The Teucrium WTI Crude Oil Fund (NYSE: CRUD) provides investors unleveraged direct exposure to crude oil without the need for a futures account. The Teucrium WTI Crude Oil Fund was also designed to reduce the effects of contango and backwardation. CRUD, as a result of the diversified futures structure, was specifically designed to reduce the cost of rolling the investment when compared to funds that hold only a single month.
The investment objective of the Fund is to have the daily changes in percentage terms of the Shares’ Net Asset Value (“NAV”) reflect the daily changes in percentage terms of a weighted average of the closing settlement prices for futures contracts for WTI crude oil, also known as Texas Light Sweet Crude Oil (“WTI Oil Futures Contracts”) traded on the NYMEX, specifically, (1) the nearest to spot June or December Oil Futures Contract, weighted 35%; (2) the June or December WTI Oil Futures Contract following the aforementioned (1), weighted 30%; and (3) the December WTI Oil Futures Contract that immediately follows the aforementioned (2), weighted 35%; less the Fund’s expenses. This weighted average of the three West Texas Intermediate (WTI) Crude Oil Futures Contracts is referred to as the “Benchmark,” and the three WTI Crude Oil Futures Contracts that at any given time make up the Benchmark are referred to as the “Benchmark Component Futures Contracts.”
Teucrium WTI Crude Oil Fund is a commodity pool that issues Shares that may be purchased and sold on the NYSE Arca. The Fund is a series of the Teucrium Commodity Trust (“Trust”), a Delaware statutory trust organized on September 11, 2009. The Fund is one of seven series of the Trust; each series operates as a separate commodity pool. Additional series of the Trust may be created in the future. The Trust and the Fund operate pursuant to the Trust’s Amended and Restated Declaration of Trust and Trust Agreement (the “Trust Agreement”). The Fund was formed and is managed and controlled by the Sponsor, Teucrium Trading, LLC. The Sponsor, a limited liability company formed in Delaware on July 28, 2009, is registered as a commodity pool operator (“CPO”) with the Commodity Futures Trading Commission ("CFTC") and is a member of the National Futures Association ("NFA").
CRUD has limited operating history, so there is little performance history to serve as a basis for you to evaluate an investment in the Trust. Investing in Crude Oil Interests subjects CRUD to the risks of the crude oil market, and this could result in substantial fluctuations in the price of CRUD’ s Shares. Unlike mutual funds, CRUD generally will not distribute dividends to Shareholders.
Investors may choose to use CRUD as a means of investing indirectly in crude oil or as a vehicle to hedge against the risk of loss, and there are risks involved in such investments and activities. The Sponsor has limited experience in operating a commodity pool, which is defined as an enterprise in which several individuals contribute funds in order to trade futures or futures options collectively.
Commodities and futures generally are volatile and are not suitable for all investors.
The Teucrium WTI Crude Oil Fund is not a mutual fund or any other type of Investment Company within the meaning of the Investment Company Act of 1940, as amended, and is not subject to regulation thereunder.
Shares of the Teucrium WTI Crude Oil Fund are not FDIC insured, may lose value, and have no bank guarantee.
All supporting documentation will be provided upon request.
Foreside Fund Services, LLC is the distributor for the Teucrium WTI Crude Oil Fund.
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