The Fund invests, under normal circumstances, at least 80% of its net assets (plus the amount of any borrowings for investment purposes) in private credit collateralized loan obligations (“Private Credit CLOs”) that, at the time of acquisition, are either rated AAA by at least one nationally recognized statistical rating organization (“NRSRO”), such as S&P Global Ratings, Fitch Ratings, Inc. or Moody’s Investors Service, Inc., or, if unrated, determined by Seix Investment Advisors (“Seix”), a division of Virtus Fixed Income Advisers, LLC, the Fund’s sub-adviser, to be of comparable quality. After purchase, a Private Credit CLO may have its rating reduced below the minimum rating required by the Fund for purchase. In such cases, Seix will consider whether the Fund will continue to hold the Private

Credit CLO. The Fund may temporarily deviate from the 80% policy while deploying new capital as the result of cash creation or redemption activity, or during unusual market conditions, or highly unusual markets, such as a downgrade in the rating of one or more securities.

A CLO is a type of asset backed security supported by interest and principal payments generated from a pool of loans, which may include, among others, U.S. and non-U.S. senior secured loans (including those issued or offered as “covenant lite” loans, which have no financial maintenance covenants) and subordinated corporate loans and privately placed loans. Private credit is funding that is lent to private companies through a loan that is not sourced from public markets (such as proceeds raised from the sale of listed equities and publicly traded bonds). A Private Credit CLO is a CLO backed by underlying loans that are primarily private credit where at least 80% of the total loan amounts within the CLO are issued to private companies. The underlying loan may be of any size, including loans to middle market companies, which Seix defines as companies with annual earnings before interest, taxes, depreciation and amortization, or EBITDA, of $10 million to $1 billion at the time of investment.

The Fund may invest up to 20% of its net assets (plus the amount of any borrowings for investment purposes) in senior loans, CLOs holding broadly syndicated loans, variable-and floating-rate debt obligations, exchange traded funds, high yield bonds (i.e., junk bonds), investment grade bonds, and cash. The Fund will not invest more than 10% of its net assets (plus the amount of any borrowings for investment purposes) in any single CLO. The Fund may purchase CLOs both in the primary and secondary markets.

The Fund is an actively managed ETF and, thus, does not seek to replicate the performance of a specified index of securities. Instead, it uses an active investment strategy that seeks to meet its investment objective.

The Fund is non-diversified, which means that it can invest a greater percentage of its assets in any one issuer than a diversified fund can. In addition, from time to time the Fund may focus its investments (i.e., invest more than 15% of its total assets) in one or more particular sectors. As of the date of July 31, 2025, the Fund focused its investments in the financials sector.