Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing of Proposed Rule Change To List and Trade the Shares of the WisdomTree Dreyfus Euro Debt Fund Under NYSE Arca Equities Rule 8.600, 34112-34118 [2011-14415]

Download as PDF 34112 Federal Register / Vol. 76, No. 112 / Friday, June 10, 2011 / Notices III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing proposed rule change has become effective upon filing pursuant to Section 19(b)(3)(A) of the Act 7 and Rule 19b–4(f)(4) 8 thereunder because the proposed rule change effects a change in an existing service of a registered clearing agency that: (i) Does not adversely affect the safeguarding of securities or funds in the custody or control of the clearing agency or for which it is responsible; and (ii) does not significantly affect the respective rights or obligations of the clearing agency or persons using the service. At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission’s Public Reference Room, 100 F Street, NE., Washington, DC 20549, on official business days between the hours of 10 a.m. and 3 p.m. Copies of such filings also will be available for inspection and copying at the principal office of FICC and on FICC’s Web site at http:// dtcc.com/downloads/legal/rule_filings/ 2011/ficc/2011-04.pdf. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR–FICC– 2011–04 and should be submitted on or before July 1, 2011. IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: For the Commission by the Division of Trading and Markets, pursuant to delegated authority.9 Cathy H. Ahn, Deputy Secretary . WReier-Aviles on DSKGBLS3C1PROD with NOTICES Electronic Comments • Use the Commission’s Internet comment form (http://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File Number SR–FICC–2011–04 on the subject line. Paper Comments • Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549–1090. All submissions should refer to File Number SR–FICC–2011–04. This file number should be included on the subject line if e-mail is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission’s Internet Web site (http://www.sec.gov/ rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written [FR Doc. 2011–14388 Filed 6–9–11; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–64608; File No. SR– NYSEArca–2011–31] Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing of Proposed Rule Change To List and Trade the Shares of the WisdomTree Dreyfus Euro Debt Fund Under NYSE Arca Equities Rule 8.600 June 6, 2011. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the ‘‘Act’’) 1 and Rule 19b–4 thereunder,2 notice is hereby given that, on May 24, 2011, NYSE Arca, Inc. (the ‘‘Exchange’’ or ‘‘NYSE Arca’’) filed with the Securities and Exchange Commission (the ‘‘Commission’’) the proposed rule change as described in Items I and II below, which Items have been prepared by the Exchange. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. 9 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 7 15 U.S.C. 78s(b)(3)(A). 8 17 CFR 240.19b–4(f)(4). VerDate Mar<15>2010 14:33 Jun 09, 2011 1 15 Jkt 223001 PO 00000 Frm 00082 Fmt 4703 Sfmt 4703 I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to list and trade the shares (‘‘Shares’’) of the following fund of the WisdomTree Trust (the ‘‘Trust’’) under NYSE Arca Equities Rule 8.600 (‘‘Managed Fund Shares’’): WisdomTree Dreyfus Euro Debt Fund. The text of the proposed rule change is available at the Exchange, the Commission’s Public Reference Room, and http://www.nyse.com. II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the self-regulatory organization included statements concerning the purpose of, and basis for, the proposed rule change and discussed any comments it received on the proposed rule change. The text of those statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant parts of such statements. A. Self-Regulatory Organization’s Statement of the Purpose of, and the Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange proposes to list and trade the Shares of the WisdomTree Dreyfus Euro Debt Fund (‘‘Fund’’) under NYSE Arca Equities Rule 8.600, which governs the listing and trading of Managed Fund Shares on the Exchange.3 The Shares will be offered 3 The Commission approved NYSE Arca Equities Rule 8.600 and the listing and trading of certain funds of the PowerShares Actively Managed Funds Trust on the Exchange pursuant to Rule 8.600 in Securities Exchange Act Release No. 57619 (April 4, 2008), 73 FR 19544 (April 10, 2008) (SR– NYSEArca–2008–25). The Commission also previously approved listing and trading on the Exchange of a number of actively managed funds under Rule 8.600. See, e.g., Securities Exchange Act Release Nos. 57801 (May 8, 2008), 73 FR 27878 (May 14, 2008) (SR–NYSEArca–2008–31) (order approving Exchange listing and trading of twelve actively managed funds of the WisdomTree Trust); 58564 (September 17, 2008), 73 FR 55194 (September 24, 2008) (SR–NYSEArca–2008–86) (order approving Exchange listing and trading of WisdomTree Dreyfus Emerging Currency Fund); 62604 (July 30, 2010), 75 FR 47323 (August 5, 2010) (SR–NYSEArca–2010–49) (order approving listing and trading of WisdomTree Emerging Markets Local Debt Fund); 62623 (August 2, 2010), 75 FR 47652 (August 6, 2010) (SR–NYSEArca–2010–51) (order approving listing and trading of WisdomTree Dreyfus Commodity Currency Fund); 63598 (December 22, 2010), 75 FR 82106 (December 29, 2010) (SR–NYSEArca–2010–98) (order approving listing and trading of WisdomTree Managed Futures Strategy Fund); and 63919 (February 16, 2011), 76 FR 10073 (February 23, 2011) (SR–NYSEArca– E:\FR\FM\10JNN1.SGM 10JNN1 Federal Register / Vol. 76, No. 112 / Friday, June 10, 2011 / Notices by the Trust, which was established as a Delaware statutory trust on December 15, 2005. The Trust is registered with the Commission as an investment company and the Fund has filed a registration statement on Form N–1A (‘‘Registration Statement’’) with the Commission. The Fund is currently known as the ‘‘WisdomTree Dreyfus Euro Fund’’ and is an actively managed exchange-traded fund. The Commission approved listing and trading on the Exchange of the WisdomTree Dreyfus Euro Fund pursuant to Section 19(b)(2) of the Exchange Act on May 8, 2008 (‘‘May 2008 Order’’).4 On April 14, 2011, the WisdomTree Dreyfus Euro Fund filed a supplement to its Registration Statement (the ‘‘Supplement’’) pursuant to Rule 497 under the Securities Act of 1933.5 As stated in the Supplement, the WisdomTree Dreyfus Euro Fund, effective on or after June 27, 2011, will change its investment objective and strategy and will be renamed the ‘‘WisdomTree Dreyfus Euro Debt Fund.’’ 6 The WisdomTree Dreyfus Euro Fund’s new name, investment objective, and investment strategies, which are not reflected in the May 2008 Order, are described below. Shareholders of the WisdomTree Dreyfus Euro Fund who wish to remain in the Fund do not need to take any action. Shareholders who do not wish to remain invested in the Fund may sell their Shares at any time. WReier-Aviles on DSKGBLS3C1PROD with NOTICES Description of the Shares and the Fund WisdomTree Asset Management, Inc. (‘‘WisdomTree Asset Management’’) is the investment adviser (‘‘Adviser’’) to the Fund.7 The Dreyfus Corporation serves as sub-adviser for the Fund (‘‘Sub-Adviser’’).8 The Bank of New York Mellon is the administrator, custodian and transfer agent for the Trust. ALPS Distributors, Inc. serves as the distributor for the Trust.9 2010–116) (order approving listing and trading of WisdomTree Asia Local Debt Fund). 4 See Securities Exchange Act Release No. 57801 (May 8, 2008), 73 FR 27878 (May 14, 2008) (SR– NYSEArca–2008–31) (order approving Exchange listing and trading of twelve actively managed funds of the WisdomTree Trust). 5 15 U.S.C. 77a et seq. 6 See Form 497, Supplement to Registration Statement on Form N–1A for the Trust, dated April 14, 2011 (File Nos. 333–132380 and 811–21864). The descriptions of the Fund and the Shares contained herein are based, in part, on information in the Supplement and the Registration Statement. 7 WisdomTree Investments, Inc. (‘‘WisdomTree Investments’’) is the parent company of WisdomTree Asset Management. 8 The Sub-Adviser is responsible for day-to-day management of the Fund and, as such, typically makes all decisions with respect to portfolio holdings. The Adviser has ongoing oversight responsibility. 9 The Commission has issued an order granting certain exemptive relief to the Trust under the VerDate Mar<15>2010 14:33 Jun 09, 2011 Jkt 223001 Commentary .06 to Rule 8.600 provides that, if the investment adviser to the Investment Company issuing Managed Fund Shares is affiliated with a broker-dealer, such investment adviser shall erect a ‘‘fire wall’’ between the investment adviser and the brokerdealer with respect to access to information concerning the composition and/or changes to such Investment Company portfolio.10 In addition, Commentary .06 further requires that personnel who make decisions on the open-end fund’s portfolio composition must be subject to procedures designed to prevent the use and dissemination of material nonpublic information regarding the open-end fund’s portfolio. Commentary .06 to Rule 8.600 is similar to Commentary .03(a)(i) and (iii) to NYSE Arca Equities Rule 5.2(j)(3); however, Commentary .06 in connection with the establishment of a ‘‘fire wall’’ between the investment adviser and the broker-dealer reflects the applicable open-end fund’s portfolio, not an underlying benchmark index, as is the case with index-based funds. The Adviser is not affiliated with any broker-dealer. The Sub-Adviser is affiliated with multiple broker-dealers Investment Company Act of 1940 (15 U.S.C. 80a– 1) (‘‘1940 Act’’). See Investment Company Act Release No. 28171 (October 27, 2008) (File No. 812– 13458). In compliance with Commentary .05 to NYSE Arca Equities Rule 8.600, which applies to Managed Fund Shares based on an international or global portfolio, the Trust’s application for exemptive relief under the 1940 Act states that the Fund will comply with the federal securities laws in accepting securities for deposits and satisfying redemptions with redemption securities, including that the securities accepted for deposits and the securities used to satisfy redemption requests are sold in transactions that would be exempt from registration under the Securities Act of 1933 (15 U.S.C. 77a). 10 An investment adviser to an open-end fund is required to be registered under the Investment Advisers Act of 1940 (the ‘‘Advisers Act’’). As a result, the Adviser and Sub-Adviser and their related personnel are subject to the provisions of Rule 204A–1 under the Advisers Act relating to codes of ethics. This Rule requires investment advisers to adopt a code of ethics that reflects the fiduciary nature of the relationship to clients as well as compliance with other applicable securities laws. Accordingly, procedures designed to prevent the communication and misuse of non-public information by an investment adviser must be consistent with Rule 204A–1 under the Advisers Act. In addition, Rule 206(4)–7 under the Advisers Act makes it unlawful for an investment adviser to provide investment advice to clients unless such investment adviser has (i) adopted and implemented written policies and procedures reasonably designed to prevent violation, by the investment adviser and its supervised persons, of the Advisers Act and the Commission rules adopted thereunder; (ii) implemented, at a minimum, an annual review regarding the adequacy of the policies and procedures established pursuant to subparagraph (i) above and the effectiveness of their implementation; and (iii) designated an individual (who is a supervised person) responsible for administering the policies and procedures adopted under subparagraph (i) above. PO 00000 Frm 00083 Fmt 4703 Sfmt 4703 34113 and has implemented a ‘‘fire wall’’ with respect to such broker-dealers regarding access to information concerning the composition and/or changes to the Fund’s portfolio. In addition, SubAdviser personnel who make decisions regarding the Fund’s portfolio are subject to procedures designed to prevent the use and dissemination of material nonpublic information regarding the Fund’s portfolio. In the event (a) the Adviser or the Sub-Adviser becomes newly affiliated with a brokerdealer, or (b) any new adviser or subadviser becomes affiliated with a brokerdealer, they [sic] will implement a fire wall with respect to such broker-dealer regarding access to information concerning the composition and/or changes to the portfolio, and will be subject to procedures designed to prevent the use and dissemination of material non-public information regarding such portfolio. WisdomTree Dreyfus Euro Debt Fund As noted above, effective on or after June 27, 2011, the WisdomTree Dreyfus Euro Fund will change its investment objective and investment strategies and be renamed the ‘‘WisdomTree Dreyfus Euro Debt Fund.’’ Upon implementation of the change, the Fund’s new investment objective will be to seek a high level of total returns consisting of both income and capital appreciation and its investment strategies will be changed as described below.11 Euro-Denominated Debt Under normal circumstances, the Fund will invest at least 80% of its net assets in Fixed Income Securities denominated in Euros.12 For purposes of this proposed rule change, Fixed Income Securities include bonds, notes or other debt obligations, such as government or corporate bonds, denominated in Euros, including issues denominated in Euros that are issued by ‘‘supranational issuers,’’ such as the European Investment Bank, International Bank for Reconstruction and Development, and the International Finance Corporation, or other regional 11 The Adviser represents that the Supplement has been sent to existing Shareholders of the Fund to notify them of the planned change. The Supplement and additional information have been posted on the Fund’s website at http:// www.wisdomtree.com. 12 The term ‘‘under normal market circumstances’’ includes, but is not limited to, the absence of extreme volatility or trading halts in the fixed income markets or the financial markets generally; operational issues causing dissemination of inaccurate market information; or force majeure type events such as systems failure, natural or manmade disaster, act of God, armed conflict, act of terrorism, riot or labor disruption or any similar intervening circumstance. E:\FR\FM\10JNN1.SGM 10JNN1 34114 Federal Register / Vol. 76, No. 112 / Friday, June 10, 2011 / Notices WReier-Aviles on DSKGBLS3C1PROD with NOTICES development banks, as well as development agencies supported by other national governments. Under normal circumstances, the Fund may invest up to 20% of its assets in Fixed Income Securities denominated in U.S. dollars. The Fund may invest in Money Market Securities and derivative and other instruments, as described below.13 The Fund intends to focus its investments on ‘‘Sovereign Debt.’’ For these purposes, Sovereign Debt means Fixed Income Securities issued by governments, government agencies and government-sponsored enterprises of countries in the European Union (‘‘EU’’) that are denominated in Euros.14 This includes inflation-linked bonds designed to provide protection against increases in general inflation rates. The Fund may invest up to 20% of its net assets in corporate debt of companies organized in EU countries or that have significant economic ties to EU countries. The Fund will invest only in corporate bonds that the Adviser or SubAdviser deems to be sufficiently liquid. Generally, a corporate bond must have $200 million or more par amount outstanding and significant par value traded to be considered as an eligible investment. Economic and other conditions may, from time to time, lead to a decrease in the average par amount outstanding of bond issuances. Therefore, although the Fund does not intend to do so, the Fund may invest up to 5% of its net assets in corporate bonds with less than $200 million par amount outstanding if (i) the Adviser or Sub-Adviser deems such security to be sufficiently liquid based on its analysis of the market for such security (based on, for example, broker-dealer quotations or its analysis of the trading history of the security or the trading history of other securities issued by the issuer), (ii) such investment is consistent with the Fund’s goal of providing exposure to a broad range of Fixed Income Securities denominated in Euros, and (iii) such investment is deemed by the Adviser or Sub-Adviser to be in the best interest of the Fund. The Fund intends to provide broad exposure to countries in the EU. As a general matter, the Fund will invest a higher percentage of its assets in 13 As of February 17, 2011, the amount of Eurodenominated debt outstanding exceeded US$19.2 trillion. Source: Deutsche Bundesbank, at http:// www.bundesbank.de/statistik/statistik_eszb_ neuesfenster_tabelle.php?stat=debt_ securities&lang=.en. 14 As of February 17, 2011, the amount of sovereign Euro-denominated debt outstanding exceeded US$8.02 trillion. Source: Deutsche Bundesbank, at http://www.bundesbank.de/ statistik/statistik_eszb_neuesfenster_tabelle.php? stat=debt_securities&lang=.en. VerDate Mar<15>2010 14:33 Jun 09, 2011 Jkt 223001 countries with larger and more liquid debt markets. The Fund’s exposure to any single country generally will be limited to 20% of the Fund’s assets. The percentage of Fund assets invested in a specific country or issuer will change from time to time. The universe of Euro-denominated Fixed Income Securities currently includes securities that are rated ‘‘investment grade’’ as well as ‘‘noninvestment grade.’’ As the Fund intends to provide broad-based exposure to Euro-denominated Fixed Income Securities, the Fund will invest in both investment-grade and non-investmentgrade securities. Securities rated investment grade generally are considered to be of higher credit quality and subject to lower default risk. Although securities rated below investment grade may offer the potential for higher yields, they generally are subject to a higher potential risk of loss. The Fund expects to have 75% or more of its assets invested in investment grade bonds, though this percentage may change from time to time in accordance with market conditions and the debt ratings assigned to countries and issuers. Because the debt ratings of issuers will change from time to time, the exact percentage of the Fund’s investments in investment grade and non-investment grade Fixed Income Securities will change from time to time in response to economic events and changes to the credit ratings of such issuers. Within the non-investment grade category some issuers and instruments are considered to be of lower credit quality and at higher risk of default. In order to limit its exposure to these more speculative credits, the Fund will not invest more than 10% of its assets in securities rated BB or below by Moody’s, or equivalently rated by S&P or Fitch. The Fund does not intend to invest in unrated securities. However, it may do so to a limited extent, such as where a rated security becomes unrated, if such security is determined by the Adviser and Sub-Adviser to be of comparable quality. In determining whether a security is of ‘‘comparable quality,’’ the Adviser or Sub-Adviser will consider, for example, current information about the credit quality of the issuer and whether or not the issuer of the security has issued other rated securities. The Fund attempts to limit interest rate risk by maintaining an aggregate portfolio duration of between two and eight years under normal market conditions. Aggregate portfolio duration is important to investors as an indication of the Fund’s sensitivity to changes in interest rates. Funds with PO 00000 Frm 00084 Fmt 4703 Sfmt 4703 higher durations generally are subject to greater interest rate risk. An aggregate portfolio duration of between two and eight years generally would be considered to be ‘‘intermediate.’’ The Fund’s actual portfolio duration may be longer or shorter depending upon market conditions. The Fund may also invest in short-term Money Market Securities (as defined below) denominated in the currencies of countries in which the Fund invests. The Fund intends to invest in Fixed Income Securities of at least 13 nonaffiliated issuers. The Fund will not concentrate 25% or more of the value of its total assets (taken at market value at the time of each investment) in any one industry, as that term is used in the 1940 Act (except that this restriction does not apply to obligations issued by the U.S. government, or any non-U.S. government, or their respective agencies and instrumentalities or governmentsponsored enterprises).15 The Fund intends to qualify each year as a regulated investment company (a ‘‘RIC’’) under Subchapter M of the Internal Revenue Code of 1986, as amended.16 The Fund will invest its assets, and otherwise conduct its operations, in a manner that is intended to satisfy the qualifying income, diversification and distribution requirements necessary to establish and maintain RIC qualification under Subchapter M. The Subchapter M diversification tests generally require that (i) the Fund invest no more than 25% of its total assets in securities (other than securities of the U.S. government or other RICs) of any one issuer or two or more issuers that are controlled by the Fund and that are engaged in the same, similar or related trades or businesses, and (ii) at least 50% of the Fund’s total assets consist of cash and cash items, U.S. government securities, securities of other RICs and other securities, with investments in such other securities limited in respect of any one issuer to an amount not greater than 5% of the value of the Fund’s total assets and 10% of the outstanding voting securities of such issuer. In addition to satisfying the above referenced RIC diversification requirements, no portfolio security held by the Fund (other than U.S. government securities and non-U.S. government securities) will represent 15 See Form N–1A, Item 9. The Commission has taken the position that a fund is concentrated if it invests more than 25% of the value of its total assets in any one industry. See, e.g., Investment Company Act Release No. 9011 (October 30, 1975), 40 FR 54241 (November 21, 1975). 16 26 U.S.C. 851. E:\FR\FM\10JNN1.SGM 10JNN1 Federal Register / Vol. 76, No. 112 / Friday, June 10, 2011 / Notices more than 30% of the weight of the Fund’s portfolio and the five highest weighted portfolio securities of the Fund (other than U.S. government securities and/or non-U.S. government securities) will not in the aggregate account for more than 65% of the weight of the Fund’s portfolio. For these purposes, the Fund may treat repurchase agreements collateralized by U.S. government securities or non-U.S. government securities as U.S. or nonU.S. government securities, as applicable. WReier-Aviles on DSKGBLS3C1PROD with NOTICES Money Market Securities Assets not invested in Fixed Income Securities generally will be invested in Money Market Securities. The Fund intends to invest in Money Market Securities in order to help manage cash flows in and out of the Fund, such as in connection with payment of dividends or expenses, and to satisfy margin requirements, to provide collateral or to otherwise back investments in derivative instruments. For these purposes, Money Market Securities include: short-term, highquality obligations issued or guaranteed by the U.S. Treasury or the agencies or instrumentalities of the U.S. government; short-term, high-quality securities issued or guaranteed by nonU.S. governments, agencies and instrumentalities; repurchase agreements backed by short-term U.S. government securities or non-U.S. government securities; money market mutual funds; and deposits and other obligations of U.S. and non-U.S. banks and financial institutions. All Money Market Securities acquired by the Fund will be rated investment grade, except that the Fund may invest in unrated Money Market Securities that are deemed by the Adviser or Sub-Adviser to be of comparable quality to Money Market Securities rated investment grade. In determining whether a security is of ‘‘comparable quality,’’ the Adviser or Sub-Adviser will consider, for example, current information about the credit quality of the issuer and whether or not the issuer of the security has issued other rated securities. Derivative Instruments and Other Investments The Fund may use derivative instruments as part of its investment strategies. Examples of derivative instruments include listed futures contracts,17 forward currency contracts, 17 The listed futures contracts in which the Fund will invest may be listed on exchanges in the U.S. or in London, Hong Kong or Singapore. Each of the United Kingdom’s primary financial markets regulator, the Financial Services Authority, Hong VerDate Mar<15>2010 14:33 Jun 09, 2011 Jkt 223001 non-deliverable forward currency contracts, currency and interest rate swaps, currency options, options on futures contracts, swap agreements and credit-linked notes.18 The Fund’s use of derivative instruments (other than credit-linked notes) will be collateralized or otherwise backed by investments in short term, high-quality U.S. Money Market Securities. Under normal circumstances, the Fund will invest no more than 20% of the value of the Fund’s net assets in derivative instruments. Such investments will be consistent with the Fund’s investment objective and will not be used to enhance leverage. With respect to certain kinds of derivative transactions entered into by the Fund that involve obligations to make future payments to third parties, including, but not limited to, futures, forward contracts, swap contracts, the purchase of securities on a when-issued or delayed delivery basis, or reverse repurchase agreements, the Fund, in accordance with applicable federal securities laws, rules, and interpretations thereof, will ‘‘set aside’’ liquid assets to ‘‘cover’’ open positions with respect to such transactions.19 The Fund may engage in foreign currency transactions, and may invest directly in foreign currencies in the form of bank and financial institution deposits, certificates of deposit, and bankers acceptances denominated in a specified non-U.S. currency. The Fund may enter into forward currency Kong’s primary financial markets regulator, the Securities and Futures Commission, and Singapore’s primary financial markets regulator, the Monetary Authority of Singapore, are signatories to the International Organization of Securities Commissions (‘‘IOSCO’’) Multilateral Memorandum of Understanding (‘‘MMOU’’), which is a multi-party information sharing arrangement among major financial regulators. Both the Commission and the Commodity Futures Trading Commission are signatories to the IOSCO MMOU. 18 The Fund may invest in credit-linked notes. A credit linked note is a type of structured note whose value is linked to an underlying reference asset. Credit linked notes typically provide periodic payments of interest as well as payment of principal upon maturity. The value of the periodic payments and the principal amount payable upon maturity are tied (positively or negatively) to a reference asset such as an index, government bond, interest rate or currency exchange rate. The ongoing payments and principal upon maturity typically will increase or decrease depending on increases or decreases in the value of the reference asset. The Fund’s investments in credit-linked notes will be limited to notes providing exposure to Fixed Income Securities denominated in Euros. The Fund’s overall investment in credit-linked notes will not exceed 25% of the Fund’s assets. 19 See 15 U.S.C. 80a–18. See also Investment Company Act Release No. 10666 (April 18, 1979), 44 FR 25128 (April 27, 1979); Dreyfus Strategic Investing, Commission No-Action Letter (June 22, 1987); Merrill Lynch Asset Management, L.P., Commission No-Action Letter (July 2, 1996). PO 00000 Frm 00085 Fmt 4703 Sfmt 4703 34115 contracts in order to ‘‘lock in’’ the exchange rate between the currency it will deliver and the currency it will receive for the duration of the contract. The Fund may enter into swap agreements, including interest rate swaps and currency swaps (e.g., Euro vs. U.S. dollar), and may buy or sell put and call options on foreign currencies, either on exchanges or in the over-thecounter market. The Fund may enter into repurchase agreements with counterparties that are deemed to present acceptable credit risks, and may enter into reverse repurchase agreements, which involve the sale of securities held by the Fund subject to its agreement to repurchase the securities at an agreed upon date or upon demand and at a price reflecting a market rate of interest. The Fund may invest in the securities of other investment companies (including money market funds and exchange-traded funds (‘‘ETFs’’)). The Fund may invest up to an aggregate amount of 15% of its net assets in (a) illiquid securities and (b) Rule 144A securities. Illiquid securities include securities subject to contractual or other restrictions on resale and other instruments that lack readily available markets.20 The Fund will not invest in non-U.S. equity securities. The Shares The Fund issues and redeems Shares on a continuous basis at net asset value (‘‘NAV’’) 21 only in large blocks of Shares (‘‘Creation Units’’) in transactions with authorized participants. Creation Units 20 The Commission has stated that long-standing Commission guidelines have required open-end funds to hold no more than 15% of their net assets in illiquid securities and other illiquid assets. See Investment Company Act Release No. 28193 (March 11, 2008), 73 14617 (March 18, 2008), footnote 34. See also Investment Company Act Release No. 5847 (October 21, 1969), 35 FR 19989 (December 31, 1970) (Statement Regarding ‘‘Restricted Securities’’); Investment Company Act Release No. 18612 (March 12, 1992), 57 FR 9828 (March 20, 1992) (Revisions of Guidelines to Form N–1A). A fund’s portfolio security is illiquid if it cannot be disposed of in the ordinary course of business within seven days at approximately the value ascribed to it by the ETF. See Investment Company Act Release No. 14983 (March 12, 1986), 51 FR 9773 (March 21, 1986) (adopting amendments to Rule 2a–7 under the 1940 Act); Investment Company Act Release No. 17452 (April 23, 1990), 55 FR 17933 (April 30, 1990) (adopting Rule 144A under the Securities Act of 1933). 21 The NAV of the Fund’s Shares generally is calculated once daily Monday through Friday as of the close of regular trading on the New York Stock Exchange, generally 4:00 p.m. Eastern time (the ‘‘NAV Calculation Time’’). NAV per Share is calculated by dividing the Fund’s net assets by the number of Fund Shares outstanding. For more information regarding the valuation of Fund investments in calculating the Fund’s NAV, see the Registration Statement. E:\FR\FM\10JNN1.SGM 10JNN1 34116 Federal Register / Vol. 76, No. 112 / Friday, June 10, 2011 / Notices WReier-Aviles on DSKGBLS3C1PROD with NOTICES generally will consist of 100,000 Shares, though this may change from time to time. Creation Units are not expected to consist of less than 50,000 Shares. The Fund generally will issue and redeem Creation Units in exchange for a portfolio of Fixed Income Securities closely approximating the holdings of the Fund and/or a designated amount of cash in U.S. dollars. Once created, Shares of the Fund will trade on the secondary market in amounts less than a Creation Unit. Shares may be redeemed from the Fund only in Creation Unit aggregations. Upon delivery and settlement of the Shares upon redemption, the Fund will deliver to the redeeming authorized participant a designated basket of Fixed Income Securities and an amount of cash. Together, such Fixed Income Securities and amount of cash constitute the ‘‘Redemption Payment.’’ The Redemption Payment may consist entirely of cash at the discretion of the Fund. Additional information regarding the Shares and the Fund, including investment strategies, risks, creation and redemption procedures, fees, portfolio holdings disclosure policies, distributions and taxes is included in the Registration Statement. Availability of Information The Fund’s Web site (http:// www.wisdomtree.com), which will be publicly available prior to the public offering of Shares, will include a form of the Prospectus for the Fund that may be downloaded. The website will include additional quantitative information updated on a daily basis, including, for the Fund: (1) The prior business day’s reported NAV, mid-point of the bid/ask spread at the time of calculation of such NAV (the ‘‘Bid/Ask Price’’),22 and a calculation of the premium and discount of the Bid/Ask Price against the NAV; and (2) data in chart format displaying the frequency distribution of discounts and premiums of the daily Bid/Ask Price against the NAV, within appropriate ranges, for each of the four previous calendar quarters. On each business day, before commencement of trading in Shares in the Core Trading Session 23 on the Exchange, the Trust will disclose on its website the identities and quantities of the portfolio of securities and other 22 The Bid/Ask Price of the Fund is determined using the midpoint of the highest bid and the lowest offer on the Exchange as of the time of calculation of such Fund’s NAV. The records relating to Bid/Ask Prices will be retained by the Fund and its service providers. 23 The Core Trading Session is 9:30 a.m. to 4 p.m. Eastern time. VerDate Mar<15>2010 14:33 Jun 09, 2011 Jkt 223001 assets (the ‘‘Disclosed Portfolio’’) held by the Fund that will form the basis for the Fund’s calculation of NAV at the end of the business day.24 The Disclosed Portfolio will include, as applicable, the names, quantity, percentage weighting and market value of Fixed Income Securities, and other assets held by the Fund and the characteristics of such assets. The website and information will be publicly available at no charge. In addition, for the Fund, an estimated value, defined in Rule 8.600 as the ‘‘Portfolio Indicative Value,’’ that reflects an estimated intraday value of the Fund’s portfolio, will be disseminated. The Portfolio Indicative Value will be based upon the current value for the components of the Disclosed Portfolio and will be updated and disseminated by one or more major market data vendors at least every 15 seconds during the Core Trading Session on the Exchange. In addition, during hours when the markets for Fixed Income Securities in the Fund’s portfolio are closed, the Portfolio Indicative Value will be updated at least every 15 seconds during the Core Trading Session to reflect currency exchange fluctuations. The dissemination of the Portfolio Indicative Value, together with the Disclosed Portfolio, will allow investors to determine the value of the underlying portfolio of the Fund on a daily basis and to provide a close estimate of that value throughout the trading day. Information regarding market price and volume of the Shares is and will be continually available on a real-time basis throughout the day on brokers’ computer screens and other electronic services. The previous day’s closing price and trading volume information for the Shares will be published daily in the financial section of newspapers. Quotation and last sale information for the Shares will be available via the Consolidated Tape Association highspeed line. Intra-day and end-of-day prices are readily available through major market data providers and broker-dealers for the Fixed Income Securities, Money Market Securities and derivative instruments held by the Fund. 24 Under accounting procedures followed by the Fund, trades made on the prior business day (‘‘T’’) will be booked and reflected in NAV on the current business day (‘‘T+1’’). Notwithstanding the foregoing, portfolio trades that are executed prior to the opening of the Exchange on any business day may be booked and reflected in NAV on such business day. Accordingly, the Fund will be able to disclose at the beginning of the business day the portfolio that will form the basis for the NAV calculation at the end of the business day. PO 00000 Frm 00086 Fmt 4703 Sfmt 4703 Initial and Continued Listing The Shares will be subject to Rule 8.600, which sets forth the initial and continued listing criteria applicable to Managed Fund Shares. The Exchange represents that, for initial and/or continued listing, the Fund must be in compliance with Rule 10A–3 under the Exchange Act,25 as provided by NYSE Arca Equities Rule 5.3. A minimum of 100,000 Shares will be outstanding at the commencement of trading on the Exchange. The Exchange will obtain a representation from the issuer of the Shares that the NAV per Share will be calculated daily and that the NAV and the Disclosed Portfolio will be made available to all market participants at the same time. Trading Halts With respect to trading halts, the Exchange may consider all relevant factors in exercising its discretion to halt or suspend trading in the Shares of the Fund. Shares of the Fund will be halted if the ‘‘circuit breaker’’ parameters in NYSE Arca Equities Rule 7.12 are reached. Trading may be halted because of market conditions or for reasons that, in the view of the Exchange, make trading in the Shares inadvisable. These may include: (1) The extent to which trading is not occurring in the securities and/or the financial instruments comprising the Disclosed Portfolio of the Fund; or (2) whether other unusual conditions or circumstances detrimental to the maintenance of a fair and orderly market are present. Trading in the Shares will be subject to Rule 8.600(d)(2)(D), which sets forth circumstances under which Shares of the Fund may be halted. Trading Rules The Exchange deems the Shares to be equity securities, thus rendering trading in the Shares subject to the Exchange’s existing rules governing the trading of equity securities. Shares will trade on the NYSE Arca Marketplace from 4 a.m. to 8 p.m. Eastern time in accordance with NYSE Arca Equities Rule 7.34 (Opening, Core, and Late Trading Sessions). The Exchange has appropriate rules to facilitate transactions in the Shares during all trading sessions. As provided in NYSE Arca Equities Rule 7.6, Commentary .03, the minimum price variation (‘‘MPV’’) for quoting and entry of orders in equity securities traded on the NYSE Arca Marketplace is $0.01, with the exception of securities that are priced less than $1.00 for which the MPV for order entry is $0.0001. 25 See E:\FR\FM\10JNN1.SGM 17 CFR 240.10A–3. 10JNN1 Federal Register / Vol. 76, No. 112 / Friday, June 10, 2011 / Notices Surveillance The Exchange intends to utilize its existing surveillance procedures applicable to derivative products (which includes Managed Fund Shares) to monitor trading in the Shares. The Exchange represents that these procedures are adequate to properly monitor Exchange trading of the Shares in all trading sessions and to deter and detect violations of Exchange rules and applicable federal securities laws. The Exchange’s current trading surveillance focuses on detecting securities trading outside their normal patterns. When such situations are detected, surveillance analysis follows and investigations are opened, where appropriate, to review the behavior of all relevant parties for all relevant trading violations. The Exchange may obtain information via the Intermarket Surveillance Group (‘‘ISG’’) from other exchanges who are members of the ISG or with which the Exchange has in place a comprehensive surveillance sharing agreement.26 In addition, the Exchange also has a general policy prohibiting the distribution of material, non-public information by its employees. WReier-Aviles on DSKGBLS3C1PROD with NOTICES Information Bulletin Prior to the commencement of trading, the Exchange will inform its Equity Trading Permit (‘‘ETP’’) Holders in an Information Bulletin (‘‘Bulletin’’) of the special characteristics and risks associated with trading the Shares. Specifically, the Bulletin will discuss the following: (1) The procedures for purchases and redemptions of Shares in Creation Unit aggregations (and that Shares are not individually redeemable); (2) NYSE Arca Equities Rule 9.2(a), which imposes a duty of due diligence on its ETP Holders to learn the essential facts relating to every customer prior to trading the Shares; (3) the risks involved in trading the Shares during the Opening and Late Trading Sessions when an updated Portfolio Indicative Value will not be calculated or publicly disseminated; (4) how information regarding the Portfolio Indicative Value is disseminated; (5) the requirement that ETP Holders deliver a prospectus to investors purchasing newly issued Shares prior to or concurrently with the confirmation of a transaction; and (6) trading information. 26 For a list of the current members of ISG, see http://www.isgportal.org. The Exchange notes that not all of the components of the Disclosed Portfolio for the Fund may trade on exchanges that are members of the ISG or with which the Exchange has in place a comprehensive surveillance sharing agreement. VerDate Mar<15>2010 14:33 Jun 09, 2011 Jkt 223001 In addition, the Bulletin will reference that the Fund is subject to various fees and expenses described in the Registration Statement. The Bulletin will discuss any exemptive, no-action, and interpretive relief granted by the Commission from any rules under the Exchange Act. The Bulletin will also disclose that the NAV for the Shares will be calculated after 4 p.m. Eastern time each trading day. 2. Statutory Basis The basis under the Exchange Act for this proposed rule change is the requirement under Section 6(b)(5) 27 that an exchange have rules that are designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to remove impediments to, and perfect the mechanism of a free and open market and, in general, to protect investors and the public interest. The Exchange believes that the proposed rule change is designed to prevent fraudulent and manipulative acts and practices in that the Shares will be listed and traded on the Exchange pursuant to the initial and continued listing criteria in NYSE Arca Equities Rule 8.600. The Exchange has in place surveillance procedures that are adequate to properly monitor trading in the Shares in all trading sessions and to deter and detect violations of Exchange rules and applicable federal securities laws. The Exchange may obtain information via ISG from other exchanges that are members of ISG or with which the Exchange has entered into a comprehensive surveillance sharing agreement. According to the Registration Statement, under normal circumstances, the Fund will invest at least 80% of its net assets in Fixed Income Securities denominated in Euros. The Fund intends to focus its investments on Sovereign Debt, as described above. The Fund will invest up to 20% of its net assets only in corporate bonds that the Adviser or SubAdviser deems to be sufficiently liquid. Generally a corporate bond must have $200 million or more par amount outstanding and significant par value traded to be considered as an eligible investment. The Fund expects to have 75% or more of its assets invested in investment grade bonds, though this percentage may change from time to time in accordance with market conditions and the debt ratings assigned to countries and issuers. Under normal circumstances, the Fund will invest no more than 20% of the value of the Fund’s net assets in derivative 27 15 PO 00000 U.S.C. 78f(b)(5). Frm 00087 Fmt 4703 Sfmt 4703 34117 instruments. Such investments will be consistent with the Fund’s investment objective and will not be used to enhance leverage. The Fund will not invest in non-U.S. equity securities. The proposed rule change is designed to promote just and equitable principles of trade and to protect investors and the public interest in that the Exchange will obtain a representation from the issuer of the Shares that the NAV per Share will be calculated daily and that the NAV and the Disclosed Portfolio will be made available to all market participants at the same time. In addition, a large amount of information is publicly available regarding the Fund and the Shares, thereby promoting market transparency. The Fund’s portfolio holdings will be disclosed on its website daily after the close of trading on the Exchange and prior to the opening of trading on the Exchange the following day. Moreover, the Portfolio Indicative Value will be disseminated by one or more major market data vendors at least every 15 seconds during the Exchange’s Core Trading Session. On each business day, before commencement of trading in Shares in the Core Trading Session on the Exchange, the Fund will disclose on its website the Disclosed Portfolio that will form the basis for the Fund’s calculation of NAV at the end of the business day. Information regarding market price and trading volume of the Shares is and will be continually available on a real-time basis throughout the day on brokers’ computer screens and other electronic services, and quotation and last sale information will be available via the CTA high-speed line. The website for the Fund will include a form of the Prospectus for the Fund and additional data relating to NAV and other applicable quantitative information. Moreover, prior to the commencement of trading, the Exchange will inform its ETP Holders in an Information Bulletin of the special characteristics and risks associated with trading the Shares. Trading in Shares of the Fund will be halted if the circuit breaker parameters in NYSE Arca Equities Rule 7.12 have been reached or because of market conditions or for reasons that, in the view of the Exchange, make trading in the Shares inadvisable, and trading in the Shares will be subject to NYSE Arca Equities Rule 8.600(d)(2)(D), which sets forth circumstances under which Shares of the Fund may be halted. In addition, as noted above, investors will have ready access to information regarding the Fund’s holdings, the Portfolio Indicative Value, the Disclosed E:\FR\FM\10JNN1.SGM 10JNN1 34118 Federal Register / Vol. 76, No. 112 / Friday, June 10, 2011 / Notices Portfolio, and quotation and last sale information for the Shares. The proposed rule change is designed to perfect the mechanism of a free and open market and, in general, to protect investors and the public interest in that it will facilitate the listing and trading of an additional type of activelymanaged exchange-traded product that will enhance competition among market participants, to the benefit of investors and the marketplace. As noted above, the Exchange has in place surveillance procedures relating to trading in the Shares and may obtain information via ISG from other exchanges that are members of ISG or with which the Exchange has entered into a comprehensive surveillance sharing agreement. In addition, as noted above, investors will have ready access to information regarding the Fund’s holdings, the Portfolio Indicative Value, the Disclosed Portfolio, and quotation and last sale information for the Shares. B. Self-Regulatory Organization’s Statement on Burden on Competition The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. C. Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others No written comments were solicited or received with respect to the proposed rule change. WReier-Aviles on DSKGBLS3C1PROD with NOTICES III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Within 45 days of the date of publication of this notice in the Federal Register or within such longer period (i) as the Commission may designate up to 90 days of such date if it finds such longer period to be appropriate and publishes its reasons for so finding or (ii) as to which the self-regulatory organization consents, the Commission shall: (A) By order approve or disapprove the proposed rule change, or (B) institute proceedings to determine whether the proposed rule change should be disapproved. IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: VerDate Mar<15>2010 17:21 Jun 09, 2011 Jkt 223001 Electronic Comments • Use the Commission’s Internet comment form (http://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File Number SR–NYSEArca–2011–31 on the subject line. Paper Comments • Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549–1090. SECURITIES AND EXCHANGE COMMISSION [Release No. 34–64605; File No. SR–DTC– 2011–05] Self-Regulatory Organizations; The Depository Trust Company; Order Granting Approval of a Proposed Rule Change To Amend Rules Relating to the Memo Segregation Function June 6, 2011. I. Introduction On April 15, 2011, The Depository Trust Company (‘‘DTC’’) filed with the Securities and Exchange Commission (‘‘Commission’’) proposed rule change All submissions should refer to File SR–DTC–2011–05 pursuant to Section Number SR–NYSEArca–2011–31. This 19(b)(1) of the Securities Exchange Act file number should be included on the of 1934 (‘‘Act’’).1 Notice of the proposal subject line if e-mail is used. To help the was published in the Federal Register Commission process and review your on May 4, 2011.2 The Commission comments more efficiently, please use received no comment letters. For the only one method. The Commission will reasons discussed below, the post all comments on the Commission’s Commission is granting approval of the Internet Web site (http://www.sec.gov/ proposed rule change. rules/sro.shtml). Copies of the II. Description submission, all subsequent DTC’s Memo Segregation Service amendments, all written statements (‘‘MSEG’’) is an optional service which with respect to the proposed rule offers a mechanism for broker-dealer change that are filed with the participants to protect fully-paid or Commission, and all written excess margin securities by allowing the communications relating to the participant to shield from unintended proposed rule change between the Commission and any person, other than delivery a designated quantity of securities that are in the participant’s those that may be withheld from the DTC free account or that may be public in accordance with the received during the daily processing provisions of 5 U.S.C. 552, will be cycle. Currently, a participant may set a available for website viewing and ‘‘counter’’ for a specified minimum printing in the Commission’s Public quantity of each security to be held in Reference Room, 100 F Street, NE., its account as a threshold to any Washington, DC 20549, on official intraday redelivery. When the counter business days between the hours of 10 for a security is greater than the a.m. and 3 p.m. Copies of the filing will inventory of the participant, MSEG will also be available for inspection and prevent the delivery of any quantity of copying at the principal office of the the security out of the participant’s Exchange. All comments received will account unless: (1) The delivery is a be posted without change; the permitted delivery (e.g., a free of value Commission does not edit personal ACATS delivery or a ‘‘turnaround’’ as identifying information from described below) or (2) the participant submissions. You should submit only provides DTC with new instructions to information that you wish to make reduce the MSEG counter. The MSEG procedures currently available publicly. All submissions should refer to File No. SR–NYSEArca– support two optional ‘‘turnaround’’ 2011–31 and should be submitted on or MSEG indicators which enable participants to make deliveries for before July 1, 2011. certain transaction types (including, but For the Commission, by the Division of not limited to, stock loans and stock Trading and Markets, pursuant to delegated loan returns) from certain positions authority.28 received intraday regardless of any Cathy H. Ahn, MSEG-related deficit. Recently, DTC Deputy Secretary. was advised by the Regulatory and [FR Doc. 2011–14415 Filed 6–9–11; 8:45 am] Clearance Committee of the Securities BILLING CODE 8011–01–P 1 15 U.S.C. 78s(b)(1). Exchange Act Release No. 64360 (April 28, 2011), 76 FR 25389 (May 4, 2011). 2 Securities 28 17 PO 00000 CFR 200.30–3(a)(12). Frm 00088 Fmt 4703 Sfmt 4703 E:\FR\FM\10JNN1.SGM 10JNN1

Agencies

[Federal Register Volume 76, Number 112 (Friday, June 10, 2011)]
[Notices]
[Pages 34112-34118]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-14415]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-64608; File No. SR-NYSEArca-2011-31]


Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
of Proposed Rule Change To List and Trade the Shares of the WisdomTree 
Dreyfus Euro Debt Fund Under NYSE Arca Equities Rule 8.600

June 6, 2011.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that, on May 24, 2011, NYSE Arca, Inc. (the ``Exchange'' or ``NYSE 
Arca'') filed with the Securities and Exchange Commission (the 
``Commission'') the proposed rule change as described in Items I and II 
below, which Items have been prepared by the Exchange. The Commission 
is publishing this notice to solicit comments on the proposed rule 
change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to list and trade the shares (``Shares'') of 
the following fund of the WisdomTree Trust (the ``Trust'') under NYSE 
Arca Equities Rule 8.600 (``Managed Fund Shares''): WisdomTree Dreyfus 
Euro Debt Fund. The text of the proposed rule change is available at 
the Exchange, the Commission's Public Reference Room, and http://www.nyse.com.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the self-regulatory organization 
included statements concerning the purpose of, and basis for, the 
proposed rule change and discussed any comments it received on the 
proposed rule change. The text of those statements may be examined at 
the places specified in Item IV below. The Exchange has prepared 
summaries, set forth in sections A, B, and C below, of the most 
significant parts of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to list and trade the Shares of the 
WisdomTree Dreyfus Euro Debt Fund (``Fund'') under NYSE Arca Equities 
Rule 8.600, which governs the listing and trading of Managed Fund 
Shares on the Exchange.\3\ The Shares will be offered

[[Page 34113]]

by the Trust, which was established as a Delaware statutory trust on 
December 15, 2005. The Trust is registered with the Commission as an 
investment company and the Fund has filed a registration statement on 
Form N-1A (``Registration Statement'') with the Commission. The Fund is 
currently known as the ``WisdomTree Dreyfus Euro Fund'' and is an 
actively managed exchange-traded fund. The Commission approved listing 
and trading on the Exchange of the WisdomTree Dreyfus Euro Fund 
pursuant to Section 19(b)(2) of the Exchange Act on May 8, 2008 (``May 
2008 Order'').\4\ On April 14, 2011, the WisdomTree Dreyfus Euro Fund 
filed a supplement to its Registration Statement (the ``Supplement'') 
pursuant to Rule 497 under the Securities Act of 1933.\5\ As stated in 
the Supplement, the WisdomTree Dreyfus Euro Fund, effective on or after 
June 27, 2011, will change its investment objective and strategy and 
will be renamed the ``WisdomTree Dreyfus Euro Debt Fund.'' \6\ The 
WisdomTree Dreyfus Euro Fund's new name, investment objective, and 
investment strategies, which are not reflected in the May 2008 Order, 
are described below. Shareholders of the WisdomTree Dreyfus Euro Fund 
who wish to remain in the Fund do not need to take any action. 
Shareholders who do not wish to remain invested in the Fund may sell 
their Shares at any time.
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    \3\ The Commission approved NYSE Arca Equities Rule 8.600 and 
the listing and trading of certain funds of the PowerShares Actively 
Managed Funds Trust on the Exchange pursuant to Rule 8.600 in 
Securities Exchange Act Release No. 57619 (April 4, 2008), 73 FR 
19544 (April 10, 2008) (SR-NYSEArca-2008-25). The Commission also 
previously approved listing and trading on the Exchange of a number 
of actively managed funds under Rule 8.600. See, e.g., Securities 
Exchange Act Release Nos. 57801 (May 8, 2008), 73 FR 27878 (May 14, 
2008) (SR-NYSEArca-2008-31) (order approving Exchange listing and 
trading of twelve actively managed funds of the WisdomTree Trust); 
58564 (September 17, 2008), 73 FR 55194 (September 24, 2008) (SR-
NYSEArca-2008-86) (order approving Exchange listing and trading of 
WisdomTree Dreyfus Emerging Currency Fund); 62604 (July 30, 2010), 
75 FR 47323 (August 5, 2010) (SR-NYSEArca-2010-49) (order approving 
listing and trading of WisdomTree Emerging Markets Local Debt Fund); 
62623 (August 2, 2010), 75 FR 47652 (August 6, 2010) (SR-NYSEArca-
2010-51) (order approving listing and trading of WisdomTree Dreyfus 
Commodity Currency Fund); 63598 (December 22, 2010), 75 FR 82106 
(December 29, 2010) (SR-NYSEArca-2010-98) (order approving listing 
and trading of WisdomTree Managed Futures Strategy Fund); and 63919 
(February 16, 2011), 76 FR 10073 (February 23, 2011) (SR-NYSEArca-
2010-116) (order approving listing and trading of WisdomTree Asia 
Local Debt Fund).
    \4\ See Securities Exchange Act Release No. 57801 (May 8, 2008), 
73 FR 27878 (May 14, 2008) (SR-NYSEArca-2008-31) (order approving 
Exchange listing and trading of twelve actively managed funds of the 
WisdomTree Trust).
    \5\ 15 U.S.C. 77a et seq.
    \6\ See Form 497, Supplement to Registration Statement on Form 
N-1A for the Trust, dated April 14, 2011 (File Nos. 333-132380 and 
811-21864). The descriptions of the Fund and the Shares contained 
herein are based, in part, on information in the Supplement and the 
Registration Statement.
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Description of the Shares and the Fund
    WisdomTree Asset Management, Inc. (``WisdomTree Asset Management'') 
is the investment adviser (``Adviser'') to the Fund.\7\ The Dreyfus 
Corporation serves as sub-adviser for the Fund (``Sub-Adviser'').\8\ 
The Bank of New York Mellon is the administrator, custodian and 
transfer agent for the Trust. ALPS Distributors, Inc. serves as the 
distributor for the Trust.\9\
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    \7\ WisdomTree Investments, Inc. (``WisdomTree Investments'') is 
the parent company of WisdomTree Asset Management.
    \8\ The Sub-Adviser is responsible for day-to-day management of 
the Fund and, as such, typically makes all decisions with respect to 
portfolio holdings. The Adviser has ongoing oversight 
responsibility.
    \9\ The Commission has issued an order granting certain 
exemptive relief to the Trust under the Investment Company Act of 
1940 (15 U.S.C. 80a-1) (``1940 Act''). See Investment Company Act 
Release No. 28171 (October 27, 2008) (File No. 812-13458). In 
compliance with Commentary .05 to NYSE Arca Equities Rule 8.600, 
which applies to Managed Fund Shares based on an international or 
global portfolio, the Trust's application for exemptive relief under 
the 1940 Act states that the Fund will comply with the federal 
securities laws in accepting securities for deposits and satisfying 
redemptions with redemption securities, including that the 
securities accepted for deposits and the securities used to satisfy 
redemption requests are sold in transactions that would be exempt 
from registration under the Securities Act of 1933 (15 U.S.C. 77a).
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    Commentary .06 to Rule 8.600 provides that, if the investment 
adviser to the Investment Company issuing Managed Fund Shares is 
affiliated with a broker-dealer, such investment adviser shall erect a 
``fire wall'' between the investment adviser and the broker-dealer with 
respect to access to information concerning the composition and/or 
changes to such Investment Company portfolio.\10\ In addition, 
Commentary .06 further requires that personnel who make decisions on 
the open-end fund's portfolio composition must be subject to procedures 
designed to prevent the use and dissemination of material nonpublic 
information regarding the open-end fund's portfolio. Commentary .06 to 
Rule 8.600 is similar to Commentary .03(a)(i) and (iii) to NYSE Arca 
Equities Rule 5.2(j)(3); however, Commentary .06 in connection with the 
establishment of a ``fire wall'' between the investment adviser and the 
broker-dealer reflects the applicable open-end fund's portfolio, not an 
underlying benchmark index, as is the case with index-based funds. The 
Adviser is not affiliated with any broker-dealer. The Sub-Adviser is 
affiliated with multiple broker-dealers and has implemented a ``fire 
wall'' with respect to such broker-dealers regarding access to 
information concerning the composition and/or changes to the Fund's 
portfolio. In addition, Sub-Adviser personnel who make decisions 
regarding the Fund's portfolio are subject to procedures designed to 
prevent the use and dissemination of material nonpublic information 
regarding the Fund's portfolio. In the event (a) the Adviser or the 
Sub-Adviser becomes newly affiliated with a broker-dealer, or (b) any 
new adviser or sub-adviser becomes affiliated with a broker-dealer, 
they [sic] will implement a fire wall with respect to such broker-
dealer regarding access to information concerning the composition and/
or changes to the portfolio, and will be subject to procedures designed 
to prevent the use and dissemination of material non-public information 
regarding such portfolio.
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    \10\ An investment adviser to an open-end fund is required to be 
registered under the Investment Advisers Act of 1940 (the ``Advisers 
Act''). As a result, the Adviser and Sub-Adviser and their related 
personnel are subject to the provisions of Rule 204A-1 under the 
Advisers Act relating to codes of ethics. This Rule requires 
investment advisers to adopt a code of ethics that reflects the 
fiduciary nature of the relationship to clients as well as 
compliance with other applicable securities laws. Accordingly, 
procedures designed to prevent the communication and misuse of non-
public information by an investment adviser must be consistent with 
Rule 204A-1 under the Advisers Act. In addition, Rule 206(4)-7 under 
the Advisers Act makes it unlawful for an investment adviser to 
provide investment advice to clients unless such investment adviser 
has (i) adopted and implemented written policies and procedures 
reasonably designed to prevent violation, by the investment adviser 
and its supervised persons, of the Advisers Act and the Commission 
rules adopted thereunder; (ii) implemented, at a minimum, an annual 
review regarding the adequacy of the policies and procedures 
established pursuant to subparagraph (i) above and the effectiveness 
of their implementation; and (iii) designated an individual (who is 
a supervised person) responsible for administering the policies and 
procedures adopted under subparagraph (i) above.
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WisdomTree Dreyfus Euro Debt Fund
    As noted above, effective on or after June 27, 2011, the WisdomTree 
Dreyfus Euro Fund will change its investment objective and investment 
strategies and be renamed the ``WisdomTree Dreyfus Euro Debt Fund.'' 
Upon implementation of the change, the Fund's new investment objective 
will be to seek a high level of total returns consisting of both income 
and capital appreciation and its investment strategies will be changed 
as described below.\11\
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    \11\ The Adviser represents that the Supplement has been sent to 
existing Shareholders of the Fund to notify them of the planned 
change. The Supplement and additional information have been posted 
on the Fund's website at http://www.wisdomtree.com.
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Euro-Denominated Debt
    Under normal circumstances, the Fund will invest at least 80% of 
its net assets in Fixed Income Securities denominated in Euros.\12\ For 
purposes of this proposed rule change, Fixed Income Securities include 
bonds, notes or other debt obligations, such as government or corporate 
bonds, denominated in Euros, including issues denominated in Euros that 
are issued by ``supranational issuers,'' such as the European 
Investment Bank, International Bank for Reconstruction and Development, 
and the International Finance Corporation, or other regional

[[Page 34114]]

development banks, as well as development agencies supported by other 
national governments. Under normal circumstances, the Fund may invest 
up to 20% of its assets in Fixed Income Securities denominated in U.S. 
dollars. The Fund may invest in Money Market Securities and derivative 
and other instruments, as described below.\13\
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    \12\ The term ``under normal market circumstances'' includes, 
but is not limited to, the absence of extreme volatility or trading 
halts in the fixed income markets or the financial markets 
generally; operational issues causing dissemination of inaccurate 
market information; or force majeure type events such as systems 
failure, natural or man-made disaster, act of God, armed conflict, 
act of terrorism, riot or labor disruption or any similar 
intervening circumstance.
    \13\ As of February 17, 2011, the amount of Euro-denominated 
debt outstanding exceeded US$19.2 trillion. Source: Deutsche 
Bundesbank, at http://www.bundesbank.de/statistik/statistik_eszb_neuesfenster_tabelle.php?stat=debt_securities&lang=.en.
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    The Fund intends to focus its investments on ``Sovereign Debt.'' 
For these purposes, Sovereign Debt means Fixed Income Securities issued 
by governments, government agencies and government-sponsored 
enterprises of countries in the European Union (``EU'') that are 
denominated in Euros.\14\ This includes inflation-linked bonds designed 
to provide protection against increases in general inflation rates. The 
Fund may invest up to 20% of its net assets in corporate debt of 
companies organized in EU countries or that have significant economic 
ties to EU countries. The Fund will invest only in corporate bonds that 
the Adviser or Sub-Adviser deems to be sufficiently liquid. Generally, 
a corporate bond must have $200 million or more par amount outstanding 
and significant par value traded to be considered as an eligible 
investment. Economic and other conditions may, from time to time, lead 
to a decrease in the average par amount outstanding of bond issuances. 
Therefore, although the Fund does not intend to do so, the Fund may 
invest up to 5% of its net assets in corporate bonds with less than 
$200 million par amount outstanding if (i) the Adviser or Sub-Adviser 
deems such security to be sufficiently liquid based on its analysis of 
the market for such security (based on, for example, broker-dealer 
quotations or its analysis of the trading history of the security or 
the trading history of other securities issued by the issuer), (ii) 
such investment is consistent with the Fund's goal of providing 
exposure to a broad range of Fixed Income Securities denominated in 
Euros, and (iii) such investment is deemed by the Adviser or Sub-
Adviser to be in the best interest of the Fund.
---------------------------------------------------------------------------

    \14\ As of February 17, 2011, the amount of sovereign Euro-
denominated debt outstanding exceeded US$8.02 trillion. Source: 
Deutsche Bundesbank, at http://www.bundesbank.de/statistik/statistik_eszb_neuesfenster_tabelle.php?stat=debt_securities&lang=.en.
---------------------------------------------------------------------------

    The Fund intends to provide broad exposure to countries in the EU. 
As a general matter, the Fund will invest a higher percentage of its 
assets in countries with larger and more liquid debt markets. The 
Fund's exposure to any single country generally will be limited to 20% 
of the Fund's assets. The percentage of Fund assets invested in a 
specific country or issuer will change from time to time.
    The universe of Euro-denominated Fixed Income Securities currently 
includes securities that are rated ``investment grade'' as well as 
``non-investment grade.'' As the Fund intends to provide broad-based 
exposure to Euro-denominated Fixed Income Securities, the Fund will 
invest in both investment-grade and non-investment-grade securities. 
Securities rated investment grade generally are considered to be of 
higher credit quality and subject to lower default risk. Although 
securities rated below investment grade may offer the potential for 
higher yields, they generally are subject to a higher potential risk of 
loss. The Fund expects to have 75% or more of its assets invested in 
investment grade bonds, though this percentage may change from time to 
time in accordance with market conditions and the debt ratings assigned 
to countries and issuers.
    Because the debt ratings of issuers will change from time to time, 
the exact percentage of the Fund's investments in investment grade and 
non-investment grade Fixed Income Securities will change from time to 
time in response to economic events and changes to the credit ratings 
of such issuers. Within the non-investment grade category some issuers 
and instruments are considered to be of lower credit quality and at 
higher risk of default. In order to limit its exposure to these more 
speculative credits, the Fund will not invest more than 10% of its 
assets in securities rated BB or below by Moody's, or equivalently 
rated by S&P or Fitch. The Fund does not intend to invest in unrated 
securities. However, it may do so to a limited extent, such as where a 
rated security becomes unrated, if such security is determined by the 
Adviser and Sub-Adviser to be of comparable quality. In determining 
whether a security is of ``comparable quality,'' the Adviser or Sub-
Adviser will consider, for example, current information about the 
credit quality of the issuer and whether or not the issuer of the 
security has issued other rated securities.
    The Fund attempts to limit interest rate risk by maintaining an 
aggregate portfolio duration of between two and eight years under 
normal market conditions. Aggregate portfolio duration is important to 
investors as an indication of the Fund's sensitivity to changes in 
interest rates. Funds with higher durations generally are subject to 
greater interest rate risk. An aggregate portfolio duration of between 
two and eight years generally would be considered to be 
``intermediate.'' The Fund's actual portfolio duration may be longer or 
shorter depending upon market conditions. The Fund may also invest in 
short-term Money Market Securities (as defined below) denominated in 
the currencies of countries in which the Fund invests.
    The Fund intends to invest in Fixed Income Securities of at least 
13 non-affiliated issuers. The Fund will not concentrate 25% or more of 
the value of its total assets (taken at market value at the time of 
each investment) in any one industry, as that term is used in the 1940 
Act (except that this restriction does not apply to obligations issued 
by the U.S. government, or any non-U.S. government, or their respective 
agencies and instrumentalities or government-sponsored 
enterprises).\15\
---------------------------------------------------------------------------

    \15\ See Form N-1A, Item 9. The Commission has taken the 
position that a fund is concentrated if it invests more than 25% of 
the value of its total assets in any one industry. See, e.g., 
Investment Company Act Release No. 9011 (October 30, 1975), 40 FR 
54241 (November 21, 1975).
---------------------------------------------------------------------------

    The Fund intends to qualify each year as a regulated investment 
company (a ``RIC'') under Subchapter M of the Internal Revenue Code of 
1986, as amended.\16\ The Fund will invest its assets, and otherwise 
conduct its operations, in a manner that is intended to satisfy the 
qualifying income, diversification and distribution requirements 
necessary to establish and maintain RIC qualification under Subchapter 
M. The Subchapter M diversification tests generally require that (i) 
the Fund invest no more than 25% of its total assets in securities 
(other than securities of the U.S. government or other RICs) of any one 
issuer or two or more issuers that are controlled by the Fund and that 
are engaged in the same, similar or related trades or businesses, and 
(ii) at least 50% of the Fund's total assets consist of cash and cash 
items, U.S. government securities, securities of other RICs and other 
securities, with investments in such other securities limited in 
respect of any one issuer to an amount not greater than 5% of the value 
of the Fund's total assets and 10% of the outstanding voting securities 
of such issuer.
---------------------------------------------------------------------------

    \16\ 26 U.S.C. 851.
---------------------------------------------------------------------------

    In addition to satisfying the above referenced RIC diversification 
requirements, no portfolio security held by the Fund (other than U.S. 
government securities and non-U.S. government securities) will 
represent

[[Page 34115]]

more than 30% of the weight of the Fund's portfolio and the five 
highest weighted portfolio securities of the Fund (other than U.S. 
government securities and/or non-U.S. government securities) will not 
in the aggregate account for more than 65% of the weight of the Fund's 
portfolio. For these purposes, the Fund may treat repurchase agreements 
collateralized by U.S. government securities or non-U.S. government 
securities as U.S. or non-U.S. government securities, as applicable.
Money Market Securities
    Assets not invested in Fixed Income Securities generally will be 
invested in Money Market Securities. The Fund intends to invest in 
Money Market Securities in order to help manage cash flows in and out 
of the Fund, such as in connection with payment of dividends or 
expenses, and to satisfy margin requirements, to provide collateral or 
to otherwise back investments in derivative instruments. For these 
purposes, Money Market Securities include: short-term, high-quality 
obligations issued or guaranteed by the U.S. Treasury or the agencies 
or instrumentalities of the U.S. government; short-term, high-quality 
securities issued or guaranteed by non-U.S. governments, agencies and 
instrumentalities; repurchase agreements backed by short-term U.S. 
government securities or non-U.S. government securities; money market 
mutual funds; and deposits and other obligations of U.S. and non-U.S. 
banks and financial institutions. All Money Market Securities acquired 
by the Fund will be rated investment grade, except that the Fund may 
invest in unrated Money Market Securities that are deemed by the 
Adviser or Sub-Adviser to be of comparable quality to Money Market 
Securities rated investment grade. In determining whether a security is 
of ``comparable quality,'' the Adviser or Sub-Adviser will consider, 
for example, current information about the credit quality of the issuer 
and whether or not the issuer of the security has issued other rated 
securities.
Derivative Instruments and Other Investments
    The Fund may use derivative instruments as part of its investment 
strategies. Examples of derivative instruments include listed futures 
contracts,\17\ forward currency contracts, non-deliverable forward 
currency contracts, currency and interest rate swaps, currency options, 
options on futures contracts, swap agreements and credit-linked 
notes.\18\ The Fund's use of derivative instruments (other than credit-
linked notes) will be collateralized or otherwise backed by investments 
in short term, high-quality U.S. Money Market Securities. Under normal 
circumstances, the Fund will invest no more than 20% of the value of 
the Fund's net assets in derivative instruments. Such investments will 
be consistent with the Fund's investment objective and will not be used 
to enhance leverage.
---------------------------------------------------------------------------

    \17\ The listed futures contracts in which the Fund will invest 
may be listed on exchanges in the U.S. or in London, Hong Kong or 
Singapore. Each of the United Kingdom's primary financial markets 
regulator, the Financial Services Authority, Hong Kong's primary 
financial markets regulator, the Securities and Futures Commission, 
and Singapore's primary financial markets regulator, the Monetary 
Authority of Singapore, are signatories to the International 
Organization of Securities Commissions (``IOSCO'') Multilateral 
Memorandum of Understanding (``MMOU''), which is a multi-party 
information sharing arrangement among major financial regulators. 
Both the Commission and the Commodity Futures Trading Commission are 
signatories to the IOSCO MMOU.
    \18\ The Fund may invest in credit-linked notes. A credit linked 
note is a type of structured note whose value is linked to an 
underlying reference asset. Credit linked notes typically provide 
periodic payments of interest as well as payment of principal upon 
maturity. The value of the periodic payments and the principal 
amount payable upon maturity are tied (positively or negatively) to 
a reference asset such as an index, government bond, interest rate 
or currency exchange rate. The ongoing payments and principal upon 
maturity typically will increase or decrease depending on increases 
or decreases in the value of the reference asset. The Fund's 
investments in credit-linked notes will be limited to notes 
providing exposure to Fixed Income Securities denominated in Euros. 
The Fund's overall investment in credit-linked notes will not exceed 
25% of the Fund's assets.
---------------------------------------------------------------------------

    With respect to certain kinds of derivative transactions entered 
into by the Fund that involve obligations to make future payments to 
third parties, including, but not limited to, futures, forward 
contracts, swap contracts, the purchase of securities on a when-issued 
or delayed delivery basis, or reverse repurchase agreements, the Fund, 
in accordance with applicable federal securities laws, rules, and 
interpretations thereof, will ``set aside'' liquid assets to ``cover'' 
open positions with respect to such transactions.\19\
---------------------------------------------------------------------------

    \19\ See 15 U.S.C. 80a-18. See also Investment Company Act 
Release No. 10666 (April 18, 1979), 44 FR 25128 (April 27, 1979); 
Dreyfus Strategic Investing, Commission No-Action Letter (June 22, 
1987); Merrill Lynch Asset Management, L.P., Commission No-Action 
Letter (July 2, 1996).
---------------------------------------------------------------------------

    The Fund may engage in foreign currency transactions, and may 
invest directly in foreign currencies in the form of bank and financial 
institution deposits, certificates of deposit, and bankers acceptances 
denominated in a specified non-U.S. currency. The Fund may enter into 
forward currency contracts in order to ``lock in'' the exchange rate 
between the currency it will deliver and the currency it will receive 
for the duration of the contract.
    The Fund may enter into swap agreements, including interest rate 
swaps and currency swaps (e.g., Euro vs. U.S. dollar), and may buy or 
sell put and call options on foreign currencies, either on exchanges or 
in the over-the-counter market. The Fund may enter into repurchase 
agreements with counterparties that are deemed to present acceptable 
credit risks, and may enter into reverse repurchase agreements, which 
involve the sale of securities held by the Fund subject to its 
agreement to repurchase the securities at an agreed upon date or upon 
demand and at a price reflecting a market rate of interest.
    The Fund may invest in the securities of other investment companies 
(including money market funds and exchange-traded funds (``ETFs'')). 
The Fund may invest up to an aggregate amount of 15% of its net assets 
in (a) illiquid securities and (b) Rule 144A securities. Illiquid 
securities include securities subject to contractual or other 
restrictions on resale and other instruments that lack readily 
available markets.\20\
---------------------------------------------------------------------------

    \20\ The Commission has stated that long-standing Commission 
guidelines have required open-end funds to hold no more than 15% of 
their net assets in illiquid securities and other illiquid assets. 
See Investment Company Act Release No. 28193 (March 11, 2008), 73 
14617 (March 18, 2008), footnote 34. See also Investment Company Act 
Release No. 5847 (October 21, 1969), 35 FR 19989 (December 31, 1970) 
(Statement Regarding ``Restricted Securities''); Investment Company 
Act Release No. 18612 (March 12, 1992), 57 FR 9828 (March 20, 1992) 
(Revisions of Guidelines to Form N-1A). A fund's portfolio security 
is illiquid if it cannot be disposed of in the ordinary course of 
business within seven days at approximately the value ascribed to it 
by the ETF. See Investment Company Act Release No. 14983 (March 12, 
1986), 51 FR 9773 (March 21, 1986) (adopting amendments to Rule 2a-7 
under the 1940 Act); Investment Company Act Release No. 17452 (April 
23, 1990), 55 FR 17933 (April 30, 1990) (adopting Rule 144A under 
the Securities Act of 1933).
---------------------------------------------------------------------------

    The Fund will not invest in non-U.S. equity securities.
The Shares
    The Fund issues and redeems Shares on a continuous basis at net 
asset value (``NAV'') \21\ only in large blocks of Shares (``Creation 
Units'') in transactions with authorized participants. Creation Units

[[Page 34116]]

generally will consist of 100,000 Shares, though this may change from 
time to time. Creation Units are not expected to consist of less than 
50,000 Shares. The Fund generally will issue and redeem Creation Units 
in exchange for a portfolio of Fixed Income Securities closely 
approximating the holdings of the Fund and/or a designated amount of 
cash in U.S. dollars. Once created, Shares of the Fund will trade on 
the secondary market in amounts less than a Creation Unit. Shares may 
be redeemed from the Fund only in Creation Unit aggregations. Upon 
delivery and settlement of the Shares upon redemption, the Fund will 
deliver to the redeeming authorized participant a designated basket of 
Fixed Income Securities and an amount of cash. Together, such Fixed 
Income Securities and amount of cash constitute the ``Redemption 
Payment.'' The Redemption Payment may consist entirely of cash at the 
discretion of the Fund.
---------------------------------------------------------------------------

    \21\ The NAV of the Fund's Shares generally is calculated once 
daily Monday through Friday as of the close of regular trading on 
the New York Stock Exchange, generally 4:00 p.m. Eastern time (the 
``NAV Calculation Time''). NAV per Share is calculated by dividing 
the Fund's net assets by the number of Fund Shares outstanding. For 
more information regarding the valuation of Fund investments in 
calculating the Fund's NAV, see the Registration Statement.
---------------------------------------------------------------------------

    Additional information regarding the Shares and the Fund, including 
investment strategies, risks, creation and redemption procedures, fees, 
portfolio holdings disclosure policies, distributions and taxes is 
included in the Registration Statement.
Availability of Information
    The Fund's Web site (http://www.wisdomtree.com), which will be 
publicly available prior to the public offering of Shares, will include 
a form of the Prospectus for the Fund that may be downloaded. The 
website will include additional quantitative information updated on a 
daily basis, including, for the Fund: (1) The prior business day's 
reported NAV, mid-point of the bid/ask spread at the time of 
calculation of such NAV (the ``Bid/Ask Price''),\22\ and a calculation 
of the premium and discount of the Bid/Ask Price against the NAV; and 
(2) data in chart format displaying the frequency distribution of 
discounts and premiums of the daily Bid/Ask Price against the NAV, 
within appropriate ranges, for each of the four previous calendar 
quarters. On each business day, before commencement of trading in 
Shares in the Core Trading Session \23\ on the Exchange, the Trust will 
disclose on its website the identities and quantities of the portfolio 
of securities and other assets (the ``Disclosed Portfolio'') held by 
the Fund that will form the basis for the Fund's calculation of NAV at 
the end of the business day.\24\ The Disclosed Portfolio will include, 
as applicable, the names, quantity, percentage weighting and market 
value of Fixed Income Securities, and other assets held by the Fund and 
the characteristics of such assets. The website and information will be 
publicly available at no charge.
---------------------------------------------------------------------------

    \22\ The Bid/Ask Price of the Fund is determined using the 
midpoint of the highest bid and the lowest offer on the Exchange as 
of the time of calculation of such Fund's NAV. The records relating 
to Bid/Ask Prices will be retained by the Fund and its service 
providers.
    \23\ The Core Trading Session is 9:30 a.m. to 4 p.m. Eastern 
time.
    \24\ Under accounting procedures followed by the Fund, trades 
made on the prior business day (``T'') will be booked and reflected 
in NAV on the current business day (``T+1''). Notwithstanding the 
foregoing, portfolio trades that are executed prior to the opening 
of the Exchange on any business day may be booked and reflected in 
NAV on such business day. Accordingly, the Fund will be able to 
disclose at the beginning of the business day the portfolio that 
will form the basis for the NAV calculation at the end of the 
business day.
---------------------------------------------------------------------------

    In addition, for the Fund, an estimated value, defined in Rule 
8.600 as the ``Portfolio Indicative Value,'' that reflects an estimated 
intraday value of the Fund's portfolio, will be disseminated. The 
Portfolio Indicative Value will be based upon the current value for the 
components of the Disclosed Portfolio and will be updated and 
disseminated by one or more major market data vendors at least every 15 
seconds during the Core Trading Session on the Exchange. In addition, 
during hours when the markets for Fixed Income Securities in the Fund's 
portfolio are closed, the Portfolio Indicative Value will be updated at 
least every 15 seconds during the Core Trading Session to reflect 
currency exchange fluctuations.
    The dissemination of the Portfolio Indicative Value, together with 
the Disclosed Portfolio, will allow investors to determine the value of 
the underlying portfolio of the Fund on a daily basis and to provide a 
close estimate of that value throughout the trading day.
    Information regarding market price and volume of the Shares is and 
will be continually available on a real-time basis throughout the day 
on brokers' computer screens and other electronic services. The 
previous day's closing price and trading volume information for the 
Shares will be published daily in the financial section of newspapers. 
Quotation and last sale information for the Shares will be available 
via the Consolidated Tape Association high-speed line.
    Intra-day and end-of-day prices are readily available through major 
market data providers and broker-dealers for the Fixed Income 
Securities, Money Market Securities and derivative instruments held by 
the Fund.
Initial and Continued Listing
    The Shares will be subject to Rule 8.600, which sets forth the 
initial and continued listing criteria applicable to Managed Fund 
Shares. The Exchange represents that, for initial and/or continued 
listing, the Fund must be in compliance with Rule 10A-3 under the 
Exchange Act,\25\ as provided by NYSE Arca Equities Rule 5.3. A minimum 
of 100,000 Shares will be outstanding at the commencement of trading on 
the Exchange. The Exchange will obtain a representation from the issuer 
of the Shares that the NAV per Share will be calculated daily and that 
the NAV and the Disclosed Portfolio will be made available to all 
market participants at the same time.
---------------------------------------------------------------------------

    \25\ See 17 CFR 240.10A-3.
---------------------------------------------------------------------------

Trading Halts
    With respect to trading halts, the Exchange may consider all 
relevant factors in exercising its discretion to halt or suspend 
trading in the Shares of the Fund. Shares of the Fund will be halted if 
the ``circuit breaker'' parameters in NYSE Arca Equities Rule 7.12 are 
reached. Trading may be halted because of market conditions or for 
reasons that, in the view of the Exchange, make trading in the Shares 
inadvisable. These may include: (1) The extent to which trading is not 
occurring in the securities and/or the financial instruments comprising 
the Disclosed Portfolio of the Fund; or (2) whether other unusual 
conditions or circumstances detrimental to the maintenance of a fair 
and orderly market are present. Trading in the Shares will be subject 
to Rule 8.600(d)(2)(D), which sets forth circumstances under which 
Shares of the Fund may be halted.
Trading Rules
    The Exchange deems the Shares to be equity securities, thus 
rendering trading in the Shares subject to the Exchange's existing 
rules governing the trading of equity securities. Shares will trade on 
the NYSE Arca Marketplace from 4 a.m. to 8 p.m. Eastern time in 
accordance with NYSE Arca Equities Rule 7.34 (Opening, Core, and Late 
Trading Sessions). The Exchange has appropriate rules to facilitate 
transactions in the Shares during all trading sessions. As provided in 
NYSE Arca Equities Rule 7.6, Commentary .03, the minimum price 
variation (``MPV'') for quoting and entry of orders in equity 
securities traded on the NYSE Arca Marketplace is $0.01, with the 
exception of securities that are priced less than $1.00 for which the 
MPV for order entry is $0.0001.

[[Page 34117]]

Surveillance
    The Exchange intends to utilize its existing surveillance 
procedures applicable to derivative products (which includes Managed 
Fund Shares) to monitor trading in the Shares. The Exchange represents 
that these procedures are adequate to properly monitor Exchange trading 
of the Shares in all trading sessions and to deter and detect 
violations of Exchange rules and applicable federal securities laws.
    The Exchange's current trading surveillance focuses on detecting 
securities trading outside their normal patterns. When such situations 
are detected, surveillance analysis follows and investigations are 
opened, where appropriate, to review the behavior of all relevant 
parties for all relevant trading violations.
    The Exchange may obtain information via the Intermarket 
Surveillance Group (``ISG'') from other exchanges who are members of 
the ISG or with which the Exchange has in place a comprehensive 
surveillance sharing agreement.\26\
---------------------------------------------------------------------------

    \26\ For a list of the current members of ISG, see http://www.isgportal.org. The Exchange notes that not all of the components 
of the Disclosed Portfolio for the Fund may trade on exchanges that 
are members of the ISG or with which the Exchange has in place a 
comprehensive surveillance sharing agreement.
---------------------------------------------------------------------------

    In addition, the Exchange also has a general policy prohibiting the 
distribution of material, non-public information by its employees.
Information Bulletin
    Prior to the commencement of trading, the Exchange will inform its 
Equity Trading Permit (``ETP'') Holders in an Information Bulletin 
(``Bulletin'') of the special characteristics and risks associated with 
trading the Shares. Specifically, the Bulletin will discuss the 
following: (1) The procedures for purchases and redemptions of Shares 
in Creation Unit aggregations (and that Shares are not individually 
redeemable); (2) NYSE Arca Equities Rule 9.2(a), which imposes a duty 
of due diligence on its ETP Holders to learn the essential facts 
relating to every customer prior to trading the Shares; (3) the risks 
involved in trading the Shares during the Opening and Late Trading 
Sessions when an updated Portfolio Indicative Value will not be 
calculated or publicly disseminated; (4) how information regarding the 
Portfolio Indicative Value is disseminated; (5) the requirement that 
ETP Holders deliver a prospectus to investors purchasing newly issued 
Shares prior to or concurrently with the confirmation of a transaction; 
and (6) trading information.
    In addition, the Bulletin will reference that the Fund is subject 
to various fees and expenses described in the Registration Statement. 
The Bulletin will discuss any exemptive, no-action, and interpretive 
relief granted by the Commission from any rules under the Exchange Act. 
The Bulletin will also disclose that the NAV for the Shares will be 
calculated after 4 p.m. Eastern time each trading day.
2. Statutory Basis
    The basis under the Exchange Act for this proposed rule change is 
the requirement under Section 6(b)(5) \27\ that an exchange have rules 
that are designed to prevent fraudulent and manipulative acts and 
practices, to promote just and equitable principles of trade, to remove 
impediments to, and perfect the mechanism of a free and open market 
and, in general, to protect investors and the public interest.
---------------------------------------------------------------------------

    \27\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange believes that the proposed rule change is designed to 
prevent fraudulent and manipulative acts and practices in that the 
Shares will be listed and traded on the Exchange pursuant to the 
initial and continued listing criteria in NYSE Arca Equities Rule 
8.600. The Exchange has in place surveillance procedures that are 
adequate to properly monitor trading in the Shares in all trading 
sessions and to deter and detect violations of Exchange rules and 
applicable federal securities laws. The Exchange may obtain information 
via ISG from other exchanges that are members of ISG or with which the 
Exchange has entered into a comprehensive surveillance sharing 
agreement. According to the Registration Statement, under normal 
circumstances, the Fund will invest at least 80% of its net assets in 
Fixed Income Securities denominated in Euros. The Fund intends to focus 
its investments on Sovereign Debt, as described above. The Fund will 
invest up to 20% of its net assets only in corporate bonds that the 
Adviser or Sub-Adviser deems to be sufficiently liquid. Generally a 
corporate bond must have $200 million or more par amount outstanding 
and significant par value traded to be considered as an eligible 
investment. The Fund expects to have 75% or more of its assets invested 
in investment grade bonds, though this percentage may change from time 
to time in accordance with market conditions and the debt ratings 
assigned to countries and issuers. Under normal circumstances, the Fund 
will invest no more than 20% of the value of the Fund's net assets in 
derivative instruments. Such investments will be consistent with the 
Fund's investment objective and will not be used to enhance leverage. 
The Fund will not invest in non-U.S. equity securities.
    The proposed rule change is designed to promote just and equitable 
principles of trade and to protect investors and the public interest in 
that the Exchange will obtain a representation from the issuer of the 
Shares that the NAV per Share will be calculated daily and that the NAV 
and the Disclosed Portfolio will be made available to all market 
participants at the same time. In addition, a large amount of 
information is publicly available regarding the Fund and the Shares, 
thereby promoting market transparency. The Fund's portfolio holdings 
will be disclosed on its website daily after the close of trading on 
the Exchange and prior to the opening of trading on the Exchange the 
following day. Moreover, the Portfolio Indicative Value will be 
disseminated by one or more major market data vendors at least every 15 
seconds during the Exchange's Core Trading Session. On each business 
day, before commencement of trading in Shares in the Core Trading 
Session on the Exchange, the Fund will disclose on its website the 
Disclosed Portfolio that will form the basis for the Fund's calculation 
of NAV at the end of the business day. Information regarding market 
price and trading volume of the Shares is and will be continually 
available on a real-time basis throughout the day on brokers' computer 
screens and other electronic services, and quotation and last sale 
information will be available via the CTA high-speed line. The website 
for the Fund will include a form of the Prospectus for the Fund and 
additional data relating to NAV and other applicable quantitative 
information. Moreover, prior to the commencement of trading, the 
Exchange will inform its ETP Holders in an Information Bulletin of the 
special characteristics and risks associated with trading the Shares. 
Trading in Shares of the Fund will be halted if the circuit breaker 
parameters in NYSE Arca Equities Rule 7.12 have been reached or because 
of market conditions or for reasons that, in the view of the Exchange, 
make trading in the Shares inadvisable, and trading in the Shares will 
be subject to NYSE Arca Equities Rule 8.600(d)(2)(D), which sets forth 
circumstances under which Shares of the Fund may be halted. In 
addition, as noted above, investors will have ready access to 
information regarding the Fund's holdings, the Portfolio Indicative 
Value, the Disclosed

[[Page 34118]]

Portfolio, and quotation and last sale information for the Shares.
    The proposed rule change is designed to perfect the mechanism of a 
free and open market and, in general, to protect investors and the 
public interest in that it will facilitate the listing and trading of 
an additional type of actively-managed exchange-traded product that 
will enhance competition among market participants, to the benefit of 
investors and the marketplace. As noted above, the Exchange has in 
place surveillance procedures relating to trading in the Shares and may 
obtain information via ISG from other exchanges that are members of ISG 
or with which the Exchange has entered into a comprehensive 
surveillance sharing agreement. In addition, as noted above, investors 
will have ready access to information regarding the Fund's holdings, 
the Portfolio Indicative Value, the Disclosed Portfolio, and quotation 
and last sale information for the Shares.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purposes of the Act.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    No written comments were solicited or received with respect to the 
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Within 45 days of the date of publication of this notice in the 
Federal Register or within such longer period (i) as the Commission may 
designate up to 90 days of such date if it finds such longer period to 
be appropriate and publishes its reasons for so finding or (ii) as to 
which the self-regulatory organization consents, the Commission shall:
    (A) By order approve or disapprove the proposed rule change, or
    (B) institute proceedings to determine whether the proposed rule 
change should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File Number SR-NYSEArca-2011-31 on the subject line.

Paper Comments

     Send paper comments in triplicate to Elizabeth M. Murphy, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-1090.

All submissions should refer to File Number SR-NYSEArca-2011-31. This 
file number should be included on the subject line if e-mail is used. 
To help the Commission process and review your comments more 
efficiently, please use only one method. The Commission will post all 
comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, 
all written statements with respect to the proposed rule change that 
are filed with the Commission, and all written communications relating 
to the proposed rule change between the Commission and any person, 
other than those that may be withheld from the public in accordance 
with the provisions of 5 U.S.C. 552, will be available for website 
viewing and printing in the Commission's Public Reference Room, 100 F 
Street, NE., Washington, DC 20549, on official business days between 
the hours of 10 a.m. and 3 p.m. Copies of the filing will also be 
available for inspection and copying at the principal office of the 
Exchange. All comments received will be posted without change; the 
Commission does not edit personal identifying information from 
submissions. You should submit only information that you wish to make 
available publicly. All submissions should refer to File No. SR-
NYSEArca-2011-31 and should be submitted on or before July 1, 2011.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\28\
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    \28\ 17 CFR 200.30-3(a)(12).
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Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011-14415 Filed 6-9-11; 8:45 am]
BILLING CODE 8011-01-P