ETFS ZACKS EARNINGS SMALLCAP U.S. INDEX FUND (ZSML) Exchange: NYSE ARCA

DELISTED - Under normal circumstances, at least 80% of the Fund’s total assets (exclusive of collateral held from securities lending) will be invested in the component securities of the Index. The Fund may invest the remainder of its assets in cash and cash equivalents, such as repurchase agreements or money market instruments, or other instruments that Vident Investment Advisory, LLC, the sub-adviser to the Fund (the “Sub-Adviser”), believes will help the Fund track the Index.   The Index is comprised of approximately 180 U.S. listed common stocks selected based on a proprietary methodology developed by Zacks Investment Research, Inc. (“Zacks” or the “Index Provider”).   Zacks Earnings Small Cap The Index Provider arranges U.S. listed stocks in order of market capitalization and selects the component stocks from a universe of the stocks ranking at position 1001 to 3000 provided that they have: (i)A price of at least $3 per share; and (ii)An average daily price volume of at least $10 million (based either on most recent month or on median monthly price volume over the past 13 months). The universe of stocks is divided into 16 sectors (according to the Zacks Expanded Classification System) and, based on the number of stocks within a sector in the whole universe, a target number of stocks for each sector to be included in the Index (the “Sector Target Number”) is determined (which is generally the total number of stocks in that sector of the universe divided by 10 and plus 1). The Zacks Rank Factor (as described below) and Zacks Quality Factor (as described below) are utilized and applied as follows. First, the Zacks Rank Factor is applied. If, following the application of the Zacks Rank Factor to a particular sector, there would be less stocks than the Sector Target Number in the Index, then those stocks with the highest Zacks Quality Factor rating are selected from the universe until the Sector Target Number is reached (provided that they were not also given the lowest two Zacks Rank factor ratings).  Within the overall Index, all 16 sectors and all stocks within a sector are given an equal weighting unless there is a sector in which no eligible stocks are identified. In this case, the Index is equally weighted between the remaining sectors. In addition, no single constituent can have a weight of more than 10% and the sum of the stocks that have an individual weight in excess of 5% cannot exceed 45% of the final Index. The Index will be reconstituted and rebalanced quarterly. The Zacks Rank Factor assigns stocks in the universe a rating based on earnings estimate revision information and only stocks with the highest rating within a particular sector of the universe are selected. Various profitability measures (including earnings) of many individual public companies are covered by financial analysts who work for brokerage houses – these analysts are often called sell-side analysts - and Zacks tries to extract stock price movement and related information by paying close attention to how those estimates are revised by the sell-side analysts over time. It is this information that forms the basis of the Zacks Rank Factor. If there are more stocks within a particular sector of the universe than the Sector Target Number, select the constituents with the highest Zacks Rank Factor. Up to 5 stocks in excess of the Sector Target Number can be selected for the Index. The Zacks Quality Factor assigns a rating to stocks within the universe based on earnings quality information. A company’s earnings is composed of cash earnings and accrued earnings. Whereas the cash component is subject to little manipulation by the company’s management team, some subjectivity is allowed for the accrued portion according to U.S. Generally Accepted Accounting Principles (“GAAP”). The Zacks Quality Factor is an adaptation of the concept that, in general, companies with lower accruals are less likely to manipulate their earnings and tend to perform better over time. The Fund employs a “replication strategy” approach to try to achieve its investment objective. “Replication strategy” is a passive indexing strategy that involves investing in all the securities of the Index in approximately the same proportion as the Index. However, the Fund may utilize a representative sampling strategy with respect to the Index when a replication strategy may be detrimental to shareholders, such as when there are practical difficulties or substantial costs involved in compiling a portfolio of all the equity securities in the Index. In general, if the Fund is performing as designed, the return of the Index will dictate the return for the Fund. The Fund pursues its investment objective regardless of the market conditions and does not take defensive positions. The Fund seeks to be fully invested at all times and will concentrate its investment (i.e., hold 25% or more of its total assets) in a particular industry or group of industries to approximately the same extent as the Index is so concentrated. Currently, the Index and the Fund are not concentrated.   The Index Provider is not affiliated with the Fund, the Adviser or the Sub-Adviser. The Index Provider determines the composition of the Index, relative weightings of the securities in the Index and publishes information regarding the market value of the Index.   The Adviser expects that, over time, the correlation between the Fund’s performance and that of the Index, before fees and expenses, will exceed 95%. A correlation of 100% would represent a perfect correlation. Because the Fund primarily uses a replication strategy, it can be expected to have greater correlation to the Index than if it uses a representative replication strategy.