ||
Telecommunication Services | 8.5 | % | ||
Utilities | 5.6 | % | ||
Other(1) | 0.5 | % | ||
100.0 | % |
(1) | Includes any non-equity securities and net other assets (liabilities). |
FTSE Developed ex US Qual/Vol/Yield Factor
5% Capped Index — Country Exposure
Country | % of Index | |||
Australia | 8.4 | % | ||
Austria | 0.1 | % | ||
Belgium | 0.5 | % | ||
Canada | 8.1 | % | ||
Denmark | 2.0 | % | ||
Finland | 1.7 | % | ||
France | 10.3 | % | ||
Germany | 7.3 | % | ||
Hong Kong | 3.5 | % | ||
Israel | 0.2 | % | ||
Italy | 1.8 | % | ||
Japan | 10.3 | % | ||
Netherlands | 2.7 | % | ||
New Zealand | 1.1 | % | ||
Norway | 0.6 | % | ||
Portugal | 0.2 | % | ||
Singapore | 1.3 | % | ||
South Korea | 3.5 | % | ||
Spain | 2.8 | % | ||
Sweden | 2.7 | % | ||
Switzerland | 13.5 | % | ||
United Kingdom | 17.4 | % | ||
100.0 | % |
ii
OSI ETF Trust
O’Shares FTSE Russell Small Cap Quality Dividend ETF
Schedule of Investments
December 31, 2017 (Unaudited)
Investments | Number of Shares | Value | |||||||
Common Stocks – 99.7% | |||||||||
Aerospace & Defense – 0.1% | |||||||||
National Presto Industries, Inc. | 663 | $ | 65,935 | ||||||
Air Freight & Logistics – 0.1% | |||||||||
Forward Air Corp. | 2,378 | 136,592 | |||||||
Airlines – 0.1% | |||||||||
Allegiant Travel Co. | 353 | 54,627 | |||||||
Auto Components – 0.7% | |||||||||
LCI Industries | 4,163 | 541,190 | |||||||
Superior Industries International, Inc. | 4,358 | 64,716 | |||||||
605,906 | |||||||||
Banks – 1.9% | |||||||||
Bank of Hawaii Corp. | 1,351 | 115,781 | |||||||
City Holding Co. | 526 | 35,489 | |||||||
Columbia Banking System, Inc. | 1,700 | 73,848 | |||||||
Community Bank System, Inc. | 1,556 | 83,635 | |||||||
Community Trust Bancorp, Inc. | 598 | 28,166 | |||||||
CVB Financial Corp. | 3,052 | 71,905 | |||||||
First Financial Bancorp | 1,831 | 48,247 | |||||||
First Financial Corp. | 284 | 12,879 | |||||||
FNB Corp. | 10,969 | 151,592 | |||||||
Glacier Bancorp, Inc. | 2,196 | 86,500 | |||||||
Hope Bancorp, Inc. | 3,687 | 67,288 | |||||||
NBT Bancorp, Inc. | 1,275 | 46,920 | |||||||
PacWest Bancorp | 4,839 | 243,886 | |||||||
Park National Corp. | 602 | 62,608 | |||||||
Sandy Spring Bancorp, Inc. | 811 | 31,645 | |||||||
Stock Yards Bancorp, Inc. | 598 | 22,545 | |||||||
Trustmark Corp. | 2,092 | 66,651 | |||||||
Umpqua Holdings Corp. | 7,423 | 154,398 | |||||||
United Bankshares, Inc. | 3,801 | 132,085 | |||||||
Valley National Bancorp | 8,860 | 99,409 | |||||||
Washington Trust Bancorp, Inc. | 598 | 31,843 | |||||||
WesBanco, Inc. | 1,217 | 49,471 | |||||||
Westamerica Bancorp | 824 | 49,069 | |||||||
1,765,860 | |||||||||
Building Products – 1.1% | |||||||||
Lennox International, Inc. | 3,188 | 663,933 | |||||||
Simpson Manufacturing Co., Inc. | 6,246 | 358,583 | |||||||
1,022,516 | |||||||||
Capital Markets – 4.6% | |||||||||
Artisan Partners Asset Management, Inc., Class A | 3,963 | 156,538 | |||||||
BGC Partners, Inc., Class A | 11,451 | 173,025 | |||||||
Cohen & Steers, Inc. | 1,984 | 93,823 | |||||||
Eaton Vance Corp. | 7,956 | 448,639 | |||||||
Evercore, Inc., Class A | 1,760 | 158,400 | |||||||
FactSet Research Systems, Inc. | 5,327 | 1,026,833 |
Investments | Number of Shares | Value | |||||||
Federated Investors, Inc., Class B | 8,844 | $ | 319,092 | ||||||
Greenhill & Co., Inc. | 2,192 | 42,744 | |||||||
Lazard Ltd., Class A | 11,715 | 615,037 | |||||||
Legg Mason, Inc. | 3,744 | 157,173 | |||||||
LPL Financial Holdings, Inc. | 3,125 | 178,562 | |||||||
Morningstar, Inc. | 1,510 | 146,425 | |||||||
MSCI, Inc. | 3,523 | 445,800 | |||||||
OM Asset Management plc | 4,984 | 83,482 | |||||||
Waddell & Reed Financial, Inc., Class A | 6,681 | 149,254 | |||||||
4,194,827 | |||||||||
Chemicals – 3.6% | |||||||||
A Schulman, Inc. | 3,333 | 124,154 | |||||||
Cabot Corp. | 7,018 | 432,239 | |||||||
Innophos Holdings, Inc. | 4,294 | 200,658 | |||||||
NewMarket Corp. | 1,076 | 427,592 | |||||||
Olin Corp. | 24,726 | 879,751 | |||||||
RPM International, Inc. | 15,579 | 816,651 | |||||||
Sensient Technologies Corp. | 5,728 | 419,003 | |||||||
3,300,048 | |||||||||
Commercial Services & Supplies – 5.6% | |||||||||
Brady Corp., Class A | 7,076 | 268,180 | |||||||
Covanta Holding Corp. | 13,552 | 229,029 | |||||||
Essendant, Inc. | 3,454 | 32,019 | |||||||
Healthcare Services Group, Inc. | 22,072 | 1,163,636 | |||||||
Herman Miller, Inc. | 9,529 | 381,637 | |||||||
HNI Corp. | 6,934 | 267,444 | |||||||
KAR Auction Services, Inc. | 16,801 | 848,619 | |||||||
Knoll, Inc. | 8,502 | 195,886 | |||||||
LSC Communications, Inc. | 6,136 | 92,960 | |||||||
McGrath RentCorp | 3,063 | 143,900 | |||||||
MSA Safety, Inc. | 2,787 | 216,048 | |||||||
Pitney Bowes, Inc. | 60,778 | 679,498 | |||||||
Rollins, Inc. | 8,363 | 389,130 | |||||||
Steelcase, Inc., Class A | 13,424 | 204,045 | |||||||
5,112,031 | |||||||||
Communications Equipment – 1.4% | |||||||||
ADTRAN, Inc. | 17,754 | 343,540 | |||||||
InterDigital, Inc. | 12,533 | 954,388 | |||||||
1,297,928 | |||||||||
Containers & Packaging – 1.9% | |||||||||
AptarGroup, Inc. | 4,573 | 394,558 | |||||||
Graphic Packaging Holding Co. | 28,995 | 447,973 | |||||||
Sonoco Products Co. | 16,884 | 897,216 | |||||||
1,739,747 | |||||||||
Distributors – 0.8% | |||||||||
Pool Corp. | 5,655 | 733,171 | |||||||
Diversified Consumer Services – 0.1% | |||||||||
Capella Education Co. | 1,421 | 109,985 |
See accompanying notes to the financial statements.
1
OSI ETF Trust
O’Shares FTSE Russell Small Cap Quality Dividend ETF
Schedule of Investments
December 31, 2017 (Unaudited)
Investments | Number of Shares | Value | |||||||
Diversified Telecommunication Services – 1.1% | |||||||||
ATN International, Inc. | 2,099 | $ | 115,991 | ||||||
Cogent Communications Holdings, Inc. | 17,245 | 781,198 | |||||||
Consolidated Communications Holdings, Inc. | 11,387 | 138,808 | |||||||
1,035,997 | |||||||||
Electric Utilities – 5.2% | |||||||||
ALLETE, Inc. | 4,551 | 338,412 | |||||||
El Paso Electric Co. | 3,133 | 173,412 | |||||||
Great Plains Energy, Inc. | 19,488 | 628,293 | |||||||
Hawaiian Electric Industries, Inc. | 11,696 | 422,810 | |||||||
IDACORP, Inc. | 4,158 | 379,875 | |||||||
MGE Energy, Inc. | 3,075 | 194,033 | |||||||
OGE Energy Corp. | 32,188 | 1,059,307 | |||||||
Otter Tail Corp. | 4,137 | 183,890 | |||||||
PNM Resources, Inc. | 5,305 | 214,587 | |||||||
Portland General Electric Co. | 9,342 | 425,808 | |||||||
Westar Energy, Inc. | 14,687 | 775,474 | |||||||
4,795,901 | |||||||||
Electrical Equipment – 1.2% | |||||||||
Hubbell, Inc. | 7,949 | 1,075,818 | |||||||
Electronic Equipment, Instruments & Components – 1.7% | |||||||||
AVX Corp. | 9,265 | 160,285 | |||||||
FLIR Systems, Inc. | 11,233 | 523,682 | |||||||
National Instruments Corp. | 16,404 | 682,899 | |||||||
Vishay Intertechnology, Inc. | 10,003 | 207,562 | |||||||
1,574,428 | |||||||||
Energy Equipment & Services – 0.2% | |||||||||
Oceaneering International, Inc. | 8,848 | 187,047 | |||||||
Equity Real Estate Investment Trusts (REITs) – 19.8% | |||||||||
Acadia Realty Trust | 4,096 | 112,067 | |||||||
Alexander's, Inc. | 204 | 80,753 | |||||||
American Assets Trust, Inc. | 1,444 | 55,219 | |||||||
American Campus Communities, Inc. | 5,924 | 243,062 | |||||||
Apartment Investment & Management Co., Class A | 4,551 | 198,924 | |||||||
Apple Hospitality REIT, Inc. | 17,289 | 339,037 | |||||||
Brandywine Realty Trust | 6,109 | 111,123 | |||||||
Brixmor Property Group, Inc. | 20,897 | 389,938 | |||||||
Camden Property Trust | 8,510 | 783,431 | |||||||
CBL & Associates Properties, Inc. | 9,515 | 53,855 | |||||||
Chesapeake Lodging Trust | 4,763 | 129,030 | |||||||
Colony NorthStar, Inc., Class A | 39,150 | 446,701 | |||||||
Columbia Property Trust, Inc. | 4,616 | 105,937 | |||||||
CoreCivic, Inc. | 7,159 | 161,077 | |||||||
CoreSite Realty Corp. | 2,046 | 233,039 | |||||||
Cousins Properties, Inc. | 17,080 | 157,990 | |||||||
CubeSmart | 10,638 | 307,651 | |||||||
DCT Industrial Trust, Inc. | 3,559 | 209,198 |
Investments | Number of Shares | Value | ||||||
DDR Corp. | 8,801 | $ | 78,857 | |||||
DiamondRock Hospitality Co. | 13,624 | 153,815 | ||||||
Douglas Emmett, Inc. | 4,566 | 187,480 | ||||||
EastGroup Properties, Inc. | 2,586 | 228,551 | ||||||
Education Realty Trust, Inc. | 2,733 | 95,436 | ||||||
Empire State Realty Trust, Inc., Class A | 3,692 | 75,797 | ||||||
EPR Properties | 6,144 | 402,186 | ||||||
Equity Commonwealth* | 8,664 | 264,339 | ||||||
Equity LifeStyle Properties, Inc. | 5,294 | 471,272 | ||||||
First Industrial Realty Trust, Inc. | 7,497 | 235,931 | ||||||
Four Corners Property Trust, Inc. | 5,527 | 142,044 | ||||||
Franklin Street Properties Corp. | 3,826 | 41,091 | ||||||
Gaming and Leisure Properties, Inc. | 22,380 | 828,060 | ||||||
GEO Group, Inc. (The) | 7,356 | 173,602 | ||||||
Getty Realty Corp. | 2,650 | 71,974 | ||||||
Global Net Lease, Inc. | 3,213 | 66,124 | ||||||
Government Properties Income Trust | 6,188 | 114,725 | ||||||
Gramercy Property Trust | 4,715 | 125,702 | ||||||
Healthcare Realty Trust, Inc. | 7,546 | 242,378 | ||||||
Healthcare Trust of America, Inc., Class A | 8,180 | 245,727 | ||||||
Hersha Hospitality Trust | 3,746 | 65,180 | ||||||
Highwoods Properties, Inc. | 5,660 | 288,151 | ||||||
InfraREIT, Inc. | 1,572 | 29,208 | ||||||
Kilroy Realty Corp. | 5,914 | 441,480 | ||||||
Kite Realty Group Trust | 2,381 | 46,668 | ||||||
Lamar Advertising Co., Class A | 9,953 | 738,911 | ||||||
LaSalle Hotel Properties | 11,359 | 318,847 | ||||||
Lexington Realty Trust | 16,000 | 154,400 | ||||||
Life Storage, Inc. | 3,117 | 277,631 | ||||||
LTC Properties, Inc. | 4,146 | 180,558 | ||||||
Mack-Cali Realty Corp. | 4,778 | 103,014 | ||||||
Medical Properties Trust, Inc. | 27,244 | 375,422 | ||||||
National Health Investors, Inc. | 4,282 | 322,777 | ||||||
National Retail Properties, Inc. | 11,433 | 493,105 | ||||||
Omega Healthcare Investors, Inc. | 16,598 | 457,109 | ||||||
Outfront Media, Inc. | 8,045 | 186,644 | ||||||
Pebblebrook Hotel Trust | 3,406 | 126,601 | ||||||
Physicians Realty Trust | 7,847 | 141,168 | ||||||
Piedmont Office Realty Trust, Inc., Class A | 8,772 | 172,019 | ||||||
Potlatch Corp. | 1,347 | 67,215 | ||||||
PS Business Parks, Inc. | 1,499 | 187,510 | ||||||
QTS Realty Trust, Inc., Class A | 1,411 | 76,420 | ||||||
Ramco-Gershenson Properties Trust | 5,632 | 82,959 | ||||||
Rayonier, Inc. | 11,840 | 374,499 | ||||||
Retail Opportunity Investments Corp. | 4,501 | 89,795 | ||||||
Retail Properties of America, Inc., Class A | 18,382 | 247,054 | ||||||
Rexford Industrial Realty, Inc. | 2,118 | 61,761 | ||||||
RLJ Lodging Trust | 14,717 | 323,332 | ||||||
Ryman Hospitality Properties, Inc. | 4,565 | 315,076 | ||||||
Sabra Health Care REIT, Inc. | 8,638 | 162,135 |
See accompanying notes to the financial statements.
2
OSI ETF Trust
O’Shares FTSE Russell Small Cap Quality Dividend ETF
Schedule of Investments
December 31, 2017 (Unaudited)
Investments | Number of Shares | Value | |||||||
Saul Centers, Inc. | 811 | $ | 50,079 | ||||||
Select Income REIT | 4,425 | 111,200 | |||||||
Senior Housing Properties Trust | 13,951 | 267,162 | |||||||
Spirit Realty Capital, Inc. | 17,955 | 154,054 | |||||||
STAG Industrial, Inc. | 4,352 | 118,940 | |||||||
STORE Capital Corp. | 9,402 | 244,828 | |||||||
Summit Hotel Properties, Inc. | 9,854 | 150,076 | |||||||
Tanger Factory Outlet Centers, Inc. | 11,171 | 296,143 | |||||||
Taubman Centers, Inc. | 4,623 | 302,483 | |||||||
Universal Health Realty Income Trust | 798 | 59,938 | |||||||
Urban Edge Properties | 7,357 | 187,530 | |||||||
Urstadt Biddle Properties, Inc., Class A | 2,448 | 53,220 | |||||||
Washington Prime Group, Inc. | 6,475 | 46,102 | |||||||
Washington REIT | 6,876 | 213,981 | |||||||
WP Carey, Inc. | 8,244 | 568,012 | |||||||
Xenia Hotels & Resorts, Inc. | 6,677 | 144,156 | |||||||
18,237,676 | |||||||||
Food & Staples Retailing – 0.2% | |||||||||
SpartanNash Co. | 3,388 | 90,392 | |||||||
Weis Markets, Inc. | 1,690 | 69,949 | |||||||
160,341 | |||||||||
Food Products – 2.1% | |||||||||
B&G Foods, Inc. | 6,676 | 234,661 | |||||||
Bob Evans Farms, Inc. | 2,502 | 197,208 | |||||||
Flowers Foods, Inc. | 34,919 | 674,286 | |||||||
Fresh Del Monte Produce, Inc. | 3,406 | 162,364 | |||||||
J&J Snack Foods Corp. | 1,845 | 280,126 | |||||||
Lancaster Colony Corp. | 3,131 | 404,557 | |||||||
1,953,202 | |||||||||
Gas Utilities – 2.1% | |||||||||
National Fuel Gas Co. | 7,429 | 407,926 | |||||||
Northwest Natural Gas Co. | 2,716 | 162,009 | |||||||
ONE Gas, Inc. | 3,626 | 265,641 | |||||||
South Jersey Industries, Inc. | 6,616 | 206,618 | |||||||
Southwest Gas Holdings, Inc. | 4,645 | 373,830 | |||||||
UGI Corp. | 11,709 | 549,737 | |||||||
1,965,761 | |||||||||
Health Care Equipment & Supplies – 2.1% | |||||||||
Meridian Bioscience, Inc. | 15,528 | 217,392 | |||||||
STERIS plc | 19,257 | 1,684,410 | |||||||
1,901,802 | |||||||||
Health Care Providers & Services – 2.0% | |||||||||
HealthSouth Corp. | 26,154 | 1,292,269 | |||||||
Owens & Minor, Inc. | 29,701 | 560,755 | |||||||
1,853,024 | |||||||||
Hotels, Restaurants & Leisure – 7.4% | |||||||||
Bloomin' Brands, Inc. | 9,516 | 203,072 | |||||||
Brinker International, Inc. | 12,391 | 481,266 |
Investments | Number of Shares | Value | |||||||
Cheesecake Factory, Inc. (The) | 10,894 | $ | 524,873 | ||||||
Cracker Barrel Old Country Store, Inc. | 4,852 | 770,934 | |||||||
DineEquity, Inc. | 2,522 | 127,941 | |||||||
Dunkin' Brands Group, Inc. | 9,201 | 593,189 | |||||||
Extended Stay America, Inc. | 21,370 | 406,030 | |||||||
International Game Technology plc | 9,718 | 257,624 | |||||||
International Speedway Corp., Class A | 2,167 | 86,355 | |||||||
Jack in the Box, Inc. | 3,554 | 348,683 | |||||||
Papa John's International, Inc. | 2,187 | 122,713 | |||||||
Six Flags Entertainment Corp. | 14,359 | 955,879 | |||||||
Sonic Corp. | 4,557 | 125,226 | |||||||
Speedway Motorsports, Inc. | 1,766 | 33,324 | |||||||
Texas Roadhouse, Inc. | 9,460 | 498,353 | |||||||
Vail Resorts, Inc. | 5,803 | 1,232,963 | |||||||
6,768,425 | |||||||||
Household Durables – 1.3% | |||||||||
Ethan Allen Interiors, Inc. | 3,544 | 101,358 | |||||||
La-Z-Boy, Inc. | 4,637 | 144,674 | |||||||
MDC Holdings, Inc. | 5,116 | 163,098 | |||||||
Tupperware Brands Corp. | 12,528 | 785,506 | |||||||
1,194,636 | |||||||||
Household Products – 0.3% | |||||||||
WD-40 Co. | 2,239 | 264,202 | |||||||
Independent Power and Renewable Electricity Producers – 0.1% | |||||||||
Pattern Energy Group, Inc. | 6,382 | 137,149 | |||||||
Industrial Conglomerates – 1.1% | |||||||||
Carlisle Cos., Inc. | 7,607 | 864,535 | |||||||
Raven Industries, Inc. | 3,068 | 105,386 | |||||||
969,921 | |||||||||
Insurance – 2.0% | |||||||||
American Financial Group, Inc. | 2,169 | 235,423 | |||||||
American National Insurance Co. | 212 | 27,189 | |||||||
AmTrust Financial Services, Inc. | 2,792 | 28,115 | |||||||
Argo Group International Holdings Ltd. | 833 | 51,354 | |||||||
Aspen Insurance Holdings Ltd. | 2,027 | 82,296 | |||||||
Assured Guaranty Ltd. | 3,542 | 119,968 | |||||||
FBL Financial Group, Inc., Class A | 355 | 24,726 | |||||||
First American Financial Corp. | 6,738 | 377,598 | |||||||
Horace Mann Educators Corp. | 1,243 | 54,816 | |||||||
Infinity Property & Casualty Corp. | 426 | 45,156 | |||||||
Maiden Holdings Ltd. | 2,934 | 19,364 | |||||||
Mercury General Corp. | 1,282 | 68,510 | |||||||
ProAssurance Corp. | 2,718 | 155,334 | |||||||
RLI Corp. | 3,533 | 214,312 | |||||||
Safety Insurance Group, Inc. | 1,030 | 82,812 | |||||||
Validus Holdings Ltd. | 4,955 | 232,489 | |||||||
1,819,462 |
See accompanying notes to the financial statements.
3
OSI ETF Trust
O’Shares FTSE Russell Small Cap Quality Dividend ETF
Schedule of Investments
December 31, 2017 (Unaudited)
Investments | Number of Shares | Value | |||||||
Internet & Direct Marketing Retail – 0.2% | |||||||||
HSN, Inc. | 5,026 | $ | 202,799 | ||||||
Internet Software & Services – 0.6% | |||||||||
NIC, Inc. | 34,176 | 567,322 | |||||||
IT Services – 2.7% | |||||||||
Convergys Corp. | 10,410 | 244,635 | |||||||
CSG Systems International, Inc. | 10,483 | 459,365 | |||||||
EVERTEC, Inc. | 6,407 | 87,456 | |||||||
Jack Henry & Associates, Inc. | 8,025 | 938,604 | |||||||
ManTech International Corp., Class A | 3,745 | 187,962 | |||||||
Sabre Corp. | 26,063 | 534,291 | |||||||
2,452,313 | |||||||||
Leisure Products – 0.1% | |||||||||
Sturm Ruger & Co., Inc. | 1,634 | 91,259 | |||||||
Life Sciences Tools & Services – 1.0% | |||||||||
Bio-Techne Corp. | 7,235 | 937,294 | |||||||
Machinery – 4.3% | |||||||||
Crane Co. | 4,684 | 417,906 | |||||||
Donaldson Co., Inc. | 12,581 | 615,840 | |||||||
Graco, Inc. | 15,543 | 702,854 | |||||||
Hillenbrand, Inc. | 6,473 | 289,343 | |||||||
ITT, Inc. | 6,927 | 369,694 | |||||||
Lincoln Electric Holdings, Inc. | 4,815 | 440,958 | |||||||
Tennant Co. | 1,584 | 115,078 | |||||||
Timken Co. (The) | 7,751 | 380,962 | |||||||
Toro Co. (The) | 9,459 | 617,010 | |||||||
3,949,645 | |||||||||
Media – 2.2% | |||||||||
Cinemark Holdings, Inc. | 13,669 | 475,954 | |||||||
John Wiley & Sons, Inc., Class A | 8,109 | 533,167 | |||||||
Meredith Corp. | 5,252 | 346,895 | |||||||
National CineMedia, Inc. | 7,838 | 53,769 | |||||||
Regal Entertainment Group, Class A | 21,235 | 488,617 | |||||||
Scholastic Corp. | 2,997 | 120,210 | |||||||
2,018,612 | |||||||||
Metals & Mining – 0.0%(a) | |||||||||
Haynes International, Inc. | 1,427 | 45,735 | |||||||
Mortgage Real Estate Investment Trusts (REITs) – 2.2% | |||||||||
Anworth Mortgage Asset Corp. | 4,629 | 25,182 | |||||||
Apollo Commercial Real Estate Finance, Inc. | 12,456 | 229,813 | |||||||
Blackstone Mortgage Trust, Inc., Class A | 4,700 | 151,246 | |||||||
Capstead Mortgage Corp. | 4,003 | 34,626 | |||||||
Chimera Investment Corp. | 16,808 | 310,612 | |||||||
CYS Investments, Inc. | 4,883 | 39,210 | |||||||
Invesco Mortgage Capital, Inc. | 6,110 | 108,941 | |||||||
MFA Financial, Inc. | 29,959 | 237,275 |
Investments | Number of Shares | Value | |||||||
New Residential Investment Corp. | 21,869 | $ | 391,018 | ||||||
PennyMac Mortgage Investment Trust | 3,050 | 49,014 | |||||||
Redwood Trust, Inc. | 3,950 | 58,539 | |||||||
Starwood Property Trust, Inc. | 10,343 | 220,823 | |||||||
Two Harbors Investment Corp. | 11,422 | 185,722 | |||||||
2,042,021 | |||||||||
Multiline Retail – 0.3% | |||||||||
Big Lots, Inc. | 4,987 | 280,020 | |||||||
Multi-Utilities – 1.1% | |||||||||
Avista Corp. | 5,092 | 262,187 | |||||||
NorthWestern Corp. | 4,847 | 289,366 | |||||||
Vectren Corp. | 7,689 | 499,939 | |||||||
1,051,492 | |||||||||
Oil, Gas & Consumable Fuels – 0.1% | |||||||||
Ship Finance International Ltd. | 8,042 | 124,651 | |||||||
Paper & Forest Products – 1.1% | |||||||||
Domtar Corp. | 10,429 | 516,444 | |||||||
Neenah Paper, Inc. | 2,516 | 228,075 | |||||||
Schweitzer-Mauduit International, Inc. | 4,957 | 224,850 | |||||||
969,369 | |||||||||
Professional Services – 0.5% | |||||||||
Exponent, Inc. | 2,234 | 158,837 | |||||||
Forrester Research, Inc. | 4,345 | 192,049 | |||||||
Insperity, Inc. | 1,728 | 99,101 | |||||||
449,987 | |||||||||
Real Estate Management & Development – 0.2% | |||||||||
HFF, Inc., Class A | 2,940 | 143,002 | |||||||
RMR Group, Inc. (The), Class A | 330 | 19,569 | |||||||
162,571 | |||||||||
Road & Rail – 0.4% | |||||||||
Ryder System, Inc. | 4,485 | 377,502 | |||||||
Software – 0.7% | |||||||||
Progress Software Corp. | 15,803 | 672,734 | |||||||
Specialty Retail – 3.1% | |||||||||
American Eagle Outfitters, Inc. | 23,415 | 440,202 | |||||||
Buckle, Inc. (The) | 6,332 | 150,385 | |||||||
Chico's FAS, Inc. | 24,599 | 216,963 | |||||||
Children's Place, Inc. (The) | 1,516 | 220,351 | |||||||
Dick's Sporting Goods, Inc. | 11,793 | 338,931 | |||||||
DSW, Inc., Class A | 11,831 | 253,302 | |||||||
Finish Line, Inc. (The), Class A | 6,336 | 92,062 | |||||||
Guess?, Inc. | 9,057 | 152,882 | |||||||
Williams-Sonoma, Inc. | 19,793 | 1,023,298 | |||||||
2,888,376 | |||||||||
Textiles, Apparel & Luxury Goods – 1.0% | |||||||||
Carter's, Inc. | 7,689 | 903,381 |
See accompanying notes to the financial statements.
4
OSI ETF Trust
O’Shares FTSE Russell Small Cap Quality Dividend ETF
Schedule of Investments
December 31, 2017 (Unaudited)
Investments | Number of Shares | Value | |||||||
Thrifts & Mortgage Finance – 0.3% | |||||||||
Capitol Federal Financial, Inc. | 5,927 | $ | 79,481 | ||||||
Dime Community Bancshares, Inc. | 1,097 | 22,982 | |||||||
Northwest Bancshares, Inc. | 3,263 | 54,590 | |||||||
Oritani Financial Corp. | 1,783 | 29,241 | |||||||
Provident Financial Services, Inc. | 2,045 | 55,154 | |||||||
TFS Financial Corp. | 1,695 | 25,323 | |||||||
TrustCo Bank Corp. | 3,532 | 32,495 | |||||||
299,266 | |||||||||
Tobacco – 0.9% | |||||||||
Universal Corp. | 4,207 | 220,867 | |||||||
Vector Group Ltd. | 25,657 | 574,204 | |||||||
795,071 | |||||||||
Trading Companies & Distributors – 2.8% | |||||||||
Applied Industrial Technologies, Inc. | 4,508 | 306,995 | |||||||
Kaman Corp. | 2,180 | 128,271 | |||||||
MSC Industrial Direct Co., Inc., Class A | 8,628 | 833,982 | |||||||
Watsco, Inc. | 7,413 | 1,260,507 | |||||||
2,529,755 | |||||||||
Transportation Infrastructure – 0.7% | |||||||||
Macquarie Infrastructure Corp. | 10,260 | 658,692 |
Investments | Number of Shares | Value | |||||||
Water Utilities – 1.0% | |||||||||
American States Water Co. | 2,369 | $ | 137,189 | ||||||
Aqua America, Inc. | 15,715 | 616,499 | |||||||
California Water Service Group | 3,206 | 145,392 | |||||||
899,080 | |||||||||
Wireless Telecommunication Services – 0.3% | |||||||||
Telephone & Data Systems, Inc. | 9,191 | 255,510 | |||||||
Total Common Stocks (Cost $88,735,027) | 91,658,422 | ||||||||
Total Investments — 99.7% (Cost $88,735,027) | 91,658,422 | ||||||||
Other Assets Less Liabilities — 0.3% | 292,596 | ||||||||
Net Assets — 100.0% | $ | 91,951,018 |
* | Non-income producing security. |
(a) | Represents less than 0.05% of net assets. |
As of December 31, 2017, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative contracts, if any) for federal income tax purposes was as follows:
Aggregate gross unrealized appreciation | $ | 4,496,635 | ||
Aggregate gross unrealized depreciation | (1,561,299 | ) | ||
Net unrealized appreciation | $ | 2,935,336 | ||
Federal income tax cost of investments (including derivative contracts, if any) | $ | 88,723,086 |
See accompanying notes to the financial statements.
5
OSI ETF Trust
O'Shares FTSE Russell International Quality Dividend ETF
Schedule of Investments
December 31, 2017 (Unaudited)
Investments | Number of Shares | Value | |||||||
Common Stocks – 98.7% | |||||||||
Aerospace & Defense – 1.0% | |||||||||
BAE Systems plc | 8,494 | $ | 65,839 | ||||||
Cobham plc* | 4,784 | 8,174 | |||||||
Meggitt plc | 1,456 | 9,497 | |||||||
Safran SA | 499 | 51,477 | |||||||
Singapore Technologies Engineering Ltd. | 6,200 | 15,124 | |||||||
Thales SA | 224 | 24,176 | |||||||
174,287 | |||||||||
Air Freight & Logistics – 1.0% | |||||||||
bpost SA | 720 | 21,947 | |||||||
Deutsche Post AG (Registered) | 2,747 | 131,119 | |||||||
Royal Mail plc | 3,810 | 23,322 | |||||||
176,388 | |||||||||
Airlines – 0.2% | |||||||||
Air New Zealand Ltd. | 201 | 456 | |||||||
Japan Airlines Co. Ltd. | 600 | 23,478 | |||||||
Singapore Airlines Ltd. | 1,600 | 12,775 | |||||||
36,709 | |||||||||
Auto Components – 2.3% | |||||||||
Bridgestone Corp. | 2,600 | 120,895 | |||||||
Cie Generale des Etablissements Michelin | 539 | 77,376 | |||||||
Continental AG | 161 | 43,509 | |||||||
Denso Corp. | 1,300 | 78,046 | |||||||
GKN plc | 5,362 | 23,168 | |||||||
Magna International, Inc. | 896 | 50,945 | |||||||
Nokian Renkaat OYJ | 288 | 13,072 | |||||||
407,011 | |||||||||
Banks – 3.3% | |||||||||
Bank of Montreal | 904 | 72,575 | |||||||
Bank of Nova Scotia (The) | 1,813 | 117,379 | |||||||
Canadian Imperial Bank of Commerce | 752 | 73,547 | |||||||
Royal Bank of Canada | 2,211 | 181,140 | |||||||
Toronto-Dominion Bank (The) | 2,623 | 154,183 | |||||||
598,824 | |||||||||
Beverages – 1.1% | |||||||||
Diageo plc | 5,156 | 190,063 | |||||||
Building Products – 0.6% | |||||||||
Assa Abloy AB, Class B | 1,005 | 20,916 | |||||||
Cie de Saint-Gobain | 827 | 45,661 | |||||||
Geberit AG (Registered) | 96 | 42,272 | |||||||
108,849 | |||||||||
Capital Markets – 1.5% | |||||||||
3i Group plc | 4,176 | 51,604 | |||||||
Ashmore Group plc | 1,392 | 7,628 | |||||||
ASX Ltd. | 626 | 26,861 | |||||||
CI Financial Corp. | 1,848 | 43,908 |
Investments | Number of Shares | Value | |||||||
IGM Financial, Inc. | 488 | $ | 17,196 | ||||||
IOOF Holdings Ltd. | 874 | 7,328 | |||||||
Partners Group Holding AG | 48 | 32,903 | |||||||
Perpetual Ltd. | 288 | 10,891 | |||||||
Platinum Asset Management Ltd. | 1,047 | 6,314 | |||||||
Singapore Exchange Ltd. | 5,500 | 30,620 | |||||||
Thomson Reuters Corp. | 848 | 37,082 | |||||||
272,335 | |||||||||
Chemicals – 3.2% | |||||||||
Agrium, Inc. | 316 | 36,464 | |||||||
Akzo Nobel NV | 425 | 37,265 | |||||||
BASF SE | 1,265 | 139,354 | |||||||
Croda International plc | 272 | 16,278 | |||||||
Daicel Corp. | 800 | 9,104 | |||||||
DuluxGroup Ltd. | 1,296 | 7,765 | |||||||
EMS-Chemie Holding AG (Registered) | 16 | 10,680 | |||||||
Evonik Industries AG | 578 | 21,773 | |||||||
FUCHS PETROLUB SE | 96 | 4,654 | |||||||
FUCHS PETROLUB SE (Preference) | 144 | 7,651 | |||||||
Givaudan SA (Registered) | 29 | 67,017 | |||||||
Israel Chemicals Ltd. | 688 | 2,794 | |||||||
Johnson Matthey plc | 432 | 17,970 | |||||||
JSR Corp. | 600 | 11,814 | |||||||
Koninklijke DSM NV | 169 | 16,168 | |||||||
Kuraray Co. Ltd. | 1,700 | 32,083 | |||||||
Linde AG | 326 | 71,011 | |||||||
Lintec Corp. | 200 | 5,584 | |||||||
Orica Ltd. | 282 | 3,992 | |||||||
Sika AG | 1 | 7,943 | |||||||
Solvay SA | 26 | 3,618 | |||||||
Umicore SA | 454 | 21,509 | |||||||
Yara International ASA | 613 | 28,232 | |||||||
580,723 | |||||||||
Commercial Services & Supplies – 1.0% | |||||||||
Babcock International Group plc | 464 | 4,428 | |||||||
Brambles Ltd. | 4,437 | 34,947 | |||||||
Dai Nippon Printing Co. Ltd. | 500 | 11,154 | |||||||
Edenred | 463 | 13,443 | |||||||
G4S plc | 3,264 | 11,789 | |||||||
ISS A/S | 538 | 20,851 | |||||||
Park24 Co. Ltd. | 600 | 14,365 | |||||||
Secom Co. Ltd. | 900 | 67,966 | |||||||
Societe BIC SA | 96 | 10,566 | |||||||
189,509 | |||||||||
Construction & Engineering – 1.1% | |||||||||
ACS Actividades de Construccion y Servicios SA | 459 | 17,979 | |||||||
Boskalis Westminster | 231 | 8,718 | |||||||
Bouygues SA | 432 | 22,467 |
See accompanying notes to the financial statements.
6
OSI ETF Trust
O'Shares FTSE Russell International Quality Dividend ETF
Schedule of Investments
December 31, 2017 (Unaudited)
Investments | Number of Shares | Value | |||||||
COMSYS Holdings Corp. | 400 | $ | 11,593 | ||||||
Ferrovial SA | 1,879 | 42,701 | |||||||
Vinci SA | 874 | 89,365 | |||||||
192,823 | |||||||||
Construction Materials – 0.8% | |||||||||
Adelaide Brighton Ltd. | 1,792 | 9,138 | |||||||
CRH plc | 1,482 | 53,307 | |||||||
CSR Ltd. | 2,128 | 7,923 | |||||||
Fletcher Building Ltd. | 2,308 | 12,475 | |||||||
James Hardie Industries plc, CHDI | 1,392 | 24,628 | |||||||
LafargeHolcim Ltd. (Registered)* | 593 | 33,438 | |||||||
140,909 | |||||||||
Containers & Packaging – 0.3% | |||||||||
Amcor Ltd. | 3,039 | 36,653 | |||||||
Huhtamaki OYJ | 85 | 3,572 | |||||||
Orora Ltd. | 3,184 | 8,442 | |||||||
48,667 | |||||||||
Distributors – 0.0%(a) | |||||||||
Inchcape plc | 580 | 6,139 | |||||||
Diversified Consumer Services – 0.0%(a) | |||||||||
Benesse Holdings, Inc. | 200 | 7,057 | |||||||
Diversified Financial Services – 0.9% | |||||||||
Corp. Financiera Alba SA | 116 | 6,647 | |||||||
Industrivarden AB, Class A | 913 | 23,596 | |||||||
Industrivarden AB, Class C | 741 | 18,327 | |||||||
Investment AB Latour, Class B | 320 | 3,944 | |||||||
Investor AB, Class B | 2,208 | 100,887 | |||||||
Sofina SA | 33 | 5,197 | |||||||
158,598 | |||||||||
Diversified Telecommunication Services – 5.0% | |||||||||
BCE, Inc. | 1,052 | 50,696 | |||||||
Bezeq The Israeli Telecommunication Corp. Ltd. | 8,912 | 13,503 | |||||||
BT Group plc | 35,216 | 129,434 | |||||||
Deutsche Telekom AG (Registered) | 6,696 | 118,960 | |||||||
Elisa OYJ | 541 | 21,256 | |||||||
Inmarsat plc | 348 | 2,310 | |||||||
Nippon Telegraph & Telephone Corp. | 1,700 | 79,997 | |||||||
Orange SA | 4,416 | 76,757 | |||||||
Proximus SADP | 592 | 19,442 | |||||||
Singapore Telecommunications Ltd. | 18,300 | 48,886 | |||||||
Spark New Zealand Ltd. | 8,998 | 23,230 | |||||||
Swisscom AG (Registered) | 70 | 37,245 | |||||||
TDC A/S | 1,120 | 6,888 | |||||||
Telefonica Deutschland Holding AG | 3,204 | 16,105 | |||||||
Telefonica SA | 9,998 | 97,546 | |||||||
Telenor ASA | 2,966 | 63,785 | |||||||
Telia Co. AB | 8,714 | 38,900 |
Investments | Number of Shares | Value | |||||||
Telstra Corp. Ltd. | 15,421 | $ | 43,783 | ||||||
TELUS Corp. | 568 | 21,588 | |||||||
910,311 | |||||||||
Electric Utilities – 2.4% | |||||||||
AusNet Services | 5,120 | 7,228 | |||||||
CK Infrastructure Holdings Ltd. | 1,500 | 12,885 | |||||||
CLP Holdings Ltd. | 6,000 | 61,364 | |||||||
Contact Energy Ltd. | 3,168 | 12,527 | |||||||
EDP – Energias de Portugal SA | 4,720 | 16,351 | |||||||
Endesa SA | 1,574 | 33,747 | |||||||
Enel SpA | 15,613 | 96,178 | |||||||
Fortum OYJ | 1,007 | 19,952 | |||||||
Hokuriku Electric Power Co. | 400 | 3,221 | |||||||
Mercury NZ Ltd. | 2,432 | 5,829 | |||||||
Orsted A/S(b) | 230 | 12,564 | |||||||
Power Assets Holdings Ltd. | 2,500 | 21,091 | |||||||
Red Electrica Corp. SA | 1,693 | 38,036 | |||||||
SSE plc | 3,718 | 66,390 | |||||||
Terna Rete Elettrica Nazionale SpA | 5,966 | 34,702 | |||||||
442,065 | |||||||||
Electrical Equipment – 1.7% | |||||||||
ABB Ltd. (Registered) | 5,401 | 144,766 | |||||||
Legrand SA | 560 | 43,165 | |||||||
Philips Lighting NV(b) | 163 | 5,989 | |||||||
Schneider Electric SE* | 1,233 | 104,914 | |||||||
298,834 | |||||||||
Electronic Equipment, Instruments & Components – 0.6% | |||||||||
Halma plc | 996 | 16,977 | |||||||
Hirose Electric Co. Ltd. | 100 | 14,621 | |||||||
Kyocera Corp. | 900 | 58,905 | |||||||
Venture Corp. Ltd. | 1,400 | 21,444 | |||||||
111,947 | |||||||||
Energy Equipment & Services – 0.2% | |||||||||
TechnipFMC plc | 913 | 28,340 | |||||||
Tenaris SA | 844 | 13,337 | |||||||
41,677 | |||||||||
Equity Real Estate Investment Trusts (REITs) – 5.2% | |||||||||
Ascendas REIT | 10,500 | 21,371 | |||||||
CapitaLand Commercial Trust | 8,400 | 12,131 | |||||||
CapitaLand Mall Trust | 12,600 | 20,082 | |||||||
Dexus | 7,017 | 53,511 | |||||||
Fonciere Des Regions | 73 | 8,282 | |||||||
Gecina SA | 192 | 35,482 | |||||||
Goodman Group | 7,437 | 48,978 | |||||||
GPT Group (The) | 11,521 | 46,047 | |||||||
Hammerson plc | 1,650 | 12,209 | |||||||
Kiwi Property Group Ltd. | 6,352 | 6,347 | |||||||
Klepierre SA | 861 | 37,908 |
See accompanying notes to the financial statements.
7
OSI ETF Trust
O'Shares FTSE Russell International Quality Dividend ETF
Schedule of Investments
December 31, 2017 (Unaudited)
Investments | Number of Shares | Value | |||||||
Link REIT | 13,000 | $ | 120,483 | ||||||
Mirvac Group | 23,396 | 43,003 | |||||||
RioCan REIT | 2,024 | 39,351 | |||||||
Scentre Group | 35,552 | 116,511 | |||||||
Shopping Centres Australasia Property Group | 5,904 | 10,760 | |||||||
Stockland | 14,217 | 49,817 | |||||||
Suntec REIT | 8,600 | 13,836 | |||||||
Unibail-Rodamco SE | 489 | 123,310 | |||||||
Vicinity Centres | 17,440 | 37,103 | |||||||
Westfield Corp. | 12,000 | 89,071 | |||||||
945,593 | |||||||||
Food & Staples Retailing – 2.5% | |||||||||
Booker Group plc | 4,880 | 15,117 | |||||||
Colruyt SA | 192 | 9,997 | |||||||
Distribuidora Internacional de Alimentacion SA | 1,390 | 7,182 | |||||||
ICA Gruppen AB | 262 | 9,533 | |||||||
Jeronimo Martins SGPS SA | 732 | 14,235 | |||||||
Kesko OYJ, Class B | 240 | 13,041 | |||||||
Lawson, Inc. | 300 | 19,947 | |||||||
Metro, Inc. | 200 | 6,425 | |||||||
Seven & i Holdings Co. Ltd. | 2,300 | 95,614 | |||||||
Wesfarmers Ltd. | 5,588 | 194,144 | |||||||
Woolworths Group Ltd. | 3,356 | 71,659 | |||||||
456,894 | |||||||||
Food Products – 4.2% | |||||||||
Marine Harvest ASA* | 1,413 | 24,012 | |||||||
Nestle SA (Registered) | 7,714 | 663,349 | |||||||
Orkla ASA | 2,999 | 31,917 | |||||||
Saputo, Inc. | 437 | 15,758 | |||||||
Tate & Lyle plc | 1,056 | 10,042 | |||||||
Toyo Suisan Kaisha Ltd. | 200 | 8,549 | |||||||
Want Want China Holdings Ltd. | 7,000 | 5,865 | |||||||
759,492 | |||||||||
Gas Utilities – 0.6% | |||||||||
APA Group | 3,969 | 25,859 | |||||||
Gas Natural SDG SA | 902 | 20,850 | |||||||
Hong Kong & China Gas Co. Ltd. | 14,800 | 29,004 | |||||||
Osaka Gas Co. Ltd. | 1,400 | 26,969 | |||||||
Rubis SCA | 138 | 9,774 | |||||||
112,456 | |||||||||
Health Care Equipment & Supplies – 0.8% | |||||||||
Cochlear Ltd. | 96 | 12,857 | |||||||
Coloplast A/S, Class B | 432 | 34,384 | |||||||
Fisher & Paykel Healthcare Corp. Ltd. | 1,686 | 17,207 | |||||||
Koninklijke Philips NV | 1,600 | 60,597 | |||||||
Smith & Nephew plc | 1,441 | 25,107 | |||||||
150,152 |
Investments | Number of Shares | Value | |||||||
Health Care Providers & Services – 0.2% | |||||||||
Miraca Holdings, Inc. | 200 | $ | 8,566 | ||||||
Ryman Healthcare Ltd. | 816 | 6,146 | |||||||
Sonic Healthcare Ltd. | 1,036 | 18,524 | |||||||
33,236 | |||||||||
Hotels, Restaurants & Leisure – 1.3% | |||||||||
Carnival plc | 325 | 21,507 | |||||||
Compass Group plc | 2,338 | 50,604 | |||||||
Crown Resorts Ltd. | 1,296 | 13,198 | |||||||
Flight Centre Travel Group Ltd. | 118 | 4,083 | |||||||
InterContinental Hotels Group plc | 395 | 25,215 | |||||||
SKYCITY Entertainment Group Ltd. | 2,384 | 7,036 | |||||||
Sodexo SA | 160 | 21,528 | |||||||
Tabcorp Holdings Ltd. | 5,399 | 23,564 | |||||||
TUI AG | 1,257 | 26,186 | |||||||
Whitbread plc | 424 | 22,943 | |||||||
William Hill plc | 2,560 | 11,151 | |||||||
227,015 | |||||||||
Household Durables – 0.4% | |||||||||
Bellway plc | 221 | 10,652 | |||||||
Berkeley Group Holdings plc | 248 | 14,080 | |||||||
Persimmon plc | 685 | 25,371 | |||||||
Taylor Wimpey plc | 11,233 | 31,364 | |||||||
81,467 | |||||||||
Household Products – 0.9% | |||||||||
Reckitt Benckiser Group plc | 1,820 | 170,346 | |||||||
Independent Power and Renewable Electricity Producers – 0.1% | |||||||||
Meridian Energy Ltd. | 3,136 | 6,524 | |||||||
Uniper SE | 416 | 12,988 | |||||||
19,512 | |||||||||
Industrial Conglomerates – 2.4% | |||||||||
CK Hutchison Holdings Ltd. | 6,000 | 75,295 | |||||||
Hopewell Holdings Ltd. | 3,000 | 11,072 | |||||||
Jardine Matheson Holdings Ltd. | 400 | 24,300 | |||||||
Keppel Corp. Ltd. | 3,200 | 17,599 | |||||||
NWS Holdings Ltd. | 4,000 | 7,215 | |||||||
Siemens AG (Registered) | 1,977 | 275,738 | |||||||
Smiths Group plc | 707 | 14,250 | |||||||
425,469 | |||||||||
Insurance – 1.7% | |||||||||
Admiral Group plc | 915 | 24,780 | |||||||
Direct Line Insurance Group plc | 3,269 | 16,879 | |||||||
Euler Hermes Group | 48 | 7,021 | |||||||
Gjensidige Forsikring ASA | 368 | 6,969 | |||||||
Great-West Lifeco, Inc. | 452 | 12,662 | |||||||
Insurance Australia Group Ltd. | 7,514 | 42,550 | |||||||
Intact Financial Corp. | 324 | 27,149 | |||||||
Medibank Pvt Ltd. | 12,964 | 33,360 |
See accompanying notes to the financial statements.
8
OSI ETF Trust
O'Shares FTSE Russell International Quality Dividend ETF
Schedule of Investments
December 31, 2017 (Unaudited)
Investments | Number of Shares | Value | |||||||
Sampo OYJ, Class A | 1,751 | $ | 96,299 | ||||||
Sun Life Financial, Inc. | 880 | 36,438 | |||||||
Tryg A/S | 350 | 8,761 | |||||||
312,868 | |||||||||
Internet Software & Services – 0.1% | |||||||||
Yahoo Japan Corp. | 2,500 | 11,474 | |||||||
IT Services – 0.5% | |||||||||
Amadeus IT Group SA | 896 | 64,673 | |||||||
Computershare Ltd. | 1,322 | 16,854 | |||||||
Nomura Research Institute Ltd. | 100 | 4,652 | |||||||
86,179 | |||||||||
Leisure Products – 0.0%(a) | |||||||||
Sankyo Co. Ltd. | 300 | 9,441 | |||||||
Machinery – 2.1% | |||||||||
Alfa Laval AB | 399 | 9,444 | |||||||
ANDRITZ AG | 160 | 9,046 | |||||||
Atlas Copco AB, Class A | 1,454 | 62,902 | |||||||
Atlas Copco AB, Class B | 1,000 | 38,425 | |||||||
GEA Group AG | 380 | 18,257 | |||||||
IMI plc | 1,035 | 18,663 | |||||||
Kone OYJ, Class B | 1,493 | 80,281 | |||||||
Kurita Water Industries Ltd. | 400 | 12,996 | |||||||
Makita Corp. | 800 | 33,626 | |||||||
MAN SE | 48 | 5,499 | |||||||
OSG Corp. | 200 | 4,332 | |||||||
Sandvik AB | 1,664 | 29,205 | |||||||
Schindler Holding AG | 48 | 11,048 | |||||||
Schindler Holding AG (Registered) | 16 | 3,620 | |||||||
SKF AB, Class B | 979 | 21,786 | |||||||
Spirax-Sarco Engineering plc | 73 | 5,550 | |||||||
Zardoya Otis SA | 976 | 10,689 | |||||||
375,369 | |||||||||
Marine – 0.2% | |||||||||
Kuehne + Nagel International AG (Registered) | 208 | 36,819 | |||||||
Media – 1.6% | |||||||||
Axel Springer SE | 64 | 5,005 | |||||||
Daiichikosho Co. Ltd. | 200 | 9,978 | |||||||
Daily Mail & General Trust plc, Class A | 464 | 3,744 | |||||||
Hakuhodo DY Holdings, Inc. | 500 | 6,494 | |||||||
ITV plc | 12,128 | 27,152 | |||||||
JCDecaux SA | 160 | 6,456 | |||||||
Lagardere SCA | 159 | 5,103 | |||||||
Mediaset Espana Comunicacion SA | 464 | 5,215 | |||||||
Pearson plc | 1,744 | 17,364 | |||||||
ProSiebenSat.1 Media SE | 652 | 22,474 | |||||||
Publicis Groupe SA | 460 | 31,292 | |||||||
RTL Group SA | 192 | 15,463 | |||||||
SES SA, FDR | 731 | 11,420 |
Investments | Number of Shares | Value | |||||||
Shaw Communications, Inc., Class B | 1,232 | $ | 28,210 | ||||||
Singapore Press Holdings Ltd. | 4,600 | 9,122 | |||||||
SKY Network Television Ltd. | 2,448 | 4,892 | |||||||
Sky plc* | 2,183 | 29,885 | |||||||
WPP plc | 2,400 | 43,537 | |||||||
282,806 | |||||||||
Metals & Mining – 0.4% | |||||||||
Maruichi Steel Tube Ltd. | 300 | 8,788 | |||||||
Norsk Hydro ASA | 2,557 | 19,492 | |||||||
Rio Tinto Ltd. | 867 | 51,408 | |||||||
79,688 | |||||||||
Multiline Retail – 0.4% | |||||||||
Canadian Tire Corp. Ltd., Class A | 82 | 10,726 | |||||||
Harvey Norman Holdings Ltd. | 2,352 | 7,671 | |||||||
Marks & Spencer Group plc | 4,912 | 20,918 | |||||||
Next plc | 537 | 32,871 | |||||||
72,186 | |||||||||
Multi-Utilities – 2.1% | |||||||||
AGL Energy Ltd. | 2,546 | 48,509 | |||||||
Canadian Utilities Ltd., Class A | 356 | 10,629 | |||||||
Centrica plc | 16,128 | 29,955 | |||||||
Engie SA | 4,816 | 82,900 | |||||||
Innogy SE(b) | 311 | 12,203 | |||||||
National Grid plc | 12,406 | 146,861 | |||||||
Suez | 864 | 15,215 | |||||||
Veolia Environnement SA | 959 | 24,500 | |||||||
370,772 | |||||||||
Oil, Gas & Consumable Fuels – 5.1% | |||||||||
ARC Resources Ltd. | 720 | 8,476 | |||||||
Caltex Australia Ltd. | 802 | 21,359 | |||||||
Enagas SA | 916 | 26,255 | |||||||
Enbridge, Inc. | 3,580 | 140,463 | |||||||
Eni SpA | 5,038 | 83,485 | |||||||
Imperial Oil Ltd. | 200 | 6,262 | |||||||
Inter Pipeline Ltd. | 936 | 19,445 | |||||||
Koninklijke Vopak NV | 101 | 4,435 | |||||||
Neste OYJ | 208 | 13,325 | |||||||
Pembina Pipeline Corp. | 880 | 31,964 | |||||||
Snam SpA | 9,176 | 44,956 | |||||||
Statoil ASA | 1,527 | 32,708 | |||||||
TOTAL SA | 6,602 | 365,030 | |||||||
TransCanada Corp. | 1,071 | 52,296 | |||||||
Woodside Petroleum Ltd. | 2,444 | 63,235 | |||||||
913,694 | |||||||||
Paper & Forest Products – 0.4% | |||||||||
Mondi plc | 601 | 15,699 | |||||||
Svenska Cellulosa AB SCA, Class B | 1,216 | 12,557 | |||||||
UPM-Kymmene OYJ | 1,158 | 36,029 | |||||||
64,285 |
See accompanying notes to the financial statements.
9
OSI ETF Trust
O'Shares FTSE Russell International Quality Dividend ETF
Schedule of Investments
December 31, 2017 (Unaudited)
Investments | Number of Shares | Value | |||||||
Personal Products – 2.9% | |||||||||
Kao Corp. | 1,600 | $ | 108,215 | ||||||
L'Oreal SA | 581 | 129,033 | |||||||
Unilever NV, CVA | 2,995 | 168,869 | |||||||
Unilever plc | 1,969 | 109,885 | |||||||
516,002 | |||||||||
Pharmaceuticals – 14.8% | |||||||||
Astellas Pharma, Inc. | 9,900 | 126,288 | |||||||
AstraZeneca plc | 2,649 | 183,508 | |||||||
Bayer AG (Registered) | 1,199 | 149,735 | |||||||
GlaxoSmithKline plc | 19,754 | 353,401 | |||||||
Mitsubishi Tanabe Pharma Corp. | 700 | 14,491 | |||||||
Novartis AG (Registered) | 6,807 | 575,574 | |||||||
Novo Nordisk A/S, Class B | 4,868 | 262,620 | |||||||
Orion OYJ, Class B | 402 | 15,003 | |||||||
Recordati SpA | 272 | 12,104 | |||||||
Roche Holding AG – BR | 105 | 26,527 | |||||||
Roche Holding AG – Genusschein | 2,400 | 607,081 | |||||||
Sanofi | 3,846 | 331,823 | |||||||
2,658,155 | |||||||||
Professional Services – 1.6% | |||||||||
Adecco Group AG (Registered) | 278 | 21,267 | |||||||
Bureau Veritas SA | 720 | 19,704 | |||||||
Capita plc | 1,584 | 8,590 | |||||||
DKSH Holding AG | 64 | 5,599 | |||||||
Experian plc | 2,016 | 44,616 | |||||||
RELX NV | 2,418 | 55,646 | |||||||
RELX plc | 2,592 | 60,975 | |||||||
SEEK Ltd. | 608 | 9,040 | |||||||
SGS SA (Registered) | 16 | 41,720 | |||||||
Wolters Kluwer NV | 330 | 17,230 | |||||||
284,387 | |||||||||
Real Estate Management & Development – 3.2% | |||||||||
Alony Hetz Properties & Investments Ltd. | 224 | 2,410 | |||||||
Daito Trust Construction Co. Ltd. | 700 | 142,765 | |||||||
Deutsche Wohnen SE | 1,128 | 49,385 | |||||||
Hang Lung Properties Ltd. | 2,000 | 4,887 | |||||||
Henderson Land Development Co. Ltd. | 3,800 | 25,034 | |||||||
Hongkong Land Holdings Ltd. | 4,700 | 33,088 | |||||||
Kerry Properties Ltd. | 1,500 | 6,745 | |||||||
LEG Immobilien AG | 331 | 37,874 | |||||||
LendLease Group | 1,230 | 15,729 | |||||||
Sino Land Co. Ltd. | 10,000 | 17,704 | |||||||
Sun Hung Kai Properties Ltd. | 4,827 | 80,519 | |||||||
Swire Pacific Ltd., Class A | 500 | 4,628 | |||||||
Swire Properties Ltd. | 4,200 | 13,539 | |||||||
Swiss Prime Site AG (Registered)* | 128 | 11,821 | |||||||
Vonovia SE | 2,071 | 102,931 | |||||||
Wharf Holdings Ltd. (The) | 3,000 | 10,362 |
Investments | Number of Shares | Value | |||||||
Wharf Real Estate Investment Co. Ltd.* | 3,000 | $ | 19,956 | ||||||
579,377 | |||||||||
Road & Rail – 1.0% | |||||||||
Aurizon Holdings Ltd. | 7,537 | 29,239 | |||||||
Canadian National Railway Co. | 1,382 | 114,326 | |||||||
ComfortDelGro Corp. Ltd. | 10,600 | 15,705 | |||||||
Kintetsu Group Holdings Co. Ltd. | 300 | 11,505 | |||||||
MTR Corp. Ltd. | 2,000 | 11,717 | |||||||
182,492 | |||||||||
Software – 0.2% | |||||||||
Sage Group plc (The) | 1,103 | 11,907 | |||||||
Trend Micro, Inc. | 300 | 17,017 | |||||||
28,924 | |||||||||
Specialty Retail – 1.2% | |||||||||
ABC-Mart, Inc. | 100 | 5,743 | |||||||
Aoyama Trading Co. Ltd. | 100 | 3,737 | |||||||
Autobacs Seven Co. Ltd. | 400 | 7,677 | |||||||
Dixons Carphone plc | 2,016 | 5,427 | |||||||
Fielmann AG | 128 | 11,300 | |||||||
Hennes & Mauritz AB, Class B | 2,924 | 60,462 | |||||||
Industria de Diseno Textil SA | 1,511 | 52,700 | |||||||
Kingfisher plc | 7,936 | 36,254 | |||||||
Shimachu Co. Ltd. | 200 | 5,761 | |||||||
USS Co. Ltd. | 900 | 19,063 | |||||||
208,124 | |||||||||
Technology Hardware, Storage & Peripherals – 2.6% | |||||||||
Samsung Electronics Co. Ltd., GDR(b) | 385 | 461,230 | |||||||
Textiles, Apparel & Luxury Goods – 1.4% | |||||||||
Burberry Group plc | 896 | 21,720 | |||||||
Cie Financiere Richemont SA (Registered) | 587 | 53,188 | |||||||
HUGO BOSS AG | 160 | 13,630 | |||||||
Luxottica Group SpA | 303 | 18,610 | |||||||
LVMH Moet Hennessy Louis Vuitton SE | 406 | 119,639 | |||||||
Pandora A/S | 130 | 14,163 | |||||||
Yue Yuen Industrial Holdings Ltd. | 2,000 | 7,854 | |||||||
248,804 | |||||||||
Tobacco – 3.1% | |||||||||
British American Tobacco plc | 4,244 | 288,087 | |||||||
Imperial Brands plc | 1,656 | 70,923 | |||||||
Japan Tobacco, Inc. | 5,400 | 174,056 | |||||||
Swedish Match AB | 727 | 28,698 | |||||||
561,764 | |||||||||
Trading Companies & Distributors – 0.4% | |||||||||
Ferguson plc | 558 | 40,233 | |||||||
Howden Joinery Group plc | 1,392 | 8,790 | |||||||
Rexel SA | 553 | 10,040 | |||||||
Travis Perkins plc | 666 | 14,118 | |||||||
73,181 |
See accompanying notes to the financial statements.
10
OSI ETF Trust
O'Shares FTSE Russell International Quality Dividend ETF
Schedule of Investments
December 31, 2017 (Unaudited)
Investments | Number of Shares | Value | |||||||
Transportation Infrastructure – 1.1% | |||||||||
Abertis Infraestructuras SA | 1,406 | $ | 31,319 | ||||||
Aena SME SA(b) | 95 | 19,279 | |||||||
Aeroports de Paris | 48 | 9,136 | |||||||
Atlantia SpA | 960 | 30,341 | |||||||
Fraport AG Frankfurt Airport Services Worldwide | 32 | 3,530 | |||||||
Hutchison Port Holdings Trust | 19,200 | 7,968 | |||||||
Macquarie Atlas Roads Group | 1,391 | 6,843 | |||||||
SATS Ltd. | 3,200 | 12,451 | |||||||
Sydney Airport | 3,136 | 17,292 | |||||||
Transurban Group | 6,280 | 61,055 | |||||||
199,214 | |||||||||
Water Utilities – 0.3% | |||||||||
Pennon Group plc | 1,649 | 17,466 | |||||||
Severn Trent plc | 664 | 19,420 | |||||||
United Utilities Group plc | 1,920 | 21,544 | |||||||
58,430 | |||||||||
Wireless Telecommunication Services – 3.5% | |||||||||
KDDI Corp. | 6,700 | 166,801 | |||||||
M1 Ltd. | 1,600 | 2,131 | |||||||
NTT DOCOMO, Inc. | 7,500 | 177,164 | |||||||
Rogers Communications, Inc., Class B | 836 | 42,736 | |||||||
StarHub Ltd. | 3,200 | 6,824 | |||||||
Tele2 AB, Class B | 933 | 11,486 | |||||||
Vodafone Group plc | 67,984 | 216,119 | |||||||
623,261 | |||||||||
Total Common Stocks (Cost $16,883,135) | 17,774,283 | ||||||||
Exchange Traded Funds – 0.8% | |||||||||
iShares MSCI South Korea Capped ETF (Cost $130,180) | 2,000 | 149,860 | |||||||
Total Investments — 99.5% (Cost $17,013,315) | 17,924,143 | ||||||||
Other Assets Less Liabilities — 0.5% | 85,916 | ||||||||
Net Assets — 100.0% | $ | 18,010,059 |
* | Non-income producing security. |
(a) | Represents less than 0.05% of net assets. |
(b) | Security exempt from registration pursuant to either Regulation S or Rule 144A under the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States and as such may have restrictions on resale. Rule 144A may be resold, normally to qualified institutional buyers, in transactions exempt from registration. At December 31, 2017, the value of these securities amounted to $511,265 or 2.84% of net assets of the Fund. |
Abbreviations | ||
CHDI | Clearing House Electronic Subregister System (CHESS) Depository Interest | |
CVA | Dutch Certification | |
FDR | Fiduciary Depositary Receipt | |
GDR | Global Depositary Receipt | |
OYJ | Public Limited Company | |
Preference | A special type of equity investment that shares in the earnings of the company, has limited voting rights, and may have a dividend preference. Preference shares may also have liquidation preference. | |
SCA | Limited partnership with share capital |
As of December 31, 2017, the gross unrealized appreciation (depreciation) of investments based on the aggregate cost of investments (including derivative contracts, if any) for federal income tax purposes was as follows:
Aggregate gross unrealized appreciation | $ | 1,178,305 | ||
Aggregate gross unrealized depreciation | (300,487 | ) | ||
Net unrealized appreciation | $ | 877,818 | ||
Federal income tax cost of investments (including derivative contracts, if any) | $ | 17,046,325 |
O'Shares FTSE Russell International Quality Dividend ETF invested, as a percentage of net assets, in the following countries as of December 31, 2017:
Australia | 8.0 | % | ||
Austria | 0.1 | % | ||
Belgium | 0.5 | % | ||
Canada | 8.1 | % | ||
China | 0.0 | %(a) | ||
Denmark | 2.0 | % | ||
Finland | 1.7 | % | ||
France | 10.8 | % | ||
Germany | 7.2 | % | ||
Hong Kong | 3.4 | % | ||
Ireland | 0.4 | % | ||
Israel | 0.1 | % | ||
Italy | 1.8 | % | ||
Japan | 10.0 | % | ||
Luxembourg | 0.2 | % | ||
Netherlands | 0.8 | % | ||
New Zealand | 0.6 | % | ||
Norway | 1.2 | % | ||
Portugal | 0.2 | % | ||
Singapore | 1.4 | % | ||
South Africa | 0.1 | % | ||
South Korea | 2.6 | % | ||
Spain | 2.6 | % | ||
Sweden | 2.7 | % | ||
Switzerland | 13.7 | % | ||
United Kingdom | 18.4 | % | ||
United States | 0.9 | % | ||
Other(1) | 0.5 | % | ||
100.0 | % |
(a) | Represents less than 0.05% of net assets. |
(1) | Includes any non-equity securities and net other assets (liabilities). |
See accompanying notes to the financial statements.
11
OSI ETF Trust
Statements of Assets and Liabilities
December 31, 2017 (Unaudited)
O'Shares FTSE Russell Small Cap Quality Dividend ETF | O'Shares FTSE Russell International Quality Dividend ETF | |||||||
ASSETS | ||||||||
Investments in securities, at value(1) | $ | 91,658,422 | $ | 17,924,143 | ||||
Cash | 69,513 | 38,989 | ||||||
Receivables: | ||||||||
Dividends | 219,213 | 44,517 | ||||||
Receivable for capital shares issued | 32,199 | — | ||||||
Reclaims | — | 10,037 | ||||||
Total Assets | 91,979,347 | 18,017,686 | ||||||
LIABILITIES | ||||||||
Cash denominated in foreign currency(2) | — | 353 | ||||||
Payables: | ||||||||
Investment management fees | 28,329 | 7,274 | ||||||
Total Liabilities | 28,329 | 7,627 | ||||||
Net Assets | $ | 91,951,018 | $ | 18,010,059 | ||||
NET ASSETS CONSIST OF: | ||||||||
Paid-in capital | $ | 88,697,803 | $ | 16,776,934 | ||||
Undistributed net investment income (loss) | 95,748 | (31,265 | ) | |||||
Undistributed net realized gain (loss) | 234,072 | 352,635 | ||||||
Net unrealized appreciation on: | ||||||||
Investments | 2,923,395 | 910,828 | ||||||
Translation of assets and liabilities denominated in foreign currencies | — | 927 | ||||||
Net Assets | $ | 91,951,018 | $ | 18,010,059 | ||||
The Funds have an unlimited number of shares authorized with no par value. Net asset value is calculated by dividing the net assets by the number of outstanding shares. | ||||||||
Shares Outstanding | 3,404,000 | 650,001 | ||||||
Net Asset Value | $ | 27.01 | $ | 27.71 | ||||
(1) Investments in securities, at cost | $ | 88,735,027 | $ | 17,013,315 | ||||
(2) Cost of foreign cash | $ | — | $ | (353 | ) |
See accompanying notes to the financial statements.
12
OSI ETF Trust
Statements of Operations
For the six months ended December 31, 2017 (Unaudited)
O'Shares FTSE Russell Small Cap Quality Dividend ETF | O'Shares FTSE Russell International Quality Dividend ETF | |||||||
INVESTMENT INCOME | ||||||||
Dividend income | $ | 974,641 | $ | 232,058 | ||||
Foreign withholding tax on dividends | — | (22,179 | ) | |||||
Total Investment Income | 974,641 | 209,879 | ||||||
EXPENSES | ||||||||
Investment management fees (Note 4) | 125,984 | 41,220 | ||||||
Total Expenses | 125,984 | 41,220 | ||||||
Net Investment Income | 848,657 | 168,659 | ||||||
NET REALIZED GAIN (LOSS) FROM: | ||||||||
Transactions in investment securities | (447,356 | ) | (89,530 | ) | ||||
In-kind redemptions of investments | 699,997 | 470,324 | ||||||
Foreign currency transactions | — | (26,913 | ) | |||||
Net Realized Gain (Loss) | 252,641 | 353,881 | ||||||
NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) FROM: | ||||||||
Investments in securities | 2,873,225 | 501,200 | ||||||
Translation of assets and liabilities denominated in foreign currencies | — | 752 | ||||||
Net Change in Unrealized Appreciation | 2,873,225 | 501,952 | ||||||
Net Realized and Unrealized Gain (Loss) | 3,125,866 | 855,833 | ||||||
Net Increase in Net Assets Resulting from Operations | $ | 3,974,523 | $ | 1,024,492 |
See accompanying notes to the financial statements.
13
OSI ETF Trust
Statements of Changes in Net Assets
O'Shares FTSE Russell Small Cap Quality Dividend ETF | O'Shares FTSE Russell International Quality Dividend ETF | |||||||||||||||
Six Months Ended December 31, 2017 (Unaudited) | For the period 12/30/16* – 06/30/17 | Six Months Ended December 31, 2017 (Unaudited) | For the period 03/22/17* – 06/30/17 | |||||||||||||
OPERATIONS | ||||||||||||||||
Net investment income | $ | 848,657 | $ | 353,659 | $ | 168,659 | $ | 108,962 | ||||||||
Net realized gain (loss) | 252,641 | 56,452 | 353,881 | (1,515 | ) | |||||||||||
Net change in unrealized appreciation | 2,873,225 | 50,170 | 501,952 | 409,803 | ||||||||||||
Net Increase in Net Assets Resulting from Operations | 3,974,523 | 460,281 | 1,024,492 | 517,250 | ||||||||||||
DISTRIBUTIONS | ||||||||||||||||
Net investment income | (854,442 | ) | (252,126 | ) | (235,712 | ) | (72,905 | ) | ||||||||
Net realized gain | (13,013 | ) | — | — | — | |||||||||||
Total Distributions | (867,455 | ) | (252,126 | ) | (235,712 | ) | (72,905 | ) | ||||||||
CAPITAL TRANSACTIONS | ||||||||||||||||
Proceeds from shares issued | 56,981,673 | 39,192,103 | 9,415,537 | 11,458,553 | ||||||||||||
Cost of shares redeemed | (6,361,149 | ) | (1,276,832 | ) | (4,097,156 | ) | — | |||||||||
Net Increase (Decrease) from Capital Transactions | 50,620,524 | 37,915,271 | 5,318,381 | 11,458,553 | ||||||||||||
Total Increase (Decrease) in Net Assets | 53,727,592 | 38,123,426 | 6,107,161 | 11,902,898 | ||||||||||||
NET ASSETS | ||||||||||||||||
Beginning of period | $ | 38,223,426 | $ | 100,000 | $ | 11,902,898 | $ | — | ||||||||
End of Period | $ | 91,951,018 | $ | 38,223,426 | $ | 18,010,059 | $ | 11,902,898 | ||||||||
Accumulated undistributed net investment income (loss) included in end of period net assets | $ | 95,748 | $ | 101,533 | $ | (31,265 | ) | $ | 35,788 | |||||||
SHARE TRANSACTIONS | ||||||||||||||||
Beginning of period | 1,504,000 | 4,000 | 450,001 | — | ||||||||||||
Shares issued | — | — | 150,000 | 1 | ||||||||||||
Shares issued in-kind | 2,150,000 | 1,550,000 | 200,000 | 450,000 | ||||||||||||
Shares redeemed in-kind | (250,000 | ) | (50,000 | ) | (150,000 | ) | — | |||||||||
Shares Outstanding, End of Period | 3,404,000 | 1,504,000 | 650,001 | 450,001 |
* | Commencement of investment operations. |
See accompanying notes to the financial statements.
14
(This page intentionally left blank.)
15
OSI ETF Trust
Financial Highlights for a share outstanding throughout the period
PER SHARE OPERATING PERFORMANCE | ||||||||||||||||||||||||||||||||||||
Investment Operations | Distributions | |||||||||||||||||||||||||||||||||||
Net asset value, beginning of period | Net investment income (loss)(1) | Net realized and unrealized gain (loss) | Total investment operations | Net investment income | Net realized gains | Tax return of capital | Total distributions | Net asset value, end of period | ||||||||||||||||||||||||||||
O'Shares FTSE Russell Small Cap Quality Dividend ETF | ||||||||||||||||||||||||||||||||||||
For the six months ended 12/31/17 (Unaudited) | $ | 25.41 | $ | 0.43 | $ | 1.53 | $ | 1.96 | $ | (0.36 | ) | $ | — | (7) | $ | — | $ | (0.36 | ) | $ | 27.01 | |||||||||||||||
For the period 12/30/16* – 06/30/17 | 25.00 | 0.38 | 0.25 | 0.63 | (0.22 | ) | — | — | (0.22 | ) | 25.41 | |||||||||||||||||||||||||
O'Shares FTSE Russell International Quality Dividend ETF | ||||||||||||||||||||||||||||||||||||
For the six months ended 12/31/17 (Unaudited) | 26.45 | 0.27 | 1.34 | 1.61 | (0.35 | ) | — | — | (0.35 | ) | 27.71 | |||||||||||||||||||||||||
For the period 03/22/17* – 06/30/17 | 25.00 | 0.34 | 1.29 | 1.63 | (0.18 | ) | — | — | (0.18 | ) | 26.45 |
* | Commencement of investment operations. |
(1) | Net investment income (loss) per share is based on average shares outstanding. |
(2) | Annualized for periods less than one year. |
(3) | Not annualized for periods less than one year. |
(4) | Net asset value total return 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 at net asset value. |
(5) | Market value total return is calculated assuming an initial investment made at market 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 at market value. The market value is determined by the mid point of the bid/ask spread at 4:00 p.m. from the NYSE Arca, Inc. Exchange. Market value returns may vary from net asset value returns. |
(6) | In-kind transactions are not included in portfolio turnover calculations. |
(7) | Per share amount is less than $0.01. |
See accompanying notes to the financial statements.
16
RATIOS/SUPPLEMENTAL DATA | ||||||||||||||||||||||||||||||||
Ratios to Average Net Assets of(2) | Total Return(3) | |||||||||||||||||||||||||||||||
Expenses | Net investment income | Net investment income excluding special dividends | Net investment income per share excluding special dividends | Net asset value(4) | Market value(5) | Portfolio turnover rate(3)(6) | Ending net assets (thousands) | |||||||||||||||||||||||||
O'Shares FTSE Russell Small Cap Quality Dividend ETF | ||||||||||||||||||||||||||||||||
For the six months ended 12/31/17 (Unaudited) | 0.48 | % | 3.23 | % | 3.23 | % | $ | 0.43 | 7.79 | % | 7.66 | % | 27 | % | $ | 91,951 | ||||||||||||||||
For the period 12/30/16* – 06/30/17 | 0.48 | 2.99 | 2.86 | 0.36 | 2.52 | 2.68 | 7 | 38,223 | ||||||||||||||||||||||||
O'Shares FTSE Russell International Quality Dividend ETF | ||||||||||||||||||||||||||||||||
For the six months ended 12/31/17 (Unaudited) | 0.48 | 1.96 | 1.96 | $ | 0.27 | 6.12 | 5.12 | 21 | 18,010 | |||||||||||||||||||||||
For the period 03/22/17* – 06/30/17 | 0.48 | 4.65 | 4.65 | 0.34 | 6.53 | 7.66 | 2 | 11,903 |
See accompanying notes to the financial statements.
17
OSI ETF Trust
Notes to Financial Statements
December 31, 2017 (Unaudited)
1. Organization
OSI ETF Trust (the “Trust”) was organized as a Delaware statutory trust on April 12, 2016 and is authorized to issue multiple series or portfolios. The Trust is an open-end management investment company, registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The Trust currently consists of two operational exchange-traded funds (each a “Fund” and collectively, the “Funds”). The O’Shares FTSE Russell Small Cap Quality Dividend ETF and O’Shares FTSE Russell International Quality Dividend ETF are diversified series of the Trust, pursuant to the 1940 Act.
The O’Shares FTSE Russell Small Cap Quality Dividend ETF commenced operations on December 30, 2016. The O’Shares FTSE Russell International Quality Dividend ETF commenced operations on March 22, 2017.
Each Fund seeks to track the performance (before fees and expenses) of a specified benchmark index (each, a “Target Index”). There can be no assurance that the Funds’ investment objectives will be achieved.
2. Significant Accounting Policies
The Trust, which is an investment company, follows accounting and reporting guidance under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Topic 946, “Financial Services — Investment Companies.”
The following is a summary of significant accounting policies followed by the Funds in the preparation of their financial statements. These policies are in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates.
Investment Company Modernization
In October 2016, the Securities and Exchange Commission (“SEC”) issued Final Rule Release No. 33-10231, Investment Company Reporting Modernization (the “Release”). The Release calls for the adoption of new rules and forms as well as amendments to current rules and forms to modernize the reporting and disclosure of information by registered investment companies. The SEC is adopting amendments to Regulation S-X, which will require standardized, enhanced disclosures about derivatives in investment company financial statements, as well as other amendments. The Funds have updated disclosure in these financial statements to reflect the amendments, which were effective August 1, 2017. The compliance date for the FORM N-CEN is on June 1, 2018. The effective date for the FORM N-PORT has been extended for the Funds until April 1, 2020. The adoption had no effect on the Funds’ net assets or results of operations.
Investment Valuation
The net asset value (“NAV”) of each Fund’s shares is calculated each business day as of the close of regular trading on the New York Stock Exchange (“NYSE”), generally 4:00 p.m., Eastern Time. NAV per share is computed by dividing the net assets by the number of each Fund’s shares outstanding.
When calculating the NAV of each Fund’s shares, securities held by the Funds are valued at market quotations when reliable market quotations are readily available. Exchange traded securities and instruments (including equity securities, depositary receipts and ETFs) are generally valued at the last reported sale price on the principal exchange on which such securities are traded (at the NASDAQ Official Closing Price for NASDAQ listed securities), as of the close of regular trading on the NYSE on the day the securities are being valued or, if there are no sales, at the mean of the most recent bid and asked prices. Over-the-counter securities not traded on an exchange are valued at the last traded price. In the absence of a recorded transaction sale price; or if the last sale price is unavailable, securities are valued at the mean between last bid and ask, as quoted. If an ask price is unavailable, last bid price is used. Such valuations would typically be categorized as Level 1 in the fair value hierarchy described below.
18
OSI ETF Trust
Notes to Financial Statements (continued)
December 31, 2017 (Unaudited)
When reliable market quotations are not readily available, securities are priced at their fair value in accordance with the Trust’s valuation guidelines, which were approved by the Board of Trustees (the “Trustees”). The Funds may use fair value pricing in a variety of circumstances, including but not limited to, situations when the value of a Fund’s security has been materially affected by events occurring after the close of the market on which such security is principally traded (such as a corporate action or other news that may materially affect the price of such security) or trading in such security has been suspended or halted. Such valuations would typically be categorized as Level 2 or Level 3 in the fair value hierarchy described below. Fair value pricing involves subjective judgments and it is possible that a fair value determination for a security is materially different than the value that could be realized upon the sale of such security. In addition, fair value pricing could result in a difference between the prices used to calculate a Fund’s NAV and the prices used by the Fund’s Target Index. This may adversely affect the Fund’s ability to track its Target Index. Securities of non-exchange traded investment companies are valued at their NAV.
The Funds disclose the fair market value of their investments in a hierarchy that distinguishes between: (1) market participant assumptions developed based on market data obtained from sources independent of the Funds (observable inputs) and (2) the Funds’ own assumptions about market participant assumptions developed based on the best information available under the circumstances (unobservable inputs). The three levels defined by the hierarchy are as follows:
• | Level 1 — Quoted prices in active markets for identical assets. |
• | Level 2 — Other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.). |
• | Level 3 — Significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments). |
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.
The following is a summary of the valuations as of December 31, 2017 for each Fund based upon the three levels defined above:
Level 1 – Quoted Prices | Level 2 – Other Significant Observable Inputs | Level 3 – Significant Unobservable Inputs | Total | |||||||||||||
O’Shares FTSE Russell Small Cap Quality Dividend ETF | ||||||||||||||||
Investments | ||||||||||||||||
Common Stocks* | $ | 91,658,422 | $ | — | $ | — | $ | 91,658,422 | ||||||||
Total Investments | $ | 91,658,422 | $ | — | $ | — | $ | 91,658,422 | ||||||||
O’Shares FTSE Russell International Quality Dividend ETF | ||||||||||||||||
Investments | ||||||||||||||||
Common Stocks* | $ | 17,774,283 | $ | — | $ | — | $ | 17,774,283 | ||||||||
Exchange Traded Fund | 149,860 | — | — | 149,860 | ||||||||||||
Total Investments | $ | 17,924,143 | $ | — | $ | — | $ | 17,924,143 |
* | See Schedules of Investments for segregation by industry type. |
At December 31, 2017, there were no Level 2 or Level 3 securities held by the Funds for which significant unobservable inputs were used to determine fair value.
19
OSI ETF Trust
Notes to Financial Statements (continued)
December 31, 2017 (Unaudited)
The Funds disclose transfer between levels based on valuations at the end of the reporting period. There were no transfers between Levels 1, 2, and 3 for the period ended December 31, 2017 based on levels assigned to securities as of June 30, 2017.
Real Estate Investment Trusts (“REITs”)
Each Fund may invest in REITs. Equity REITs invest primarily in real property while mortgage REITs make construction, development and long-term mortgage loans. Their value may be affected by changes in the value of the underlying property of the REIT, the creditworthiness of the issuer, property taxes, interest rates, and tax and regulatory requirements, such as those relating to the environment.
REITs are dependent upon management skill, are not diversified and are subject to heavy cash flow dependency, default by borrowers, self-liquidation and the possibility of failing to qualify for tax free income status under the Internal Revenue Code of 1986 and failing to be exempt from registration as a registered investment company under the 1940 Act.
Distributions from REIT investments may be comprised of return of capital, capital gains and income. The actual character of amounts received during the year is not known until after the REIT’s fiscal year end. The Funds record the character of distributions received from REITs during the year based on estimates available. The characterization of distributions received by the Funds may be subsequently revised based on information received from the REITs after their tax reporting periods have concluded.
Foreign Currency Translation
The books and records of the Funds are maintained in U.S. dollars. The Funds’ assets and liabilities in foreign currencies are translated into U.S. dollars at the prevailing exchange rate at the valuation date. Transactions denominated in foreign currencies are translated into U.S. dollars at the prevailing exchange rate on the date of the transaction. The Funds’ income earned and expense incurred in foreign denominated currencies are translated into U.S. dollars at the prevailing exchange rate on the date of such activity.
The Funds do not isolate that portion of the results of operations arising from changes in the foreign exchange rates on investments from the fluctuations that result from changes in the market prices of investments held or sold during the period. Accordingly, such foreign currency gains (losses) are included in the reported net realized gain (loss) on investments in securities and net change in unrealized appreciation (depreciation) on investment securities on the Statements of Operations.
Net realized gains (losses) on foreign currency transactions reported on the Statements of Operations arise from sales of foreign currency, realized currency gains or losses, including foreign exchange contracts, between the trade and settlement dates on securities transactions and the difference in the amounts of dividends and foreign withholding taxes recorded on the Funds’ books and the U.S. dollar equivalent of the amounts actually received or paid. Net changes in unrealized appreciation (depreciation) on translation of assets and liabilities denominated in foreign currencies reported on the Statements of Operations arise from changes (due to the changes in the exchange rate) in the value of foreign currency and assets and liabilities (other than investments) denominated in foreign currencies, which are held at period end.
Organizational and Offering Expenses
O’Shares Investment Advisers, LLC (the “Adviser”) has agreed to pay the organizational and initial offering costs on behalf of the Funds. The organizational and initial offering costs include preparation and filing incorporation documents, bylaws, declarations of trust, registration statements, board materials, state and federal registration of shares and audit fees. As a result, organizational and offering expenses are not reflected in the Funds’ financial statements.
20
OSI ETF Trust
Notes to Financial Statements (continued)
December 31, 2017 (Unaudited)
Taxes and Distributions
Each of the Funds intends to qualify or continue to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code and distribute substantially all of its net investment income and net capital gains to shareholders. Accordingly, no provision for Federal income taxes is required in the financial statements.
As of June 30, 2017 (the Funds’ tax year end), management of the Funds has reviewed the open tax years and major jurisdictions and concluded that there is no tax liability resulting from unrecognized tax benefits relating to uncertain income tax positions taken or expected to be taken in future tax returns. The Funds are also not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next 12 months. On an ongoing basis, management will monitor the tax positions taken to determine if adjustment to conclusions are necessary based on factors including but not limited to further implementation on guidance expected from FASB and ongoing analysis of tax law, regulation, and interpretations thereof.
Each Fund expects to declare and distribute all of its net investment income, if any, to shareholders as dividends monthly. Net capital gains are distributed at least annually. Dividends may be declared and paid more frequently to improve a Fund’s tracking of its Target Index or to comply with the distribution requirements of the Internal Revenue Code.
3. Investment Transactions and Related Income
Throughout the reporting period, investment transactions are accounted for no later than one business day following the trade date. For financial reporting purposes, investment transactions are accounted for on trade date on the last business day of the reporting period. Interest income is recognized on an accrual basis and includes, where applicable, the amortization of premiums and accretion of discounts. Dividend income received or paid from the Fund, net of any applicable foreign withholding taxes, is recorded on the ex-dividend date, except for dividends of foreign securities where the dividend may not be known until after the ex-date. For those cases, dividend income, net of withholding taxes, is recorded when the Fund becomes aware of the dividends. Non-cash dividends, if any, are recorded at the fair market value of the asset received. Large, non-recurring dividends recognized by the Funds are presented separately on the Statement of Operations as “Special Dividends” and the impact of these dividends is presented in the Financial Highlights. Gains or losses realized on sales of securities are determined using the specific identification method by comparing the identified cost of the security lot sold with the net sales proceeds.
4. Investment Management Fees
The Adviser serves as investment adviser to the Funds pursuant to an Investment Advisory Agreement with the Trust (the “Advisory Agreement”). Pursuant to the Advisory Agreement, the Adviser has the overall responsibility for the Funds’ investment program. The Adviser, on behalf of each Fund, has entered into a Sub-Advisory Agreement with Vident Investment Advisory, LLC (the “Sub-Adviser”). The Sub-Adviser is responsible for trading portfolio securities and other investment instruments on behalf of the Funds, including selecting broker-dealers to execute purchase and sale transactions, as instructed by the Adviser or in connection with any rebalancing or reconstitution of a Target Index, subject to the overall supervision and oversight of the Adviser and the Trustees. The Adviser oversees the Sub-Adviser for compliance with the Funds’ investment objective, policies, strategies and restrictions. The Board of Trustees supervises and oversees the Adviser and the Sub-Adviser, establishes policies that they must follow in their management activities, and oversees the hiring and termination of sub-advisers recommended by the Adviser.
21
OSI ETF Trust
Notes to Financial Statements (continued)
December 31, 2017 (Unaudited)
Under the Advisory Agreement, the Funds pay the Adviser a unitary management fee for its services payable on a monthly basis at the annual rate listed in the table below, based on the average daily net assets of each Fund.
Fund | Management Fee | |||
O’Shares FTSE Russell Small Cap Quality Dividend ETF | 0.48 | % | ||
O’Shares FTSE Russell International Quality Dividend ETF | 0.48 | % |
Pursuant to the Sub-Advisory Agreement, the Adviser compensates the Sub-Adviser out of the management fee it receives from the Funds.
Under the Advisory Agreement, the Adviser bears all of the ordinary operating expenses of the Funds, except for (i) the management fee, (ii) payments under the Funds’ Rule 12b-1 plan, (iii) brokerage expenses (including any costs incidental to transactions in portfolio securities or instruments), (iv) acquired fund fees and expenses, (v) taxes, (vi) interest (including borrowing costs and dividend expenses on securities sold short and overdraft charges), (vii) litigation expenses (including litigation to which the Trust or a Fund may be a party and indemnification of the Trustees and officers with respect thereto) and (viii) other extraordinary or non-routine expenses.
5. Administration, Fund Accounting and Transfer Agency Fees
JPMorgan Chase Bank, N.A. (“Administrator”) acts as administrator, fund accounting agent and transfer agent to the Funds pursuant to an administration agreement. The Administrator provides the Funds with all required general administrative services, including, without limitation, office space, equipment, and personnel; clerical and general back office services; bookkeeping, internal accounting, and secretarial services; the determination of NAVs; and the preparation and filing of all reports, registration statements, proxy statements, and all other materials required to be filed or furnished by the Funds under federal and state securities laws.
6. Custodian Fees
JPMorgan Chase Bank, N.A. acts as custodian to the Funds. The custodian holds cash, securities and other assets of the Funds as required by the 1940 Act. As compensation for the services, the Custodian is entitled to fees and reasonable out-of-pocket expenses.
7. Distribution, Service Plan and Fund Officers
Foreside Fund Services, LLC (the “Distributor”) serves as the Funds’ Distributor. The Trust has adopted a distribution and service plan (“Plan”) pursuant to Rule 12b-1 under the 1940 Act. In accordance with the Plan, each Fund is authorized to pay an amount up to 0.25% of its average daily net assets each year to finance any activity primarily intended to result in the sale of Creation Units of the Funds or the provision of investor services, including but not limited to: (i) marketing and promotional services, including advertising; (ii) facilitating communications with beneficial owners of shares of the Funds; (iii) wholesaling services; and (iv) such other services and obligations as may be set forth in the Distribution Agreement with the Distributor.
No distribution or service fees are currently paid by any Funds and there are no current plans to impose these fees. In the event Rule 12b-1 fees were charged, over time they would increase the cost of an investment in a Fund and may cost you more than paying other types of sales charges.
Foreside Fund Officer Services, LLC (“FFOS”), an affiliate of the Distributor, provides a Chief Compliance Officer, Principal Financial Officer and Treasurer, and certain additional compliance support functions to the Funds. FFOS does not have a role in determining the investment policies of the Trust or Funds, or which securities are to be purchased or sold by the Trust or a Fund.
22
OSI ETF Trust
Notes to Financial Statements (continued)
December 31, 2017 (Unaudited)
8. Issuance and Redemption of Fund Shares
The Funds are exchange-traded funds or ETFs. Individual Fund shares may only be purchased and sold on a national securities exchange through a broker-dealer and investors may pay a commission to such broker-dealers in connection with their purchase or sale. The price of Fund shares is based on market price, and because ETF shares trade at market prices rather than NAV, shares may trade at a price greater than NAV (a premium) or less than NAV (a discount). The Funds will only issue or redeem shares aggregated into blocks of 50,000 shares or multiples thereof (“Creation Units”) to Authorized Participants who have entered into agreements with the Funds’ Distributor. An Authorized Participant is either (1) a “Participating Party,” (i.e., a broker-dealer or other participant in the clearing process of the Continuous Net Settlement System of the NSCC) (“Clearing Process”), or (2) a participant of DTC (“DTC Participant”), and, in each case, must have executed an agreement (“Participation Agreement”) with the distributor with respect to creations and redemptions of Creation Units. The Funds will issue or redeem Creation Units in return for a basket of assets that the Funds specify each day.
Shares are listed on the NYSE Arca, Inc.TM and are publicly traded. If you buy or sell Fund shares on the secondary market, you will pay or receive the market price, which may be higher or lower than NAV. Your transaction will be priced at NAV if you purchase or redeem Fund shares in Creation Units.
Authorized Participants may pay transaction fees to offset transfer and other transaction costs associated with the issuance and redemption of Creation Units. Authorized Participants purchasing and redeeming Creation Units may pay a purchase transaction fee and a redemption transaction fee directly to JPMorgan Chase Bank, N.A., the Funds’ administrator, to offset transfer and other transaction costs associated with the issuance and redemption of Creation Units, including Creation Units for cash.
9. Investment Transactions
For the period ended December 31, 2017, the cost of securities purchased and proceeds from sales of securities, excluding in-kind transactions, were as follows:
Fund | Purchases | Sales | ||||||
O’Shares FTSE Russell Small Cap Quality Dividend ETF | $ | 14,934,528 | $ | 14,979,553 | ||||
O’Shares FTSE Russell International Quality Dividend ETF | 7,504,467 | 3,490,156 |
10. In-Kind Transactions
During the period presented in this report, certain Funds of the Trust delivered securities of the Funds in exchange for the redemption of shares (redemption-in-kind). Cash and securities were transferred for redemptions at fair value. For financial reporting purposes, the Funds recorded net realized gains and losses in connection with each transaction.
For the period ended December 31, 2017 the value of the securities transferred for redemptions, and the net realized gains recorded in connection with the transactions were as follows:
Fund | Value | Realized Gain | ||||||
O’Shares FTSE Russell Small Cap Quality Dividend ETF | $ | 6,306,021 | $ | 699,997 | ||||
O’Shares FTSE Russell International Quality Dividend ETF | 4,048,285 | 470,324 |
23
OSI ETF Trust
Notes to Financial Statements (continued)
December 31, 2017 (Unaudited)
During the period presented in this report, the Funds received securities in exchange for subscription of shares (subscription-in-kind). For the period ended December 31, 2017, the value of the securities received for subscriptions were as follows:
Fund | Value | |||
O’Shares FTSE Russell Small Cap Quality Dividend ETF | $ | 56,821,288 | ||
O’Shares FTSE Russell International Quality Dividend ETF | 5,228,029 |
11. Principal Risks
Each Fund is subject to the principal risks noted below, which may adversely affect a Fund’s NAV, trading price, yield, total return and ability to meet its investment objective. A more complete description of the principal risks to which each Fund is subject is included in the Funds’ prospectus.
Authorized Participants Concentration Risk. Each Fund has a limited number of financial institutions that may act as Authorized Participants. To the extent they cannot or are otherwise unwilling to engage in creation and redemption transactions with the Funds and no other Authorized Participant steps in, shares of the Funds may trade like closed-end fund shares at a significant discount to NAV and may face trading halts and/or delisting from the Exchange. This risk may be more pronounced in volatile markets, potentially where there are significant redemptions in ETFs generally.
Cash and Cash Equivalents Risk. Holding cash or cash equivalents, even strategically, may lead to missed investment opportunities. This is particularly true when the market for other investments in which each Fund may invest is rapidly rising.
Concentration Risk. To the extent that a Fund’s Target Index is concentrated in a particular industry or group of industries, the Fund is also expected to be concentrated in that industry or group of industries which may subject the Fund to a greater loss as a result of adverse economic, business or other developments affecting that industry or group of industries.
Depositary Receipts Risk. The risks of investments in depositary receipts are substantially similar to Foreign Investment Risks. In addition, depositary receipts may not track the price of the underlying foreign securities, and their value may change materially at times when the U.S. markets are not open for trading.
Dividend-Paying Stocks Risk. A Fund’s emphasis on dividend-paying stocks involves the risk that such stocks may fall out of favor with investors and underperform the market. Also, a company may reduce or eliminate its dividend after a Fund’s purchase of such a company’s securities.
Equity Investing Risk. An investment in a Fund involves risks similar to those of investing in any fund holding equity securities, such as market fluctuations, changes in interest rates and perceived trends in stock prices. The values of equity securities could decline generally or could underperform other investments. In addition, securities may decline in value due to factors affecting a specific issuer, market or securities markets generally.
ETFs and Other Investment Companies Risk. The risks of investing in securities of ETFs and other investment companies typically reflect the risks of the types of instruments in which the underlying ETF or other investment company invests. In addition, with such investments, a Fund indirectly bears its proportionate share of the fees and expenses of the underlying entity. As a result, a Fund’s operating expenses may be higher and performance may be lower.
Foreign Investment Risk. Returns on investments in foreign securities could be more volatile than, or trail the returns on, investments in U.S. securities. Exposures to foreign securities entail special risks, including due to: differences in information available about foreign issuers; differences in investor protection standards in other jurisdictions; capital controls risks, including the risk of a foreign jurisdiction imposing restrictions on the ability to repatriate or transfer currency or other assets; political, diplomatic and economic risks; regulatory risks; and
24
OSI ETF Trust
Notes to Financial Statements (continued)
December 31, 2017 (Unaudited)
foreign market and trading risks, including the costs of trading and risks of settlement in foreign jurisdictions. Current political uncertainty surrounding the European Union (“EU”) and its membership, including the 2016 referendum in which the United Kingdom voted to exit the EU, may increase market volatility. In addition, a Fund’s investments in securities denominated in other currencies could decline due to changes in local currency relative to the value of the U.S. dollar, which may affect such Fund’s returns.
Geographic Concentration Risk. Because a Fund’s investments may be concentrated in a particular geographic region or country, the value of such Fund shares may be affected by events that adversely affect that region or country and may fluctuate more than that of a less concentrated funds.
Index-Related Risk. Each Fund is managed with an investment strategy that attempts to track the performance of the Target Index. As a result, the Funds expect to hold constituent securities of the Target Index regardless of their current or projected performance. Maintaining investments in securities regardless of market conditions or the performance of individual securities could cause a Fund’s return to be lower than if the Funds employed an active strategy.
There is no assurance that the Index Provider will compile each Target Index accurately, or that each Target Index will be determined, composed or calculated accurately. While the Index Provider provides descriptions of what each Target Index is designed to achieve, the Index Provider does not guarantee the quality, accuracy or completeness of data in respect of its indices, and does not guarantee that each Target Index will be in line with its described index methodology. Any gains, losses or costs to a Fund that are caused by Index Provider errors will therefore be borne by the Fund and its shareholders. Each Target Index is new and has a limited performance history. The foregoing risks may be greater for a new index.
International Closed Market Trading Risk. If a Fund’s underlying securities trade on markets that may be closed when the Exchange is open, there are likely to be deviations between current pricing of an underlying security and stale pricing resulting in the Fund trading at a discount or premium to NAV that may be greater than those incurred by other ETFs.
Large Capitalization Securities Risk. The securities of large market capitalization companies may underperform other segments of the market because such companies may be less responsive to competitive challenges and opportunities and may be unable to attain high growth rates during periods of economic expansion.
Liquidity Risk. Liquidity risk exists when investments are difficult to purchase or sell. This can reduce a Fund’s returns because the Fund or an entity in which it invests may be unable to transact at advantageous times or prices.
Market Events Risk. The market values of a Fund’s investments, and therefore the value of such Fund’s shares, will go up and down, sometimes rapidly or unpredictably. Market risk may affect a single issuer, industry or section of the economy, or it may affect the market as a whole. Turbulence in the financial markets and reduced liquidity may negatively affect issuers, which could have an adverse effect on a Fund. In addition, there is a risk that policy changes by the U.S. Government, Federal Reserve and/or other government actors, such as increasing interest rates, could cause increased volatility in financial markets and disruption in the creation/redemption process of a Fund, which could have a negative impact on the Fund.
Mid-Capitalization Securities Risk. The securities of mid-capitalization companies are often more volatile and less liquid than the securities of larger companies and may be more affected than other types of securities during market downturns. Compared to larger companies, mid-capitalization companies may have a shorter history of operations, and may have limited product lines, markets or financial resources.
25
OSI ETF Trust
Notes to Financial Statements (continued)
December 31, 2017 (Unaudited)
Multifactor Risk. Each Target Index, and thus each Fund, seeks to achieve specific factor exposures. There can be no assurance that targeting exposure to such factors will enhance a Fund’s performance over time, and targeting exposure to certain factors may detract from performance in some market environments. There is no guarantee the Index Provider’s methodology will be successful in creating an index that achieves the specific factor exposures.
Premium-Discount Risk. Fund shares may trade above or below their NAV on the Exchange. The market prices of Fund shares will generally fluctuate in accordance with changes in NAV as well as the relative supply of, and demand for, Fund shares. Therefore, you may pay more than NAV when you buy shares of a Fund on the Exchange, and you may receive less than NAV when you sell those shares on the Exchange. This risk is separate and distinct from the risk that the NAV of Fund shares may decrease.
Quality Stocks Risk. Quality investing entails investing in securities of companies with high returns on equity, stable earnings per share growth, and low financial leverage. This style of investing is subject to the risk that the past performance of these companies does not continue or that the returns on “quality” equity securities are less than returns on other styles of investing or the overall stock market. In addition, there may be periods when quality investing is out of favor and during which the investment performance of a fund using a quality strategy may suffer.
REIT Risk. A REIT is a company that owns or finances income-producing real estate. Each Fund, through its investments in REITs, is subject to the risks of investing in the real estate market, including decreases in property revenues, increases in interest rates, increases in property taxes and operating expenses, legal and regulatory changes, a lack of credit or capital, defaults by borrowers or tenants, environmental problems and natural disasters.
REITs are subject to additional risks, including those related to adverse governmental actions, declines in property value and the real estate market, and the potential failure to qualify for tax-free pass through of income and exemption from registration as an investment company. REITs are dependent upon specialized management skills and may invest in relatively few properties, a small geographic area or a small number of property types. As a result, investments in REITs may be volatile. To the extent a Fund invests in REITs concentrated in specific geographic areas or property types, the Fund may be subject to a greater loss as a result of adverse developments affecting such area or property types. REITs are pooled investment vehicles with their own fees and expenses and a Fund will indirectly bear a proportionate share of those fees and expenses.
Sampling Risk. To the extent a Fund uses a representative sampling approach; it will hold a smaller number of securities than are in the Target Index. As a result, an adverse development respecting a security held by the Fund could result in a greater decline in NAV than would be the case if the Fund held all of the securities in the Target Index. Conversely, a positive development relating to a security in the Target Index that is not held by the Fund could cause the Fund to underperform the Target Index. To the extent the assets in the Fund are smaller, these risks will be greater.
Secondary Market Trading Risk. Investors buying or selling Fund shares in the secondary market may pay brokerage commissions or other charges, which may be a significant proportional cost for investors seeking to buy or sell relatively small amounts of Fund shares. Although a Fund’s shares are listed on the Exchange, there can be no assurance that an active or liquid trading market for them will develop or be maintained. In addition, trading in Fund shares on the Exchange may be halted.
Sector Risk. To the extent a Target Index, and thereby a Fund, emphasizes, from time to time, investments in a particular sector, the Funds are subject to a greater degree to the risks particular to that sector. Market conditions, interest rates, and economic, regulatory, or financial developments could significantly affect all the securities in a single sector. If the Funds invest in a few sectors, it may have increased exposure to the price movements of those sectors.
26
OSI ETF Trust
Notes to Financial Statements (continued)
December 31, 2017 (Unaudited)
Small Capitalization Securities Risk. The securities of small capitalization companies are often more volatile and less liquid than the stocks of larger companies and may be more affected than other types of securities during market downturns. Compared to larger companies, small capitalization companies may have a shorter history of operations, and may have limited product lines, markets or financial resources.
Tracking Error Risk. Tracking error is the divergence of a Fund’s performance from that of its Target Index. Tracking error may occur due to, among other things, fees and expenses paid by a Fund, including the cost of buying and selling securities, that are not reflected in its Target Index. If a Fund is small, it may experience greater tracking error. If a Fund is not fully invested, holding cash balances may prevent it from tracking its Target Index. In addition, a Fund’s NAV may deviate from its Target Index if such Fund fair values a portfolio security at a price other than the price used by its Target Index for that security. To the extent a Fund uses a representative sampling strategy to track its Target Index, such a strategy may produce greater tracking error than if the Fund employed a full replication strategy.
Volatility Risk. There is a risk that the present and future volatility of a security, relative to the market index, will not be the same as it historically has been and thus that a Fund’s Target Index will not be exposed to the less volatile securities in the index universe. Volatile stocks are subject to sharp swings in value.
12. Guarantees and Indemnifications
In the normal course of business, the Funds enter into contracts with third-party service providers that contain a variety of representations and warranties and that provide general indemnifications. Additionally, under the Funds’ organizational documents, the officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Funds. The Funds’ maximum exposure under these arrangements is unknown, as it involves possible future claims that may or may not be made against the Funds. The Adviser is of the view that the risk of loss to the Funds in connection with the Funds’ indemnification obligations is remote; however, there can be no assurance that such obligations will not result in material liabilities that adversely affect the Funds.
13. Subsequent Events
Management has evaluated subsequent events and transactions for potential recognition or disclosure through the date the financial statements were issued and has determined that there are no material events that would require disclosure in the Funds’ financial statements.
27
OSI ETF Trust
Expense Examples (Unaudited)
December 31, 2017
As a shareholder, you incur two types of costs: (1) transaction costs for purchasing and selling shares and (2) ongoing costs, including management fees, other operational and investment related expenses. The expense examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other funds.
Actual Expenses
The actual expense examples are based on an investment of $1,000 invested at the beginning of a six month period and held through the period ended December 31, 2017.
The first line in the following tables provides information about actual account values and actual expenses. You may use the information in this line, 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 in the first line under the heading “Expenses Paid During the Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The hypothetical expense examples are based on an investment of $1,000 invested at the beginning of a six month period and held through the period ended December 31, 2017.
The second line in the following tables provides information about hypothetical account values and hypothetical expenses based on the Funds’ actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Funds’ 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 the Funds 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 transaction costs, such as brokerage charges. Therefore, the second line for each Fund in the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
Beginning Account Value 07/01/17 | Ending Account Value 12/31/17 | Expenses Paid During the Period* | Annualized Expense Ratio During Period | ||||||||||||||
O’Shares FTSE Russell Small Cap Quality Dividend ETF | |||||||||||||||||
Actual | $ | 1,000.00 | $ | 1,077.90 | $ | 2.51 | 0.48 | % | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,022.79 | $ | 2.45 | 0.48 | % | |||||||||
O’Shares FTSE Russell International Quality Dividend ETF | |||||||||||||||||
Actual | $ | 1,000.00 | $ | 1,061.20 | $ | 2.49 | 0.48 | % | |||||||||
Hypothetical | $ | 1,000.00 | $ | 1,022.79 | $ | 2.45 | 0.48 | % |
* | Expenses are equal to the average account value over the period multiplied by the Fund’s annualized expense ratio, multiplied by 184 days in the most recent fiscal half-year divided by 365 days in the fiscal year (to reflect the one half year period). |
28
OSI ETF Trust
Additional Information (Unaudited)
Proxy Voting Information
A description of OSI ETF Trust’s proxy voting policies and procedures is attached to the Funds’ Statement of Additional Information, which is available without charge by visiting the Trust’s website at www.oshares.com or the Securities and Exchange Commission’s (“SEC”) SEC’s website at www.sec.gov or by calling collect 1-617-855-7670.
In addition, a description of how each Fund voted proxies relating to its portfolio securities during the most recent 12-month period ended June 30 will be available without charge upon request by calling collect 1-617-855-7670 or on the SEC’s website at www.sec.gov.
Quarterly Portfolio Holdings Information
OSI ETF Trust will file its complete schedule of portfolio holdings with the SEC for the first and third quarters on Form N-Q. The Form N-Q will be available on the SEC’s website at www.sec.gov. It may also be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. Information about the Public Reference Room may be obtained by calling 1-800-SEC-0330. In addition, the Funds’ full portfolio holdings are updated daily and available on the O’Shares Investment Funds’ website at www.oshares.com.
This report has been prepared for shareholders and may be distributed to others only if preceded or accompanied by a current prospectus.
29
OSI ETF Trust
60 State Street, Suite 700
Boston, MA 02109
www.oshares.com
Distributor:
Foreside Fund Services, LLC
3 Canal Plaza, Suite 100
Portland, ME 04101
Item 2. Code Of Ethics.
Disclosure required in Registrant’s annual Form N-CSR filing.
Item 3. Audit Committee Financial Expert.
Disclosure required in Registrant’s annual Form N-CSR filing.
Item 4. Principal Accountant Fees and Services.
Disclosure required in Registrant’s annual Form N-CSR filing.
Item 5. Audit Committee of Listed Registrants.
Disclosure required in Registrant’s annual Form N-CSR filing.
Item 6. Investments
(a) | Schedule I – Investments in Securities of Unaffiliated Issuers |
Not applicable. The complete schedule of investments is included in Item 1 of this Form N-CSR.
(b) | Securities Divested of in accordance with Section 13(c) of the Investment Company Act of 1940. |
The Registrant made no divestments of securities in accordance with Section 13(c) of the Investment Company Act of 1940.
Item 7. Disclosure Of Proxy Voting Policies And Procedures For Closed-End Management Investment Companies.
Not applicable to the Registrant.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable to the Registrant.
Item 9. Purchase Of Equity Securities By Closed-End Management Investment Company And Affiliated Purchasers.
Not applicable to the Registrant.
Item 10. Submission Of Matters To A Vote Of Security Holders.
The Registrant did not have in place procedures by which shareholders may recommend nominees to the Registrant’s board of trustees.
Item 11. Controls And Procedures.
(a) | The Registrant’s principal executive officer and principal financial officer have concluded, based on their evaluation of the registrant’s disclosure controls and procedures as conducted within 90 days of the filing date of this report, that those disclosure controls and procedures provide reasonable assurance that the material information required to be disclosed by the Registrant on this report is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. |
(b) | There were no changes in the Registrant’s internal control over financial reporting that occurred during the Registrant’s second fiscal half year covered by this report that have materially affected, or are 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 to the Registrant.
Item 13. Exhibits.
(a) | File the exhibits listed below as part of this Form. |
(a)(1) | Code of ethics – Not required for this filing. |
(a)(2) | Certifications pursuant to Rule 30a-2(a) under the 1940 Act and Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto. |
(a)(3) | Any written solicitation to purchase securities under Rule 23c-1 under the 1940 Act – Not applicable. |
(a)(4) | Change in the registrant’s independent public accountant – Not applicable. |
(b) | Certification required by Rule 30a-2(b) under the 1940 Act and Section 906 of the Sarbanes-Oxley Act of 2002 is attached hereto. |
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.
OSI ETF Trust
By: | /s/ Kevin Beadles |
Kevin Beadles
President
March 9, 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: | /s/ Kevin Beadles |
Kevin Beadles
President
March 9, 2018
By: | /s/ Joshua Hunter |
Joshua Hunter
Principal Financial Officer and Treasurer
March 9, 2018