UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number 811-22255
Ridgewood, NJ 07450
Robert C. Holderith
171 East Ridgewood Avenue
Ridgewood, NJ 07450
Registrant's telephone number, including area code: 1-201-389-6872
Date of fiscal year end: March 31
Date of reporting period: September 30, 2010
Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.
Item 1. Reports to Stockholders.
EGA EMERGING GLOBAL SHARES TRUST
Semi-Annual Report
September 30, 2010
EMERGING GLOBAL SHARES DOW JONES EMERGING MARKETS
TITANS COMPOSITE INDEX FUND
EMERGING GLOBAL SHARES DOW JONES EMERGING MARKETS
METALS & MINING TITANS INDEX FUND
EMERGING GLOBAL SHARES DOW JONES EMERGING MARKETS
CONSUMER TITANS INDEX FUND
EMERGING GLOBAL SHARES DOW JONES EMERGING MARKETS
ENERGY TITANS INDEX FUND
EMERGING GLOBAL SHARES DOW JONES EMERGING MARKETS
FINANCIALS TITANS INDEX FUND
EMERGING GLOBAL SHARES INDXX
INDIA INFRASTRUCTURE INDEX FUND
EMERGING GLOBAL SHARES INDXX
CHINA INFRASTRUCTURE INDEX FUND
EMERGING GLOBAL SHARES INDXX
BRAZIL INFRASTRUCTURE INDEX FUND
EMERGING GLOBAL SHARES INDXX
INDIA SMALL CAP INDEX FUND
Table of Contents
Dear Shareholder,
It is our opinion that very little has changed since our previous semi-annual letter. To clarify, this pertains to our surroundings and the world around us. In terms of Emerging Global Advisors, there have been significant changes of late and we believe very positive ones at that.
First, the environment: We believe the outlook for the developed markets has not improved significantly. The end of a recession has proven to be quite different from the start of a meaningful recovery. Thankfully, the gloom is not global. The outlook in terms of economic growth and capital market expectations remains resilient in the emerging markets. Uncertainties remain in the overall macro environment. Will the US central bank’s Quantitative Easing 2 (money printing plus buying of US paper) incentivize US consumers to spend more and for corporations to deploy capital? Will this stimulative measure kick start a new commodity bull run benefiting emerging markets and potentially an unexpected rise in globally synchronized inflation? How will the Chinese respond given that two-thirds of their reserves are in USD? How will leaders in other emerging economies react if funds flow to their higher yielding currencies? When do debt/GDP numbers become so absurd that everyone becomes an ostrich with their head in the sands? What does insolvency mean today? Will a currency war lead to a series of defaults similar to the Asian contagion … only happening in what we now still call developed markets (Greece, Ireland)?
The following logic is not new from us: In today’s low yielding, low return environment, one way for investors to potentially obtain tangible returns is to accept exposure to various risk factors. We argue that certain risk factors such as political risk actually exist to a large degree in developed market and not just in emerging markets. Furthermore, we believe that investors underestimate the scale of such risks in their highly home biased portfolios. QE2 is just one obvious example. It did not work in Japan and they have had two lost decades since. The US has already had one lost decade. Why cannot we have two lost decades as well given the US central bank is doing something very similar to what the Japanese central bankers did. Remember the carry trade where global investors were borrowing low yielding Yen and re-investing in Aussie dollars and other higher yielding currencies? They’re using US dollars now instead of Japanese Yen.1
We believe that all of this continues to favor emerging market investments and the weapon of choice continues to be the exchange traded fund (ETF). According to Morgan Stanley, fund flows in 2010 have increased not only to equities, but also to global emerging markets and ETFs. Around the time of this report’s writing, Morgan Stanley’s October 25 weekly report stated that there were 86 ETFs classified as “International – Emerging” with assets totaling 16% of the total US domiciled ETF market. “Commodities” was also 16% and the only larger category by asset size was “US – Large Cap” at 21%. Overall this statistic from this report is key:
“ETF assets stand at $925 bln; up 18.5% YTD”
Thus, although the S&P 500 year-to-date is up roughly 6%, and the broad emerging market index (MSCI EM) is up roughly 12%, the growth of the ETF industry’s total assets, especially into the emerging market category are up more than this differential suggesting that assets in emerging market ETFs are not only due to market returns but to fund flows. Again, fund flow to ETFs is a key reason for growing assets under management, in addition to market returns. For example, in the 13-week period ending October 22, this same report shows that USD 18.8billion of new fund flow went into the emerging market ETF category.
“$40.9 bln net inflows into ETFs over past 13 weeks (46% into EM Equity)”
Note that 46% of US$40.9 billion is $18.8 billion. The next highest category for the same time period was fixed income with USD 6.9 billion. It is our opinion that investors were looking for growth for their portfolios from emerging markets yet the presumed security of fixed income. This fund flow pattern has been quite consistent for all of 2010 according to EFPR Global (www.epfr.com), a provider of fund flow data. EGShares have begun to significantly participate in this rising tide of fund flows to emerging market ETFs especially since Q3 2010.
EPFR said in their November 16, 2010 news release:
“Global Equity Funds had their best week since early April (2010) and flows into Emerging Market Equity Funds are on the verge of setting an all-time yearly inflow record.”
Thus, our belief that not only are emerging market investments becoming more accepted as a core asset category, but ETFs are becoming even more popular as a means for exposure.
EGA Emerging Global Shares Trust 1
Again, the ETF industry has grown in assets versus other fund types especially the mutual fund. Investors continue to desire growth and diversification from their portfolios. Thus, the emerging market component of this fund industry continues to show growth, in fact some of the fastest growth in the ETF space. ETFs provide one of the most popular means for access to emerging markets given their liquidity, relative low cost and other positive attributes. Emerging Global Shares are participating well in the overall market attraction towards emerging market ETFs.
Of course, during major market declines, there is good reason to expect that investors will take monies out of volatile asset categories such as emerging markets. However, if investors believe that the short and/or long term potential for emerging markets remain intact, there is potential for funds to flow back. This higher turnover environment is more suited to ETFs over other fund formats with lesser degrees of liquidity. For ETFs, it’s expected for investors to trade with a greater degree of frequency… that liquidity is a key feature of ETFs. For many other fund types, the trading of such funds is detrimental due to administrative costs. Furthermore, regulatory authorities do not look highly upon the trading of such funds. Thus, for investors looking to go beyond the traditional buy-hold strategy, there is attraction to look at instruments including ETFs.
We believe our funds represent asset categories that provide great potential for active managers to derive alpha, a measure of performance over a benchmark. It is not enough that we provide investors with an India ETF. Since our last semi-annual report we have launched an Indian Small Cap ETF and an Indian Infrastructure ETF. These funds specifically target the domestic consumption and local infrastructure plays in India, the main drivers of that economy and the reason why its economy has truly decoupled with a strong equity market in 2010 while most other global markets have generally trended sideways. Our Chief Investment Officer/Director of Research spent several days in Mumbai as part of a 9-city Asian speaking tour for the CFA Society. His observations confirm these two themes which are at the early stages versus what has already been done in past decades in places like Taiwan and South Korea. Our latest fund launch to date is a broader emerging market consumer ETF that provides significant country diversification but has gained significant popularity as one of very few means to gain exposure to the growing domestic consumption story in developing markets. This ETF (ticker ECON) has been a very fast riser in terms of assets under management and our first fund to reach assets of over $100 million.
Of course, given the significant market rise in 2009 and the relatively muted but still positive overall curve in 2010, we are cognizant that emerging markets are, nearly by definition, volatile. By volatile, we mean in this case that regardless of time horizon, there is great potential dispersion of returns. However, we continue to believe that investors realize that their recent past experiences has been filled with volatility (tech bubble, global financial crisis). Many expect that even with bond portfolios filled with mortgage and real estate related underlying positions, there is little that can be defined as a safe asset class. Thus, due to an underlying need for growth to fund future liabilities, there is little choice but to embrace the risk associated with emerging markets along with other higher risk/higher potential return categories and embrace the assumption, albeit uncertain, that the likelihood for fair compensation is better than what is believed to be received from more traditional home biased portfolios. [anyone who thinks this is an opinion should be on tv answering questions when the pension crisis becomes exposed. This is fact.]
Market downturns will happen. Fund flows to emerging market funds provides some evidence to us that in the past year and a half, global investors have used these opportunities to accumulate further emerging market positions. Nicely for us, this includes a general pattern of deviation from plain vanilla broad emerging market indices and towards funds that provide an investor to make a call, whether it is by country, sector, size, style or theme. Because of the general assumption that emerging markets are deemed inefficient, we can assume that investors are willing to allocate more resources here to actively manage their portfolios. The fund flow data mentioned earlier would confirm this. For a more efficient market like the US stock market, we believe the growing trend is to just “set it and forget it”. Both the fear of volatility and the greed for potentially higher returns commensurate to this level of volatility plays well for us a provider of emerging market ETFs. Thus, we believe that these markets will be traded by many investors given this reasoning.
In the ETF industry, many funds have closed and several ETF sponsor companies have shut down operations. Very few new entrants have appeared in the recent year including in the emerging market space. This is a surprise to us. However, the reality is that the small numbers of providers that focus on emerging market ETFs, including EGA, are now fighting aggressively for market share. As the only ETF provider on the planet providing exposure specifically to emerging markets (as far as we know), we are now building a strong
2 EGA Emerging Global Shares Trust
following under the EGShares brand. Advertising, media appearances and point-of-sale contact within a coordinated effort have produced strong results in just the past several months.
Ongoing research related to the specific purpose of further product development efforts has been and always will be a focus of our firm. We believe it is the innovation in our product lineup that provides us our edge and makes us attractive to investors of our funds. Our understanding of the ongoing dynamics of the ETF industry and the emerging markets is respected by our peers. And we respect them. Our only concern is establishing areas of competitive advantage and have done so and will continue to do so in upcoming quarters.
Given all of the above, clearly the environment is providing us a strong tailwind with the increased popularity of ETFs and especially those providing exposures to emerging markets. The factors that determine this benefit are longer term (US monetary policy, emerging market demographics, retirement of our baby boomers needing growth as they live longer) and thus we don’t see our story as being one for only the short-term. We remain steadfast and positive on the outlook of our company.
Sincerely,
![](https://capedge.com/proxy/N-CSRSA/0000891092-10-005710/a40819prt1x7x1.jpg)
Robert C. Holderith
President & Chief Executive Officer
Emerging Global Advisors, LLC
Robert C. Holderith is a registered representative of ALPS Distributors, Inc.
1 | This article (http://www.ft.com/cms/s/0/59f108a4-d3a9-11de-8caf-00144feabdc0.html#axzz168IX35d6) highlights that the US carry trade could be taken off if interest rates in the US go up or the USD’s decline reverses. This was written one year ago. Consensus is that QE2 will lower interest rates and cause the dollar to fall further. Actually, that’s what it’s designed to do to stimulate the economy. Thus, the thoughts of a US carry trade from a year ago seem even more practical now. This could also be helpful: http://www.investopedia.com/slide-show/carry-trade/default.aspx?redirect=0 |
The above commentary is for informational purposes only. Nothing in this commentary should be construed as an offer or recommendation to buy or sell a particular security. The opinions and estimates noted herein are accurate as of September 30, 2010 and are subject to change. | |
Emerging market investments involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles, from economic or political instability in other nations or increased volatility and lower trading volume. This fund will concentrate its investments in issuers of one or more particular industries to the same extent that its Underlying Index is so concentrated and to the extent permitted by applicable regulatory guidance. Concentration risk results from maintaining exposure to issuers conducting business in a specific industry. Emerging Global Shares are distributed by ALPS Distributors Inc. |
EGA Emerging Global Shares Trust 3
Portfolio Summary (Unaudited)
EMERGING GLOBAL SHARES DOW JONES EMERGING MARKETS
TITANS COMPOSITE INDEX FUND
Industry Breakdown* |
![](https://capedge.com/proxy/N-CSRSA/0000891092-10-005710/a40819prt1x8x1.jpg)
Top Ten Holdings* | ||
Itau Unibanco Holding SA | 6.6 | % |
Gazprom OAO | 5.4 | |
America Movil SAB de CV | 4.5 | |
Reliance Industries, Ltd. | 4.4 | |
Vale SA | 4.4 | |
Industrial and Commercial Bank of China, Ltd. | 4.3 | |
Petroleo Brasileiro | 4.3 | |
Infosys Technologies, Ltd. | 3.9 | |
China Construction Bank Corp. | 3.5 | |
Banco Bradesco SA | 3.1 |
* | Expressed as a percentage of total investments in securities as of 9/30/2010. |
Emerging Global Shares Dow Jones Emerging Markets Titans Composite Index Fund (ticker: EEG)
The Fund seeks to achieve its investment objective of total return by investing in the constituent securities of the Dow Jones Emerging Markets Composite Titans 100 Index. The Dow Jones Emerging Markets Composite Titans 100 Index is a stock market index comprised of a representative sample of 100 Emerging Markets companies that Dow Jones Indexes deems to be the 10 leading companies in each of the 10 industrial sectors, as defined by the Industry Classification Benchmark (ICB), across the developing world. Under normal circumstances, the Fund will invest at least 80% of its net assets in companies included in the Index and generally expects to be substantially invested at such times, with at least 95% of its net assets invested in these securities.
Emerging market investments involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles, from economic or political instability in other nations or increased volatility and lower trading volume. This fund will concentrate its investments in issuers of one or more particular industries to the same extent that its Underlying Index is so concentrated and to the extent permitted by applicable regulatory guidance. Concentration risk results from maintaining exposure to issuers conducting business in a specific industry.
4 EGA Emerging Global Shares Trust
Portfolio Summary (Unaudited)
EMERGING GLOBAL SHARES DOW JONES EMERGING MARKETS
METALS & MINING TITANS INDEX FUND
Industry Breakdown* |
![](https://capedge.com/proxy/N-CSRSA/0000891092-10-005710/a40819prt1x9x1.jpg)
Top Ten Holdings* | ||
Vale SA | 10.0 | % |
Mining and Metallurgical Company Norilsk Nickel JSC | 7.5 | |
Impala Platinum Holdings, Ltd. | 6.7 | |
Sterlite Industries India Ltd. | 6.5 | |
AngloGold Ashanti, Ltd. | 6.4 | |
Companhia Siderurgica Nacional SA | 6.0 | |
China Shenhua Energy Co., Ltd. | 5.6 | |
Gerdau SA | 4.9 | |
Grupo Mexico SAB de CV | 4.8 | |
Gold Fields, Ltd. | 3.9 |
* | Expressed as a percentage of total investments in securities as of 9/30/2010. |
Emerging Global Shares Dow Jones Emerging Markets Metals & Mining Titans Index Fund (ticker: EMT)
The Fund seeks to achieve its investment objective of total return by investing in the constituent securities of the Dow Jones Emerging Markets Metals & Mining Titans Index. The Dow Jones Emerging Markets Metals & Mining Titans Index is a stock market index comprised of 30 leading Emerging Markets companies that Dow Jones Indexes deems to be in the Metals & Mining sector of the global economy. The Metals & Mining sector is a sub-sector of the Basic Materials industry, as defined by ICB. Accordingly, some securities in which the Fund invests may also be held by the Emerging Global Shares Dow Jones Emerging Markets Basic Materials Titans Index Fund. Under normal circumstances, the Fund will invest at least 80% of its net assets in Metals & Mining companies included in the Index and generally expects to be substantially invested at such times, with at least 95% of its net assets invested in these securities.
Emerging market investments involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles, from economic or political instability in other nations or increased volatility and lower trading volume. This fund will concentrate its investments in issuers of one or more particular industries to the same extent that its Underlying Index is so concentrated and to the extent permitted by applicable regulatory guidance. Concentration risk results from maintaining exposure to issuers conducting business in a specific industry.
EGA Emerging Global Shares Trust 5
Portfolio Summary (Unaudited)
EMERGING GLOBAL SHARES DOW JONES EMERGING MARKETS
CONSUMER TITANS INDEX FUND
Industry Breakdown* |
![](https://capedge.com/proxy/N-CSRSA/0000891092-10-005710/a40819prt1x10x1.jpg)
Top Ten Holdings* | ||
Comphania de Bebidas DAS Americas | 9.0 | % |
Wal-Mart de Mexico SAB de CV | 7.0 | |
Naspers, Ltd. | 6.5 | |
Astra International Tbk PT | 6.0 | |
ITC, Ltd. | 5.8 | |
Fomento Economico Mexicano SAB de CV | 5.2 | |
Grupo Televisa SA | 5.0 | |
BRF - Brasil Foods SA | 4.7 | |
Hindustan Unilever, Ltd. | 4.1 | |
Genting Berhad | 4.1 |
* | Expressed as a percentage of total investments in securities as of 9/30/2010. |
Emerging Global Shares Dow Jones Emerging Markets Consumer Titans Index Fund (ticker: ECON)
The Fund seeks to achieve its investment objective of total return by investing in the constituent securities of the Dow Jones Emerging Markets Consumer Titans Index. The Dow Jones Emerging Markets Consumer Titans Index is a stock market index comprised of 30 leading Emerging Markets companies that Dow Jones Indexes deems to be part of the Consumer Goods and Consumer Services sectors of the global economy. Under normal circumstances, the Fund will invest at least 80% of its net assets in Consumer Goods/Services companies included in the Index and generally expects to be substantially invested at such times, with at least 95% of its net assets invested in these securities.
Emerging market investments involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles, from economic or political instability in other nations or increased volatility and lower trading volume. This fund will concentrate its investments in issuers of one or more particular industries to the same extent that its Underlying Index is so concentrated and to the extent permitted by applicable regulatory guidance. Concentration risk results from maintaining exposure to issuers conducting business in a specific industry.
6 EGA Emerging Global Shares Trust
Portfolio Summary (Unaudited)
EMERGING GLOBAL SHARES DOW JONES EMERGING MARKETS
ENERGY TITANS INDEX FUND
Industry Breakdown* |
![](https://capedge.com/proxy/N-CSRSA/0000891092-10-005710/a40819prt1x11x1.jpg)
Top Ten Holdings* | ||
Reliance Industries, Ltd. | 8.8 | % |
Petroleo Brasileiro SA | 8.3 | |
Surgutneftegaz | 8.1 | |
CNOOC Ltd. | 7.7 | |
Gazprom OAO | 6.6 | |
PetroChina Co., Ltd. | 5.5 | |
PTT PCL | 5.0 | |
China Petroleum & Chemical Corp. | 5.0 | |
Sasol, Ltd. | 4.8 | |
LUKOIL OAO | 4.6 |
* | Expressed as a percentage of total investments in securities as of 9/30/2010. |
Emerging Global Shares Dow Jones Emerging Markets Energy Titans Index Fund (ticker: EEO)
The Fund seeks to achieve its investment objective of total return by investing in the constituent securities of the Dow Jones Emerging Markets Oil and Gas Titans Index. The Dow Jones Emerging Markets Oil and Gas Titans Index is a stock market index comprised of 30 leading Emerging Markets companies that Dow Jones Indexes deems to be part of the Oil and Gas sector of the global economy, which also includes alternative energy sources other than oil and gas. Under normal circumstances, the Fund will invest at least 80% of its net assets in Energy companies included in the Index and generally expects to be substantially invested at such times, with at least 95% of its net assets invested in these securities.
Emerging market investments involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles, from economic or political instability in other nations or increased volatility and lower trading volume. This fund will concentrate its investments in issuers of one or more particular industries to the same extent that its Underlying Index is so concentrated and to the extent permitted by applicable regulatory guidance. Concentration risk results from maintaining exposure to issuers conducting business in a specific industry.
EGA Emerging Global Shares Trust 7
Portfolio Summary (Unaudited)
EMERGING GLOBAL SHARES DOW JONES EMERGING MARKETS
FINANCIALS TITANS INDEX FUND
Industry Breakdown* |
![](https://capedge.com/proxy/N-CSRSA/0000891092-10-005710/a40819prt1x12x1.jpg)
Top Ten Holdings* | ||
Industrial and Commercial Bank of China, Ltd. | 8.2 | % |
Itau Unibanco Holding SA | 7.3 | |
Banco Bradesco SA | 7.1 | |
China Construction Bank Corp. | 6.4 | |
State Bank of India, Ltd. | 5.6 | |
ICICI Bank, Ltd. | 5.5 | |
Bank of China Ltd. | 4.9 | |
Banco Do Brasil SA | 4.5 | |
China Life Insurance Co., Ltd. | 4.5 | |
Ping An Insurance Group Co. of China Ltd. | 4.2 |
* | Expressed as a percentage of total investments in securities as of 9/30/2010. |
Emerging Global Shares Dow Jones Emerging Markets Financials Titans Index Fund (ticker: EFN)
The Fund seeks to achieve its investment objective of total return by investing in the constituent securities of the Dow Jones Emerging Markets Financials Titans Index. The Dow Jones Emerging Markets Financials Titans Index is a stock market index comprised of 30 leading Emerging Markets companies that Dow Jones Indexes deems to be part of the Financials sector of the global economy. Under normal circumstances, the Fund will invest at least 80% of its net assets in Financials companies included in the Index and generally expects to be substantially invested at such times, with at least 95% of its net assets invested in these securities.
Emerging market investments involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles, from economic or political instability in other nations or increased volatility and lower trading volume. This fund will concentrate its investments in issuers of one or more particular industries to the same extent that its Underlying Index is so concentrated and to the extent permitted by applicable regulatory guidance. Concentration risk results from maintaining exposure to issuers conducting business in a specific industry.
8 EGA Emerging Global Shares Trust
Portfolio Summary (Unaudited)
EMERGING GLOBAL SHARES INDXX
INDIA INFRASTRUCTURE INDEX FUND
Industry Breakdown* |
![](https://capedge.com/proxy/N-CSRSA/0000891092-10-005710/a40819prt1x13x1.jpg)
Top Ten Holdings* | ||
Gail India, Ltd. | 6.4 | % |
Larsen & Toubro, Ltd. | 5.8 | |
Jindal Steel & Power, Ltd. | 5.8 | |
Bharat Heavy Electricals, Ltd. | 5.1 | |
Tata Power Co., Ltd. | 4.9 | |
NTPC, Ltd. | 4.9 | |
IL&FS Transportation Networks, Ltd. | 4.7 | |
Reliance Infrastructure, Ltd. | 4.2 | |
Bharti Airtel, Ltd. | 4.2 | |
Idea Cellular, Ltd. | 4.1 |
* | Expressed as a percentage of total investments in securities as of 9/30/2010. |
Emerging Global Shares INDXX India Infrastructure Index Fund (ticker: INXX)
The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield performance of the INDXX India Infrastructure Index (the “Underlying Index”). The Fund seeks to achieve its investment objective by attempting to replicate the portfolio of the Underlying Index through investments in equity securities, including shares traded on local exchanges, American Depositary Receipts (“ADRs”) and Global Depositary Receipts (“GDRs”). The Underlying Index is a free-float capitalization weighted stock market index comprised of 30 leading companies that INDXX, LLC determines to be representative of India’s infrastructure sectors. The Fund invests in Indian mid cap infrastructure companies that are included in the Underlying Index, which are generally defined as companies that are domiciled in India. There is a maximum allowance at time of rebalancing of 4.9% for each underlying position. Names and weights of the underlying index is done annually as of October 1. Under normal circumstances, the Fund will invest at least 80% of its net assets in Indian infrastructure companies included in the Underlying Index and generally expect to be substantially invested at such times, with at least 95% of its net assets invested in these securities.
Emerging market investments involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles, from economic or political instability in other nations or increased volatility and lower trading volume. This fund will concentrate its investments in issuers of one or more particular industries to the same extent that its Underlying Index is so concentrated and to the extent permitted by applicable regulatory guidance. Concentration risk results from maintaining exposure to issuers conducting business in a specific industry.
EGA Emerging Global Shares Trust 9
Portfolio Summary (Unaudited)
EMERGING GLOBAL SHARES INDXX
CHINA INFRASTRUCTURE INDEX FUND
Industry Breakdown* |
![](https://capedge.com/proxy/N-CSRSA/0000891092-10-005710/a40819prt1x14x1.jpg)
Top Ten Holdings* | ||
Jiangxi Copper Co., Ltd. | 5.7 | % |
China Telecom Corp., Ltd. | 5.7 | |
China Railway Construction Corp., Ltd. | 5.3 | |
China National Building Material Co., Ltd. | 5.0 | |
China Railway Group, Ltd. | 4.8 | |
Huaneng Power International, Inc. | 4.7 | |
China Communications Construction Co., Ltd. | 4.7 | |
Aluminum Corp. of China, Ltd. | 4.5 | |
Agile Property Holdings Ltd. | 4.1 | |
Guangzhou R&F Properties Co. Ltd. | 3.6 |
* | Expressed as a percentage of total investments in securities as of 9/30/2010. |
Emerging Global Shares INDXX China Infrastructure Index Fund (ticker: CHXX)
The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield performance of the INDXX China Infrastructure Index (the “Underlying Index”). The Fund seeks to achieve its investment objective by attempting to replicate the portfolio of the Underlying Index through investments in equity securities, including shares traded on local exchanges, American Depositary Receipts (“ADRs”) and Global Depositary Receipts (“GDRs”). The Underlying Index is a free-float market capitalization weighted stock market index comprised of 30 leading companies that INDXX, LLC determines to be representative of China’s Infrastructure sectors. The Fund invests in Chinese infrastructure companies that are included in the Underlying Index, which are generally defined as companies that are domiciled in China. There is a maximum allowance at time of rebalancing of 4.9% for each underlying position. Names and weights of the underlying index is done annually as of October 1. Under normal circumstances, the Fund will invest at least 80% of its net assets in Chinese Infrastructure companies included in the Underlying Index and generally expects to be substantially invested at such times, with at least 95% of its net assets invested in these securities.
Emerging market investments involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles, from economic or political instability in other nations or increased volatility and lower trading volume. This fund will concentrate its investments in issuers of one or more particular industries to the same extent that its Underlying Index is so concentrated and to the extent permitted by applicable regulatory guidance. Concentration risk results from maintaining exposure to issuers conducting business in a specific industry.
10 EGA Emerging Global Shares Trust
Portfolio Summary (Unaudited)
EMERGING GLOBAL SHARES INDXX
BRAZIL INFRASTRUCTURE INDEX FUND
Industry Breakdown* |
![](https://capedge.com/proxy/N-CSRSA/0000891092-10-005710/a40819prt1x15x1.jpg)
Top Ten Holdings* | ||
Companhia de Concessoes Rodoviarias | 6.1 | % |
Ultrapar Participacoes SA | 5.9 | |
Vale SA | 5.4 | |
Empresa Brasileira de Aeronautica SA | 5.0 | |
Tractebel Energia SA | 4.8 | |
WEG SA | 4.8 | |
AES Tiete SA | 4.7 | |
Companhia Siderurgica Nacional SA | 4.6 | |
Net Servicos de Comunicacao SA | 4.6 | |
VIVO Participacoes SA | 4.5 |
* | Expressed as a percentage of total investments in securities as of 9/30/2010. |
Emerging Global Shares INDXX Brazil Infrastructure Index Fund (ticker: BRXX)
The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield performance of the INDXX Brazil Infrastructure Index (the “Underlying Index”). The Fund seeks to achieve its investment objective by attempting to replicate the portfolio of the Underlying Index through investments in equity securities, including shares traded on local exchanges, American Depositary Receipts (“ADRs”) and Global Depositary Receipts (“GDRs”). The Underlying Index is a free-float capitalization weighted stock market index comprised of 30 leading companies that INDXX, LLC determines to be representative of Brazil’s Infrastructure sectors. The Fund invests in Brazilian infrastructure companies that are included in the Underlying Index, which are generally defined as companies that are domiciled in Brazil. There is a maximum allowance at time of rebalancing of 4.75% for each underlying position. Names and weights of the underlying index is done annually as of October 1. Under normal circumstances, the Fund will invest at least 80% of its net assets in Brazilian Infrastructure companies included in the Underlying Index and generally expects to be substantially invested at such times, with at least 95% of its net assets invested in these securities.
Emerging market investments involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles, from economic or political instability in other nations or increased volatility and lower trading volume. This fund will concentrate its investments in issuers of one or more particular industries to the same extent that its Underlying Index is so concentrated and to the extent permitted by applicable regulatory guidance. Concentration risk results from maintaining exposure to issuers conducting business in a specific industry.
EGA Emerging Global Shares Trust 11
Portfolio Summary (Unaudited)
EMERGING GLOBAL SHARES INDXX
INDIA SMALL CAP INDEX FUND
Industry Breakdown* |
![](https://capedge.com/proxy/N-CSRSA/0000891092-10-005710/a40819prt1x16x1.jpg)
Top Ten Holdings* | ||
Indian Bank | 2.9 | % |
UCO Bank | 2.7 | |
Patni Computer Systems, Ltd. | 2.5 | |
Godrej Industries, Ltd. | 2.3 | |
Amtek Auto, Ltd. | 2.3 | |
Vijaya Bank, Ltd | 2.2 | |
Central Bank of India | 2.1 | |
Alstom Projects India, Ltd. | 2.0 | |
Havells India, Ltd. | 2.0 | |
Dish TV India, Ltd. | 2.0 |
* | Expressed as a percentage of total investments in securities as of 9/30/2010. |
Emerging Global Shares INDXX India Small Cap Index Fund (ticker: SCIN)
The Fund seeks investment results that generally correspond (before fees and expenses) to the price and yield performance of the INDXX India Small Cap Index (the “Underlying Index”). The Fund seeks to achieve its investment objective by attempting to replicate the portfolio of the Underlying Index through investments in equity securities, including shares traded on local exchanges, American Depositary Receipts (“ADRs”) and Global Depositary Receipts (“GDRs”). The Underlying Index is a free-float capitalization weighted stock market index comprised of 75 leading companies that INDXX, LLC determines to be representative of India’s smaller capitalized companies. The Fund invests in Indian small cap companies that are included in the Underlying Index, which are generally defined as companies that are domiciled in India and that have a free float market capitalization of at least $100 million at the time of purchase but no more than $2 billion. There is a maximum allowance at time of rebalancing of 4.9% for each underlying position. Names and weights of the underlying index is done annually as of April 1. Under normal circumstances, the Fund will invest at least 80% of its net assets in Indian small cap companies included in the Underlying Index and generally expect to be substantially invested at such times, with at least 95% of its net assets invested in these securities.
Emerging market investments involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles, from economic or political instability in other nations or increased volatility and lower trading volume. This fund will concentrate its investments in issuers of one or more particular industries to the same extent that its Underlying Index is so concentrated and to the extent permitted by applicable regulatory guidance. Concentration risk results from maintaining exposure to issuers conducting business in a specific industry.
12 EGA Emerging Global Shares Trust
Shareholder Expense Examples (Unaudited)
As a shareholder of a EGA Emerging Global Shares Trust ETF, you incur advisory fees and other Fund expenses. The following example is intended to help you understand your ongoing costs (in dollars and cents) of investing in a Fund and to compare these costs with the ongoing costs of investing in other funds. The example is based on an investment of $1,000 invested at the beginning of the period and held throughout the entire period ended September 30, 2010.
Actual expenses
The first line under each Fund in the table below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line for your Fund under the heading entitled “Expenses Paid Through 9/30/2010” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes
The second line under each Fund in the table provides information about hypothetical account values and hypothetical expenses based on each Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as brokerage commissions paid on purchases and sales of Fund shares. Therefore, the second line under each Fund in the table is useful in comparing ongoing Fund costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
EGA Emerging Global Shares Trust 13
Shareholder Expense Example (Unaudited) (concluded)
Beginning Account Value | Ending Account Value 9/30/2010 | Annualized Expense Ratios for the Period | Expenses Paid Through 9/30/2010* | ||||||||
Emerging Global Shares Dow Jones Emerging Markets | |||||||||||
Titans Composite Index Fund | |||||||||||
Actual | $ | 1,000.00 | $ | 1,042.70 | 0.75 | % | $ | 3.84 | |||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.31 | 0.75 | % | $ | 3.80 | |||
Emerging Global Shares Dow Jones Emerging Markets | |||||||||||
Metals & Mining Titans Index Fund | |||||||||||
Actual | $ | 1,000.00 | $ | 976.10 | 0.86 | % | $ | 4.26 | |||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,020.76 | 0.86 | % | $ | 4.36 | |||
Emerging Global Shares Dow Jones Emerging Markets | |||||||||||
Consumer Titans Index Fund1 | |||||||||||
Actual | $ | 1,000.00 | $ | 1,063.00 | 0.98 | % | $ | 0.47 | † | ||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,020.16 | 0.98 | % | $ | 0.46 | |||
Emerging Global Shares Dow Jones Emerging Markets | |||||||||||
Energy Titans Index Fund | |||||||||||
Actual | $ | 1,000.00 | $ | 1,023.70 | 0.85 | % | $ | 4.31 | |||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,020.81 | 0.85 | % | $ | 4.31 | |||
Emerging Global Shares Dow Jones Emerging Markets | |||||||||||
Financials Titans Index Fund | |||||||||||
Actual | $ | 1,000.00 | $ | 1,105.50 | 0.85 | % | $ | 4.49 | |||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,020.81 | 0.85 | % | $ | 4.31 | |||
Emerging Global Shares INDXX | |||||||||||
India Infrastructure Index Fund2 | |||||||||||
Actual | $ | 1,000.00 | $ | 1,096.50 | 1.14 | % | $ | 1.67 | †† | ||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,019.35 | 1.14 | % | $ | 1.61 | |||
Emerging Global Shares INDXX | |||||||||||
China Infrastructure Index Fund | |||||||||||
Actual | $ | 1,000.00 | $ | 1,008.70 | 0.85 | % | $ | 4.28 | |||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,020.81 | 0.85 | % | $ | 4.31 | |||
Emerging Global Shares INDXX | |||||||||||
Brazil Infrastructure Index Fund | |||||||||||
Actual | $ | 1,000.00 | $ | 1,100.20 | 0.85 | % | $ | 4.48 | |||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,020.81 | 0.85 | % | $ | 4.31 | |||
Emerging Global Shares INDXX | |||||||||||
India Small Cap Index Fund3 | |||||||||||
Actual | $ | 1,000.00 | $ | 1,147.00 | 1.17 | % | $ | 2.96 | ††† | ||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,019.20 | 1.17 | % | $ | 2.78 | |||
* | Expenses are calculated using each Fund’s annualized expense ratio, multiplied by the ending account value for the period, multiplied by 183/365 (to reflect the six-month period). |
† | Expenses are calculated using the Fund’s annualized expense ratio, multiplied by the ending account value for the period, multiplied by 17/365 (to reflect commencement of operations). |
†† | Expenses are calculated using the Fund’s annualized expense ratio, multiplied by the ending account value for the period, multiplied by 51/365 (to reflect commencement of operations). |
††† | Expenses are calculated using the Fund’s annualized expense ratio, multiplied by the ending account value for the period, multiplied by 86/365 (to reflect commencement of operations). |
1 | Emerging Global Shares Dow Jones Emerging Markets Consumer Titans Index Fund commenced operations on September 14, 2010. |
2 | Emerging Global Shares INDXX India Infrastructure Index Fund commenced operations on August 11, 2010. |
3 | Emerging Global Shares INDXX India Small Cap Index Fund commenced operations on July 7, 2010. |
14 EGA Emerging Global Shares Trust
Frequency Distribution of Premium and Discount (Unaudited)
The chart below presents information about differences between the per share net asset value (“NAV”) of each Fund and the market trading price of shares of each Fund. For these purposes, the “market price” is the mid-point of the highest bid and lowest offer for Fund shares as of the close of trading on the exchange where Fund shares are listed. The term “premium” is sometimes used to describe a market price in excess of NAV and the term “discount” is sometimes used to describe a market price below NAV. The chart presents information about the size and frequency of premiums or discounts. As with other exchange traded funds, the market price of Fund shares is typically slightly higher or lower than the Fund’s per share NAV. Factors that contribute to the differences between market price and NAV include the supply and demand for Fund shares and investors’ assessments of the underlying value of a Fund’s portfolio securities.
Differences between the closing times of U.S. and non-U.S. markets may contribute to differences between the NAV and market price of Fund shares. Many non-U.S. markets close prior to the close of the U.S. securities exchanges. Developments after the close of such markets as a result of ongoing price discovery may be reflected in a Fund’s market price but not in its NAV (or vice versa).
Market Price Above or Equal to NAV | Market Price Below NAV | |||||||||
Basis Point Differential | Number of Days | % of Total Days | Number of Days | % of Total Days | ||||||
Emerging Global Shares Dow Jones Emerging Markets | ||||||||||
Titans Composite Index Fund | ||||||||||
July 22, 2009*–September 30, 2010 | ||||||||||
0–24.99 | 42 | 13.86 | % | 26 | 8.59 | % | ||||
25–49.99 | 45 | 14.85 | % | 19 | 6.27 | % | ||||
50–74.99 | 36 | 11.88 | % | 13 | 4.29 | % | ||||
75–99.99 | 30 | 9.90 | % | 4 | 1.32 | % | ||||
>100 | 72 | 23.76 | % | 16 | 5.28 | % | ||||
Total | 225 | 74.25 | % | 78 | 25.75 | % | ||||
Emerging Global Shares Dow Jones Emerging Markets | ||||||||||
Metals & Mining Titans Index Fund | ||||||||||
May 21, 2009*–September 30, 2010 | ||||||||||
0–24.99 | 45 | 13.04 | % | 34 | 9.85 | % | ||||
25–49.99 | 55 | 15.94 | % | 22 | 6.38 | % | ||||
50–74.99 | 33 | 9.57 | % | 19 | 5.51 | % | ||||
75–99.99 | 37 | 10.72 | % | 8 | 2.32 | % | ||||
>100 | 70 | 20.29 | % | 22 | 6.38 | % | ||||
Total | 240 | 69.56 | % | 105 | 30.44 | % | ||||
Emerging Global Shares Dow Jones Emerging Markets | ||||||||||
Consumer Titans Index Fund | ||||||||||
September 14, 2010*–September 30, 2010 | ||||||||||
0–24.99 | 1 | 7.69 | % | — | 0.00 | % | ||||
25–49.99 | 1 | 7.69 | % | — | 0.00 | % | ||||
50–74.99 | 4 | 30.77 | % | — | 0.00 | % | ||||
75–99.99 | 3 | 23.08 | % | — | 0.00 | % | ||||
>100 | 4 | 30.77 | % | — | 0.00 | % | ||||
Total | 13 | 100.00 | % | — | 0.00 | % | ||||
Emerging Global Shares Dow Jones Emerging Markets | ||||||||||
Energy Titans Index Fund | ||||||||||
May 21, 2009*–September 30, 2010 | ||||||||||
0–24.99 | 31 | 8.98 | % | 23 | 6.67 | % | ||||
25–49.99 | 50 | 14.50 | % | 30 | 8.69 | % | ||||
50–74.99 | 55 | 15.94 | % | 19 | 5.51 | % | ||||
75–99.99 | 39 | 11.30 | % | 10 | 2.90 | % | ||||
>100 | 64 | 18.55 | % | 24 | 6.96 | % | ||||
Total | 239 | 69.27 | % | 106 | 30.73 | % | ||||
* | Inception date. |
EGA Emerging Global Shares Trust 15
Frequency Distribution of Premium and Discount (Unaudited) (concluded)
Market Price Above or Equal to NAV | Market Price Below NAV | |||||||||
Basis Point Differential | Number of Days | % of Total Days | Number of Days | % of Total Days | ||||||
Emerging Global Shares Dow Jones Emerging Markets | ||||||||||
Financials Titans Index Fund | ||||||||||
September 16, 2009*–September 30, 2010 | ||||||||||
0–24.99 | 28 | 10.65 | % | 27 | 10.27 | % | ||||
25–49.99 | 35 | 13.31 | % | 15 | 5.70 | % | ||||
50–74.99 | 31 | 11.79 | % | 12 | 4.56 | % | ||||
75–99.99 | 28 | 10.65 | % | 6 | 2.28 | % | ||||
>100 | 63 | 23.95 | % | 18 | 6.84 | % | ||||
Total | 185 | 70.35 | % | 78 | 29.65 | % | ||||
Emerging Global Shares INDXX | ||||||||||
India Infrastructure Index Fund | ||||||||||
August 11, 2010*–September 30, 2010 | ||||||||||
0–24.99 | 5 | 15.15 | % | 2 | 6.06 | % | ||||
25–49.99 | 1 | 3.03 | % | — | 0.00 | % | ||||
50–74.99 | 5 | 15.15 | % | — | 0.00 | % | ||||
75–99.99 | 6 | 18.18 | % | — | 0.00 | % | ||||
>100 | 14 | 42.43 | % | — | 0.00 | % | ||||
Total | 31 | 93.94 | % | 2 | 6.06 | % | ||||
Emerging Global Shares INDXX | ||||||||||
China Infrastructure Index Fund | ||||||||||
February 17, 2010*–September 30, 2010 | ||||||||||
0–24.99 | 17 | 10.76 | % | 6 | 3.80 | % | ||||
25–49.99 | 14 | 8.86 | % | 14 | 8.86 | % | ||||
50–74.99 | 21 | 13.29 | % | 11 | 6.96 | % | ||||
75–99.99 | 12 | 7.60 | % | 10 | 6.33 | % | ||||
>100 | 31 | 19.62 | % | 22 | 13.92 | % | ||||
Total | 95 | 60.13 | % | 63 | 39.87 | % | ||||
Emerging Global Shares INDXX | ||||||||||
Brazil Infrastructure Index Fund | ||||||||||
February 24, 2010*–September 30, 2010 | ||||||||||
0–24.99 | — | 0.00 | % | — | 0.00 | % | ||||
25–49.99 | 4 | 2.61 | % | — | 0.00 | % | ||||
50–74.99 | 2 | 1.31 | % | 1 | 0.65 | % | ||||
75–99.99 | 5 | 3.27 | % | — | 0.00 | % | ||||
>100 | 139 | 90.85 | % | 2 | 1.31 | % | ||||
Total | 150 | 98.04 | % | 3 | 1.96 | % | ||||
Emerging Global Shares INDXX | ||||||||||
India Small Cap Index Fund | ||||||||||
July 7, 2010*–September 30, 2010 | ||||||||||
0–24.99 | 10 | 16.67 | % | 3 | 5.00 | % | ||||
25–49.99 | 6 | 10.00 | % | 1 | 1.67 | % | ||||
50–74.99 | 5 | 8.33 | % | 1 | 1.67 | % | ||||
75–99.99 | 12 | 20.00 | % | — | 0.00 | % | ||||
>100 | 21 | 35.00 | % | 1 | 1.67 | % | ||||
Total | 54 | 90.00 | % | 6 | 10.00 | % | ||||
* | Inception date. |
Each line in the table shows the number of trading days in which the Fund traded within the premium/discount range indicated. The number of trading days in each premium/discount range is also shown as a percentage of the total number of trading days in the period covered by each table. All data presented here represents past performance, which cannot be used to predict future results.
16 EGA Emerging Global Shares Trust
Schedule of Investments
EMERGING GLOBAL SHARES DOW JONES EMERGING MARKETS
TITANS COMPOSITE INDEX FUND
September 30, 2010 (Unaudited)
Investments | Shares | Value | |||
COMMON STOCKS—87.5% | |||||
Brazil—12.1% | |||||
BRF - Brasil Foods SA ADR* | 13,200 | $ | 204,996 | ||
Centrais Eletricas Brasileiras SA ADR* | 8,540 | 109,739 | |||
Companhia Siderurgica Nacional SA ADR | 15,280 | 269,998 | |||
Petroleo Brasileiro SA ADR | 32,950 | 1,195,096 | |||
Ultrapar Participacoes SA ADR | 2,180 | 133,416 | |||
Usinas Siderurgicas de Minas Gerais SA ADR* | 5,450 | 146,060 | |||
Vale SA ADR | 39,400 | 1,232,038 | |||
VIVO Participacoes SA ADR | 3,800 | 103,246 | |||
Total Brazil | 3,394,589 | ||||
Chile—0.9% | |||||
Empresa Nacional de Electricidad SA ADR | 2,385 | 128,862 | |||
Empresas Copec SA | 194 | 3,639 | |||
Enersis SA ADR | 5,385 | 126,601 | |||
Total Chile | 259,102 | ||||
China—21.2% | |||||
Baidu, Inc. ADR* | 3,226 | 331,052 | |||
Bank of China Ltd. Class H | 1,194,930 | 626,464 | |||
BYD Co. Ltd. Class H | 12,300 | 98,787 | |||
China Communications Construction Co., Ltd. Class H | 88,000 | 83,656 | |||
China Construction Bank Corp. Class H | 1,116,350 | 977,842 | |||
China Life Insurance Co., Ltd. Class H | 154,000 | 608,010 | |||
China Petroleum & Chemical Corp. Class H | 562,080 | 498,134 | |||
China Shenhua Energy Co., Ltd. Class H | 82,170 | 339,764 | |||
China Telecom Corp., Ltd. Class H | 286,000 | 156,940 | |||
Ctrip.com International Ltd. ADR* | 2,612 | 124,723 | |||
Dongfeng Motor Group Co., Ltd. Class H | 46,000 | 94,095 | |||
Industrial and Commercial Bank of | |||||
China, Ltd. Class H | 1,630,680 | 1,214,104 | |||
Mindray Medical International, Ltd. ADR | 1,981 | 58,578 | |||
NetEase.com, Inc. ADR* | 1,189 | 46,894 | |||
PetroChina Co., Ltd. Class H | 440,000 | 511,799 | |||
Shandong Weigao Group Medical | |||||
Polymer Co. Ltd. Class H | 15,800 | 44,979 | |||
Sina Corp.* | 1,691 | 85,531 | |||
Sohu.com, Inc.* | 757 | 43,618 | |||
Total China | 5,944,970 | ||||
Czech Republic—0.6% | |||||
CEZ AS | 3,449 | 154,861 | |||
Egypt—0.3% | |||||
Orascom Construction Industries | 1,760 | 77,396 | |||
Hungary—0.2% | |||||
Richter Gedeon Nyrt. | 275 | 63,811 | |||
India—13.0% | |||||
Dr. Reddys Laboratories, Ltd. ADR | 2,586 | 83,321 | |||
ICICI Bank, Ltd. ADR | 8,309 | 414,204 | |||
Infosys Technologies, Ltd. ADR | 16,412 | 1,104,692 | |||
Larsen & Toubro, Ltd. GDR | 15,101 | 687,095 | |||
Ranbaxy Laboratories, Ltd. GDR* | 3,366 | 42,513 | |||
Reliance Industries, Ltd. GDR 144A | 27,824 | 1,240,950 | |||
Wipro, Ltd. ADR | 6,061 | 87,642 | |||
Total India | 3,660,417 | ||||
Indonesia—2.2% | |||||
Astra International Tbk PT | 44,000 | 279,529 | |||
Perusahaan Gas Negara PT | 251,000 | 108,275 | |||
Telekomunikasi Indonesia Tbk PT | 230,000 | 237,087 | |||
Total Indonesia | 624,891 | ||||
Malaysia—2.2% | |||||
Genting Berhad | 48,300 | 155,211 | |||
IOI Corp. Berhad | 127,393 | 225,734 | |||
Sime Darby Berhad | 48,000 | 132,167 | |||
Tenaga Nasional Berhad | 37,300 | 106,571 | |||
Total Malaysia | 619,683 | ||||
Mexico—8.3% | ||||||
America Movil SAB de CV Series L | 468,261 | 1,258,541 | ||||
Cemex SAB de CV Series CPO* | 197,790 | 169,992 | ||||
Fomento Economico Mexicano SAB de CV Series UB | 46,900 | 239,867 | ||||
Grupo Bimbo SAB de CV Series A | 13,200 | 96,910 | ||||
Grupo Televisa SA Series CPO | 59,300 | 226,246 | ||||
Wal-Mart de Mexico SAB de CV Series V | 132,500 | 335,183 | ||||
Total Mexico | 2,326,739 | |||||
Netherlands—0.3% | ||||||
Vimpelcom Ltd. ADR* | 6,500 | 96,525 | ||||
Philippines—0.4% | ||||||
Philippine Long Distance Telephone Co. | 1,700 | 101,338 | ||||
Poland—0.1% | ||||||
Asseco Poland SA | 1,326 | 23,908 | ||||
Russia—14.5% | ||||||
Gazprom OAO ADR | 72,228 | 1,516,066 | ||||
LUKOIL OAO ADR | 9,705 | 551,244 | ||||
Magnit OJSC GDR | 6,400 | 161,280 | ||||
Mining and Metallurgical Company Norilsk Nickel | ||||||
JSC ADR | 25,272 | 430,888 | ||||
Mobile TeleSystems ADR | 9,075 | 192,662 | ||||
Rosneft Oil Co. GDR* | 60,671 | 404,675 | ||||
Surgutneftegaz ADR | 83,472 | 799,662 | ||||
Total Russia | 4,056,477 | |||||
South Africa—11.2% | ||||||
AngloGold Ashanti, Ltd. | 7,213 | 334,417 | ||||
Aspen Pharmacare Holdings, Ltd.* | 6,534 | 88,065 | ||||
Bidvest Group, Ltd. | 8,122 | 171,377 | ||||
Gold Fields, Ltd. | 14,208 | 215,128 | ||||
Impala Platinum Holdings, Ltd. | 19,049 | 491,636 | ||||
MTN Group, Ltd. | 21,909 | 395,815 | ||||
Naspers, Ltd. N Shares | 5,665 | 276,821 | ||||
Netcare, Ltd.* | 25,304 | 50,214 | ||||
Remgro, Ltd. | 8,957 | 140,090 | ||||
Sasol, Ltd. | 9,281 | 416,363 | ||||
Shoprite Holdings, Ltd. | 6,400 | 90,802 | ||||
Standard Bank Group, Ltd. | 24,629 | 391,985 | ||||
Tiger Brands, Ltd.* | 2,953 | 80,279 | ||||
Trans Hex Group Ltd.* | 524 | 255 | ||||
Total South Africa | 3,143,247 | |||||
TOTAL COMMON STOCKS (Cost: $23,736,650) | 24,547,954 | |||||
PREFERRED STOCKS—12.7% | ||||||
Brazil—12.7% | ||||||
Banco Bradesco SA ADR | 42,350 | 863,093 | ||||
Companhia de Bebidas DAS Americas ADR | 3,250 | 402,285 | ||||
Companhia Energetica de Minas Gerais ADR | 8,220 | 134,726 | ||||
Gerdau SA ADR | 13,110 | 178,427 | ||||
Itau Unibanco Holding SA ADR | 76,680 | 1,854,123 | ||||
Tele Norte Leste Participacoes SA ADR* | 8,380 | 117,990 | ||||
TOTAL PREFERRED STOCKS (Cost: $3,256,622) | 3,550,644 | |||||
TOTAL INVESTMENTS IN SECURITIES—100.2% | ||||||
(Cost: $26,993,272) | 28,098,598 | |||||
Liabilities in Excess of Other Assets—(0.2)% | (54,038 | ) | ||||
Net Assets—100.0% | $ | 28,044,560 | ||||
* | Non-income producing security. | |
ADR | American Depositary Receipts | |
GDR | Global Depositary Receipts | |
144A | Series 144A securities were purchased pursuant to Rule 144A under the Securities Act of 1933 and may not be resold subject to that rule except to qualified institutional buyers. Unless otherwise noted, Series 144A securities are deemed to be liquid. |
The accompanying notes are an integral part of these financial statements.
18 | EGA Emerging Global Shares Trust |
Schedule of Investments
EMERGING GLOBAL SHARES DOW JONES EMERGING MARKETS
METALS & MINING TITANS INDEX FUND
September 30, 2010 (Unaudited)
Investments | Shares | Value | |||
COMMON STOCKS—95.5% | |||||
Brazil—19.4% | |||||
Companhia Siderurgica Nacional SA ADR | 81,600 | $ | 1,441,872 | ||
Usinas Siderurgicas de Minas Gerais SA ADR* | 29,600 | 793,280 | |||
Vale SA ADR | 77,070 | 2,409,979 | |||
Total Brazil | 4,645,131 | ||||
China—20.7% | |||||
Aluminum Corp. of China, Ltd. Class H* | 637,264 | 600,883 | |||
Angang Steel Co., Ltd. Class H | 207,242 | 332,625 | |||
China Coal Energy Co. Class H | 561,267 | 928,312 | |||
China Shenhua Energy Co., Ltd. Class H | 326,519 | 1,350,121 | |||
Jiangxi Copper Co., Ltd. Class H | 238,641 | 604,349 | |||
Yanzhou Coal Mining Co., Ltd. Class H | 312,720 | 766,976 | |||
Zijin Mining Group Co., Ltd. Class H | 460,600 | 391,586 | |||
Total China | 4,974,852 | ||||
India—6.5% | |||||
Sterlite Industries India Ltd. ADR | 103,997 | 1,557,875 | |||
Indonesia—3.5% | |||||
Bumi Resources Tbk PT | 3,525,590 | 839,426 | |||
Mexico—4.8% | |||||
Grupo Mexico SAB de CV Series B | 395,725 | 1,146,956 | |||
Poland—2.8% | |||||
KGHM Polska Miedz SA | 16,608 | 669,054 | |||
Russia—15.8% | |||||
Mining and Metallurgical Company Norilsk | |||||
Nickel JSC ADR | 105,148 | 1,792,773 | |||
Novolipetsk Steel GDR | 17,720 | 637,920 | |||
Polyus Gold ADR | 31,969 | 821,603 | |||
Severstal GDR* | 36,317 | 537,492 | |||
Total Russia | 3,789,788 | ||||
South Africa—20.5% | ||||||
Anglo Platinum Ltd.* | 8,799 | 833,939 | ||||
AngloGold Ashanti, Ltd. | 33,056 | 1,532,578 | ||||
Gold Fields, Ltd. | 62,139 | 940,866 | ||||
Impala Platinum Holdings, Ltd. | 62,373 | 1,609,787 | ||||
Total South Africa | 4,917,170 | |||||
Turkey—1.5% | ||||||
Eregli Demir ve Celik Fabrikalari TAS* | 101,053 | 359,793 | ||||
TOTAL COMMON STOCKS (Cost: $20,154,696) | 22,900,045 | |||||
PREFERRED STOCK—4.9% | ||||||
Brazil—4.9% | ||||||
Gerdau SA ADR | 86,250 | 1,173,862 | ||||
TOTAL PREFERRED STOCKS (Cost: $1,207,500) | 1,173,862 | |||||
TOTAL INVESTMENTS IN SECURITIES—100.4% | ||||||
(Cost: $21,362,196) | 24,073,907 | |||||
Liabilities in Excess of Other Assets—(0.4)% | (101,644 | ) | ||||
Net Assets—100.0% | $ | 23,972,263 | ||||
* | Non-income producing security. | |
ADR | American Depositary Receipts | |
GDR | Global Depositary Receipts |
The accompanying notes are an integral part of these financial statements.
Schedule of Investments (Consolidated)
EMERGING GLOBAL SHARES DOW JONES EMERGING MARKETS
CONSUMER TITANS INDEX FUND
September 30, 2010 (Unaudited)
Investments | Shares | Value | ||
COMMON STOCKS—88.1% | ||||
Brazil—4.7% | ||||
BRF—Brasil Foods SA ADR* | 83,723 | $ | 1,300,218 | |
Chile—2.3% | ||||
Lan Airlines SA ADR | 21,510 | 633,254 | ||
China—9.3% | ||||
Ctrip.com International Ltd. ADR* | 23,450 | 1,119,738 | ||
Dongfeng Motor Group Co., Ltd. Class H | 476,000 | 973,681 | ||
New Oriental Education & Technology Group ADR* | 4,709 | 459,504 | ||
Total China | 2,552,923 | |||
India—17.2% | ||||
Bajaj Auto, Ltd. | 23,020 | 753,023 | ||
Hero Honda Motors, Ltd. | 15,128 | 625,522 | ||
Hindustan Unilever, Ltd. | 163,900 | 1,127,257 | ||
ITC, Ltd. | 400,784 | 1,590,292 | ||
Maruti Suzuki India, Ltd. | 20,309 | 651,235 | ||
Total India | 4,747,329 | |||
Indonesia—6.0% | ||||
Astra International Tbk PT | 260,000 | 1,651,765 | ||
Malaysia—8.9% | ||||
Genting Berhad | 350,140 | 1,125,166 | ||
Genting Malaysia Berhad | 456,680 | 501,505 | ||
IOI Corp. Berhad | 469,620 | 832,142 | ||
Total Malaysia | 2,458,813 | |||
Mexico—19.7% | ||||
Fomento Economico Mexicano SAB de CV Series UB | 282,200 | 1,443,293 | ||
Grupo Bimbo SAB de CV Series A | 95,800 | 703,333 | ||
Grupo Televisa SA Series CPO | 360,900 | 1,376,934 | ||
Wal-Mart de Mexico SAB de CV Series V | 762,600 | 1,929,138 | ||
Total Mexico | 5,452,698 | |||
Russia—5.4% | ||||
Magnit OJSC GDR | 39,616 | 998,323 | ||
X5 Retail Group NV GDR* | 12,628 | 505,120 | ||
Total Russia | 1,503,443 | |||
South Africa—14.6% | ||||
Massmart Holdings, Ltd. | 24,336 | 515,731 | ||
Naspers, Ltd. N Shares | 36,496 | 1,783,381 | ||
Shoprite Holdings, Ltd. | 48,661 | 690,393 | ||
Steinhoff International Holdings, Ltd.* | 133,836 | 393,968 | ||
Tiger Brands, Ltd.* | 24,336 | 661,587 | ||
Total South Africa | 4,045,060 | |||
TOTAL COMMON STOCKS (Cost: $23,712,502) | 24,345,503 | |||
PREFERRED STOCKS—11.6% | ||||
Brazil—11.6% | ||||
Companhia Brasileira de Distribuicao Grupo PAO | ||||
de Acucar ADR | 10,485 | 723,675 | ||
Comphania de Bebidas DAS Americas ADR | 20,076 | 2,485,007 | ||
TOTAL PREFERRED STOCKS (Cost: $3,142,058) | 3,208,682 | |||
TOTAL INVESTMENTS IN SECURITIES—99.7% | ||||
(Cost: $26,854,560) | 27,554,185 | |||
Other Assets in Excess of Liabilities—0.3% | 79,885 | |||
Net Assets—100.0% | $ | 27,634,070 | ||
* | Non-income producing security. | |
ADR | American Depositary Receipts | |
GDR | Global Depositary Receipts |
The accompanying notes are an integral part of these financial statements.
20 EGA Emerging Global Shares Trust
Schedule of Investments
EMERGING GLOBAL SHARES DOW JONES EMERGING MARKETS
ENERGY TITANS INDEX FUND
September 30, 2010 (Unaudited)
Investments | Shares | Value | ||
COMMON STOCKS—98.3% | ||||
Brazil—8.2% | ||||
Petroleo Brasileiro SA ADR | 22,250 | $ | 807,008 | |
Chile—2.9% | ||||
Empresas Copec SA | 15,260 | 286,283 | ||
China—13.7% | ||||
China Oilfield Services, Ltd. Class H | 100,555 | 157,247 | ||
China Petroleum & Chemical Corp. Class H | 544,066 | 482,169 | ||
PetroChina Co., Ltd. Class H | 453,460 | 527,455 | ||
Suntech Power Holdings Co., Ltd. ADR* | 18,523 | 178,562 | ||
Total China | 1,345,433 | |||
Colombia—4.1% | ||||
Ecopetrol SA ADR | 9,610 | 401,218 | ||
Hong Kong—7.6% | ||||
CNOOC Ltd. | 384,800 | 745,491 | ||
Hungary—4.3% | ||||
MOL Hungarian Oil And Gas PLC* | 4,015 | 422,109 | ||
India—8.6% | ||||
Reliance Industries, Ltd. GDR 144A | 19,014 | 848,024 | ||
Poland—4.2% | ||||
Polski Koncern Naftowy Orlen SA* | 14,156 | 194,467 | ||
Polskie Gornictwo Naftowe I Gazownictwo SA | 177,777 | 219,798 | ||
Total Poland | 414,265 | |||
Russia—28.8% | ||||
Gazprom OAO ADR | 30,272 | 635,409 | ||
LUKOIL OAO ADR | 7,773 | 441,507 | ||
NovaTek OAO GDR | 3,586 | 308,038 | ||
Rosneft Oil Co. GDR* | 51,206 | 341,544 | ||
Surgutneftegaz ADR | 81,628 | 781,996 | ||
Tatneft ADR | 10,270 | 321,348 | ||
Total Russia | 2,829,842 | |||
South Africa—4.7% | ||||
Sasol, Ltd. | 10,413 | 467,146 | ||
Thailand—10.3% | ||||
PTT Aromatics & Refining PCL | 143,828 | 130,322 | ||
PTT Exploration and Production PCL | 69,465 | 352,475 | ||
PTT PCL | 49,889 | 488,205 | ||
Thai Oil PCL | 24,646 | 42,836 | ||
Total Thailand | 1,013,838 | |||
Turkey—0.9% | ||||
Tupras-Turkiye Petrol Rafinerileri AS | 3,330 | 89,785 | ||
TOTAL INVESTMENTS IN SECURITIES—98.3% | ||||
(Cost: $8,508,336) | 9,670,442 | |||
Other Assets in Excess of Liabilities—1.7% | 167,275 | |||
Net Assets—100.0% | $ | 9,837,717 | ||
* | Non-income producing security. | |
ADR | American Depositary Receipts | |
GDR | Global Depositary Receipts | |
144A | Series 144A securities were purchased pursuant to Rule 144A under the Securities Act of 1933 and may not be resold subject to that rule except to qualified institutional buyers. Unless otherwise noted, Series 144A securities are deemed to be liquid. |
The accompanying notes are an integral part of these financial statements.
Schedule of Investments
EMERGING GLOBAL SHARES DOW JONES EMERGING MARKETS
FINANCIALS TITANS INDEX FUND
September 30, 2010 (Unaudited)
Investments | Shares | Value | |||
COMMON STOCKS—86.0% | |||||
Brazil—4.5% | |||||
Banco do Brasil SA ADR | 23,720 | $ | 456,136 | ||
China—32.5% | |||||
Bank of China Ltd. Class H | 943,890 | 494,852 | |||
Bank of Communications Co., Ltd. Class H | 156,500 | 169,136 | |||
China Construction Bank Corp. Class H | 741,100 | 649,150 | |||
China Life Insurance Co., Ltd. Class H | 115,060 | 454,270 | |||
China Merchants Bank Co., Ltd. Class H | 101,775 | 262,198 | |||
Industrial and Commercial Bank of China, Ltd. Class H | 1,118,240 | 832,572 | |||
Ping An Insurance Group Co. of China Ltd. Class H | 41,300 | 421,342 | |||
Total China | 3,283,520 | ||||
Hong Kong—2.2% | |||||
BOC Hong Kong Holdings, Ltd. | 71,200 | 225,618 | |||
Hungary—2.1% | |||||
OTP Bank Nyrt.* | 7,890 | 207,229 | |||
India—14.5% | |||||
HDFC Bank, Ltd. ADR | 1,839 | 339,056 | |||
ICICI Bank, Ltd. ADR | 11,156 | 556,127 | |||
State Bank of India, Ltd. GDR | 3,930 | 563,169 | |||
Total India | 1,458,352 | ||||
Malaysia—5.0% | |||||
CIMB Group Holdings Berhad | 112,100 | 296,682 | |||
Malayan Banking Berhad | 72,900 | 207,813 | |||
Total Malaysia | 504,495 | ||||
Poland—4.6% | |||||
Bank Pekao SA | 2,907 | 171,719 | |||
Powszechna Kasa Oszczednosci Bank Polski SA | 19,399 | 293,409 | |||
Total Poland | 465,128 | ||||
South Africa—10.7% | |||||
ABSA Group, Ltd. | 14,436 | 277,365 | |||
FirstRand, Ltd. | 60,308 | 185,568 | |||
Sanlam, Ltd. | 59,406 | 224,019 | |||
Standard Bank Group, Ltd. | 24,899 | 396,282 | |||
Total South Africa | 1,083,234 | ||||
Spain—1.9% | |||||
Banco Santander SA ADR | 15,010 | 190,027 | |||
Turkey—8.0% | |||||
Akbank TAS | 34,514 | 211,173 | |||
Turkiye Garanti Bankasi AS | 63,192 | 366,976 | |||
Turkiye Is Bankasi Class C | 53,604 | 227,914 | |||
Total Turkey | 806,063 | ||||
TOTAL COMMON STOCKS (Cost: $7,632,960) | 8,679,802 | ||||
PREFERRED STOCKS—14.4% | |||||
Brazil—14.4% | |||||
Banco Bradesco SA ADR | 35,320 | 719,822 | |||
Itau Unibanco Holding SA ADR | 30,500 | 737,490 | |||
TOTAL PREFERRED STOCKS (Cost: $1,286,204) | 1,457,312 | ||||
TOTAL INVESTMENTS IN SECURITIES—100.4% | |||||
(Cost: $8,919,164) | 10,137,114 | ||||
Liabilities in Excess of Other Assets—(0.4)% | (37,535 | ) | |||
Net Assets—100.0% | $ | 10,099,579 | |||
* | Non-income producing security. | |
ADR | American Depositary Receipts | |
GDR | Global Depositary Receipts |
The accompanying notes are an integral part of these financial statements.
22 EGA Emerging Global Shares Trust
Schedule of Investments (Consolidated)
EMERGING GLOBAL SHARES INDXX
INDIA INFRASTRUCTURE INDEX FUND
September 30, 2010 (Unaudited)
Investments | Shares | Value | ||
COMMON STOCKS—99.8% | ||||
Construction & Engineering—7.7% | ||||
Lanco Infratech, Ltd.* | 40,024 | $ | 64,131 | |
Larsen & Toubro, Ltd. | 6,986 | 319,201 | ||
Punj Lloyd, Ltd. | 12,681 | 35,713 | ||
Total Construction & Engineering | 419,045 | |||
Construction Materials—6.9% | ||||
ACC, Ltd. | 8,470 | 186,581 | ||
Ambuja Cements, Ltd. | 61,661 | 192,935 | ||
Total Construction Materials | 379,516 | |||
Diversified Telecommunication Services—0.5% | ||||
Tata Communications, Ltd.* | 3,814 | 26,019 | ||
Electric Utilities—11.4% | ||||
Power Grid Corp. of India, Ltd. | 51,907 | 123,024 | ||
Reliance Infrastructure, Ltd. | 9,655 | 229,713 | ||
Tata Power Co., Ltd. | 8,962 | 270,286 | ||
Total Electric Utilities | 623,023 | |||
Electrical Equipment—9.8% | ||||
ABB, Ltd | 9,162 | 187,970 | ||
Bharat Heavy Electricals, Ltd. | 5,053 | 278,711 | ||
Suzlon Energy, Ltd.* | 61,913 | 72,199 | ||
Total Electrical Equipment | 538,880 | |||
Gas Utilities—6.4% | ||||
Gail India, Ltd. | 32,838 | 348,988 | ||
Independent Power Producers & Energy Traders—8.9% | ||||
GMR Infrastructure, Ltd.* | 83,951 | 106,118 | ||
NTPC, Ltd. | 55,123 | 266,139 | ||
Reliance Power, Ltd.* | 33,034 | 118,212 | ||
Total Independent Power Producers & Energy Traders | 490,469 | |||
Industrial Conglomerates—7.5% | ||||
Jaiprakash Associates, Ltd. | 74,442 | 200,124 | ||
Siemens India, Ltd. | 11,636 | 213,234 | ||
Total Industrial Conglomerates | 413,358 | |||
Machinery—4.0% | ||||
Tata Motors, Ltd. | 9,062 | 221,453 | ||
Metals & Mining—13.5% | ||||
Jindal Steel & Power, Ltd. | 20,107 | 316,472 | ||
Steel Authority of India, Ltd. | 47,004 | 214,544 | ||
Sterlite Industries India, Ltd. | 56,709 | 210,632 | ||
Total Metals & Mining | 741,648 | |||
Real Estate Management & Development—4.9% | ||||
DLF, Ltd. | 12,529 | 105,452 | ||
Indiabulls Real Estate, Ltd.* | 17,287 | 65,805 | ||
Unitech, Ltd. | 48,785 | 95,866 | ||
Total Real Estate Management & Development | 267,123 | |||
Transportation Infrastructure—7.4% | ||||
IL&FS Transportation Networks, Ltd. | 36,551 | 258,993 | ||
Mundra Port And Special Economic Zone, Ltd. | 39,618 | 147,813 | ||
Total Transportation Infrastructure | 406,806 | |||
Wireless Telecommunication Services—10.9% | ||||
Bharti Airtel, Ltd. | 28,130 | 229,309 | ||
Idea Cellular, Ltd.* | 135,707 | 222,428 | ||
Reliance Communications, Ltd. | 38,087 | 142,821 | ||
Total Wireless Telecommunication Services | 594,558 | |||
TOTAL COMMON STOCKS (Cost: $5,177,986) | 5,470,886 | |||
TOTAL INVESTMENTS IN SECURITIES—99.8% | ||||
(Cost: $5,177,986) | 5,470,886 | |||
Other Assets in Excess of Liabilities—0.2% | 12,374 | |||
Net Assets—100.0% | $ | 5,483,260 | ||
* | Non-income producing security. |
The accompanying notes are an integral part of these financial statements.
Schedule of Investments
EMERGING GLOBAL SHARES INDXX
CHINA INFRASTRUCTURE INDEX FUND
September 30, 2010 (Unaudited)
Investments | Shares | Value | ||
COMMON STOCKS—96.7% | ||||
Construction & Engineering—14.3% | ||||
China Communications Construction Co., Ltd. Class H | 398,000 | $ | 378,354 | |
China Railway Construction Corp., Ltd. Class H | 320,000 | 430,338 | ||
China Railway Group, Ltd. Class H | 498,000 | 390,025 | ||
Total Construction & Engineering | 1,198,717 | |||
Construction Materials—6.7% | ||||
China National Building Material Co., Ltd. Class H | 171,600 | 401,856 | ||
China Shanshui Cement Group, Ltd | 266,000 | 163,098 | ||
Total Construction Materials | 564,954 | |||
Diversified Telecommunication Services—8.3% | ||||
China Communications Services Corp., Ltd. Class H | 402,000 | 238,201 | ||
China Telecom Corp., Ltd. Class H | 837,600 | 459,627 | ||
Total Diversified Telecommunication Services | 697,828 | |||
Electrical Equipment—6.7% | ||||
China High Speed Transmission Equipment | ||||
Group Co., Ltd. | 134,000 | 290,674 | ||
Shanghai Electric Group Co. Ltd. Class H | 484,000 | 268,709 | ||
Total Electrical Equipment | 559,383 | |||
Independent Power Producers & Energy Traders—8.1% | ||||
Datang International Power Generation Co., Ltd. | ||||
Class H | 700,000 | 292,148 | ||
Huaneng Power International, Inc. Class H | 614,000 | 382,010 | ||
Total Independent Power Producers & Energy Traders | 674,158 | |||
Machinery—2.2% | ||||
China National Materials Co., Ltd. Class H | 218,000 | 181,405 | ||
Metals & Mining—18.9% | ||||
Aluminum Corp. of China, Ltd. Class H* | 386,000 | 363,963 | ||
Angang Steel Co., Ltd. Class H | 176,000 | 282,481 | ||
China Molybdenum Co., Ltd. Class H | 201,000 | 144,215 | ||
Fosun International | 233,000 | 185,183 | ||
Hidili Industry International Development, Ltd. | 154,000 | 151,159 | ||
Jiangxi Copper Co., Ltd. Class H | 182,000 | 460,908 | ||
Total Metals & Mining | 1,587,909 | |||
Real Estate Management & Development—20.7% | ||||
Agile Property Holdings Ltd. | 296,400 | 335,985 | ||
Country Garden Holdings Co. | 812,500 | 264,791 | ||
E-House China Holdings, Ltd. ADS | 6,445 | 121,617 | ||
Guangzhou R&F Properties Co. Ltd. Class H | 209,200 | 293,729 | ||
Renhe Commercial Holdings | 882,000 | 164,739 | ||
Shui On Land, Ltd. | 572,500 | 280,232 | ||
Soho China, Ltd. | 388,000 | 275,386 | ||
Total Real Estate Management & Development | 1,736,479 | |||
Semiconductors & Semiconductor Equipment—6.2% | ||||
Suntech Power Holdings Co., Ltd. ADR* | 27,482 | 264,927 | ||
Yingli Green Energy Holding Co., Ltd. ADR* | 18,341 | 253,839 | ||
Total Semiconductors & Semiconductor Equipment | 518,766 | |||
Transportation Infrastructure—4.6% | ||||
Beijing Capital International Airport Co., Ltd. Class H | 324,000 | 170,280 | ||
Jiangsu Expressway Co., Ltd. Class H | 208,000 | 217,828 | ||
Total Transportation Infrastructure | 388,108 | |||
TOTAL COMMON STOCKS (Cost: $7,865,792) | 8,107,707 | |||
TOTAL INVESTMENTS IN SECURITIES—96.7% | ||||
(Cost: $7,865,792) | 8,107,707 | |||
Other Assets in Excess of Liabilities—3.3% | 276,992 | |||
Net Assets—100.0% | $ | 8,384,699 | ||
* | Non-income producing security. | |
ADR | American Depositary Receipts | |
ADS | American Depositary Shares |
The accompanying notes are an integral part of these financial statements.
24 EGA Emerging Global Shares Trust
Schedule of Investments
EMERGING GLOBAL SHARES INDXX
BRAZIL INFRASTRUCTURE INDEX FUND
September 30, 2010 (Unaudited)
Investments | Shares | Value | ||
COMMON STOCKS—67.5% | ||||
Aerospace & Defense—4.9% | ||||
Empresa Brasileira de Aeronautica SA | 309,700 | $ | 2,160,698 | |
Air Freight & Logistics—0.5% | ||||
Log-In Logistica Intermodal SA* | 39,600 | 212,468 | ||
Construction Materials—1.1% | ||||
Magnesita Refratarios SA* | 71,000 | 484,034 | ||
Electric Utilities—9.2% | ||||
Centrais Eletricas Brasileiras SA* | 113,200 | 1,433,207 | ||
Companhia Energetica de Minas Gerais | 99,820 | 1,188,389 | ||
CPFL Energia SA | 62,400 | 1,432,747 | ||
Total Electric Utilities | 4,054,343 | |||
Independent Power Producers & Energy Traders—4.8% | ||||
Tractebel Energia SA | 141,300 | 2,110,076 | ||
Machinery—5.3% | ||||
Lupatech SA* | 19,400 | 255,010 | ||
Weg SA | 188,900 | 2,074,979 | ||
Total Machinery | 2,329,989 | |||
Metals & Mining—13.9% | ||||
Companhia Siderurgica Nacional SA | 116,200 | 2,022,629 | ||
Gerdau SA | 172,900 | 1,770,638 | ||
Vale SA * | 76,400 | 2,356,666 | ||
Total Metals & Mining | 6,149,933 | |||
Real Estate Management & Development—2.0% | ||||
BR Malls Participacoes SA | 109,300 | 901,264 | ||
Road & Rail—2.1% | ||||
Localiza Rent A Car SA | 54,600 | 908,818 | ||
Transportation Infrastructure—11.3% | ||||
Companhia de Concessoes Rodoviarias | 104,300 | 2,668,755 | ||
LLX Logistica SA* | 332,800 | 1,811,130 | ||
Obrascon Huarte Lain Brasil SA | 15,600 | 488,939 | ||
Total Transportation Infrastructure | 4,968,824 | |||
Water Utilities—5.2% | ||||
Companhia de Saneamento Basico do Estado | ||||
de Sao Paulo* | 78,000 | 1,740,751 | ||
Companhia de Saneamento de Minas Gerais* | 35,100 | 536,175 | ||
Total Water Utilities | 2,276,926 | |||
Wireless Telecommunication Services—7.2% | ||||
Tim Participacoes SA* | 282,500 | 1,222,244 | ||
VIVO Participacoes SA ADR | 71,697 | 1,948,007 | ||
Total Wireless Telecommunication Services | 3,170,251 | |||
TOTAL COMMON STOCKS (Cost: $28,177,866) | 29,727,624 | |||
PREFERRED STOCKS—31.5% | ||||
Diversified Telecommunication Services—8.7% | ||||
Brasil Telecom SA* | 204,200 | 1,348,718 | ||
Telemar Norte Leste SA Class A* | 54,600 | 1,444,119 | ||
Telesp - Telecomunicacoes de Sao Paulo SA | 42,900 | 1,050,850 | ||
Total Diversified Telecommunication Services | 3,843,687 | |||
Gas Utilities—2.7% | ||||
Companhia de Gas de Sao Paulo Class A | 54,600 | 1,176,307 | ||
Independent Power Producers & Energy Traders—8.2% | ||||
AES Tiete SA | 155,100 | 2,056,160 | ||
CESP - Companhia Energetica de Sao Paulo Class B | 104,400 | 1,558,420 | ||
Total Independent Power Producers & Energy Traders | 3,614,580 | |||
Machinery—1.6% | ||||
Randon SA Implemetos e Participacoes | 100,700 | 707,313 | ||
Media—4.5% | ||||
Net Servicos de Comunicacao SA* | 153,800 | 2,001,706 | ||
Oil, Gas & Consumable Fuels—5.8% | ||||
Ultrapar Participacoes SA | 42,900 | 2,573,443 | ||
TOTAL PREFERRED STOCKS (Cost: $13,010,117) | 13,917,036 | |||
TOTAL INVESTMENTS IN SECURITIES—99.0% | ||||
(Cost: $41,187,983) | 43,644,660 | |||
Other Assets in Excess of Liabilities—1.0% | 444,979 | |||
Net Assets—100.0% | $ | 44,089,639 | ||
* | Non-income producing security. | |
ADR | American Depositary Receipts |
The accompanying notes are an integral part of these financial statements.
Schedule of Investments (Consolidated)
EMERGING GLOBAL SHARES INDXX
INDIA SMALL CAP INDEX FUND
September 30, 2010 (Unaudited)
Investments | Shares | Value | ||
COMMON STOCKS—99.5% | ||||
Airlines—3.1% | ||||
Jet Airways India, Ltd.* | 18,794 | $ | 340,705 | |
Kingfisher Airlines, Ltd.* | 113,919 | 187,985 | ||
Total Airlines | 528,690 | |||
Auto Components—2.7% | ||||
Amtek Auto, Ltd. | 105,439 | 387,638 | ||
Apollo Tyres, Ltd. | 39,063 | 70,502 | ||
Total Auto Components | 458,140 | |||
Building Products—0.8% | ||||
Electrosteel Castings, Ltd. | 139,261 | 141,477 | ||
Capital Markets—0.7% | ||||
Indiabulls Securities, Ltd. | 202,567 | 122,843 | ||
Chemicals—4.8% | ||||
Chambal Fertilizers & Chemicals, Ltd. | 172,301 | 264,194 | ||
Godrej Industries, Ltd. | 82,731 | 393,541 | ||
Nagarjuna Fertilizers & Chemicals, Ltd. | 263,720 | 174,600 | ||
Total Chemicals | 832,335 | |||
Commercial Banks—12.7% | ||||
Central Bank of India | 83,820 | 362,999 | ||
Development Credit Bank, Ltd.* | 156,715 | 203,675 | ||
Dhanlaxmi Bank, Ltd. | 66,365 | 274,927 | ||
Indian Bank | 80,561 | 499,663 | ||
UCO Bank | 184,509 | 463,993 | ||
Vijaya Bank, Ltd | 205,656 | 373,005 | ||
Total Commercial Banks | 2,178,262 | |||
Computers & Peripherals—1.3% | ||||
Moser Baer India, Ltd. | 155,317 | 231,411 | ||
Construction & Engineering—3.5% | ||||
Alstom Projects India, Ltd. | 19,251 | 349,247 | ||
Maytas Infra, Ltd.* | 29,921 | 150,154 | ||
Noida Toll Bridge Co., Ltd. | 146,520 | 102,386 | ||
Total Construction & Engineering | 601,787 | |||
Construction Materials—0.7% | ||||
Prism Cement, Ltd. | 90,601 | 120,774 | ||
Containers & Packaging—0.7% | ||||
Everest Kanto Cylinder, Ltd. | 45,507 | 120,515 | ||
Diversified Consumer Services—0.6% | ||||
Aptech, Ltd. | 30,681 | 107,197 | ||
Diversified Financial Services—0.9% | ||||
Srei Infrastructure Finance, Ltd. | 77,630 | 157,817 | ||
Diversified Telecommunication Services—2.0% | ||||
Tata Communications, Ltd.* | 45,841 | 312,731 | ||
Tulip Telecom Ltd. | 9,686 | 37,722 | ||
Total Diversified Telecommunication Services | 350,453 | |||
Electrical Equipment—2.0% | ||||
Havells India, Ltd. | 19,578 | 349,232 | ||
Energy Equipment & Services—1.2% | ||||
BGR Energy Systems, Ltd. | 11,691 | 197,408 | ||
Food Products—5.6% | ||||
KS Oils Ltd. | 161,187 | 173,975 | ||
McLeod Russel India, Ltd. | 54,462 | 282,461 | ||
Ruchi Soya Industries, Ltd. | 119,028 | 343,959 | ||
Triveni Engineering & Industries, Ltd. | 60,956 | 167,193 | ||
Total Food Products | 967,588 | |||
Health Care Providers & Services—1.1% | ||||
Fortis Healthcare, Ltd.* | 52,616 | 184,715 | ||
Hotels, Restaurants & Leisure—1.1% | ||||
Hotel Leelaventure, Ltd. | 167,358 | 196,651 | ||
Household Durables—1.8% | ||||
Videocon Industries Ltd. | 49,985 | 302,068 | ||
Independent Power Producers & Energy Traders—1.5% | ||||
Jaiprakash Power Ventures, Ltd.* | 183,884 | 260,675 | ||
IT Services—7.7% | ||||
Core Projects & Technologies, Ltd. | 41,337 | 275,841 | ||
Firstsource Solutions, Ltd.* | 376,770 | 225,551 | ||
Hexaware Technologies, Ltd. | 119,483 | 201,952 | ||
NIIT, Ltd. | 123,347 | 182,955 | ||
Patni Computer Systems, Ltd. | 47,054 | 434,308 | ||
Total IT Services | 1,320,607 | |||
Machinery—3.1% | ||||
Escorts, Ltd. | 53,090 | 253,960 | ||
Praj Industries, Ltd. | 164,275 | 270,532 | ||
Total Machinery | 524,492 | |||
Marine—2.6% | ||||
Mercator Lines, Ltd. | 142,655 | 178,418 | ||
Shipping Corp. of India, Ltd. | 75,164 | 270,815 | ||
Total Marine | 449,233 | |||
Media—3.5% | ||||
Deccan Chronicle Holdings, Ltd. | 89,366 | 258,542 | ||
Dish TV India, Ltd.* | 280,408 | 345,089 | ||
Total Media | 603,631 | |||
Metals & Mining—6.1% | ||||
Gujarat Mineral Development Corp., Ltd. | 82,581 | 240,199 | ||
Jai Corp., Ltd. | 36,552 | 204,459 | ||
Jindal South West Holdings, Ltd.* | 4,891 | 232,082 | ||
JSL Stainless, Ltd.* | 75,323 | 214,143 | ||
Prakash Industries Ltd.* | 44,897 | 164,361 | ||
Total Metals & Mining | 1,055,244 | |||
Oil, Gas & Consumable Fuels—2.9% | ||||
Mangalore Refinery & Petrochemicals, Ltd. | 193,157 | 328,627 | ||
Reliance Industrial Infrastructure | 9,210 | 176,104 | ||
Total Oil, Gas & Consumable Fuels | 504,731 | |||
Pharmaceuticals—1.8% | ||||
Orchid Chemicals & Pharmaceuticals, Ltd. | 58,789 | 306,537 | ||
Real Estate Management & Development—6.3% | ||||
Ackruti City, Ltd. | 12,926 | 146,031 | ||
Anant Raj Industries, Ltd. | 106,820 | 334,593 | ||
Orbit Corp. Ltd. | 66,824 | 178,678 | ||
Parsvnath Developers Ltd.* | 52,001 | 168,090 | ||
Sobha Developers, Ltd. | 29,145 | 247,507 | ||
Total Real Estate Management & Development | 1,074,899 | |||
Software—7.4% | ||||
3i Infotech, Ltd. | 131,527 | 175,916 | ||
Allied Digital Services, Ltd. | 27,596 | 144,259 | ||
Geodesic, Ltd. | 79,015 | 163,886 | ||
ICSA India, Ltd. | 49,682 | 137,376 | ||
NIIT Technologies, Ltd. | 35,316 | 159,388 | ||
OnMobile Global, Ltd.* | 28,686 | 219,223 | ||
Polaris Software Lab, Ltd. | 74,085 | 268,493 | ||
Total Software | 1,268,541 | |||
The accompanying notes are an integral part of these financial statements.
26 EGA Emerging Global Shares Trust
Schedule of Investments (Consolidated) (continued)
EMERGING GLOBAL SHARES INDXX
INDIA SMALL CAP INDEX FUND
September 30, 2010 (Unaudited)
Investments | Shares | Value | ||
Textiles, Apparel & Luxury Goods—6.6% | ||||
Alok Industries, Ltd. | 370,448 | $ | 173,950 | |
Arvind, Ltd.* | 153,476 | 155,235 | ||
Bombay Dyeing & Manufacturing Co., Ltd. | 13,864 | 192,479 | ||
Bombay Rayon Fashions, Ltd. | 44,286 | 251,859 | ||
Rajesh Exports, Ltd. | 76,083 | 167,201 | ||
SRF, Ltd. | 31,140 | 200,208 | ||
Total Textiles, Apparel & Luxury Goods | 1,140,932 | |||
Thrifts & Mortgage Finance—1.4% | ||||
Dewan Housing Finance Corp., Ltd. | 36,856 | 235,112 | ||
Wireless Telecommunication Services—1.3% | ||||
Tata Teleservices Maharashtra, Ltd.* | 449,514 | 221,081 | ||
TOTAL INVESTMENTS IN SECURITIES—99.5% | ||||
(Cost: $16,165,517) | 17,115,078 | |||
Other Assets in Excess of Liabilities—0.5% | 91,466 | |||
Net Assets—100.0% | $ | 17,206,544 | ||
* | Non-income producing security. |
The accompanying notes are an integral part of these financial statements.
Statements of Assets and Liabilities
EGA EMERGING GLOBAL SHARES TRUST
September 30, 2010 (Unaudited)
Emerging Global Shares Dow Jones Emerging Markets Titans Composite Index Fund | Emerging Global Shares Dow Jones Emerging Markets Metals & Mining Titans Index Fund | Emerging Global Shares Dow Jones Emerging Markets Consumer Titans Index Fund (Consolidated) | |||||||||
ASSETS: | |||||||||||
Cost of Investments: | $ | 26,993,272 | $ | 21,362,196 | $ | 26,854,560 | |||||
Investments at value | 28,098,598 | 24,073,907 | 27,554,185 | ||||||||
Cash | — | — | 2,278,015 | ||||||||
Foreign cash* | 6,103 | — | — | ||||||||
Receivables: | |||||||||||
Dividend and interest | 101,490 | 8,495 | 44,039 | ||||||||
Due from sub-adviser | 78,203 | 34,875 | 5,686 | ||||||||
Capital shares sold | — | — | 18,385,641 | ||||||||
Foreign currency sold | — | — | 206,139 | ||||||||
Prepaid trustee fees | 591 | 413 | — | ||||||||
Prepaid organization expenses | — | — | 3,671 | ||||||||
Prepaid expense and other assets | — | — | 85 | ||||||||
Total Assets | 28,284,985 | 24,117,690 | 48,477,461 | ||||||||
LIABILITIES: | |||||||||||
Payables: | |||||||||||
Capital shares payable | — | 4,087 | 125 | ||||||||
Due to custodian | 78,669 | 5,474 | 207,291 | ||||||||
Accrued investment advisory fees | 36,290 | 30,790 | 317 | ||||||||
Investment securities purchased | — | — | 20,427,000 | ||||||||
Trustee fees | — | — | 16 | ||||||||
Accrued expenses and other liabilities | 125,466 | 105,076 | 208,642 | ||||||||
Total Liabilities | 240,425 | 145,427 | 20,843,391 | ||||||||
NET ASSETS | $ | 28,044,560 | $ | 23,972,263 | $ | 27,634,070 | |||||
NET ASSETS: | |||||||||||
Paid-in capital | $ | 26,892,730 | $ | 21,587,132 | $ | 26,912,219 | |||||
Accumulated net investment income (loss) | 339,722 | 113,526 | 41,136 | ||||||||
Undistributed (accumulated) net realized gain (loss) on investments | |||||||||||
and foreign currency translations | (296,127 | ) | (440,124 | ) | (7,050 | ) | |||||
Net unrealized appreciation (depreciation) on investments and | |||||||||||
on foreign currency translations | 1,108,235 | 2,711,729 | 687,765 | ||||||||
NET ASSETS | $ | 28,044,560 | $ | 23,972,263 | $ | 27,634,070 | |||||
Outstanding beneficial interest shares (unlimited shares of beneficial | |||||||||||
interest authorized, par value) | 1,105,000 | 1,200,000 | 1,300,000 | ||||||||
Net asset value per share | $ | 25.38 | $ | 19.98 | $ | 21.26 | |||||
* Cost of foreign cash | $ | 6,066 | $ | (1,308 | ) | $ | (206,956 | ) |
Emerging Global Shares Dow Jones Emerging Markets Energy Titans Index Fund | Emerging Global Shares Dow Jones Emerging Markets Financials Titans Index Fund | Emerging Global Shares INDXX India Infrastructure Index Fund (Consolidated) | Emerging Global Shares INDXX China Infrastructure Index Fund | Emerging Global Shares INDXX Brazil Infrastructure Index Fund | Emerging Global Shares INDXX India Small Cap Index Fund (Consolidated) | ||||||||||||||||||
ASSETS: | |||||||||||||||||||||||
Cost of Investments: | $ | 8,508,336 | $ | 8,919,164 | $ | 5,177,986 | $ | 7,865,792 | $ | 41,187,983 | $ | 16,165,517 | |||||||||||
Investments at value | 9,670,442 | 10,137,114 | 5,470,886 | 8,107,707 | 43,644,660 | 17,115,078 | |||||||||||||||||
Cash | 135,356 | 15,843 | — | 269,269 | 249,668 | — | |||||||||||||||||
Foreign cash* | 59,163 | 3,445 | 47,594 | — | 95,957 | 274,704 | |||||||||||||||||
Receivables: | |||||||||||||||||||||||
Dividend and interest | 48,700 | 4,956 | 4,090 | 14,407 | 204,654 | 22,159 | |||||||||||||||||
Due from sub-adviser | 30,018 | 18,844 | 23,334 | 24,992 | 17,712 | 32,711 | |||||||||||||||||
Capital shares sold | — | — | 1,059,680 | — | — | 4,534,572 | |||||||||||||||||
Foreign currency sold | — | — | 1,136,373 | — | — | — | |||||||||||||||||
Prepaid trustee fees | 325 | 240 | — | — | — | — | |||||||||||||||||
Prepaid organization expenses | — | — | — | 29,631 | 23,588 | 4,197 | |||||||||||||||||
Prepaid expense and other assets | — | 142 | 80 | 1,260 | 1,260 | 1,845 | |||||||||||||||||
Total Assets | 9,944,004 | 10,180,584 | 7,742,037 | 8,447,266 | 44,237,499 | 21,985,266 | |||||||||||||||||
LIABILITIES: | |||||||||||||||||||||||
Payables: | |||||||||||||||||||||||
Capital shares payable | — | — | — | — | — | — | |||||||||||||||||
Due to custodian | — | — | 1,130,953 | — | — | 84,611 | |||||||||||||||||
Accrued investment advisory fees | 10,620 | 7,777 | 965 | 6,089 | 10,907 | 1,865 | |||||||||||||||||
Investment securities purchased | — | — | 1,110,032 | — | 126 | — | |||||||||||||||||
Trustee fees | — | — | 48 | 51 | 50 | 93 | |||||||||||||||||
Accrued expenses and other liabilities | 95,667 | 73,228 | 16,779 | 56,427 | 136,777 | 4,692,153 | |||||||||||||||||
Total Liabilities | 106,287 | 81,005 | 2,258,777 | 62,567 | 147,860 | 4,778,722 | |||||||||||||||||
NET ASSETS | $ | 9,837,717 | $ | 10,099,579 | $ | 5,483,260 | $ | 8,384,699 | $ | 44,089,639 | $ | 17,206,544 | |||||||||||
NET ASSETS: | |||||||||||||||||||||||
Paid-in capital | $ | 8,606,203 | $ | 8,419,540 | $ | 5,194,233 | $ | 7,806,791 | $ | 41,284,687 | $ | 16,216,075 | |||||||||||
Accumulated net investment income (loss) | 66,084 | 135,028 | 2,073 | 121,022 | 340,953 | 44,574 | |||||||||||||||||
Undistributed (accumulated) net realized gain (loss) on investments | |||||||||||||||||||||||
and foreign currency translations | 3,382 | 326,950 | (1,991 | ) | 214,968 | 4,898 | (11,319 | ) | |||||||||||||||
Net unrealized appreciation (depreciation) on investments and | |||||||||||||||||||||||
on foreign currency translations | 1,162,048 | 1,218,061 | 288,945 | 241,918 | 2,459,101 | 957,214 | |||||||||||||||||
NET ASSETS | $ | 9,837,717 | $ | 10,099,579 | $ | 5,483,260 | $ | 8,384,699 | $ | 44,089,639 | $ | 17,206,544 | |||||||||||
Outstanding beneficial interest shares (unlimited shares of beneficial | |||||||||||||||||||||||
interest authorized, par value) | 400,000 | 400,000 | 250,000 | 400,000 | 1,950,000 | 750,000 | |||||||||||||||||
Net asset value per share | $ | 24.59 | $ | 25.25 | $ | 21.93 | $ | 20.96 | $ | 22.61 | $ | 22.94 | |||||||||||
* Cost of foreign cash | $ | 59,584 | $ | 3,370 | $ | 46,222 | $ | — | $ | 95,418 | $ | 267,482 |
The accompanying notes are an integral part of these financial statements.
28 & 29 EGA Emerging Global Shares Trust |
Statements of Operations
EGA EMERGING GLOBAL SHARES TRUST
Emerging Global Shares Dow Jones Emerging Markets Titans Composite Index Fund (Unaudited) | Emerging Global Shares Dow Jones Emerging Markets Metals & Mining Titans Index Fund (Unaudited) | Emerging Global Shares Dow Jones Emerging Markets Consumer Titans Index Fund (Unaudited) (Consolidated) | |||||||||
For the Period March 31, 2010 Through September 30, 2010 | For the Period March 31, 2010 Through September 30, 2010 | For the Period September 14, 20101 Through September 30, 2010 | |||||||||
INVESTMENT INCOME: | |||||||||||
Dividend income* | $ | 484,557 | $ | 280,252 | $ | 44,965 | |||||
EXPENSES: | |||||||||||
Sub-advisory fees | 107,055 | 105,818 | 3,330 | ||||||||
Investment advisory fees | 64,322 | 53,397 | 317 | ||||||||
Administration and accounting fees | 33,770 | 35,859 | 1,455 | ||||||||
Organization and offering fees | 33,491 | 19,846 | 2,329 | ||||||||
Legal fees | 21,921 | 16,656 | 233 | ||||||||
Licensing fees | 21,312 | 21,124 | 162 | ||||||||
Custody fees | 19,353 | 6,834 | 349 | ||||||||
Shareholder reporting fees | 7,589 | 7,103 | 29 | ||||||||
Audit and tax fees | 7,518 | 7,518 | 1,111 | ||||||||
Pricing fees | 6,438 | 6,496 | 699 | ||||||||
Transfer agent fees | 6,017 | 6,017 | 559 | ||||||||
Insurance fees | 4,536 | 3,765 | 21 | ||||||||
Trustees’ fees and expenses | 3,904 | 3,198 | 16 | ||||||||
Registration fees | 2,531 | 1,114 | 100 | ||||||||
Exchange listing fees | 1,662 | 1,287 | 233 | ||||||||
Mauritius entity fees | — | — | 1,397 | ||||||||
Interest expense | — | 816 | 499 | ||||||||
Miscellaneous fees | 157 | 162 | — | ||||||||
Total expenses before reimbursements/waivers | 341,576 | 297,010 | 12,839 | ||||||||
Less: Reimbursements/waivers of expenses from sub-adviser | (234,521 | ) | (190,376 | ) | (9,010 | ) | |||||
Net expenses | 107,055 | 106,634 | 3,829 | ||||||||
Net investment income (loss) | 377,502 | 173,618 | 41,136 | ||||||||
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND | |||||||||||
FOREIGN CURRENCY TRANSLATIONS: | |||||||||||
Net realized gain (loss) on: | |||||||||||
Investments | (565,476 | ) | (398,276 | ) | (4,005 | ) | |||||
In-Kind Redemption | 354,811 | — | — | ||||||||
Foreign currency translations | 13,795 | 23,804 | (3,045 | ) | |||||||
Net realized gain (loss) | (196,870 | ) | (374,472 | ) | (7,050 | ) | |||||
Change in unrealized appreciation (depreciation) on: | |||||||||||
Investments | (348,853 | ) | (786,943 | ) | 699,625 | ||||||
Foreign currency translations | 1,650 | 91 | (11,860 | ) | |||||||
Change in unrealized appreciation (depreciation) | (347,203 | ) | (786,852 | ) | 687,765 | ||||||
Net realized and unrealized gain (loss) on investments and foreign currency translations | (544,073 | ) | (1,161,324 | ) | 680,715 | ||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | $ | (166,571 | ) | $ | (987,706 | ) | $ | 721,851 | |||
* Net of foreign taxes withheld of: | $ | 43,885 | $ | 28,602 | $ | — | |||||
1 Commencement of operations. |
Emerging Global Shares Dow Jones Emerging Markets Energy Titans Index Fund (Unaudited) | Emerging Global Shares Dow Jones Emerging Markets Financials Titans Index Fund (Unaudited) | Emerging Global Shares INDXX India Infrastructure Index Fund (Unaudited) (Consolidated) | Emerging Global Shares INDXX China Infrastructure Index Fund (Unaudited) | Emerging Global Shares INDXX Brazil Infrastructure Index Fund (Unaudited) | Emerging Global Shares INDXX India Small Cap Index Fund (Unaudited) (Consolidated) | ||||||||||||||||||
For the Period March 31, 2010 Through September 30, 2010 | For the Period March 31, 2010 Through September 30, 2010 | For the Period August 11, 20101 Through September 30, 2010 | For the Period March 31, 2010 Through September 30, 2010 | For the Period March 31, 2010 Through September 30, 2010 | For the Period July 7, 20101 Through September 30, 2010 | ||||||||||||||||||
INVESTMENT INCOME: | |||||||||||||||||||||||
Dividend income* | $ | 150,064 | $ | 180,224 | $ | 6,464 | $ | 157,359 | $ | 494,341 | $ | 64,724 | |||||||||||
EXPENSES: | |||||||||||||||||||||||
Sub-advisory fees | 38,796 | 42,001 | 3,264 | 36,201 | 108,510 | 14,589 | |||||||||||||||||
Investment advisory fees | 18,769 | 16,680 | 965 | 13,381 | 33,014 | 1,865 | |||||||||||||||||
Administration and accounting fees | 35,859 | 30,983 | 4,367 | 19,846 | 19,846 | 7,363 | |||||||||||||||||
Organization and offering fees | 19,846 | 25,464 | 6,987 | 10,808 | 10,808 | 11,781 | |||||||||||||||||
Legal fees | 6,095 | 6,246 | 699 | 6,424 | 16,573 | 1,178 | |||||||||||||||||
Licensing fees | 10,205 | 9,634 | 384 | 4,259 | 12,766 | 1,716 | |||||||||||||||||
Custody fees | 5,777 | 7,206 | 849 | 7,741 | 15,034 | 3,528 | |||||||||||||||||
Shareholder reporting fees | 3,157 | 2,201 | 194 | 1,586 | 2,886 | 325 | |||||||||||||||||
Audit and tax fees | 7,143 | 7,093 | 2,858 | 5,171 | 5,171 | 4,187 | |||||||||||||||||
Pricing fees | 6,438 | 6,438 | 2,096 | 6,211 | 6,135 | 3,535 | |||||||||||||||||
Transfer agent fees | 6,017 | 6,017 | 1,677 | 6,017 | 6,017 | 2,828 | |||||||||||||||||
Insurance fees | 1,319 | 1,291 | 85 | 1,155 | 2,566 | 155 | |||||||||||||||||
Trustees’ fees and expenses | 1,229 | 1,009 | 48 | 690 | 1,592 | 93 | |||||||||||||||||
Registration fees | 2,295 | 515 | 500 | 584 | 1,224 | 500 | |||||||||||||||||
Exchange listing fees | 1,382 | 1,941 | 699 | 2,507 | 2,507 | 1,178 | |||||||||||||||||
Mauritius entity fees | — | — | 4,192 | — | — | 7,068 | |||||||||||||||||
Interest expense | — | — | 1,125 | — | 38 | 5,562 | |||||||||||||||||
Miscellaneous fees | 162 | 145 | — | 142 | 154 | — | |||||||||||||||||
Total expenses before reimbursements/waivers | 164,489 | 164,864 | 30,989 | 122,723 | 244,841 | 67,451 | |||||||||||||||||
Less: Reimbursements/waivers of expenses from sub-adviser | (125,694 | ) | (122,863 | ) | (26,598 | ) | (86,522 | ) | (136,293 | ) | (47,301 | ) | |||||||||||
Net expenses | 38,795 | 42,001 | 4,391 | 36,201 | 108,548 | 20,150 | |||||||||||||||||
Net investment income (loss) | 111,269 | 138,223 | 2,073 | 121,158 | 385,793 | 44,574 | |||||||||||||||||
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND | |||||||||||||||||||||||
FOREIGN CURRENCY TRANSLATIONS: | |||||||||||||||||||||||
Net realized gain (loss) on: | |||||||||||||||||||||||
Investments | 66,747 | 59,794 | (15,068 | ) | (56,441 | ) | (6,139 | ) | 7,984 | ||||||||||||||
In-Kind Redemption | — | 223,615 | — | 271,627 | — | — | |||||||||||||||||
Foreign currency translations | 1,443 | 964 | 13,077 | (218 | ) | 13,829 | (19,303 | ) | |||||||||||||||
Net realized gain (loss) | 68,190 | 284,373 | (1,991 | ) | 214,968 | 7,690 | (11,319 | ) | |||||||||||||||
Change in unrealized appreciation (depreciation) on: | |||||||||||||||||||||||
Investments | 50,875 | 564,975 | 292,900 | 88,140 | 2,665,082 | 949,561 | |||||||||||||||||
Foreign currency translations | 162 | 27 | (3,955 | ) | 3 | 1,881 | 7,653 | ||||||||||||||||
Change in unrealized appreciation (depreciation) | 51,037 | 565,002 | 288,945 | 88,143 | 2,666,963 | 957,214 | |||||||||||||||||
Net realized and unrealized gain (loss) on investments and foreign currency translations | 119,227 | 849,375 | 286,954 | 303,111 | 2,674,653 | 945,895 | |||||||||||||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | $ | 230,496 | $ | 987,598 | $ | 289,027 | $ | 424,269 | $ | 3,060,446 | $ | 990,469 | |||||||||||
* Net of foreign taxes withheld of: | $ | 18,471 | $ | 13,098 | $ | — | $ | 9,313 | $ | 2,196 | $ | — | |||||||||||
1 Commencement of operations. |
The accompanying notes are an integral part of these financial statements.
30 & 31 EGA Emerging Global Shares Trust |
Statements of Changes in Net Assets
EGA EMERGING GLOBAL SHARES TRUST
Emerging Global Shares Dow Jones Emerging Markets Titans Composite Index Fund | Emerging Global Shares Dow Jones Emerging Markets Metals & Mining Titans Index Fund | Emerging Global Shares Dow Jones Emerging Markets Consumer Titans Index Fund (Consolidated) | Emerging Global Shares Dow Jones Emerging Markets Energy Titans Index Fund | ||||||||||||||||||||||||
For the Period April 1, 20102 Through September 30, 2010 (Unaudited) | For the Period July 22, 20091,2 Through March 31, 2010 | For the Period April 1, 20103 Through September 30, 2010 (Unaudited) | For the Period May 21, 20091,3 Through March 31, 2010 | For the Period September 14, 20101 Through September 30, 2010 | For the Period April 1, 20102 Through September 30, 2010 (Unaudited) | For the Period May 21, 20091,2 Through March 31, 2010 | |||||||||||||||||||||
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS: | |||||||||||||||||||||||||||
Net investment income (loss) | $ | 377,502 | $ | 59,079 | $ | 173,618 | $ | (6,134 | ) | $ | 41,136 | $ | 111,269 | $ | 30,765 | ||||||||||||
Net realized gain (loss) on investments and foreign currency translations | (196,870 | ) | (155,887 | ) | (374,472 | ) | (67,719 | ) | (7,050 | ) | 68,190 | (122,738 | ) | ||||||||||||||
Net unrealized appreciation (depreciation) on investments and forward currency translations | (347,203 | ) | 1,455,438 | (786,852 | ) | 3,498,581 | 687,765 | 51,037 | 1,111,011 | ||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | (166,571 | ) | 1,358,630 | (987,706 | ) | 3,424,728 | 721,851 | 230,496 | 1,019,038 | ||||||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS: | |||||||||||||||||||||||||||
Net investment income | — | (45,229 | ) | — | (56,190 | ) | — | — | (21,996 | ) | |||||||||||||||||
CAPITAL SHARE TRANSACTIONS: | |||||||||||||||||||||||||||
Proceeds from sale of shares | 5,055,523 | 30,341,841 | — | 24,271,605 | 26,912,219 | — | 8,610,179 | ||||||||||||||||||||
Cost of shares redeemed | (8,599,634 | ) | — | (2,680,174 | ) | — | — | — | — | ||||||||||||||||||
Net increase (decrease) in net assets resulting from capital share transactions | (3,544,111 | ) | 30,341,841 | (2,680,174 | ) | 24,271,605 | 26,912,219 | — | 8,610,179 | ||||||||||||||||||
Net Increase (Decrease) in Net Assets | (3,710,682 | ) | 31,655,242 | (3,667,880 | ) | 27,640,143 | 27,634,070 | 230,496 | 9,607,221 | ||||||||||||||||||
NET ASSETS: | |||||||||||||||||||||||||||
Beginning of period | 31,755,242 | 100,000 | 27,640,143 | — | — | 9,607,221 | — | ||||||||||||||||||||
End of period | $ | 28,044,560 | $ | 31,755,242 | $ | 23,972,263 | $ | 27,640,143 | $ | 27,634,070 | $ | 9,837,717 | $ | 9,607,221 | |||||||||||||
Accumulated net investment income (loss) included in net assets at end of period | $ | 339,722 | $ | (37,780 | ) | $ | 113,526 | $ | (60,092 | ) | $ | 41,136 | $ | 66,084 | $ | (45,185 | ) | ||||||||||
SHARES CREATED AND REDEEMED: | |||||||||||||||||||||||||||
Shares outstanding, beginning of period | 1,305,000 | 5,000 | 1,350,000 | — | — | 400,000 | 400,000 | ||||||||||||||||||||
Shares sold | 200,000 | 1,300,000 | — | 1,350,000 | 1,300,000 | — | — | ||||||||||||||||||||
Shares redeemed | (400,000 | ) | — | (150,000 | ) | — | — | — | — | ||||||||||||||||||
Shares outstanding, end of period | 1,105,000 | 1,305,000 | 1,200,000 | 1,350,000 | 1,300,000 | 400,000 | 400,000 | ||||||||||||||||||||
Emerging Global Shares | Emerging Global Shares INDXX India Infrastructure Index Fund (Consolidated) | Emerging Global Shares INDXX China Infrastructure Index Fund | Emerging Global Shares INDXX Brazil Infrastructure Index Fund | Emerging Global Shares INDXX India Small Cap Index Fund (Consolidated) | ||||||||||||||||||||||||||||
For the Period April 1, 20102 Through September 30, 2010 (Unaudited) | For the Period September 16, 20091,2 Through March 31, 2010 | For the Period August 11, 20101 Through September 30, 2010 | For the Period April 1, 2010 Through September 30, 2010 (Unaudited) | For the Period February 17, 20101 Through March 31, 2010 | For the Period April 1, 2010 Through September 30, 2010 (Unaudited) | For the Period February 24, 20101 Through March 31, 2010 | For the Period July 7, 20101 Through September 30, 2010 (Unaudited) | |||||||||||||||||||||||||
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS: | ||||||||||||||||||||||||||||||||
Net investment income (loss) | $ | 138,223 | $ | 18,076 | $ | 2,073 | $ | 121,158 | $ | (4,237 | ) | $ | 385,793 | $ | 10,777 | $ | 44,574 | |||||||||||||||
Net realized gain (loss) on investments and foreign currency translations | 284,373 | 30,056 | (1,991 | ) | 214,968 | 3,831 | 7,690 | (58,409 | ) | (11,319 | ) | |||||||||||||||||||||
Net unrealized appreciation (depreciation) on investments and forward currency translations | 565,002 | 653,059 | 288,945 | 88,143 | 153,775 | 2,666,963 | (207,862 | ) | 957,214 | |||||||||||||||||||||||
Net increase (decrease) in net assets resulting from operations | 987,598 | 701,191 | 289,027 | 424,269 | 153,369 | 3,060,446 | (255,494 | ) | 990,469 | |||||||||||||||||||||||
DISTRIBUTIONS TO SHAREHOLDERS: | ||||||||||||||||||||||||||||||||
Net investment income | — | (13,750 | ) | — | — | — | — | — | — | |||||||||||||||||||||||
CAPITAL SHARE TRANSACTIONS: | ||||||||||||||||||||||||||||||||
Proceeds from sale of shares | 4,605,635 | 6,164,649 | 5,194,233 | 6,518,077 | 6,081,584 | 29,726,457 | 11,558,230 | 16,216,075 | ||||||||||||||||||||||||
Cost of shares redeemed | (2,345,744 | ) | — | — | (4,792,600 | ) | — | — | — | — | ||||||||||||||||||||||
Net increase (decrease) in net assets resulting from capital share transactions | 2,259,891 | 6,164,649 | 5,194,233 | 1,725,477 | 6,081,584 | 29,726,457 | 11,558,230 | 16,216,075 | ||||||||||||||||||||||||
Net Increase (Decrease) in Net Assets | 3,247,489 | 6,852,090 | 5,483,260 | 2,149,746 | 6,234,953 | 32,786,903 | 11,302,736 | 17,206,544 | ||||||||||||||||||||||||
NET ASSETS: | ||||||||||||||||||||||||||||||||
Beginning of period | 6,852,090 | — | — | 6,234,953 | — | 11,302,736 | — | — | ||||||||||||||||||||||||
End of period | $ | 10,099,579 | $ | 6,852,090 | $ | 5,483,260 | $ | 8,384,699 | $ | 6,234,953 | $ | 44,089,639 | $ | 11,302,736 | $ | 17,206,544 | ||||||||||||||||
Accumulated net investment income (loss) included in net assets at end of period | $ | 135,028 | $ | (3,195 | ) | $ | 2,073 | $ | 121,022 | $ | (136 | ) | $ | 340,953 | $ | (44,840 | ) | $ | 44,574 | |||||||||||||
SHARES CREATED AND REDEEMED: | ||||||||||||||||||||||||||||||||
Shares outstanding, beginning of period | 300,000 | — | — | 300,000 | — | 550,000 | — | — | ||||||||||||||||||||||||
Shares sold | 200,000 | 300,000 | 250,000 | 350,000 | 300,000 | 1,400,000 | 550,000 | 750,000 | ||||||||||||||||||||||||
Shares redeemed | (100,000 | ) | — | — | (250,000 | ) | — | — | — | — | ||||||||||||||||||||||
Shares outstanding, end of period | 400,000 | 300,000 | 250,000 | 400,000 | 300,000 | 1,950,000 | 550,000 | 750,000 | ||||||||||||||||||||||||
1 | Commencement of operations. |
2 | On September 16, 2010, there was a 2 for 1 forward stock split. Historical share amounts have been adjusted to reflect the 3 for 1 forward stock split on a retroactive basis. |
3 | On September 16, 2010, there was a 3 for 1 forward stock split. Historical share amounts have been adjusted to reflect the 3 for 1 forward stock split on a retroactive basis. |
The accompanying notes are an integral part of these financial statements.
32 & 33 EGA Emerging Global Shares Trust |
Financial Highlights
EGA EMERGING GLOBAL SHARES TRUST
For a share outstanding throughout each period
Emerging Global Shares Dow Jones Emerging Markets Titans Composite Index Fund | Emerging Global Shares Dow Jones Emerging Markets Metals & Mining Titans Index Fund | Emerging Global Shares Dow Jones Emerging Markets Consumer Titans Index Fund (Consolidated) | Emerging Global Shares Dow Jones Emerging Markets Energy Titans Index Fund | ||||||||||||||||||||||||
For the Period April 1, 20108 Through September 30, 2010 (Unaudited) | For the Period July 22, 20091,8 Through March 31, 2010 | For the Period April 1, 20109 Through September 30, 2010 (Unaudited) | For the Period May 21, 20091,9 Through March 31, 2010 | For the Period September 14, 20101 Through September 30, 2010 (Unaudited) | For the Period April 1, 20108 Through September 30, 2010 (Unaudited) | For the Period May 21, 20091,8 Through March 31, 2010 | |||||||||||||||||||||
Net asset value, beginning of period | $ | 24.34 | $ | 20.00 | $ | 20.47 | $ | 13.73 | $ | 20.00 | $ | 24.02 | $ | 20.49 | |||||||||||||
Investment operations: | |||||||||||||||||||||||||||
Net investment income (loss)2 | 0.31 | 0.09 | 0.13 | (0.01 | ) | 0.08 | 0.28 | 0.09 | |||||||||||||||||||
Net realized and unrealized gain on investments | 0.737 | 4.31 | (0.62 | ) | 6.82 | 1.18 | 0.29 | 3.50 | |||||||||||||||||||
Total from investment operations | 1.04 | 4.40 | (0.49 | ) | 6.81 | 1.26 | 0.57 | 3.59 | |||||||||||||||||||
Less: Distributions from net investment income | — | (0.06 | ) | — | (0.07 | ) | — | — | (0.06 | ) | |||||||||||||||||
Net asset value, end of period | $ | 25.38 | $ | 24.34 | $ | 19.98 | $ | 20.47 | $ | 21.26 | $ | 24.59 | $ | 24.02 | |||||||||||||
NET ASSET VALUE TOTAL RETURN3 | 4.27 | % | 21.96 | % | (2.39 | )% | 49.69 | % | 6.30 | % | 2.37 | % | 17.53 | %4 | |||||||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||||||||||||||
Net assets, end of period (000’s ommited) | $ | 28,045 | $ | 31,755 | $ | 23,972 | $ | 27,640 | $ | 27,634 | $ | 9,838 | $ | 9,607 | |||||||||||||
Ratios to average net assets: | |||||||||||||||||||||||||||
Expenses, net of expense reimbursements/waivers5 | 0.75 | % | 0.75 | % | 0.86 | % | 0.85 | % | 0.98 | % | 0.85 | % | 0.85 | % | |||||||||||||
Expenses, prior to expense reimbursements/waivers5 | 2.39 | % | 3.43 | % | 2.39 | % | 4.37 | % | 3.28 | % | 3.60 | % | 5.90 | % | |||||||||||||
Net investment income (loss)5 | 2.64 | % | 0.52 | % | 1.39 | % | (0.06 | )% | 10.52 | % | 2.44 | % | 0.49 | % | |||||||||||||
Portfolio turnover rate6 | 35 | % | 6 | % | 35 | % | 17 | % | 0 | % | 16 | % | 49 | % | |||||||||||||
Emerging Global Shares Dow Jones Emerging Markets Financials Titans Index Fund | Emerging Global Shares INDXX India Infrastructure Index Fund (Consolidated) | Emerging Global Shares INDXX China Infrastructure Index Fund | Emerging Global Shares INDXX Brazil Infrastructure Index Fund | Emerging Global Shares INDXX India Small Cap Index Fund (Consolidated) | |||||||||||||||||||||||||||
For the Period April 1, 20108 Through September 30, 2010 (Unaudited) | For the Period September 16, 20091,8 Through March 31, 2010 | For the Period August 11, 20101 Through March 31, 2010 (Unaudited) | For the Period April 1, 2010 Through September 30, 2010 (Unaudited) | For the Period February 17, 20101 Through March 31, 2010 | For the Period April 1, 2010 Through September 30, 2010 (Unaudited) | For the Period February 24, 20101 Through March 31, 2010 | For the Period July 7, 20101 Through March 31, 2010 (Unaudited) | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 22.84 | $ | 20.12 | $ | 20.00 | $ | 20.78 | $ | 20.09 | $ | 20.55 | $ | 20.00 | $ | 20.00 | |||||||||||||||
Investment operations: | |||||||||||||||||||||||||||||||
Net investment income (loss)2 | 0.31 | 0.08 | 0.02 | 0.27 | (0.02 | ) | 0.31 | 0.03 | 0.13 | ||||||||||||||||||||||
Net realized and unrealized gain on investments | 2.10 | 2.71 | 1.91 | (0.09 | )7 | 0.71 | 1.75 | 0.527 | 2.81 | ||||||||||||||||||||||
Total from investment operations | 2.41 | 2.79 | 1.93 | 0.18 | 0.69 | 2.06 | 0.55 | 2.94 | |||||||||||||||||||||||
Less: Distributions from net investment income | — | (0.07 | ) | — | — | — | — | — | — | ||||||||||||||||||||||
Net asset value, end of period | $ | 25.25 | $ | 22.84 | $ | 21.93 | $ | 20.96 | $ | 20.78 | $ | 22.61 | $ | 20.55 | $ | 22.94 | |||||||||||||||
NET ASSET VALUE TOTAL RETURN3 | 10.55 | % | 13.87 | % | 9.65 | % | 0.87 | % | 3.43 | % | 10.02 | % | 2.75 | % | 14.70 | % | |||||||||||||||
RATIOS/SUPPLEMENTAL DATA: | |||||||||||||||||||||||||||||||
Net assets, end of period (000’s ommited) | $ | 10,100 | $ | 6,852 | $ | 5,483 | $ | 8,385 | $ | 6,235 | $ | 44,090 | $ | 11,303 | $ | 17,207 | |||||||||||||||
Ratios to average net assets: | |||||||||||||||||||||||||||||||
Expenses, net of expense reimbursements/waivers5 | 0.85 | % | 0.85 | % | 1.14 | % | 0.85 | % | 0.85 | % | 0.85 | % | 0.85 | % | 1.17 | % | |||||||||||||||
Expenses, prior to expense reimbursements/waivers5 | 3.34 | % | 5.47 | % | 8.07 | % | 2.88 | % | 7.82 | % | 1.92 | % | 5.67 | % | 3.93 | % | |||||||||||||||
Net investment income (loss)5 | 2.80 | % | 0.67 | % | 0.54 | % | 2.84 | % | (0.85 | )% | 3.02 | % | 1.58 | % | 2.60 | % | |||||||||||||||
Portfolio turnover rate6 | 34 | % | 12 | % | 0 | % | 1 | % | 1 | % | 0 | % | 1 | % | 0 | % | |||||||||||||||
1 | Commencement of operations. |
2 | Based on average shares outstanding. |
3 | Total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period and redemption on the last day of the period. Total return calculated for a period of less than one year is not annualized. The total return would have been lower if certain expenses had not been reimbursed/waived by the sub-adviser. |
4 | For the period ended March 31, 2010, 0.61% of the Fund’s total return consists of a voluntary reimbursement by the current and former sub-advisers for a realized investment loss, and another (0.91)% consists of a loss on an investment not meeting the Fund’s investment restrictions. Excluding these items, total return would have been 17.83%. |
5 | Annualized. |
6 | Not annualized. |
7 | The realized and unrealized gain on investments and foreign currency transactions does not accord with the amounts reported in the Statement of Operations due to the timing of subscriptions of fund shares in relation to the investment performance during the period and contributions made by Authorized Participants to compensate the Fund for additional costs incurred in purchasing securities that were not transferred in kind (See Note 9). |
8 | On September 16, 2010, there was a 2 for 1 forward stock split. Historical share amounts have been adjusted to reflect the 3 for 1 forward stock split on a retroactive basis. |
9 | On September 16, 2010, there was a 3 for 1 forward stock split. Historical share amounts have been adjusted to reflect the 3 for 1 forward stock split on a retroactive basis. |
The accompanying notes are an integral part of these financial statements.
34 & 35 EGA Emerging Global Shares Trust |
Notes to Financial Statements
September 30, 2010 (Unaudited)
1. ORGANIZATION
EGA Emerging Global Shares Trust (the “Trust”) is a Delaware statutory trust organized on September 12, 2008. The Trust is an open-end management investment company, registered under the Investment Company Act of 1940, as amended (the “1940 Act”). The Trust currently consists of nineteen separate non-diversified series. As of the date of this report, only the following funds (each a “Fund” and collectively the “Funds”) are being publicly offered:
Funds | Commencement of Operations |
Emerging Global Shares Dow Jones Emerging Markets Titans Composite Index Fund (“Composite Fund”) | July 22, 2009 |
Emerging Global Shares Dow Jones Emerging Markets Metals & Mining Titans Index Fund (“Metals & Mining Fund”) | May 21, 2009 |
Emerging Global Shares Dow Jones Emerging Markets Consumer Titans Index Fund (“Consumer Fund”) | September 14, 2010 |
Emerging Global Shares Dow Jones Emerging Markets Energy Titans Index Fund (“Energy Fund”) | May 21, 2009 |
Emerging Global Shares Dow Jones Emerging Markets Financials Titans Index Fund (“Financials Fund”) | September 16, 2009 |
Emerging Global Shares INDXX India Infrastructure Index Fund (“India Infrastructure Fund”) | August 11, 2010 |
Emerging Global Shares INDXX China Infrastructure Index Fund (“China Infrastructure Fund”) | February 17, 2010 |
Emerging Global Shares INDXX Brazil Infrastructure Index Fund (“Brazil Infrastructure Fund”) | February 24, 2010 |
Emerging Global Shares INDXX India Small Cap Index Fund (“India Small Cap Fund”) | July 7, 2010 |
The Composite Fund’s investment objective is to seek investment results that generally correspond (before fees and expenses) to the price and yield performance of the Dow Jones Emerging Markets Composite Titans 100 Index. The Dow Jones Emerging Markets Composite Titans 100 Index is a stock market index comprised of a representative sample of 100 emerging markets companies that Dow Jones Indices deem to be the 10 leading companies in each of the 10 industrial sectors, as defined by the Industry Classification Benchmark system (“ICB”), across the developing world.
The Metals & Mining Fund’s investment objective is to seek investment results that generally correspond (before fees and expenses) to the price and yield performance of the Dow Jones Emerging Markets Metals & Mining Titans Index. The Dow Jones Emerging Markets Metals & Mining Titans Index is a stock market index comprised of 30 leading emerging markets companies that Dow Jones Indices deem to be in the Metals & Mining sector of the global economy. The Metals & Mining sector is a sub-sector of the Basic Materials industry, as defined by ICB.
The Consumer Fund’s investment objective is to seek investment results that generally correspond (before fees and expenses) to the price and yield performance of the Dow Jones Emerging Markets Consumer Titans 30 Index. The Dow Jones Emerging Markets Consumer Titans 30 Index is a stock market index comprised of publicly traded firms in the Consumer Goods industry and Consumer Services industry as defined by ICB.
The Energy Fund’s investment objective is to seek investment results that generally correspond (before fees and expenses) to the price and yield performance of the Dow Jones Emerging Markets Oil and Gas Titans Index. The Dow Jones Emerging Markets Oil and Gas Titans Index is a stock market index comprised of 30 leading emerging markets companies that Dow Jones Indices deem to be part of the Oil and Gas sector of the global economy, which also includes alternative energy sources other than oil and gas.
The Financials Fund’s investment objective is to seek investment results that generally correspond (before fees and expenses) to the price and yield performance of the Dow Jones Emerging Markets Financials Titans Index. The Dow Jones Emerging Markets Financials Titans Index is a stock market index comprised of 30 leading emerging markets companies that Dow Jones Indices deem to be part of the Financials sector of the global economy.
The India Infrastructure Fund’s investment objective is to seek investment results that generally correspond (before fees and expenses) to the price and yield performance of the INDXX India Infrastructure Index. The INDXX India Infrastructure Index is a free-float market capitalization weighted stock market index comprised of 30 leading companies that INDXX, LLC determines to be representative of India’s Infrastructure industries, as defined by ICB.
The China Infrastructure Fund’s investment objective is to seek investment results that generally correspond (before fees and expenses) to the price and yield performance of the INDXX China Infrastructure Index, by investing in Chinese mid cap infrastructure companies that are included in the INDXX China Infrastructure Index, which are generally defined as companies that are domiciled in China and that have a market capitalization of at least $200 million at the time of purchase. The INDXX China Infrastructure Index is a free-float market capitalization weighted stock market index comprised of 30 leading companies that INDXX, LLC determines to be representative of China’s Infrastructure sectors.
36 EGA Emerging Global Shares Trust
Notes to Financial Statements (continued)
September 30, 2010 (Unaudited)
The Brazil Infrastructure Fund’s investment objective is to seek investment results that generally correspond (before fees and expenses) to the price and yield performance of the INDXX Brazil Infrastructure Index, by investing in Brazilian mid cap infrastructure companies that are included in the INDXX Brazil Infrastructure Index, which are generally defined as companies that are domiciled in Brazil and that have a market capitalization of at least $200 million at the time of purchase. The INDXX Brazil Infrastructure Index is a free-float market capitalization weighted stock market index comprised of 30 leading companies that INDXX, LLC determines to be representative of Brazil’s Infrastructure sectors.
The India Small Cap Fund’s investment objective is to seek investment results that generally correspond (before fees and expenses) to the price and yield performance of the INDXX India Small Cap Index. The INDXX India Small Cap Index is a free-float market capitalization weighted stock market index comprised of a representative sample of 75 Indian companies that INDXX, LLC determines to be the representative of small market capitalization companies domiciled in India.
2. CONSOLIDATION OF SUBSIDIARIES
The Consolidated Schedule of Investments, Consolidated Statements of Asset and Liabilities, of Operations and of Changes in Net Assets and the Consolidated Financial Highlights of the Funds listed below include the accounts of wholly-owned subsidiaries. All inter-company accounts and transactions have been eliminated in consolidation.
Fund | Wholly-owned Subsidiary |
Consumer Fund | EG Shares Consumer Mauritius |
India Infrastructure Fund | EG Shares India Infrastructure Mauritius |
India Small Cap Fund | EG Shares India Small Cap Mauritius |
The Consumer Fund may invest its assets in a wholly owned subsidiary in Mauritius, which in turn invests virtually all of its assets in Indian securities, based on the number of Indian securities that are included in the Underlying Index.
The India Infrastructure Fund and India Small Cap Fund invests substantially all of their assets in wholly owned subsidiaries in Mauritius, which in turn, invests at least 90% of their assets in Indian securities, and to some extent ADRs and GDRs, based on the number of Indian securities that are included in each respective Underlying Index.
By investing in a wholly owned subsidiary, The Consumer Fund, the India Infrastructure Fund and India Small Cap Fund each obtain benefits under the tax treaty between Mauritius and India. Each Subsidiary may be subject to withholding taxes imposed by the Indian government on dividends, interest and realized capital gains should new legislation be passed to modify the current tax treaty with Mauritius. Any change in the provision of this treaty could result in the imposition of withholding and other taxes on these Funds by authorities in India. This would reduce the return on investment and the return received by each Fund’s shareholders.
A summary of each Funds’ investment in its corresponding subsidiary is as follows:
Subsidiary Net | % of Fund’s Total | |||||
Inception Date | Assets at | Net assets at | ||||
Fund | of Subsidiary | September 30, 2010 | September 30, 2010 | |||
Consumer Fund | September 14, 2010 | $ | 4,704,563 | 17.0 | % | |
India Infrastructure Fund | August 11, 2010 | 5,478,020 | 99.9 | |||
India Small Cap Fund | July 7, 2010 | 17,177,086 | 99.8 | |||
3. SIGNIFICANT ACCOUNTING POLICIES
These financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”), which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual amounts could differ from these estimates. The following summarizes the significant accounting policies of the Funds.
Indemnifications
In the normal course of business, the Trust enters into contracts that contain a variety of representations that provide general indemnifications. The Trust’s maximum exposure under these arrangements cannot be known as this would involve future claims that may be made against the Trust that have not yet occurred; however, the Trust expects any risk of loss to be remote.
EGA Emerging Global Shares Trust 37
Notes to Financial Statements (continued)
September 30, 2010 (Unaudited)
Investment Valuation
The Net Asset Value (“NAV”) per share is computed as of the scheduled close of regular trading on the New York Stock Exchange (“NYSE”), ordinarily 4:00 p.m. Eastern time, on each day during which the NYSE is open for trading. The NAV per share of a Fund is computed by dividing the value of the Fund’s portfolio securities, cash and other assets (including accrued interest), less all liabilities (including accrued expenses), by the total number of shares outstanding at the time such computation is made.
Securities Valuation
Equity securities (including American Depositary Receipts and Global Depositary Receipts) are valued at the last reported sale price on the principal exchange on which such securities are traded, as of the close of regular trading on the NYSE on the day the securities are being valued or, if there are no sales, at the mean of the most recent bid and asked prices. Equity securities that are traded in over-the-counter markets are valued at the NASDAQ Official Closing Price as of the close of regular trading on the NYSE on the day the securities are valued or, if there are no sales, at the mean of the most recent bid and asked prices. Securities for which market quotations are not readily available, including restricted securities, are valued by a method that the Board of Trustees (the “Board”) believe accurately reflects fair value. The value of assets denominated in foreign currencies is converted into U.S. dollars using exchange rates deemed appropriate by the Funds. Use of a rate different from the rate used by Dow Jones Indices or INDXX Indices may adversely affect a Fund’s ability to track its Underlying Index.
Foreign Currency Translations
Investments denominated in foreign currencies are subject to additional risk factors as compared to investments denominated in U.S. dollars. The value of an investment denominated in a foreign currency could change significantly as foreign currencies strengthen or weaken relative to the U.S. dollar. Generally, when the U.S. dollar gains in value against a foreign currency, an investment traded in that foreign currency loses value because that currency is worth fewer U.S. dollars. Risks related to foreign currencies also include those related to economic or political developments, market inefficiencies or a higher risk that essential investment information may be incomplete, unavailable or inaccurate. A U.S. dollar investment in Depositary Receipts or Ordinary Shares of foreign issuers traded on U.S. exchanges is indirectly subject to foreign currency risk to the extent that the issuer conducts its principal business in markets where transactions are denominated in foreign currencies.
Portfolio securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars based on the exchange rate of such currencies against U.S. dollars on the date of valuation. Purchases and sales of securities and income items denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect on the transaction date.
The Funds do not separately report the effect of changes in foreign exchange rates from changes in market prices on securities held. Such changes are included in net realized and unrealized gain or loss from investments.
Realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions and the difference between the recorded amounts of dividends, interest, and foreign withholding taxes, and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period.
Security Transactions and Related Income
Investment transactions are recorded on trade date. The Funds determine the gain or loss realized from the investment transactions by comparing the identified cost, which is the same basis used for federal income tax purposes, with the net sales proceeds. Dividend income is recorded on the ex-dividend date. Interest income is recorded on the accrual basis. Discounts are accreted and premiums are amortized on securities purchased over the lives of the respective securities.
Federal Income Taxes
Each Fund intends to continue to qualify as a “regulated investment company” under Subchapter M of the Internal Revenue Code. If so qualified, a Fund will not be subject to federal income tax to the extent it distributes substantially all of its net investment income and capital gains to shareholders. Each Fund expects to declare and pay all of its net investment income, if any, to shareholders as dividends annually, and will also declare and pay net realized capital gains, if any, at least annually, except where the costs of such distributions exceed the amount of tax that the distributions are intended to avoid, in which case the Fund will pay the applicable tax. A Fund may distribute such income dividends and capital gains more frequently, if necessary, in order to reduce or eliminate federal excise or income taxes on the Fund. Distributions to shareholders are recorded on the ex-dividend date.
38 EGA Emerging Global Shares Trust
Notes to Financial Statements (continued)
September 30, 2010 (Unaudited)
The Funds are subject to accounting standards that provide guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. These standards require the evaluation of tax positions taken or expected to be taken by the Funds and whether the tax positions are “more-likely-than-not” of being sustained by the applicable tax authority. Tax positions not deemed to meet the more-likely-than-not threshold would be recorded as a tax benefit or expense in the current year. Accounting for uncertainty in income taxes requires management of the Funds to analyze all open tax years as defined by IRS statute of limitations, for all major jurisdictions, including federal tax authorities and certain state tax authorities. Open tax years are those years that are open for examination by the relevant income taxing authority. As of March 31, 2010, the Funds have no examinations in progress.
There is no tax liability resulting from uncertain income tax positions taken or expected to be taken. The Funds are also not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax expense will significantly change in the next twelve months.
Expenses
Expenses of the Trust, which are directly identifiable to a specific Fund, are applied to that Fund. Expenses which are not readily identifiable to a specific Fund are allocated in such a manner as deemed equitable, taking into consideration the nature and type of expense and the relative net assets of each Fund in the Trust.
Organizational and Offering Expenses
Costs incurred in connection with the organization and initial offering of the Funds are being amortized over a 12-month period.
4. CONCENTRATION OF MARKET RISK
The India Infrastructure Fund and India Small Cap Fund only invests in Indian securities, therefore, their NAVs will be much more sensitive to changes in economic, political and other factors within India than would a fund that invested in a greater variety of countries. Investments in emerging market securities are subject to even greater risks than for foreign investments generally, including increased risks of: illiquidity of securities; price volatility; inflation or deflation; restrictions on foreign investment; nationalization; higher taxation; economic and political instability; pervasive corruption and crime; less governmental regulation; and less developed legal systems.
The China Infrastructure Fund only invests in Chinese securities, therefore, its NAV will be much more sensitive to changes in economic, political and other factors within China than would a fund that invested in a greater variety of countries. Investments in emerging market securities are subject to even greater risks than for foreign investments generally, including increased risks of: illiquidity of securities; price volatility; inflation or deflation; restrictions on foreign investment; nationalization; higher taxation; economic and political instability; pervasive corruption and crime; less governmental regulation; and less developed legal systems.
The Brazil Infrastructure Fund only invests in Brazilian securities, therefore, its NAV will be much more sensitive to changes in economic, political and other factors within Brazil than would a fund that invested in a greater variety of countries. Investments in emerging market securities are subject to even greater risks than for foreign investments generally, including increased risks of: illiquidity of securities; price volatility; inflation or deflation; restrictions on foreign investment; nationalization; higher taxation; economic and political instability; pervasive corruption and crime; less governmental regulation; and less developed legal systems.
5. DISTRIBUTION AGREEMENT
The Distributor serves as the distributor of Creation Units for the Funds pursuant to a distribution agreement. The Distributor does not maintain a secondary market in shares. The Funds have adopted a Distribution and Service Plan (the “Plan”) pursuant to Rule 12b-1 under the 1940 Act. In accordance with the Plan, each Fund is authorized to pay an amount up to 0.25% of its average daily net assets each year for certain distribution-related activities. For the periods ended September 30, 2010, no fees were paid by the Funds under the Plan, and there are no current plans to impose these fees.
EGA Emerging Global Shares Trust 39
Notes to Financial Statements (continued)
September 30, 2010 (Unaudited)
6. FEDERAL INCOME TAX MATTERS
At September 30, 2010, the cost of investments on a tax basis including the adjustments for financial reporting purposes as of the most recently completed Federal income tax reporting period were as follows:
Funds | Cost of Investments | Gross Unrealized Appreciation | Gross Unrealized Depreciation | Net Unrealized Appreciation | |||||
Composite Fund* | $ | 27,160,240 | $ | 2,109,123 | $ | (1,170,765 | ) | $ | 938,358 |
Metals & Mining Fund* | 21,391,907 | 2,993,438 | (311,438 | ) | 2,682,000 | ||||
Consumer Fund | 26,854,560 | 743,709 | (44,084 | ) | 699,625 | ||||
Energy Fund* | 8,537,784 | 1,431,354 | (298,696 | ) | 1,132,658 | ||||
Financials Fund* | 8,998,682 | 1,372,367 | (233,935 | ) | 1,138,432 | ||||
India Infrastructure Fund | 5,177,986 | 301,678 | (8,778 | ) | 292,900 | ||||
China Infrastructure Fund* | 7,865,792 | 541,771 | (299,856 | ) | 241,915 | ||||
Brazil Infrastructure Fund* | 41,188,806 | 3,068,146 | (612,292 | ) | 2,455,854 | ||||
India Small Cap Fund | 16,165,516 | 1,123,198 | (173,637 | ) | 949,561 | ||||
* | Cost of investments on a tax basis, includes the adjustment for financial reporting purposes, as of the most recently completed Federal income tax reporting period-end. |
The differences between book basis and tax basis components of net assets are primarily attributable to tax deferral of losses on wash sales, expensing of organization costs and deferral of post-October losses. At March 31, 2010, the components of accumulated earnings/loss on a tax-basis were as follows:
Funds | Undistributed Ordinary Income | Accumulated Capital and Other Losses | Net Unrealized Appreciation (Depreciation) | Total Accumulated Earnings (Losses) | ||||||||
Composite Fund | $ | 63,856 | $ | (33,925 | ) | $ | 1,288,470 | $ | 1,318,401 | |||
Metals & Mining Fund | — | (96,034 | ) | 3,468,871 | 3,372,837 | |||||||
Energy Fund | 14,117 | (94,662 | ) | 1,081,563 | 1,001,018 | |||||||
Financials Fund | 135,515 | (16,615 | ) | 573,541 | 692,441 | |||||||
China Infrastructure Fund | — | (136 | ) | 153,775 | 153,639 | |||||||
Brazil Infrastructure Fund | — | (46,809 | ) | (208,685 | ) | (255,494 | ) | |||||
For financial reporting purposes, capital accounts are adjusted to reflect the tax character of permanent book/tax differences. Reclassifications are primarily due to tax treatment of redemptions in kind, non-deductible organization costs and tax treatment of currency gains and losses. Results of operations and net assets were not affected by these reclassifications.
Certain net losses incurred after October 31 and within the taxable year are deemed to arise on the first business day of the Funds’ next taxable year. For the periods ended March 31, 2010, the Funds deferred to April 1, 2010 post October losses of:
Funds | Post October Currency Losses | Post October Capital Losses | |||
Composite Fund | $ | — | $ | — | |
Metals & Mining Fund | 853 | 9,466 | |||
Energy Fund | — | 29,448 | |||
Financials Fund | — | — | |||
China Infrastructure Fund | 136 | — | |||
Brazil Infrastructure Fund | 44,840 | 1,969 | |||
40 EGA Emerging Global Shares Trust
Notes to Financial Statements (continued)
September 30, 2010 (Unaudited)
At March 31, 2010, the Funds listed below had net capital loss carryforwards for federal income tax purposes which are available for offset against future taxable net capital gains. The amounts were determined after adjustments for certain differences between financial reporting and tax purposes, such as wash sale losses. Accordingly, no capital gain distributions are expected to be paid to shareholders of these Funds until future net capital gains have been realized in excess of the available capital loss carryforwards. There is no assurance that any Fund will be able to utilize all of its capital loss carryforwards before they expire. These loss carryforwards expire in amounts and fiscal years as follows:
Funds | Fiscal Year 2018 | |
Composite Fund | $ | — |
Metals & Mining Fund | 26,475 | |
Energy Fund | 35,360 | |
Financials Fund | — | |
China Infrastructure Fund | — | |
Brazil Infrastructure Fund | — | |
7. FAIR VALUE MEASUREMENT
The authoritative guidance for fair value measurements and disclosures, Accounting Standards CodificationTM (“ASC”) 820-10-65-4 (formerly FAS 157-4) establishes an authoritative framework for the measurement of fair value, and enhances disclosures about fair value measurements. The Funds utilized various inputs in determining the value of each Fund’s investments. The guidance also establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring the most observable inputs be used when available. Also included is guidance on identifying circumstances that indicate a transaction is not orderly and outlines additional disclosure based on investment type. These inputs are summarized in the three broad levels as follows:
Level 1 — quoted prices in active markets for identical securities
Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.)
Level 3 — significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.
The following summarizes inputs used as of September 30, 2010 in valuing the Funds’ assets and liabilities carried at fair value:
Funds | Quoted Prices in Active Market (Level 1) | Other Significant Inputs (Level 2) Common Stock | Significant Unobservable Inputs (Level 3) | Total | |||||||
Common Stock | Preferred Stock | ||||||||||
Composite Fund* | $ | 24,547,954 | $ | 3,550,644 | $ | — | $ | — | $ | 28,098,598 | |
Metals & Mining Fund* | 22,900,045 | 1,173,862 | — | — | 24,073,907 | ||||||
Consumer Fund* | 24,345,503 | 3,208,682 | — | — | 27,554,185 | ||||||
Energy Fund* | 9,670,442 | — | — | — | 9,670,442 | ||||||
Financials Fund* | 8,679,802 | 1,457,312 | — | — | 10,137,114 | ||||||
India Infrastructure Fund** | 5,470,886 | — | — | — | 5,470,886 | ||||||
China Infrastructure Fund** | 8,107,707 | — | — | — | 8,107,707 | ||||||
Brazil Infrastructure Fund** | 29,727,624 | 13,917,036 | — | — | 43,644,660 | ||||||
India Small Cap Fund** | 17,115,078 | — | — | — | 17,115,078 | ||||||
* | Please refer to the schedule of investments to view securities segregated by country. |
** | Please refer to the schedule of investments to view securities segregated by industry type. |
Transfers between Level 1 and 2 securities are deemed to be insignificant and do not require further disclosure. The Funds did not hold any Level 3 securities during the periods reported.
EGA Emerging Global Shares Trust 41
Notes to Financial Statements (continued)
September 30, 2010 (Unaudited)
8. INVESTMENT TRANSACTIONS
During the periods ended September 30, 2010, the cost of purchases and proceeds from sales of investments (excluding cost of in-kind transactions, proceeds from in-kind sales, and short-term investments) were:
Funds | Purchases | Sales | ||
Composite Fund | $ | 9,802,008 | $ | 10,035,562 |
Metals & Mining Fund | 8,749,961 | 11,152,405 | ||
Consumer Fund | 11,759,487 | — | ||
Energy Fund | 1,422,960 | 1,501,066 | ||
Financials Fund | 4,317,322 | 3,438,702 | ||
India Infrastructure Fund | 5,177,986 | — | ||
China Infrastructure Fund | 3,767,569 | 84,869 | ||
Brazil Infrastructure Fund | 28,782,338 | 1,758 | ||
India Small Cap Fund | 16,165,516 | — | ||
For the periods ended September 30, 2010, the cost of in-kind transactions and proceeds from in-kind sales were as follows:
Funds | Purchases | Sales | ||
Composite Fund | $ | 3,617,278 | $ | 6,356,915 |
Metals & Mining Fund | — | — | ||
Consumer Fund | 15,095,073 | — | ||
Energy Fund | — | — | ||
Financials Fund | 3,312,895 | 1,782,001 | ||
India Infrastructure Fund | — | — | ||
China Infrastructure Fund | 2,748,443 | 4,793,729 | ||
Brazil Infrastructure Fund | 381,572 | — | ||
India Small Cap Fund | — | — | ||
9. INVESTMENT ADVISORY AND OTHER AGREEMENTS
The Trust has entered into an Investment Advisory Agreement (the “Advisory Agreement”) with ALPS Advisors, Inc. (“ALPS” or the “Adviser”). The Adviser acts as the Funds’ investment adviser pursuant to an advisory agreement with the Trust on behalf of the Funds. Pursuant to the Advisory Agreement, the Adviser has overall supervisory responsibility for the general management and investment of each Fund’s securities portfolio, and has ultimate responsibility (subject to oversight by the Trust’s Board of Trustees) for oversight of the Trust’s sub-adviser. For its services, the Trust pays the Adviser an annual management fee consisting of the greater of $400,000 or 0.10% of each Fund’s average daily net assets, but not to exceed $1,000,000 per year. From time to time, the Adviser may waive all or a portion of its fee.
Emerging Global Advisors, LLC (“EGA”) serves as the sub-adviser to the Funds and provides investment advice and management services to the Funds. EGA supervises the day-to-day investment and reinvestment of the assets in each Fund and is responsible for designating the Deposit Securities and for monitoring each Fund’s adherence to its investment mandate. For its investment sub-advisory services, EGA receives from the Funds an annual fee equal to 0.75% of the average daily net assets of Composite Fund and 0.85% of the average daily nets assets of each of the other Funds.
The Trust and EGA have entered into a written fee waiver and expense reimbursement agreement pursuant to which EGA has agreed to reduce and/or reimburse expenses to the extent necessary to prevent the annual operating expenses of each Fund (excluding any taxes, interest, brokerage fees and non-routine expenses) from exceeding 0.85% of average daily net assets (0.75% for Composite Fund) at least until May 21, 2011 (January 26, 2011, for India Infrastructure Fund, China Infrastructure Fund, Brazil Infrastructure Fund, and India Small Cap Fund and February 9, 2011 for the Consumer Fund). Under this fee waiver and expense assumption agreement, EGA retains the right to seek reimbursement from each Fund of fees previously waived or expenses previously assumed to the extent such fees were waived or expenses were assumed within three years of such reimbursement, and provided such reimbursement does not cause a Fund to exceed any applicable fee waiver or expense limitation agreement that was in place at the time the fees were waived or expenses assumed.
42 EGA Emerging Global Shares Trust
Notes to Financial Statements (continued)
September 30, 2010 (Unaudited)
For the periods ended September 30, 2010, EGA reimbursed and/or waived the following fees, which are all available for recoupment:
Funds | Fees Reimbursed/ Waived | |
Composite Fund | $ | 234,521 |
Metals & Mining Fund | 190,376 | |
Consumer Fund | 9,010 | |
Energy Fund | 125,694 | |
Financials Fund | 122,863 | |
India Infrastructure Fund | 26,598 | |
China Infrastructure Fund | 86,522 | |
Brazil Infrastructure Fund | 136,293 | |
India Small Cap Fund | 47,301 | |
The amounts available for potential future recoupment by EGA and the expiration schedule at September 30, 2010 are as follows:
Potential Recoupment Amounts Expiring | ||||||
Funds | Total Potential Recoupment Amount | March 31, 2014 | March 31, 2013 | |||
Composite Fund | $ | 536,968 | $ | 234,521 | $ | 302,447 |
Metals & Mining Fund | 535,245 | 190,376 | 344,869 | |||
Consumer Fund | 9,010 | 9,010 | — | |||
Energy Fund | 444,056 | 125,694 | 318,362 | |||
Financials Fund | 248,475 | 122,863 | 125,612 | |||
India Infrastructure Fund | 26,598 | 26,598 | — | |||
China Infrastructure Fund | 121,290 | 86,522 | 34,768 | |||
Brazil Infrastructure Fund | 169,205 | 136,293 | 32,912 | |||
India Small Cap Fund | 47,301 | 47,301 | — | |||
The Bank of New York Mellon serves as the Funds’ Administrator, Custodian, Fund Accountant and Transfer Agent pursuant to a Fund Administration and Accounting Agreement, a Custody Agreement and a Transfer Agency and Service Agreement, as the case may be.
ALPS Fund Services, Inc. (“AFS”), an affiliate of the Adviser and the Distributor, provides a Chief Compliance Officer and an Anti-Money Laundering Officer as well as certain additional compliance support functions under a Compliance Services Agreement. AFS also provides a Principal Financial Officer to the Trust under a PFO Services Agreement. As compensation for the foregoing services, AFS receives certain out of pocket costs, and fixed and asset-based fees, which are accrued daily and paid monthly by the Funds. Compensation for such services is included under the Advisory Agreement.
10. PAYMENTS BY AFFILIATES AND NET GAINS (LOSSES) REALIZED ON TRADING ERROR
As a result of a trade error by the Energy Fund’s former sub-adviser, the Energy Fund experienced an aggregate loss of $73,832, of which $25,000 was reimbursed by the former sub-adviser and $25,000 was reimbursed by EGA, resulting in a net loss to the Energy Fund of $23,832.
11. CREATION AND REDEMPTION TRANSACTIONS
The Funds issue and redeem Shares on a continuous basis at NAV in blocks of 50,000 shares called “Creation Units.” Except when aggregated in Creation Units, shares are not redeemable securities of a Fund.
Only “Authorized Participants” may purchase or redeem shares directly from a Fund. An Authorized Participant is either (i) a broker-dealer or other participant in the clearing process through the Continuous Net Settlement System of the National Securities Clearing Corporation or (ii) a DTC participant and, in each case, must have executed a Participant Agreement with Distributors. Most retail investors will not qualify as Authorized Participants or do not have the resources to buy and sell whole Creation Units. Therefore, they will be unable to purchase or redeem the shares directly from the Funds. Rather, most retail investors will purchase shares in the secondary market with the assistance of a broker and will be subject to customary brokerage commissions or fees.
EGA Emerging Global Shares Trust 43
Notes to Financial Statements (concluded)
September 30, 2010
The consideration for the purchase of Creation Units of a Fund generally consists of the in-kind deposit of a designated portfolio of equity securities, which constitutes an optimized representation of the corresponding Index and an amount of cash (except for the Brazil Infrastructure Fund, which are offered in Creation Units solely or partially for cash in U.S. dollars). Investors transacting in Creation Units for cash pay an additional variable charge to compensate the relevant Fund for brokerage and market impact expenses relating to investing in portfolio securities.
From time to time, settlement of securities related to in-kind contributions may be delayed. In such cases, securities related to in-kind contributions are reflected as “Due from custodian” in the Statements of Assets and Liabilities.
12. TRUSTEES’ FEES
The Trust compensates each Trustee who is not an employee of the Adviser, EGA or its affiliates. The interested Trustees do not receive any compensation from the Trust for serving as Trustees.
13. NEW ACCOUNTING PRONOUNCEMENT
In January 2010, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2010-06 “Improving Disclosures about Fair Value Measurements.” ASU 2010-06 amends FASB Accounting Standards Codification Topic 820, Fair Value Measurements and Disclosures, to require additional disclosures regarding fair value measurements. Certain disclosures required by ASU No. 2010-06 are effective for this report, and other required disclosures are effective for fiscal years beginning after December 31, 2010, and for interim periods within those fiscal years. Management has evaluated the impact ASU No. 2010-06 and does not expect it to materially impact the financial statements disclosures.
14. ADDITIONAL INFORMATION
During the period ended September 30, 2010, shares of the Composite Fund, Metal & Mining Fund, Energy Fund and Financials Fund were adjusted to reflect a forward stock split. The effect of the forward stock split was to increase the number of shares outstanding and decrease the net asset value. The stock splits have no impact on the net assets of the Fund or the value of a shareholder’s investment in the Fund. A summary of the stock splits is as follows:
Fund | Effective Date | Rate | Net Asset Value Before Split | Net Asset Value After Split | Shares Outstanding Before Split | Shares Outstanding After Split | ||||
Composite Fund | 9/16/2010 | 2 : 1 | $ | 49.06 | $ | 24.53 | 552,500 | 1,105,000 | ||
Metals & Mining Fund | 9/16/2010 | 3 : 1 | 57.09 | 19.03 | 400,000 | 1,200,000 | ||||
Energy Fund | 9/16/2010 | 2 : 1 | 47.78 | 23.89 | 200,000 | 400,000 | ||||
Financials Fund | 9/16/2010 | 2 : 1 | 48.36 | 24.18 | 200,000 | 400,000 | ||||
15. SUBSEQUENT EVENTS
The Funds have evaluated subsequent events through the date of issuance of this report and have determined that there are no material events that would require disclosure.
44 EGA Emerging Global Shares Trust
Board of Trustees and Officers (Unaudited)
The Trustees and officers of the Trust, along with their principal occupations over the past five years and their affiliations, if any, with EGA, are listed below. Unless otherwise noted, the address of each Trustee of the Trust is 171 East Ridgewood Ave., Ridgewood, NJ 07450.
Name and Year of Birth | Position(s) Held with Trust | Term of Office1 and Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex 2 Overseen by Trustee | Other Directorships Held by Trustee | |||||
Robert Willens, 1946 | Trustee | Since 2009 | Robert Willens, LLC (tax consulting), President, since January, 2008; Lehman Brothers, Inc., Managing Director, Equity Research Department, January 2004 to January 2008. | 19 | Daxor Corp. (Medical Products and Biotechnology), since 2004. | |||||
Ron Safir, 1951 | Trustee | Since 2009 | Retired, since 2008; UBS Wealth Management, Chief Administrative Officer, February 1971 to December 2008. | 19 | None | |||||
Jeffrey D. Haroldson, 1957 | Trustee | Since 2009 | HDG Mansur Capital Group, LLC, President and Chief Operating Officer, since 2004; HSBC Securities (USA), Inc., Executive Managing Director, Head of Investment and Merchant Banking, 2000 to 2003. | 19 | None | |||||
Interested Trustees | ||||||||||
Robert C. Holderith3, 1960 | Trustee and President | Since 2008 | Emerging Global Advisors, LLC, Managing Member and Chief Executive Officer, since September 2008; ProFund Advisors, Managing Director, Institutional Sales & Investment Analytics, June 2006 to August 2008; UBS Financial Services, Inc., Director, January 2000 to May 2006. | 19 | None | |||||
James J. Valenti3, 1947 | Trustee and Secretary | Since 2008 | Emerging Global Advisors, LLC, Member and Chief Administrative Officer, since September 2008; Private Investor and Independent Consultant, June 2007 to September 2008; Senior Loan Consultant, Bridgepoint Mortgage Company, June 2006 to June 2007; Mercedes Benz, North America, Sales Representative, November 2000 to June 2006. | 19 | None | |||||
1 | Each Trustee holds office for an indefinite term. |
2 | The “Fund Complex” consists of the Trust, which consists of nineteen Funds. |
3 | Mr. Holderith and Mr. Valenti are considered to be “interested persons” of the Trust as defined in the 1940 Act, due to their relationship with EGA, the Funds’ sub-adviser. |
EGA Emerging Global Shares Trust 45
Board of Trustees and Officers (Unaudited) (concluded)
Name and Year of Birth | Position(s) Held with the Trust | Term of Office1 and Length of Time Served | Principal Occupation(s) During Past 5 Years | |||
Officers | ||||||
Thomas A. Carter ALPS Fund Services, Inc. 1290 Broadway Suite 1100 Denver, CO 80203 1966 | Treasurer | Since 2009 | ALPS Fund Services, Inc., Directors, since October 2005; ALPS Advisors, Inc., President and Directors, since September 2008; ALPS Distributors, Inc., President and Director, since September 2008; FTAM Funds Distributor, Inc., President and Director, since September 2008; ALPS Holdings, Inc., Director, since October 2005; and ALPS ETF Trust, President and Trustee, since March 2008. | |||
Melanie H. Zimdars ALPS Fund Services, Inc. 1290 Broadway Suite 1100 Denver, CO 80203 1976 | Chief Compliance Officer | Since 2010 | ALPS Fund Services, Inc., Deputy Chief Compliance Officer, since September 2009; ALPS ETF Trust, Chief Compliance Officer, since December 2009; EGA Emerging Global Shares Trust, Chief Compliance Officer, since March 2010; Financial Investors Variable Insurance Trust, Chief Compliance Officer, since September 2009; Liberty All-Star Growth Fund, Inc., Chief Compliance Officer, since December 2009; Liberty All-Star Equity Fund, Chief Compliance Officer, since December 2009; Wasatch Funds, Principal Financial Officer, Treasurer and Secretary, February 2007 to December 2008; Wasatch Funds, Assistant Treasurer, November 2006 to February 2007; Wasatch Funds, Senior Compliance Officer, 2005 to December 2008. | |||
1 Officers of the Trust are elected by the Trustees and serve at the pleasure of the Board. |
46 EGA Emerging Global Shares Trust
General Information (Unaudited)
Investment Adviser
ALPS Advisors, Inc.
1290 Broadway, Suite 1100
Denver, CO 80203
Sub-Adviser
Emerging Global Advisors, LLC
171 East Ridgewood Ave.
Ridgewood, NJ 07450
Distributor
ALPS Distributors, Inc.
1290 Broadway, Suite 1100
Denver, CO 80203
Administrator, Custodian and Transfer Agent
The Bank of New York Mellon
101 Barclay Street
New York, NY 10286
Independent Registered Public Accounting Firm
BBD, LLP
1835 Market Street, 26th Floor
Philadelphia, PA 19103
You may obtain a description of the EGA Funds’ proxy voting, policies, procedures and information regarding how each Fund voted proxies relating to portfolio securities during the most recent 12-month period ending June 30 (available by August 31) without charge, upon request, by calling 1-888-800-4347 or visiting the Funds’ website www.egshares.com, or by accessing the SEC’s website at www.sec.gov. Such reports may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 202-942-8090.
Each of the Funds’ premium/discount information that is current to the most recent quarter-end is available by visiting www.EGShares.com or by calling 1-201-389-6872.
The Trust files complete schedules of the portfolio holdings with the SEC for the first and third quarters on Form N-Q. The Form N-Q is available without charge, upon request, by calling 1-800-SEC-0330, or by accessing the SEC’s website, at www.sec.gov. It may also be reviewed and copied at the SEC’s Public Reference Room in Washington, DC.
This report has been prepared for shareholders and may be distributed to others only if preceded or accompanied by an effective prospectus, which includes information regarding the Funds’ objectives and polices, experienced of its management, marketability of shares and other information.
EGA Emerging Global Shares Trust 47
![](https://capedge.com/proxy/N-CSRSA/0000891092-10-005710/a40819prt3x13x1.jpg)
171 East Ridgewood Avenue
Ridgewood, NJ 07450
(201) 389-6872
470 Park Avenue South, 8th Floor
New York, NY 10016
(888) 800-4EGS (4347)
www.egshares.com
EGA EMERGING GLOBAL SHARES TRUST
EMERGING GLOBAL SHARES DOW JONES EMERGING MARKETS
TITANS COMPOSITE INDEX FUND
EMERGING GLOBAL SHARES DOW JONES EMERGING MARKETS
METALS & MINING TITANS INDEX FUND
EMERGING GLOBAL SHARES DOW JONES EMERGING MARKETS
CONSUMER TITANS INDEX FUND
EMERGING GLOBAL SHARES DOW JONES EMERGING MARKETS
ENERGY TITANS INDEX FUND
EMERGING GLOBAL SHARES DOW JONES EMERGING MARKETS
FINANCIALS TITANS INDEX FUND
EMERGING GLOBAL SHARES INDXX
INDIA INFRASTRUCTURE INDEX FUND
EMERGING GLOBAL SHARES INDXX
CHINA INFRASTRUCTURE INDEX FUND
EMERGING GLOBAL SHARES INDXX
BRAZIL INFRASTRUCTURE INDEX FUND
EMERGING GLOBAL SHARES INDXX
INDIA SMALL CAP INDEX FUND
Emerging Global Shares are distributed by ALPS Distributors Inc.
Item 2. Code of Ethics.
Not Applicable for the semi-annual reporting period.
Item 3. Audit Committee Financial Expert.
Not Applicable for the semi-annual reporting period.
Item 4. Principal Accountant Fees and Services.
Not Applicable for the semi-annual reporting period.
Item 5. Audit Committee of Listed Registrants.
Not Applicable for the semi-annual reporting period.
Item 6. Schedule of Investments.
(a) | Schedule is included as part of the report to shareholders filed under Item 1 of this Form. | |
(b) | Not Applicable. |
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not Applicable.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not Applicable.
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company & Affiliated Purchasers.
Not Applicable.
Item 10. Submission of Matters to a Vote of Security Holders.
Not Applicable.
Item 11. Controls and Procedures.
(a) The Chief Executive Officer and Chief Financial Officer have evaluated the Registrant's disclosure controls and procedures within 90 days of the filing date of this report and have concluded that these controls and procedures are effective.
(b) There were no significant changes in the Registrant's internal controls over financial reporting or in other factors that could significantly affect these controls subsequent to the date of their evaluation.
Item 12. Exhibits.
(a) Any code of ethics, or amendment thereto, that is the subject of the disclosure required by Item 2, to the extent that the Registrant intends to satisfy the Item 2 requirements through filing of an exhibit: Not applicable at this time.
(b) Certifications for each Principal Executive Officer and Principal Financial Officer of the Registrant as required by Rule 30a-2(a) under the 1940 Act (17CFR 270.30a-(a)).
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Registrant: EGA Emerging Global Shares Trust
By: /s/ Robert C. Holderith
Robert C. Holderith, Chief Executive Officer
Date: November 23, 2010
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
Registrant: EGA Emerging Global Shares Trust
By: /s/ Robert C. Holderith
Robert C. Holderith, Chief Executive Officer
Date: November 23, 2010
By: /s/ Thomas A. Carter
Thomas A. Carter, Chief Financial Officer
Date: November 23, 2010