Teucrium Wheat Fund (1695)

Overview

ETFS Wheat (1695) is a specialized financial instrument known as an Exchange Traded Commodity (ETC) that allows investors to gain exposure to the returns of the wheat markets. This investment vehicle is designed to replicate the performance of the Bloomberg Wheat Subindex, in addition to a collateral return, thus providing a comprehensive investment solution for those looking to invest in wheat without engaging in the physical commodities market. Unlike traditional investments, 1695 is structured to allow for easy creation and redemption on demand by Authorized Participants, ensuring liquidity and flexibility for investors. It is listed on stock exchanges and trades like an equity, but with the operational mechanism of an Exchange Traded Fund (ETF). The backbone of its financial structure includes fully funded swaps with counterparties, where payment obligations are secured with collateral that is revalued daily. This collateral management process is overseen by The Bank of New York Mellon, where the assets are held in pledge accounts, ensuring transparency and security for investors. Information about the collateral and its management is made available on the ETF Securities website, providing an additional layer of transparency.

Products and Services

• Exchange Traded Commodity (ETC)

ETFS Wheat (1695) offers an innovative financial product known as an Exchange Traded Commodity (ETC), specifically focused on wheat. This investment vehicle is crafted to provide investors with a path to gain exposure to the performance of the wheat market, via the Bloomberg Wheat Subindex, alongside a collateral return. By operating in a fashion similar to Exchange Traded Funds (ETFs), it combines the benefits of stock-like trading with the specialized focus on a single commodity, i.e., wheat. This allows for greater specificity in investment strategies and the ability to respond quickly to market changes.

• Collateralized Payment Obligations

The innovative financial structure of 1695 includes fully funded swap agreements, where the counterparties' payment obligations are bolstered by collateral. This collateral is appraised daily to reflect current market values, ensuring that the underlying assets fully back the product's value. The security of these obligations is a critical aspect of 1695, providing investors with confidence in the product's stability and the integrity of their investment.

• Collateral Transparency and Security

The collateral underpinning the swap agreements in ETFS Wheat (1695) is managed with an emphasis on transparency and security. This is ensured by holding the collateral in dedicated pledge accounts at The Bank of New York Mellon, a leading financial institution known for its robust asset management services. Investors are given access to detailed information regarding the collateral, including its composition and daily valuation, through the ETF Securities website. This level of transparency is designed to foster investor trust and provide a clear understanding of the product’s financial health and operational integrity.