Direxion Announces Reverse And Forward Share Splits Of Nine ETFs

NEW YORK, July 24, 2013 /PRNewswire/ -- Direxion, a leader in alternative investment solutions, has announced it will execute reverse share splits for seven of its leveraged exchange-traded funds ("ETFs"), as well as forward share splits for another two leveraged ETFs. The total market value of the shares outstanding will not be affected as a result of these splits, except with respect to the redemption of fractional shares, as outlined below.

(Logo: http://photos.prnewswire.com/prnh/20130724/NY52763LOGO )

Reverse Splits

Direxion will execute 1-for-4 reverse splits of the shares of the Direxion Daily India Bull 3X Shares (INDL), Direxion Daily Real Estate Bear 3X Shares (DRV), Direxion Daily Semiconductor Bear 3X Shares (SOXS), Direxion Daily Developed Markets Bear 3X Shares (DPK) and Direxion Daily Natural Gas Related Bear 3X Shares (GASX), effective at the open of the markets on Tuesday, August 20, 2013. The firm will also execute a 1-for-5 reverse split of the shares of the Direxion Daily S&P 500 Bear 3X Shares (SPXS) and a 1-for-10 reverse split of the shares of the Direxion Daily Gold Miners Bull 3X Shares (NUGT), also effective at the open of the markets on Tuesday, August 20, 2013.

A summary of the seven ETFs undergoing reverse splits is as follows (please note the CUSIP changes, effective Tuesday, August 20, 2013):

Forward Splits

In addition, Direxion will execute 2-for-1 forward splits of the shares of the Direxion Daily Gold Miners Bear 3X Shares (DUST) and Direxion Daily Healthcare Bull 3X Shares (CURE) according to the following schedule:

Ex-Date:                    Tuesday, August 20, 2013
Record Date:              Friday, August 16, 2013
Payable Date:             Monday, August 19, 2013

A summary of the two ETFs undergoing forward splits is as follows (CUSIPs remain the same):

Shares of the Funds will begin trading on the NYSE Arca on a split-adjusted basis on the Ex-Date. On the Ex-Date, the opening market value of each Fund's issued and outstanding shares, and thus a shareholder's investment value, will not be affected by the share split. However, the per-share net asset value ("NAV") and opening market price on the Ex-Date will be approximately one-half for the Funds. As stated previously, the total market value of the shares outstanding will not be affected as a result of the reverse and forward splits, except with respect to the redemption of fractional shares, as outlined below.

The Depository Trust Company ("DTC"), the registered owner of all ETF shares, has been notified of the reverse and forward splits and has been instructed to adjust each shareholder's investment accordingly.

Hypothetical Example of 1-for-4 reverse split:

Hypothetical Example of 2-for-1 forward split:

Redemption of Fractional Shares and Tax Consequences for Each Reverse and Forward Split

As a result of the reverse and forward splits, a shareholder of each Fund potentially could hold a fractional share. However, fractional shares cannot trade on the NYSE Arca. Thus, a Fund will redeem for cash a shareholder's fractional shares at the Fund's split-adjusted NAV as of the respective Effective/Record Date. Such redemption may have tax implications for those shareholders and a shareholder could recognize gain or loss in connection with the redemption of the shareholder's fractional shares. Otherwise, the reverse and forward splits will not result in a taxable transaction for holders of Fund shares. No transaction fee will be imposed on shareholders for such redemption.

"Odd Lot" Unit

Also as a result of the reverse and forward splits, the ETFs will have outstanding one aggregation of less than 50,000 shares to make a creation unit, or an "odd lot unit." Thus, the Funds will provide one authorized participant with a one-time opportunity to redeem the odd lot unit at the split-adjusted NAV or the NAV on such date the authorized participant seeks to redeem the odd lot unit.

For more information about Direxion, please contact James Doyle at 973-850-7308 or [email protected].

About Direxion
Direxion Funds and Direxion Shares, managed by Rafferty Asset Management, LLC, offer leveraged index funds, ETFs and alternative-class fund products for investment advisors and sophisticated investors who seek to effectively manage risk and return in both bull and bear markets. Founded in 1997, the company has approximately $6.8 billion in assets under management as of 6/30/13. The company's business model is built on continuous product innovation, exceptional customer service and a commitment to building strategic relationships with distribution partners. For more information, please visit www.direxionfunds.com.

There is no guarantee that the funds will achieve their objectives.

For more information on all Direxion Shares daily leveraged ETFs, go to www.direxionfunds.com, or call us at 866.476.7523.

The ETFs are not suitable for all investors and should be utilized only by sophisticated investors who understand leverage risk, consequences of seeking daily leveraged investment results and intend to actively monitor and manage their investments. Due to the daily nature of the leverage employed, there is no guarantee of amplified long-term returns. Past performance is not indicative of future results.

An investor should consider the investment objectives, risks, charges, and expenses of Direxion Shares carefully before investing. The prospectus and summary prospectus contains this and other information about Direxion Shares. Download a prospectus and summary prospectus at www.direxionfunds.com. The prospectus and summary prospectus should be read carefully before investing.

Risks:
Investing in the funds may be more volatile than investing in broadly diversified funds. The use of leverage by a fund increases the risk to the fund. The more a fund invests in leveraged instruments the more the leverage will magnify gains or losses on those investments. There is no assurance that the Funds will achieve their objectives and an investment in a Fund could lose money. No single Fund is a complete investment program. The Funds are not designed to, and will not necessarily, track the underlying index or benchmark over a longer period of time. One cannot invest directly in an index.

An investment in the Funds involves risk, including the possible loss of principal. The Funds are non-diversified and include concentration risk that results from the Funds' investments in a particular industry, sector or geography which can increase volatility. The use of derivatives such as futures contracts, forward contracts, options and swaps are subject to market risks that may cause their price to fluctuate over time. The Fund does not attempt to, and should not be expected to, provide returns which are a multiple of the return of the Index for periods other than a single day. For other risks including correlation, leverage, compounding, market volatility and specific risks regarding South Korean and Brazilian securities, please read the prospectus.

Distributor: Foreside Fund Services, LLC.

SOURCE Direxion

WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM?

440k+
Newsrooms &
Influencers

9k+
Digital Media
Outlets

270k+
Journalists
Opted In

GET STARTED