SPDR
®
Series Trust
Prospectus
February 20, 2013
(as last supplemented August 16, 2013)
The U.S. Securities and Exchange Commission has not approved or disapproved these securities or passed upon the accuracy or adequacy of this Prospectus. Any
representation to the contrary is a criminal offense. Shares in the Funds are not guaranteed or insured by the Federal Deposit Insurance Corporation or any other agency of the U.S. Government, nor are shares deposits or obligations of any bank. Such
shares in the Funds involve investment risks, including the loss of principal.
SPDR Russell 1000
®
Low Volatility ETF (LGLV)
SPDR Russell 2000
®
Low Volatility ETF (SMLV)
Principal U.S. Listing Exchange for each ETF: NYSE Arca, Inc.
Precise in a world that
isnt.
SM
Precise in a world that
isnt.
SM
FUND SUMMARIES
SPDR Russell
1000
®
Low Volatility ETF
|
|
INVESTMENT OBJECTIVE
|
The SPDR Russell 1000 Low Volatility ETF (the Fund) seeks to provide investment results that, before fees
and expenses, correspond generally to the total return performance of a large cap, low volatility index.
|
FEES AND EXPENSES OF THE FUND
This table describes the fees and expenses that you may pay if you buy and hold shares of the Fund (Shares). This table and the example below do not reflect brokerage commissions you may pay on
purchases and sales of the Funds Shares.
|
|
|
|
|
ANNUAL FUND OPERATING EXPENSES
(expenses that you pay each year as a percentage of the value of
your investment):
|
MANAGEMENT FEES
|
|
0.20%
|
|
|
DISTRIBUTION AND SERVICE (12b-1) FEES (1)
|
|
0.00%
|
|
|
OTHER EXPENSES (2)
|
|
0.00%
|
|
|
TOTAL ANNUAL FUND OPERATING EXPENSES
|
|
0.20%
|
|
|
(1)
|
The Fund has adopted a Distribution and Service (12b-1) Plan pursuant to which payments of up to 0.25% of average daily net assets may be made; however, the Board has determined
that no such payments will be made through the next twelve (12) months of operation.
|
(2)
|
Other Expenses are based on estimated amounts for the current fiscal year.
|
EXAMPLE:
This example is intended to help you compare the cost of investing in the Fund with the cost of
investing in other mutual funds. The example assumes that you invest $10,000 in the Fund for the time periods indicated, and then sell all of your Shares at the end of those periods. The example also assumes that your investment has a 5% return each
year and that the Funds operating expenses remain the same. Although your actual costs may be higher or lower, based on these assumptions your costs would be:
PORTFOLIO TURNOVER:
The
Fund pays transaction costs, such as commissions, when it buys and sells securities (or turns over its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund Shares are
held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the example, affect the Funds performance.
THE FUNDS PRINCIPAL INVESTMENT STRATEGY
In seeking to track the performance of the Russell 1000
®
Low Volatility Index
(the Index), the Fund employs a sampling strategy, which means that the Fund is not required to purchase all of the securities represented in the Index. Instead, the Fund may purchase a subset of the securities in the Index in an effort
to hold a portfolio of securities with generally the same risk and return characteristics of the Index. The quantity of holdings in the Fund will be based on a number of factors, including asset size of the Fund. SSgA Funds Management, Inc.
(SSgA FM or the Adviser), the investment adviser to the Fund, generally expects the Fund to hold less than the total number of securities in the Index, but reserves the right to hold as many securities as it believes
necessary to achieve the Funds investment objective.
Under normal market conditions, the Fund generally invests substantially all, but at least
80%, of its total assets in the securities comprising the Index. The Fund will provide shareholders with at least 60 days notice prior to any material change in this 80% investment policy. In addition, the Fund may invest in equity securities that
are not included in the
|
|
|
Precise in a world that isnt.
SM
|
|
1
|
Index, cash and cash equivalents or money market instruments, such as repurchase agreements and money market funds (including money market funds advised by the Adviser).
The Index includes large cap U.S. equity securities and is designed to deliver exposure to low volatility. Volatility is a measure of a
securitys variability in total returns based on its historic behavior. A low volatility index is considered to have a lower return variability than the overall market and can be used by investors to adjust volatility exposure in a portfolio.
To construct the Index, the Index starts with the Russell 1000
®
Index, which measures the performance of the large cap
segment of the U.S. equity universe. The Index selects securities generally to deliver focused exposure to low volatility securities, while minimizing exposure to non-target factors. The Index contains no more than 200 securities and is
reconstituted monthly to maintain its focus on low volatility. Unlike more traditional equity market indexes which seek to track the performance of a specific segment of the equity market, the Index is intended to provide a specific factor exposure.
The Index is sponsored by Frank Russell Company (Russell or Index Provider). The Index Provider determines the composition and relative weightings of the securities in the Index and publishes information regarding the market
value of the Index. As of January 31, 2013, there were approximately 96 securities in the Index.
PRINCIPAL RISKS OF INVESTING IN THE FUND
As with all investments, there are certain risks of investing in the Fund, and you could lose money on an investment in the Fund.
PASSIVE STRATEGY/INDEX RISK:
The Fund is managed with a passive investment strategy, attempting to
track the performance of an unmanaged index of securities. This differs from an actively managed fund, which typically seeks to outperform a benchmark index. As a result, the Fund may hold constituent securities of the Index regardless of the
current or projected performance of a specific security or a particular industry or market sector. Maintaining investments in securities regardless of market conditions or the performance of individual securities could cause the Funds return
to be lower than if the Fund employed an active strategy.
INDEX TRACKING
RISK:
While the Adviser seeks to track the performance of the Index as closely as possible (i.e., achieve a high degree of correlation with the Index), the Funds return may not
match or achieve a high degree of correlation with the return of the Index due to operating expenses, transaction costs, cash flows, regulatory requirements and operational inefficiencies. For example, the Adviser anticipates that it may take
several business days for additions and deletions to the Index to be reflected in the portfolio composition of the Fund.
INDEX CONSTRUCTION RISK:
A stock included in the Index may not exhibit the factor trait or provide specific factor exposure for which it was
selected and consequently the Funds holdings may not exhibit a lower return variability than the overall market.
EQUITY INVESTING RISK:
An investment in the Fund involves risks similar to those of investing in any fund of equity securities, such as market
fluctuations, changes in interest rates and perceived trends in stock prices.
LARGE
CAP RISK:
Returns on investments in stocks of large U.S. companies could trail the returns on investments in stocks of smaller and mid-sized companies.
LOW VOLATILITY RISK:
Although
subject to the risks of common stocks, low volatility stocks are seen as having a lower risk profile than the overall markets. However, a portfolio comprised of low volatility stocks may not produce investment exposure that has lower variability to
changes in such stocks price levels.
CONCENTRATION RISK:
The Fund may invest a substantial portion of its assets within one or more economic sectors or industries, which may change from period to period. The Funds assets will generally be concentrated
in an industry or group of industries to the extent that the Funds underlying Index concentrates in a particular industry or group of industries. To the extent the Fund invests a substantial portion of its assets in one or more sectors, market
or economic factors impacting those sectors could have a significant effect on the value of the Funds investments. Additionally, the Funds performance may be more volatile when the Funds investments are less diversified across
sectors.
TURNOVER
RISK:
The Fund may have higher portfolio turnover than a fund that seeks to track a traditionally weighted index. A high rate of portfolio turnover could produce higher trading costs and
taxable distributions, which would detract from the Funds performance.
|
|
|
2
|
|
Precise in a world that
isnt.
SM
|
NON-DIVERSIFICATION RISK:
The Fund is non-diversified and may invest a larger percentage of its assets in securities of a few issuers or a single
issuer than that of a diversified fund. As a result, the Funds performance may be disproportionately impacted by the performance of relatively few securities.
FUND PERFORMANCE
The Fund has not yet completed a full calendar year of investment operations and therefore
does not have any performance history. Once the Fund has completed a full calendar year of operations, a bar chart and table will be included that will provide some indication of the risks of investing in the Fund by showing the variability of the
Funds returns based on net assets and comparing the Funds performance to the Index.
PORTFOLIO MANAGEMENT
INVESTMENT ADVISER
SSgA FM serves as the investment adviser to the Fund.
PORTFOLIO MANAGERS
The professionals primarily responsible
for the day-to-day management of the Fund are Mike Feehily and John Tucker.
MIKE FEEHILY,
CFA,
is a Senior Managing Director of the Adviser. He joined the Adviser in 1997, moved to State Street Global Markets LLC in 2006 and rejoined the Adviser in 2010.
JOHN TUCKER, CFA,
is a Senior Managing Director of the Adviser. He
joined the Adviser in 1988.
PURCHASE AND SALE INFORMATION
The Fund will issue (or redeem) Shares to certain institutional investors (typically market makers or other broker-dealers) only in large blocks of 50,000 Shares known as Creation Units. Creation Unit
transactions are typically conducted in exchange for the deposit or delivery of a designated portfolio of in-kind securities and/or cash.
Individual
Shares of the Fund may only be purchased and sold on the NYSE Arca, Inc., other national securities exchanges, electronic communication networks (ECNs) and other alternative trading systems through your broker-dealer at market prices.
Because Fund Shares trade at market prices rather than at net asset value (NAV), Shares may trade at a price greater than NAV (premium) or less than NAV (discount).
TAX INFORMATION
The Funds distributions are expected to be taxed as ordinary income and/or capital
gains, unless you are investing through a tax-deferred arrangement, such as a 401(k) plan or individual retirement account.
|
|
|
Precise in a world that isnt.
SM
|
|
3
|
SPDR Russell 2000
®
Low Volatility ETF
|
|
INVESTMENT OBJECTIVE
|
The SPDR Russell 2000 Low Volatility ETF (the Fund) seeks to provide investment results that, before fees
and expenses, correspond generally to the total return performance of a small cap, low volatility index.
|
FEES AND EXPENSES OF THE FUND
This table describes the fees and expenses that you may pay if you buy and hold shares of the Fund (Shares). This table and the example below do not reflect brokerage commissions you may pay on
purchases and sales of the Funds Shares.
|
|
|
|
|
ANNUAL FUND OPERATING EXPENSES
(expenses that you pay each year as a percentage of the value of your
investment):
|
MANAGEMENT FEES
|
|
0.25%
|
|
|
DISTRIBUTION AND SERVICE (12b-1) FEES (1)
|
|
0.00%
|
|
|
OTHER EXPENSES (2)
|
|
0.00%
|
|
|
TOTAL ANNUAL FUND OPERATING EXPENSES
|
|
0.25%
|
|
|
(1)
|
The Fund has adopted a Distribution and Service (12b-1) Plan pursuant to which payments of up to 0.25% of average daily net assets may be made; however, the Board has determined
that no such payments will be made through the next twelve (12) months of operation.
|
(2)
|
Other Expenses are based on estimated amounts for the current fiscal year.
|
EXAMPLE:
This example is intended to help you compare the cost of investing in the Fund with the cost of
investing in other mutual funds. The example assumes that you invest $10,000 in the Fund for the time periods indicated, and then sell all of your Shares at the end of those periods. The example also assumes that your investment has a 5% return each
year and that the Funds operating expenses remain the same. Although your actual costs may be higher or lower, based on these assumptions your costs would be:
PORTFOLIO TURNOVER:
The
Fund pays transaction costs, such as commissions, when it buys and sells securities (or turns over its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund Shares are
held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the example, affect the Funds performance.
THE FUNDS PRINCIPAL INVESTMENT STRATEGY
In seeking to track the performance of the Russell 2000
®
Low Volatility Index
(the Index), the Fund employs a sampling strategy, which means that the Fund is not required to purchase all of the securities represented in the Index. Instead, the Fund may purchase a subset of the securities in the Index in an effort
to hold a portfolio of securities with generally the same risk and return characteristics of the Index. The quantity of holdings in the Fund will be based on a number of factors, including asset size of the Fund. SSgA Funds Management, Inc.
(SSgA FM or the Adviser), the investment adviser to the Fund, generally expects the Fund to hold less than the total number of securities in the Index, but reserves the right to hold as many securities as it believes
necessary to achieve the Funds investment objective.
Under normal market conditions, the Fund generally invests substantially all, but at least
80%, of its total assets in the securities comprising the Index. The Fund will provide shareholders with at least 60 days notice prior to any material change in this 80% investment policy. In addition, the Fund may invest in equity securities that
are not included in the
|
|
|
4
|
|
Precise in a world that
isnt.
SM
|
Index, cash and cash equivalents or money market instruments, such as repurchase agreements and money market funds (including money market funds advised by the Adviser).
The Index includes small cap U.S. equity securities, including business development companies, and is designed to deliver exposure to low
volatility. Volatility is a measure of a securitys variability in total returns based on its historic behavior. A low volatility index is considered to have a lower return variability than the overall market and can be used by investors to
adjust volatility exposure in a portfolio. To construct the Index, the Index starts with the Russell 2000
®
Index, which
measures the performance of the small cap segment of the U.S. equity universe. The Index selects securities generally to deliver focused exposure to low volatility securities, while minimizing exposure to non-target factors. The Index contains no
more than 400 securities and is reconstituted monthly to maintain its focus on low volatility. Unlike more traditional equity market indexes which seek to track the performance of a specific segment of the equity market, the Index is intended to
provide a specific factor exposure. The Index is sponsored by Frank Russell Company (Russell or the Index Provider). The Index Provider determines the composition and relative weightings of the securities in the Index and
publishes information regarding the market value of the Index. As of January 31, 2013, there were approximately 165 securities in the Index.
PRINCIPAL RISKS OF INVESTING IN THE FUND
As with all investments, there are certain risks of investing in the Fund, and you could lose money on an investment in the Fund.
PASSIVE STRATEGY/INDEX RISK:
The Fund is managed with a passive investment strategy, attempting to
track the performance of an unmanaged index of securities. This differs from an actively managed fund, which typically seeks to outperform a benchmark index. As a result, the Fund may hold constituent securities of the Index regardless of the
current or projected performance of a specific security or a particular industry or market sector. Maintaining investments in securities regardless of market conditions or the performance of individual securities could cause the Funds return
to be lower than if the Fund employed an active strategy.
INDEX TRACKING
RISK:
While the Adviser seeks to track the performance of the Index as closely as possible (i.e., achieve a high degree of correlation with the Index), the Funds return may not
match or achieve a high degree of correlation with the return of the Index due to operating expenses, transaction costs, cash flows, regulatory requirements and operational inefficiencies. For example, the Adviser anticipates that it may take
several business days for additions and deletions to the Index to be reflected in the portfolio composition of the Fund.
INDEX CONSTRUCTION RISK:
A stock included in the Index may not exhibit the factor trait or provide specific factor exposure for which it was
selected and consequently the Funds holdings may not exhibit a lower return variability than the overall market.
EQUITY INVESTING RISK:
An investment in the Fund involves risks similar to those of investing in any fund of equity securities, such as market
fluctuations, changes in interest rates and perceived trends in stock prices.
SMALL
CAP RISK:
Small-sized companies may be more volatile and more likely than large- and mid-capitalization companies to have relatively limited product lines, markets or financial
resources, or depend on a few key employees. Returns on investments in stocks of small companies could trail the returns on investments in stocks of larger companies.
LOW VOLATILITY RISK:
Although subject to the risks of common stocks, low volatility stocks are seen
as having a lower risk profile than the overall markets. However, a portfolio comprised of low volatility stocks may not produce investment exposure that has lower variability to changes in such stocks price levels.
CONCENTRATION RISK:
The Fund may
invest a substantial portion of its assets within one or more economic sectors or industries, which may change from period to period. The Funds assets will generally be concentrated in an industry or group of industries to the extent that the
Funds underlying Index concentrates in a particular industry or group of industries. To the extent the Fund invests a substantial portion of its assets in one or more sectors, market or economic factors impacting those sectors could have a
significant effect on the value of the Funds investments. Additionally, the Funds performance may be more volatile when the Funds investments are less diversified across sectors.
|
|
|
Precise in a world that isnt.
SM
|
|
5
|
TURNOVER RISK:
The Fund may have higher portfolio turnover than a fund that seeks to track a traditionally weighted index. A high rate of portfolio
turnover could produce higher trading costs and taxable distributions, which would detract from the Funds performance.
NON-DIVERSIFICATION RISK:
The Fund is non-diversified and may invest a larger percentage of its assets in securities of a few issuers or a single
issuer than that of a diversified fund. As a result, the Funds performance may be disproportionately impacted by the performance of relatively few securities.
FUND PERFORMANCE
The Fund has not yet completed a full calendar year of investment operations and therefore
does not have any performance history. Once the Fund has completed a full calendar year of operations, a bar chart and table will be included that will provide some indication of the risks of investing in the Fund by showing the variability of the
Funds returns based on net assets and comparing the Funds performance to the Index.
PORTFOLIO MANAGEMENT
INVESTMENT ADVISER
SSgA FM serves as the investment adviser to the Fund.
PORTFOLIO MANAGERS
The professionals primarily responsible
for the day-to-day management of the Fund are Mike Feehily and John Tucker.
MIKE FEEHILY,
CFA,
is a Senior Managing Director of the Adviser. He joined the Adviser in 1997, moved to State Street Global Markets LLC in 2006 and rejoined the Adviser in 2010.
JOHN TUCKER, CFA,
is a Senior Managing Director of the Adviser. He
joined the Adviser in 1988.
PURCHASE AND SALE INFORMATION
The Fund will issue (or redeem) Shares to certain institutional investors (typically market makers or other broker-dealers) only in large blocks of 50,000 Shares known as Creation Units. Creation Unit
transactions are typically conducted in exchange for the deposit or delivery of a designated portfolio of in-kind securities and/or cash.
Individual
Shares of the Fund may only be purchased and sold on the NYSE Arca, Inc., other national securities exchanges, electronic communication networks (ECNs) and other alternative trading systems through your broker-dealer at market prices.
Because Fund Shares trade at market prices rather than at net asset value (NAV), Shares may trade at a price greater than NAV (premium) or less than NAV (discount).
TAX INFORMATION
The Funds distributions are expected to be taxed as ordinary income and/or capital
gains, unless you are investing through a tax-deferred arrangement, such as a 401(k) plan or individual retirement account.
|
|
|
6
|
|
Precise in a world that
isnt.
SM
|
ADDITIONAL STRATEGIES INFORMATION
PRINCIPAL STRATEGIES
GENERAL.
The Adviser seeks to track the performance of a Funds Index as closely as possible (i.e., obtain a high degree of correlation with the Index). A number of factors may affect a Funds ability
to achieve a high degree of correlation with its Index, and there can be no guarantee that a Fund will achieve a high degree of correlation.
The Adviser
intends to employ a sampling strategy in managing the Funds. Sampling means that the Adviser uses quantitative analysis to select securities, including securities in the Index, outside of the Index and derivatives, that have a similar investment
profile as the relevant Index in terms of key risk factors, performance attributes and other economic characteristics. These include industry weightings, market capitalization, and other financial characteristics of securities. The quantity of
holdings in each Fund will be based on a number of factors, including asset size of the Fund. In addition, from time to time, securities are added to or removed from each Index. The Adviser may sell securities that are represented in an Index or
purchase securities that are not yet represented in an Index, in anticipation of their removal from or addition to an Index. Further, the Adviser may choose to overweight securities in an Index, purchase or sell securities not in an Index, or
utilize various combinations of other available techniques, in seeking to track an Index.
The Board of Trustees of the Trust (the Board) may
change a Funds investment strategy, Index and other policies without shareholder approval, except as otherwise indicated in this Prospectus or in the SAI. Each Fund will provide shareholders with at least 60 days notice prior to changing its
Index. The Board may also change a Funds investment objective without shareholder approval.
NON-PRINCIPAL STRATEGIES
CERTAIN OTHER INVESTMENTS.
Each Fund may invest in
convertible securities, variable rate demand notes, commercial paper, structured notes (notes on which the amount of principal repayment and interest payments are based on the movement of one or more specified factors such as the movement of a
particular security or index), swaps and in options and futures contracts. Swaps, options and futures contracts, convertible securities and structured notes may be used by a Fund in seeking
performance that corresponds to its Index and in managing cash flows.
TEMPORARY DEFENSIVE POSITIONS
. In certain situations or market conditions, a Fund may temporarily depart from its normal investment policies and strategies
provided that the alternative is consistent with the Funds investment objective and is in the best interest of the Fund. For example, a Fund may invest in derivatives to maintain exposure to its Index if it is unable to invest directly in a
component security.
BORROWING MONEY.
Each
Fund may borrow money from a bank as permitted by the Investment Company Act of 1940, as amended (1940 Act) or other governing statute, by the Rules thereunder, or by the U.S. Securities and Exchange Commission (SEC) or other
regulatory agency with authority over the Fund, but only for temporary or emergency purposes. The 1940 Act presently allows a Fund to borrow from any bank (including pledging, mortgaging or hypothecating assets) in an amount up to 33 1/3% of its
total assets (not including temporary borrowings not in excess of 5% of its total assets). The Funds may also invest in reverse repurchase agreements, which are considered borrowings under the 1940 Act. Although there is no limit on the percentage
of Fund assets that can be used in connection with reverse repurchase agreements, the Funds do not expect to engage, under normal circumstances, in reverse repurchase agreements with respect to more than 33 1/3% of its total assets.
LENDING SECURITIES.
Each Fund may lend its portfolio
securities in an amount not to exceed one third (33 1/3%) of the value of its total assets via a securities lending program through its securities lending agent, State Street Bank and Trust Company (State Street or Lending
Agent), to brokers, dealers and other financial institutions desiring to borrow securities to complete transactions and for other purposes. A securities lending program allows a Fund to receive a portion of the income generated by lending its
securities and investing the respective collateral. A Fund will receive collateral for each loaned security which is at least equal to the market value of that security, marked to market each trading day. In the securities lending program, the
borrower generally has the right to vote the loaned securities, however a Fund may call loans to vote proxies if a material issue affecting the Funds economic interest in the investment is to be voted upon. Security loans may be terminated at
any time by a Fund.
|
|
|
Precise in a world that isnt.
SM
|
|
7
|
ADDITIONAL RISK INFORMATION
The following section provides additional information regarding certain of the principal risks identified under Principal Risks of Investing in the Fund in the Fund Summaries along with additional risk
information. Risk information is applicable to each Fund.
PRINCIPAL RISKS
CONCENTRATION.
A Funds assets will generally be concentrated in an industry or group of industries to
the extent that the Funds underlying Index concentrates in a particular industry or group of industries. By concentrating its assets in a single industry or group of industries, a Fund is subject to the risk that economic, political or other
conditions that have a negative effect on that industry or group of industries will negatively impact the Fund to a greater extent than if the Funds assets were invested in a wider variety of industries.
MARKET RISK:
An investment in a Fund involves risks
similar to those of investing in any fund, such as market fluctuations caused by such factors as economic and political developments, changes in interest rates and perceived trends in security prices. The values of equity securities could decline
generally or could underperform other investments. Different types of equity securities tend to go through cycles of out-performance and under- performance in comparison to the general securities markets. In addition, securities may decline in value
due to factors affecting a specific issuer, market or securities markets generally.
NON-PRINCIPAL RISKS
TRADING ISSUES.
Although the Shares of the Funds are
listed for trading on NYSE Arca, Inc. (the Exchange) and may be listed or traded on U.S. and non-U.S. stock exchanges other than the Exchange, there can be no assurance that an active trading market for such Shares will develop or be
maintained. Trading in Shares on the Exchange may be halted due to market conditions or for reasons that, in the view of the Exchange, make trading in Shares inadvisable. In addition, trading in Shares on the Exchange is subject to trading halts
caused by extraordinary market volatility pursuant to Exchange circuit breaker rules. There can be no assurance that the requirements of the Exchange necessary to maintain the listing of a Fund will continue to be met or will remain
unchanged or that the Shares will trade with any volume, or at all, on any stock exchange.
FLUCTUATION
OF NET ASSET VALUE.
The net asset value of the Shares will generally fluctuate with changes in the
market value of a Funds securities holdings. The market prices of Shares will generally fluctuate in accordance with changes in a Funds net asset value and supply and demand of Shares
on the Exchange. It cannot be predicted whether Shares will trade below, at or above their net asset value. Price differences may be due, in large part, to the fact that supply and demand forces at work in the secondary trading market for Shares
will be closely related to, but not identical to, the same forces influencing the prices of the securities of an Index trading individually or in the aggregate at any point in time. The market price of Shares may deviate significantly from the net
asset value of the Shares during periods of market volatility. However, given that Shares can be created and redeemed in Creation Units (unlike shares of many closed-end funds, which frequently trade at appreciable discounts from, and sometimes at
premiums to, their net asset value), the Adviser believes that large discounts or premiums to the net asset value of Shares should not be sustained over long periods. While the creation/redemption feature is designed to make it likely that Shares
normally will trade close to a Funds net asset value, disruptions to creations and redemptions or market volatility may result in trading prices that differ significantly from such Funds net asset value. If an investor purchases Shares
at a time when the market price is at a premium to the net asset value of the Shares or sells at a time when the market price is at a discount to the net asset value of the Shares, then the investor may sustain losses.
COSTS OF BUYING OR SELLING SHARES.
Investors buying or
selling Shares in the secondary market will pay brokerage commissions or other charges imposed by brokers as determined by that broker. Brokerage commissions are often a fixed amount and may be a significant proportional cost for investors seeking
to buy or sell relatively small amounts of Shares. In addition, secondary market investors will also incur the cost of the difference between the price that an investor is willing to pay for Shares (the bid price) and the price at which
an investor is willing to sell Shares (the ask price). This difference in bid and ask prices is often referred to as the spread or bid/ask spread. The bid/ask spread varies over time for Shares based on trading
volume and market liquidity, and is generally lower if a Funds Shares have more trading volume and market liquidity and higher if a Funds Shares have little trading volume and market liquidity. Further, increased market volatility may
cause increased bid/ask spreads. Due to the costs of buying or selling Shares, including bid/ask spreads, frequent trading of Shares may significantly reduce investment results
|
|
|
8
|
|
Precise in a world that
isnt.
SM
|
and an investment in Shares may not be advisable for investors who anticipate regularly making small investments.
LENDING OF SECURITIES.
Although the Funds are indemnified by the Lending Agent for losses incurred in
connection with a borrowers default with respect to a loan, the Funds bear the risk of loss of investing cash collateral and may be required to make payments to a borrower upon return of loaned securities if invested collateral has declined in
value. Furthermore, because of the risks in delay of recovery, a Fund may lose the opportunity to sell the securities at a desirable price, and the Fund will generally not have the right to vote securities while they are being loaned.
MONEY MARKET FUND INVESTMENTS.
Although money market
funds generally seek to preserve the value of their shares at $1.00 per share, it is possible that a Fund could lose money by investing in a money market fund. Investments in money market funds have traditionally not been and currently are not
federally insured.
DERIVATIVES.
A derivative
is a financial contract the value of which depends on, or is derived from, the value of a financial asset (such as stock, bond or currency), a physical asset (such as gold) or a market index (such as the S&P 500 Index). Each Fund may invest in
futures contracts and other derivatives. Compared to conventional securities, derivatives can be more sensitive to changes in interest rates or to sudden fluctuations in market prices and thus a Funds losses may be greater if it invests in
derivatives than if it invests only in conventional securities. Derivatives are also subject to credit risk because a Fund could lose money when a contracting party is unable to meet its contractual obligations in a timely manner or negative
perceptions of a contracting partys ability to meet its obligations cause the derivative to decline in value.
CONTINUOUS OFFERING.
The method by which Creation Units are purchased and traded may raise certain issues under applicable securities laws. Because new
Creation Units are issued and sold by each Fund on an ongoing basis, at any point a distribution, as such term is used in the Securities Act of 1933 (the Securities Act) may occur.
Broker-dealers and other persons are cautioned that some activities on their part may, depending on the circumstances, result in their being deemed participants in
a distribution in a manner which could render them statutory underwriters and subject them to the prospectus delivery and liability provisions of the Securities Act.
For example, a broker-dealer firm or its client may be deemed a statutory underwriter if it takes Creation Units
after placing an order with the principal underwriter, breaks them down into individual Shares, and sells such Shares directly to customers, or if it chooses to couple the creation of a supply of new Shares with an active selling effort involving
solicitation of secondary market demand for Shares. A determination of whether one is an underwriter for purposes of the Securities Act must take into account all the facts and circumstances pertaining to the activities of the broker-dealer or its
client in the particular case, and the examples mentioned above should not be considered a complete description of all the activities that could lead to categorization as an underwriter.
Broker-dealer firms should also note that dealers who are not underwriters but are effecting transactions in Shares, whether or not participating in the distribution of Shares, are generally required to
deliver a prospectus or summary prospectus. This is because the prospectus delivery exemption in Section 4(3) of the Securities Act is not available with respect to such transactions as a result of Section 24(d) of the 1940 Act.
|
|
|
Precise in a world that isnt.
SM
|
|
9
|
MANAGEMENT
ADVISER.
SSgA FM serves as the investment adviser to each Fund and, subject to the supervision of the
Board, is responsible for the investment management of the Funds. The Adviser provides an investment management program for each Fund and manages the investment of the Funds assets. The Adviser and other affiliates of State Street Corporation
make up State Street Global Advisors (SSgA), the investment management arm of State Street Corporation. As of December 31, 2012, the Adviser managed approximately $264.87 billion in assets and SSgA managed approximately $2.09
trillion in assets. The Advisers principal business address is State Street Financial Center, One Lincoln Street, Boston, Massachusetts 02111.
For the services provided to each Fund under the Investment Advisory Agreement, each Fund expects to pay the Adviser the annual fees based on a percentage of the Funds average daily net assets as set forth
below:
|
|
|
|
|
SPDR Russell 1000 Low Volatility ETF
|
|
|
0.20
|
%
|
SPDR Russell 2000 Low Volatility ETF
|
|
|
0.25
|
%
|
From time to time, the Adviser may waive all or a portion of its fee, although it does not currently intend to do so. The Adviser
pays all expenses of each Fund other than the management fee, distribution fee pursuant to each Funds Distribution and Service Plan, if any, brokerage, taxes, interest, fees and expenses of the Independent Trustees (including any
Trustees counsel fees), litigation expenses, acquired fund fees and expenses and other extraordinary expenses.
A discussion regarding the
Boards consideration of the Investment Advisory Agreement will be available in the Trusts Annual Report to Shareholders for the period ended June 30, 2013.
The Adviser and the Trust are seeking an exemptive order from the SEC that will permit the Adviser, with the approval of the Independent Trustees of the Trust, to retain and amend existing sub-advisory agreements
with unaffiliated investment sub-advisers for the Funds without submitting the sub-advisory agreement to a vote of the respective Funds shareholders. The Trust will notify shareholders in the event of any change in the identity of such
sub-adviser or sub-advisers. The Adviser has ultimate responsibility for the investment performance of the Funds due to its responsibility to oversee each sub-adviser and recommend their hiring, termination and replacement. If the exemptive relief
is obtained, the Adviser will not be required to disclose fees
paid to sub-advisers. Approval by a Funds shareholders would be required before any authority granted under an exemptive order could be exercised.
PORTFOLIO MANAGERS.
The Adviser manages the Funds using a
team of investment professionals. The team approach is used to create an environment that encourages the flow of investment ideas. The portfolio managers within each team work together in a cohesive manner to develop and enhance techniques that
drive the investment process for the respective investment strategy. This approach requires portfolio managers to share a variety of responsibilities including investment strategy and analysis while retaining responsibility for the implementation of
the strategy within any particular portfolio. The approach also enables the team to draw upon the resources of other groups within SSgA. Each portfolio management team is overseen by the SSgA Investment Committee.
The professionals primarily responsible for the day-to-day management of each Fund are:
MIKE FEEHILY.
Mr. Feehily, CFA, is a Senior Managing Director of SSgA and the Adviser and Co-Head of
Passive Equity Strategies in North America in the Global Equity Beta Solutions Group. In this capacity, Mr. Feehily has oversight of the North American Passive Equity teams in Boston and Montreal. In addition, Mr. Feehily is a member of
the Senior Management Group. Mr. Feehily rejoined SSgA in 2010 after spending the previous four years at State Street Global Markets LLC, where he helped to build the Exposure Solutions business. This group created and managed portfolios that
were designed to meet the short-term market exposure needs of institutional clients. Prior to this, Mr. Feehily had been Head of the US Passive Equity Team within SSgA. He joined SSgA in 1997. Mr. Feehily received a Bachelor of Science
Degree from Babson College in Finance, Investments, and Economics. He received an MBA in Finance from Bentley College and also earned the Chartered Financial Analyst designation. He is a member of the Boston Security Analysts Society and the CFA
Institute. Mr. Feehily is also a former member of the Russell Index Client Advisory Board.
JOHN
TUCKER.
Mr. Tucker, CFA, is a Senior Managing Director of SSgA and the Adviser and Co-Head of Passive Equity Strategies in North America in the Global Equity Beta Solutions Group. He
joined the firm in 1988 and is responsible for overseeing the management of all equity index strategies and Exchange Traded Funds managed in North America. He is a member of the Senior Management Group. Previously, Mr. Tucker was head of
|
|
|
10
|
|
Precise in a world that
isnt.
SM
|
the Structured Products Group in SSgAs London office where he was responsible for the management of all index strategies in SSgAs second largest investment center. Mr. Tucker
received a BA in Economics from Trinity College and an MS in Finance from Boston College. He is a member of the Boston Security Analysts Society and the CFA Institute.
Additional information about the portfolio managers compensation, other accounts managed by the portfolio managers, and the portfolio managers ownership of securities in the Funds is available in the
SAI.
ADMINISTRATOR, CUSTODIAN AND TRANSFER
AGENT.
State Street, part of State Street Corporation, is the Administrator for the Funds, the Custodian for each Funds assets and serves as Transfer Agent to the Funds.
LENDING AGENT.
State Street is the securities lending
agent for the Trust. For its services, the lending agent would typically receive a portion of the net investment income, if any, earned on the collateral for the securities loaned.
DISTRIBUTOR.
State Street Global Markets, LLC (the Distributor), part of State Street
Corporation, is the distributor of the Funds Shares. The Distributor will not distribute Shares in less than Creation Units, and it does not maintain a secondary market in the Shares. The Distributor may enter into selected dealer agreements
with other broker-dealers or other qualified financial institutions for the sale of Creation Units of Shares.
INDEX/TRADEMARK
LICENSES/DISCLAIMERS
The Index Provider is not affiliated with the Trust, the Adviser, the Funds administrator, custodian, transfer agent or
distributor, or any of their respective affiliates. The Adviser (Licensee) has entered into a license agreement with the Index Provider pursuant to which the Adviser pays a fee to use its Indexes. The Adviser is sub-licensing rights to
the Indexes to the Funds at no charge.
The Products are not sponsored, endorsed, sold or promoted by Russell Investment Group
(Russell). Russell makes no representation or warranty, express or implied, to the owners of the Products or any member of the public regarding the advisability of investing in securities generally or in the Products particularly or the
ability of the Russell 1000
®
Low Volatility Index and Russell 2000
®
Low Volatility Index to track general stock
market performance or a segment of the same. Russells publication of the Russell 1000 Low Volatility Index and Russell 2000 Low Volatility Index in no way suggests or implies an opinion by
Russell as to the advisability of investment in any or all of the securities upon which the Russell 1000 Low Volatility Index and Russell 2000 Low Volatility Index are based. Russells only relationship to the SPDR Russell 1000 Low Volatility
ETF and SPDR Russell 2000 Low Volatility ETF is the licensing of certain trademarks and trade names of Russell and of the Russell 1000 Low Volatility Index and Russell 2000 Low Volatility Index which is determined, composed and calculated by Russell
without regard to the SPDR Russell 1000 Low Volatility ETF and SPDR Russell 2000 Low Volatility ETF or the Products. Russell is not responsible for and has not reviewed the Products nor any associated literature or publications and Russell makes no
representation or warranty express or implied as to their accuracy or completeness, or otherwise. Russell reserves the right, at any time and without notice, to alter, amend, terminate or in any way change the Russell 1000 Low Volatility Index and
Russell 2000 Low Volatility Index. Russell has no obligation or liability in connection with the administration, marketing or trading of the Products.
RUSSELL DOES NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF ANY OF THE INDEXES OR ANY DATA INCLUDED THEREIN AND RUSSELL SHALL HAVE NO LIABILITY FOR ANY
ERRORS, OMISSIONS, OR INTERRUPTIONS THEREIN. RUSSELL MAKES NO WARRANTY, EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED BY THE FUNDS, INVESTORS, OWNERS OF THE PRODUCTS, OR ANY OTHER PERSON OR ENTITY FROM THE USE OF ANY OF THE INDEXES OR ANY DATA
INCLUDED THEREIN. RUSSELL MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIMS ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO ALL OF THE INDEXES OR ANY DATA INCLUDED THEREIN. WITHOUT LIMITING
ANY OF THE FOREGOING, IN NO EVENT SHALL RUSSELL HAVE ANY LIABILITY FOR ANY SPECIAL, PUNITIVE, INDIRECT, OR CONSEQUENTIAL DAMAGES (INCLUDING LOST PROFITS), EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES.
SPDR TRADEMARK
The SPDR trademark is used under
license from Standard & Poors Financial Services LLC. No Fund offered by the Trust or its affiliates is sponsored,
|
|
|
Precise in a world that isnt.
SM
|
|
11
|
endorsed, sold or promoted by S&P or its affiliates. S&P makes no representation or warranty, express or implied, to the owners of the Funds or any member of the public regarding the
advisability of investing in securities generally or in the Funds particularly or the ability of the index on which the Funds are based to track general stock market performance. S&P is not responsible for and has not participated in any
determination or calculation made with respect to issuance or redemption of financial the Funds. S&P has no obligation or liability in connection with the administration, marketing or trading of the Funds.
WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL S&P OR ITS AFFILIATES HAVE ANY LIABILITY FOR ANY SPECIAL, PUNITIVE, INDIRECT, OR CONSEQUENTIAL DAMAGES
(INCLUDING, BUT NOT LIMITED TO, LOST PROFITS), EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES.
ADDITIONAL PURCHASE AND
SALE INFORMATION
The Shares are listed for secondary trading on the Exchange and individual Fund Shares may only be purchased and sold in the secondary
market through a broker-dealer. The secondary markets are closed on weekends and also are generally closed on the following holidays: New Years Day, Dr. Martin Luther King, Jr. Day, Presidents Day, Good Friday, Memorial Day
(observed), Independence Day, Labor Day, Thanksgiving Day and Christmas Day. The Exchange may close early on the business day before certain holidays and on the day after Thanksgiving Day. Exchange holiday schedules are subject to change without
notice. If you buy or sell Shares in the secondary market, you will pay the secondary market price for Shares. In addition, you may incur customary brokerage commissions and charges and may pay some or all of the spread between the bid and the
offered price in the secondary market on each leg of a round trip (purchase and sale) transaction.
The trading prices of a Funds Shares will
fluctuate continuously throughout trading hours based on market supply and demand rather than the Funds net asset value, which is calculated at the end of each business day. The Shares will trade on the Exchange at prices that may be above
(i.e., at a premium) or below (i.e., at a discount), to varying degrees, the daily net asset value of the Shares. The trading prices of a Funds Shares may deviate significantly from its net asset value during periods of market volatility.
Given, however, that Shares
can be issued and redeemed daily in Creation Units, the Adviser believes that large discounts and premiums to net asset value should not be sustained over long periods. Information showing the
number of days the market price of a Funds Shares was greater than the Funds net asset value and the number of days it was less than the Funds net asset value (i.e., premium or discount) for various time periods is available by
visiting the Funds website at
http://www.spdrs.com
.
The Exchange will disseminate, every fifteen seconds during the regular trading day, an
indicative optimized portfolio value (IOPV) relating to the Funds. The IOPV calculations are estimates of the value of the Funds net asset value per Share using market data converted into U.S. dollars at the current currency rates.
The IOPV price is based on quotes and closing prices from the securities local market and may not reflect events that occur subsequent to the local markets close. Premiums and discounts between the IOPV and the market price may occur.
This should not be viewed as a real-time update of the net asset value per Share of the Funds, which is calculated only once a day. Neither the Funds, nor the Adviser or any of their affiliates are involved in, or responsible for, the
calculation or dissemination of such IOPVs and make no warranty as to their accuracy.
The Funds do not impose any restrictions on the frequency of
purchases and redemptions; however, the Funds reserve the right to reject or limit purchases at any time as described in the SAI. When considering that no restriction or policy was necessary, the Board evaluated the risks posed by market timing
activities, such as whether frequent purchases and redemptions would interfere with the efficient implementation of a Funds investment strategy, or whether they would cause a Fund to experience increased transaction costs. The Board considered
that, unlike traditional mutual funds, Fund Shares are issued and redeemed only in large quantities of Shares known as Creation Units available only from a Fund directly, and that most trading in a Fund occurs on the Exchange at prevailing market
prices and does not involve the Fund directly. Given this structure, the Board determined that it is unlikely that (a) market timing would be attempted by a Funds shareholders or (b) any attempts to market time a Fund by shareholders
would result in negative impact to a Fund or its shareholders.
OTHER CONSIDERATIONS
DISTRIBUTION AND SERVICE PLAN.
Each Fund has adopted a
Distribution and Service Plan in accordance with
|
|
|
12
|
|
Precise in a world that
isnt.
SM
|
Rule 12b-1 under the 1940 Act pursuant to which payments of up to 0.25% of the Funds average daily net assets may be made for the sale and distribution of its Shares. No payments
pursuant to the Distribution and Service Plan will be made through at least the next twelve (12) months of operations. Additionally, the implementation of any such payments would have to be approved by the Board prior to implementation. Because
these fees would be paid out of each Funds assets on an on-going basis, if payments are made in the future, these fees will increase the cost of your investment and may cost you more than paying other types of sales charges.
DISTRIBUTIONS
DIVIDENDS AND CAPITAL GAINS.
As a Fund shareholder, you are entitled to your share of a Funds income and net realized gains on its investments. Each
Fund pays out substantially all of its net earnings to its shareholders as distributions.
Each Fund typically earns income dividends from
stocks, interest from debt securities and, if participating, securities lending income. These amounts, net of expenses and taxes (if applicable), are passed along to Fund shareholders as income dividend distributions. Each Fund realizes
capital gains or losses whenever it sells securities. Net long-term capital gains are distributed to shareholders as capital gain distributions.
Income dividend distributions, if any, are generally distributed to shareholders quarterly, but may vary significantly from period to period. Net capital gains for the Funds are distributed at least annually.
Dividends may be declared and paid more frequently or at any other times to improve Index tracking or to comply with the distribution requirements of the Internal Revenue Code of 1986, as amended (the Code).
Each of the Funds intends to distribute at least annually amounts representing the full dividend yield net of expenses on the underlying investment securities as if
the Fund owned the underlying investment securities for the entire dividend period. As a result, some portion of each distribution may result in a return of capital. You will be notified regarding the portion of the distribution which represents a
return of capital.
Distributions in cash may be reinvested automatically in additional whole Shares only if the broker through whom you purchased Shares
makes such option available. Distributions which are reinvested will nevertheless be taxable to the same extent as if such distributions had not been reinvested.
PORTFOLIO HOLDINGS
A description of the Trusts policies and procedures with respect to the disclosure of each Funds portfolio securities is available in the SAI.
ADDITIONAL TAX INFORMATION
As with any investment, you should consider how your Fund
investment will be taxed. The tax information in this Prospectus is provided as general information. You should consult your own tax professional about the tax consequences of an investment in a Fund.
Unless your investment in the Funds is through a tax-exempt entity or tax deferred retirement account, such as a 401(k) plan, you need to be aware of the possible
tax consequences when:
|
A Fund makes distributions;
|
|
You sell Shares listed on the Exchange; and
|
|
You create or redeem Creation Units.
|
TAXES ON DISTRIBUTIONS.
In general, your distributions are subject to federal income tax when they are paid, whether you take them in cash or reinvest them
in a Fund. The income dividends and short-term capital gains distributions you receive from the Funds will be taxed as either ordinary income or qualified dividend income. Dividends that are reported by a Fund as qualified dividend income will be
taxable to noncorporate shareholders at rates of up to 20%. Any distributions of the excess of a Funds net long-term capital gain over its net short-term capital loss are taxable as long-term capital gain regardless of how long you have owned
your Shares. Long-term capital gains are taxed to noncorporate shareholders at rates of up to 20%. Distributions in excess of a Funds current and accumulated earnings and profits are treated as a tax-free return of capital to the extent of
your basis in the Shares, and as capital gain thereafter.
Dividends may be reported by a Fund as qualified dividend income if they are attributable to
qualified dividend income received by the Fund, which, in general, includes dividend income from taxable U.S. corporations and certain foreign corporations (e.g., foreign corporations incorporated in a possession of the United States or in
certain countries with a comprehensive tax treaty with the United States, or the stock of which is readily tradable on an established securities market in the United States), provided that the Fund satisfies certain holding period requirements in
respect of the stock of
|
|
|
Precise in a world that isnt.
SM
|
|
13
|
such corporations and has not hedged its position in the stock in certain ways. A dividend generally will not be treated as qualified dividend income if the dividend is received with respect to
any share of stock held by a Fund for fewer than 61 days during the 121-day period beginning at the date which is 60 days before the date on which such share becomes ex-dividend with respect to such dividend or, in the case of certain
preferred stock, for fewer than 91 days during the 181-day period beginning 90 days before such date. These holding period requirements will also apply to your ownership of Fund Shares. Holding periods may be suspended for these purposes
for stock that is hedged.
U.S. individuals with income exceeding $200,000 ($250,000 if married and filing jointly), are also subject to a 3.8%
Medicare contribution tax on their net investment income, which includes taxable interest, dividends and capital gains (including capital gains realized upon the sale or exchange of Fund Shares). This 3.8% tax also applies to all or
a portion of the undistributed net investment income of certain shareholders that are estates and trusts.
If the Fund redeems Creation Units in cash, it
may recognize more capital gains than it will if it redeems Creation Units in-kind.
If you lend your Fund Shares pursuant to securities lending
arrangements you may lose the ability to treat Fund dividends (paid while the Shares are held by the borrower) as qualified dividend income. You should consult your financial intermediary or tax advisor to discuss your particular circumstances.
Distributions paid in January, but declared by a Fund in October, November or December of the previous year, payable to shareholders of record in such a
month, may be taxable to you in the calendar year in which they were declared. The Funds will inform you of the amount of your ordinary income dividends, qualified dividend income and capital gain distributions shortly after the close of each
calendar year.
A distribution will reduce a Funds net asset value per Share and may be taxable to you as ordinary income or capital gain even
though, from an investment standpoint, the distribution may constitute a return of capital.
DERIVATIVES
AND OTHER COMPLEX SECURITIES.
Each Fund may invest in complex securities. These investments may be subject to numerous special and complex rules. These rules could affect whether gains and
losses recognized by a Fund are treated as ordinary income or capital gain, accelerate the recognition of income to the
Fund and/or defer the Funds ability to recognize losses. In turn, these rules may affect the amount, timing or character of the income distributed to you by a Fund.
TAXES ON EXCHANGE-LISTED SHARE SALES.
Any capital gain or
loss realized upon a sale of Shares is generally treated as long-term capital gain or loss if the Shares have been held for more than one year and as short-term capital gain or loss if the Shares have been held for one year or less, except that any
capital loss on the sale of Shares held for six months or less is treated as long-term capital loss to the extent that capital gain dividends were paid with respect to such Shares.
TAXES ON CREATIONS AND REDEMPTIONS OF CREATION UNITS.
A person who exchanges securities for Creation Units
generally will recognize a gain or loss. The gain or loss will be equal to the difference between the market value of the Creation Units at the time and the exchangers aggregate basis in the securities surrendered plus any cash paid for the
Creation Units. A person who exchanges Creation Units for securities will generally recognize a gain or loss equal to the difference between the exchangers basis in the Creation Units and the aggregate market value of the securities and the
amount of cash received. The Internal Revenue Service, however, may assert that a loss realized upon an exchange of securities for Creation Units cannot be deducted currently under the rules governing wash sales, or on the basis that
there has been no significant change in economic position. Persons exchanging securities should consult their own tax advisor with respect to whether wash sale rules apply and when a loss might be deductible.
Under current federal tax laws, any capital gain or loss realized upon a redemption of Creation Units is generally treated as long-term capital gain or loss if the
Shares have been held for more than one year and as a short-term capital gain or loss if the Shares have been held for one year or less.
If you create
or redeem Creation Units, you will be sent a confirmation statement showing how many Shares you purchased or sold and at what price.
CERTAIN TAX EXEMPT INVESTORS.
A Fund, if investing in certain limited real estate investments and other publicly traded partnerships, may be required to
pass- through certain excess inclusion income and other income as unrelated business taxable income (UBTI). Prior to investing in a Fund, tax-exempt investors sensitive to UBTI should consult their tax advisors
regarding this issue and recent IRS pronouncements addressing the treatment of such income in the hands of such investors.
|
|
|
14
|
|
Precise in a world that
isnt.
SM
|
NON-U.S.
INVESTORS.
Ordinary income dividends paid by a Fund to shareholders who are nonresident aliens or foreign entities (other than, for tax years of the Fund ending on or before December 31,
2013, the Funds interest-related dividends and short-term capital gain dividends) will generally be subject to a 30% U.S. withholding tax, unless a lower treaty rate applies or unless such income is effectively connected with a
U.S. trade or business. In general, a Fund may report interest-related dividends to the extent of its net income derived from U.S.-source interest, and a Fund may report short-term capital gain dividends to the extent its net short-term capital
gain for the taxable year exceeds its net long-term capital loss. Gains on the sale of Shares and dividends that are effectively connected with the conduct of a trade or business within the U.S. will generally be subject to U.S. federal
net income taxation at regular income tax rates. Non-U.S. shareholders that own, directly or indirectly, more than 5% of Fund Shares are urged to consult their own tax advisors concerning special tax rules that may apply to their
investments.
Unless certain non-U.S. entities that hold Shares comply with IRS requirements that will generally require them to report information
regarding U.S. persons investing in, or holding accounts with, such entities, a 30% withholding tax may apply to Fund distributions payable to such entities after December 31, 2013 (or, in certain cases, after later dates) and redemption proceeds
and certain capital gain dividends payable to such entities after December 31, 2016. A non-U.S. shareholder may be exempt from the withholding described in this paragraph under an applicable intergovernmental agreement between the U.S. and a foreign
government, provided that the shareholder and the applicable foreign government comply with the terms of the agreement.
BACKUP WITHHOLDING.
A Fund will be required in certain cases to withhold (as backup withholding) on amounts payable to any shareholder who (1)
has provided the Fund either an incorrect tax identification number or no number at all, (2) is subject to backup withholding by the Internal Revenue Service for failure to properly report payments of interest or dividends, (3) has failed to certify
to the Fund that such shareholder is not subject to backup withholding, or (4) has not certified that such shareholder is a U.S. person (including a U.S. resident alien). The backup withholding rate is 28%. Backup withholding will not be applied to
payments that have been subject to the 30% withholding tax on shareholders who are neither citizens nor permanent residents of the U.S.
The foregoing discussion summarizes some of the consequences under current federal income tax law of an investment in
the Funds. It is not a substitute for personal tax advice. Consult your personal tax advisor about the potential tax consequences of an investment in the Funds under all applicable tax laws.
GENERAL INFORMATION
The Trust was organized as a Massachusetts business trust on
June 12, 1998. If shareholders of any Fund are required to vote on any matters, shareholders are entitled to one vote for each Share they own. Annual meetings of shareholders will not be held except as required by the 1940 Act and other
applicable law. See the SAI for more information concerning the Trusts form of organization.
For purposes of the 1940 Act, Shares of the Trust are
issued by the respective series of the Trust and the acquisition of Shares by investment companies is subject to the restrictions of section 12(d)(1) of the 1940 Act. The Trust has received exemptive relief from Section 12(d)(1) to allow
registered investment companies to invest in the Funds beyond the limits set forth in Section 12(d)(1), subject to certain terms and conditions as set forth in an SEC exemptive order issued to the Trust, including that such investment companies
enter into an agreement with the Trust.
From time to time, a Fund may advertise yield and total return figures. Yield is a historical measure of
dividend income, and total return is a measure of past dividend income (assuming that it has been reinvested) plus capital appreciation. Neither yield nor total return should be used to predict the future performance of a Fund.
Bingham McCutchen LLP serves as counsel to the Trust, including the Funds. Ernst & Young LLP serves as the independent registered public accounting firm
and will audit the Funds financial statements annually.
PREMIUM/DISCOUNT INFORMATION
The Funds had not commenced operations prior to the date of this Prospectus and therefore do not have information regarding how often the Shares of each Fund traded
on the Exchange at a price above (i.e., at a premium) or below (i.e., at a discount) the net asset value of the Fund during the past calendar year. When available, such information will be provided at
http://www.spdrs.com
.
|
|
|
Precise in a world that isnt.
SM
|
|
15
|
FINANCIAL HIGHLIGHTS
The Funds had not commenced operations prior to the date of this Prospectus and therefore do not have financial information.
|
|
|
16
|
|
Precise in a world that
isnt.
SM
|
WHERE TO LEARN MORE ABOUT
THE FUNDS
This Prospectus does not contain all the information included in the Registration Statement filed with the SEC with respect to the Funds
Shares. An SAI is on file with the SEC and provides more information about the Funds. The SAI is incorporated herein by reference (i.e., it is legally part of this Prospectus). These materials may be obtained without charge, upon request, by writing
to the Distributor, State Street Global Markets, LLC, State Street Financial Center, One Lincoln Street, Boston, Massachusetts 02111, by visiting the Funds website at
http://www.spdrs.com
or by calling the following number:
INVESTOR INFORMATION: 1-866-787-2257
The
Registration Statement, including this Prospectus, the SAI, and the exhibits as well as any shareholder reports may be reviewed and copied at the SECs Public Reference Room (100 F Street NE, Washington D.C. 20549) or on the EDGAR Database on
the SECs website (http://www.sec.gov). Information on the operation of the public reference room may be obtained by calling the SEC at 1-202-942- 8090. You may get copies of this and other information after paying a duplicating fee, by
electronic request at the following e-mail address: publicinfo@sec.gov, or by writing the Public Reference Section of the SEC, Washington, D.C. 20549-1520.
Shareholder inquiries may be directed to the Funds in writing to State Street Global Markets, LLC, State Street Financial Center, One Lincoln Street, Boston, Massachusetts 02111 or by calling the Investor
Information number listed above.
No person has been authorized to give any information or to make any representations other than those contained in
this Prospectus in connection with the offer of each Funds Shares, and, if given or made, the information or representations must not be relied upon as having been authorized by the Trust or the Funds. Neither the delivery of this Prospectus
nor any sale of Shares shall under any circumstance imply that the information contained herein is correct as of any date after the date of this Prospectus.
Dealers effecting transactions in the Funds Shares, whether or not participating in this distribution, are generally required to deliver a Prospectus. This is in addition to any obligation of dealers to
deliver a Prospectus when acting as underwriters.
|
|
|
SPDRRUSSELLPRO
|
|
The Trusts Investment Company Act Number is 811-08839.
|
Aly Energy Services (GM) (USOTC:ALYE)
Historical Stock Chart
From Jun 2024 to Jul 2024
Aly Energy Services (GM) (USOTC:ALYE)
Historical Stock Chart
From Jul 2023 to Jul 2024