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• The Teucrium 2x Daily Wheat ETF (NYSE: WXET).
Each fund seeks to provide 200% of the daily performance of corn futures or wheat futures, respectively, allowing an opportunity to amplify market exposure through a traditional brokerage account.
“Corn and wheat are among most widely traded agricultural commodities in the world, and their supply and demand patterns are often driven by factors that can arise unexpectedly, such as weather and geopolitics, making each an active and dynamic commodity for traders,” said Sal Gilbertie, Chief Executive Officer with Teucrium. “Now, with CXRN and WXET, ETF investors have the opportunity to trade with leveraged exposure to these commodities, and they can do so via ETFs from Teucrium, where we have made agricultural commodities our core focus since our founding in 2010.”
CXRN joins CORN in the Teucrium ETF family, providing exposure to the price of corn futures, while WXET joins WEAT. The launch of these two new funds brings the total Teucrium agricultural commodity ETF lineup to eight funds.
“Adding leveraged ETFs for corn and wheat provides active traders with additional tools through which to express their views on these commodities,” added Gilbertie. “We’re very pleased to be launching these funds and look forward to educating the marketplace about the roles they can play in portfolios and trading strategies.”
1 Based on trading volume data www.cme.com
2 Measured by AUM, 3 of the top 5 Agricultural Commodity ETFs are Teucrium funds according to Bloomberg 12/02/2024. For terminal users “ETF
Teucrium Trading, LLC. sponsors these three funds which are registered as partnerships under the Securities act of 1933 and are not clients of Teucrium Investment Advisors. CXRN and WXET are clients of Teucrium Investment Advisors, LLC which is wholly owned by Teucrium Trading, LLC.
For more information on Teucrium, please visit teucrium.com.
About Teucrium Investment Advisors, LLC
Teucrium is a provider of exchange-traded funds (ETFs) that focuses on offering investment products primarily in the agriculture and commodities sectors. The company also provides White-Label ETF services, allowing partners to create customized ETF products. For more information, visit www.Teucrium.com.
An investor should consider the investment objectives, risks, charges, and expenses of the Funds carefully before investing. The prospectus and, if available, the summary prospectus contain this and other information about the Funds. You may obtain a prospectus and, if available, a summary prospectus by calling 720-651-8092 or visiting www.teucrium.com. Please read the prospectus or summary prospectus carefully before investing.
Important Disclosures and Risks
The Funds are recently organized investment companies with a limited operating history. As a result, prospective investors have a limited track record or history on which to base their investment decision. The Funds carry distinct risks, using leverage that makes them riskier than similar funds without leverage. These funds may not be suitable for all investors and should only be considered by knowledgeable investors who understand the effects of compounding and daily leveraged (2x) investment returns. Designed for short-term trading, the Funds require active, frequent (even daily) management and are unsuitable for investors who do not actively monitor and manage their portfolio. Investors could lose the full principal value of their investment in a single day. For periods longer than a single day, the Funds’ returns will be based on daily returns compounded over time, likely differing in amount and possibly direction from the Funds’ stated 2x multiple of the underlying futures market’s daily changes. If the underlying futures market is flat, the Funds will lose money, and losses may occur even if futures prices increase.
The Funds’ goal is not to achieve its stated objective over periods longer than a single day. Compounded daily rebalancing can lead to returns that differ from twice the price performance of the underlying futures market, and even in a flat or upward market, the Fund can lose money due to compounding, volatility, and daily rebalancing effects. There is no guarantee that the Funds will meet their stated objective.
Effects of Compounding and Market Volatility Risk: The Funds have a daily leveraged investment objective and the performance for periods greater than a trading day will be the result of each day’s returns compounded over the period, which is very likely to differ from two times (2x) the price performance of corn or wheat, before fees and expenses.
Compounding affects all investments, but has a more significant impact on funds that are leveraged and that rebalance daily. The impact of compounding will impact each shareholder differently depending on the period of time an investment in a Fund is held and the volatility of the price of the underlying commodity during the shareholder’s holding period of an investment in a Fund.
Leverage Risk: The Funds seeks to achieve and maintain the exposure to the price of corn and wheat for future delivery by using leverage inherent in futures contracts. Therefore, the Funds are subject to leverage risk. Leverage may cause the Funds to be more volatile because it may exaggerate the effect of any increase or decrease in the value of the Funds’ portfolio securities. Futures trading involves a degree of leverage and as a result, a relatively small price movement in futures instruments may result in immediate and substantial losses. The Funds may at times be required to liquidate portfolio positions, including when it is not advantageous to do so, in order to comply with guidance from the U.S. Securities and Exchange Commission (the “SEC”) regarding asset segregation requirements to cover certain leveraged positions.
Daily Correlation/Tracking Risk: There is no guarantee that the Funds will achieve a high degree of correlation to the price performance of corn or wheat and therefore achieve the daily leveraged investment objective. To achieve a high degree of correlation with the price performance of the underlying commodity markets the Funds seek to rebalance their portfolios daily to keep leverage consistent with the daily leveraged investment objective. The possibility of a Fund being materially over- or under-exposed to the price performance of the underlying commodity increases on days when the price of corn or wheat is volatile near the close of the trading day. Market disruptions, regulatory restrictions and extreme volatility will also adversely affect a Fund’s ability to adjust exposure to the required levels.
Derivatives and Futures Risks: Because the Funds will invest primarily in commodity futures contracts and other derivative instruments based on the prices of the underlying commodities (corn and wheat), an investment in either Fund will subject the investor to the risks of the respective commodity market, which could result in substantial fluctuations in the price of the Funds’ shares. Futures investing is highly speculative and involves a high degree of risk. An investor may lose all or substantially all of an investment in either Fund.
Investing in commodity interests subjects each Fund to the risks of its related industry.
Investment Capacity Risk: If either Fund’s ability to obtain exposure to commodities futures consistent with its investment objective is disrupted for any reason, including limited liquidity in the commodities futures markets for corn or wheat, a disruption to the respective commodities futures, or as a result of margin requirements or position limits imposed by the Funds’ futures commission merchants (FCMs), the designated contract markets (DCMs), or the Commodity Futures Trading Commission (CFTC) on the Funds or the Adviser, the affected Fund would not be able to achieve its investment objective and may experience significant losses.
Liquidity Risk: Liquidity risk exists when particular investments are difficult to purchase or sell. This risk applies to both Funds, as certain investments in the commodities futures markets for corn or wheat may lack liquidity. This can reduce a Fund’s returns because the Fund may be unable to transact at advantageous times or prices.
Non-Diversification Risk: Both CXRN and WXET are “non-diversified” investment companies under the Investment Company Act of 1940, as amended, and therefore may invest a greater percentage of their assets in a particular security than a diversified fund.
Commodity Pool Regulatory Risk: Both CXRN and WXET’s investment exposure to commodities futures will cause them to be deemed commodity pools, regulated under the Commodity Exchange Act (“CEA”) and CFTC rules.
Subsidiary Investment Risk: By investing in their respective Subsidiaries, CXRN and WXET are indirectly exposed to the risks associated with the Subsidiaries’ investments. The Subsidiaries are not registered under the Investment Company Act of 1940 (the “1940 Act”) and are not subject to all the investor protections of the 1940 Act. Changes in the laws of the United States and/or the Cayman Islands could result in the inability of either Fund and/or their respective Subsidiaries to continue to operate as they do currently and could adversely affect the Funds. If Cayman Islands law changes such that the Subsidiaries must pay Cayman Islands taxes, shareholders of CXRN and WXET would likely suffer decreased investment returns.
Tax Risk: CXRN and WXET may gain most of their exposure to the commodities markets through their investments in their respective Subsidiaries, which may invest directly in commodity-linked derivative instruments, including commodities futures and reverse repurchase agreements. Each Fund’s investment in its Subsidiary is expected to provide the Fund with exposure to the commodities markets within the limitations of the federal tax requirements of Subchapter M of the Internal Revenue Code for qualification as a regulated investment company (RIC).
Volatility Risk: The value of certain investments held by CXRN and WXET, including commodities futures, is subject to market risk. Market risk refers to the risk that the value of the investments to which each Fund is exposed may decline due to general market or economic conditions or other factors.
General Investment Risks: Investments in CXRN and WXET involve risk, including the possible loss of principal. ETFs trade like stocks, are subject to investment risk, fluctuate in market value, and may trade at prices above or below the ETF’s net asset value (NAV). ETFs are not individually redeemable directly with the ETF. Brokerage commissions and ETF expenses will reduce returns. ETFs are subject to specific risks, depending on the nature of each Fund’s underlying strategy. These risks include, but are not limited to, Agricultural Commodities Risk, Cash Transaction Risk, Clearing Broker Risk, Collateral Securities Risk, Commodity-Linked Derivatives Tax Risk, Counterparty Risk, Cybersecurity Risk, Early Close/Trading Halt Risk, High Portfolio Turnover Risk, Intra-Day Investment Risk, Market Risk, Valuation Risk, and Whipsaw Markets Risk. For a complete description of each Fund’s principal investment risks, please refer to the prospectus.
This material is not an offer or solicitation of any kind to buy or sell any securities outside of the United States of America.
PINE Distributors LLC is the distributor for the Teucrium 2x Daily Corn ETF (CXRN) and the Teucrium 2x Daily Wheat ETF (WXET). Teucrium Investment Advisors, LLC, wholly owned by Teucrium Trading, LLC, serves as the investment adviser for the Teucrium ETFs. PINE Distributors LLC is not affiliated with Teucrium Trading, LLC or Teucrium Investment Advisors, LLC.
Media Contact
Chris Sullivan, on behalf of Teucrium, 1 9179020617, [email protected], https://www.teucrium.com/
SOURCE on behalf of Teucrium