Bank of Montreal Announces the Split of Three Series of ETNs

NEW YORK, January 29, 2021 – Bank of Montreal (TSX:BMO)(NYSE:BMO) announced today that it will implement a split of three series of its outstanding exchange traded notes, as listed in the table below (the “ETNs” or “Notes”). The split of the three series will be effective at the open of trading on February 12, 2021 (the “effective date,” or the “ex date”).

The closing indicative value of the ETNs on February 11, 2021 (the “payable date”) will be divided by the number indicated above to determine the split-adjusted closing indicative value of the ETNs. The number of ETNs outstanding at the close of trading on the payable date correspondingly will be multiplied by the number indicated above to determine the adjusted number of ETNs outstanding as of the effective date. The holders of the ETNs as of February 10, 2021 (the “record date”) will see this change reflected on the payable date. The split will be effective at the open on the ex date, and the ETNs will begin trading on the NYSE Arca on a split-adjusted basis on that date.


Following the split, each ETN will have the same CUSIP and ISIN, and will continue to trade under the same ticker symbol.


The split will affect the trading denominations of each series of the ETNs, but it will not have any effect on the stated principal amount of those ETNs.


Illustration of a Split

The following table shows the effect of a hypothetical 10-to-1 split on the hypothetical closing indicative value of the ETNs. The closing indicative value of an ETN is not the same as the principal amount (currently, $50) or the trading price of that ETN.

None of the other exchange traded notes issued by Bank of Montreal are affected by this announcement.


The Notes are senior, unsecured obligations of Bank of Montreal.


Investment suitability must be determined individually for each investor, and the Notes may not be suitable for all investors. This information is not intended to provide and should not be relied upon as providing accounting, legal, regulatory or tax advice.


Investors should consult with their own financial advisors as to these matters.

The leveraged ETNs discussed in this press release (FNGU and FNGO) are intended to be daily trading tools for sophisticated investors to manage daily trading risks as part of an overall diversified portfolio. They are designed to achieve their stated investment objectives on a daily basis. The returns on the ETNs over longer periods of time can, and most likely will, differ significantly from the return on a direct long or short investment in the index underlying those ETNs.


Bank of Montreal, the issuer of the ETNs, has filed a registration statement (including a pricing supplement, prospectus supplement and prospectus) with the SEC regarding each offering of the ETNs discussed in this press release. Please read those documents and the other documents relating to the ETNs that Bank of Montreal has filed with the SEC for more complete information about Bank of Montreal and the ETNs. These documents may be obtained without cost by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, Bank of Montreal, and any agent or dealer that participated in the offerings of the ETNs, will arrange to send the applicable pricing supplement, the prospectus supplement and the prospectus if so requested by calling toll-free at 1-877-369-5412.


About REX Shares

Founded in 2015, REX Shares (REX) is an independent provider of exchange-traded products (ETPs) based in Fairfield, Connecticut. As ETP architects, the REX team creates investment vehicles that solve for a range of specific challenges in investor portfolios. The firm is rooted in decades of structuring and building inventive exchange-traded product solutions.


For more information, please visit www.MicroSectors.com

Follow REX on Twitter @MSectors

REX Media Contacts: media@rexshares.com



About BMO Financial Group

Serving customers for 200 years and counting, BMO is a highly diversified financial services provider - the 8th largest bank, by assets, in North America. With total assets of $949 billion as of October 31, 2020, and a team of diverse and highly engaged employees, BMO provides a broad range of personal and commercial banking, wealth management and investment banking products and services to more than 12 million customers and conducts business through three operating groups: Personal and Commercial Banking, BMO Wealth Management and BMO Capital Markets.


BMO Media Contact: Kelly Hechler, Kelly.Hechler@bmo.com, (416) 867-3996

Bank of Montreal ETNs: US.ETN@bmo.com, +1-877-369-5412

Internet: www.bmo.com


Original release here.

Bank of Montreal, the issuer of the ETNs ("Bank of Montreal" or the "Issuer"), has filed a registration statement (including pricing supplements, product supplements, a prospectus supplement and a prospectus) with the Securities and Exchange Commission (the "SEC") about each of the offerings to which this website relates. Please read those documents and the other documents relating to these offerings that Bank of Montreal has filed with the SEC for more complete information about Bank of Montreal and these offerings. These documents may be obtained without cost by visiting EDGAR on the SEC website at . Alternatively, Bank of Montreal, any agent or any deal participating in these offerings will arrange to send the applicable pricing supplement, any applicable product supplement, the prospectus supplement and the prospectus if so requested by calling toll-free at 1-877-369-5412.
 
The ETNs are senior, unsecured debt obligations of Bank of Montreal, and are subject to Bank of Montreal’s credit risk.
 
The leveraged and inverse ETNs are intended to be daily trading tools for sophisticated investors to manage daily trading risks as part of an overall diversified portfolio. They are designed to achieve their stated investment objectives on a daily basis. You should proceed with extreme caution in considering an investment in those ETNs.
 
The ETNs do not guarantee any return of your investment. For example, with respect to some ETNs, if the closing Indicative Note Value or the Intraday Indicative Value (each as defined in the applicable pricing supplement) for the ETNs is equal to or less than $0 at any time during a relevant trading day, you will lose all of your investment in the ETNs. Even if the Index Closing Level has increased or decreased, as applicable, from the Initial Index Level, you may receive less than the principal amount of your ETNs upon a call, redemption, at maturity, or if you sell your ETNs, with the loss magnified by any leverage, each as described in more detail in the applicable pricing supplement.
 
Leverage (if applicable) increases the sensitivity of your ETNs to changes in the level of the applicable index. Investment suitability must be determined individually for each investor, and the ETNs are not suitable for all investors. The leveraged and inverse ETNs are not suitable for investors with longer-term investment objectives. You should regularly monitor your holdings of the ETNs to ensure that they remain consistent with your investment strategies. In particular, the leveraged and inverse ETNs should be purchased only by sophisticated investors who do not intend to hold the ETNs as a buy and hold investment, who are willing to actively and continuously monitor their investment and who understand the consequences of investing in and of seeking daily resetting investment results, which are leveraged as to some of the ETNs. Due to the effect of compounding, if the Indicative Note Value increases, any subsequent adverse change in the applicable index level will result in a larger dollar reduction from the Indicative Note Value than if the Indicative Note Value remained constant; the converse is also true. The ETNs are subject to intraday purchase risk. The Indicative Note Value of the leveraged and inverse ETNs is reset daily, and the leverage or exposure of the ETNs during any relevant trading day may be greater than or less than that contemplated by the name of a particular leveraged ETN.
 
The ETNs are subject to a call right, which may adversely affect the value of, or your ability to sell, your ETNs. Most of the ETNs do not pay any interest, and you will not have any ownership rights in the applicable index constituents. The Index Closing Level used to calculate any payment by the Issuer of the ETNs may be different from the Index Closing Level at other times during the term of the ETNs. There are restrictions on your ability to request a redemption of the ETNs, and you will not know the amount due upon redemption at the time you elect to request that the ETNs be redeemed. The Issuer may sell additional ETNs, but is under no obligation to do so.
 
Market disruptions may adversely affect your return. Significant aspects of the tax treatment of the ETNs are uncertain.
 
The Intraday Indicative Value and the Indicative Note Value are not the same as the closing price or any other trading price of the ETNs in the secondary market. There is no assurance that your ETNs will be listed or continue to be listed on a securities exchange, and they may not have an active trading market. The value of the ETNs in the secondary market may be influenced by many unpredictable factors.
 
The Issuer or its affiliates may have economic interests that are adverse to those of the holders of the ETNs as a result of its business, hedging and trading activities, or as Calculation Agent (as defined in the applicable pricing supplement) of the ETNs, and may have published research, expressed opinions or provided recommendations that are inconsistent with investing in or holding the ETNs, and may do so in the future.
 
Each index has limited actual historical information. The Index Calculation Agent (as defined in the applicable pricing supplement), may adjust the index in a way that may affect its level, and may, in its sole discretion, discontinue the public disclosure of the intraday index value and the end-of-day closing value of the index. The indices lack diversification and are vulnerable to fluctuations in the applicable sector. A limited number of index constituents may affect each Index Closing Level, and the Indices are not necessarily representative of their focus industry. An index constituent may be replaced upon occurrence of certain events. The manner in which each index selects its components may differ from how other index providers or market participants might do so.
 
Use of Hypothetical Back-Tested Data - The historical data of the Indices shown herein is from the dates displayed. Any index data shown prior to that date is hypothetical and a result of the application of the index methodology to historical data, and has inherent limitations. The creation of hypothetical data necessarily involves assumptions and cannot take into account the impact of financial risk in actual trading. Alternative modeling techniques or assumptions may produce different hypothetical back-tested information that might be more appropriate and that might differ significantly from the information presented herein. The hypothetical back-tested data herein should not be considered indicative of actual results that might be obtained from an investment in a financial instrument referencing the index.
 
Historical and hypothetical back-tested results are neither an indicator nor a guarantee of future index performance or the return of the ETNs.
 
Please see the “Risk Factors” section in the pricing supplement, any applicable product supplement, the prospectus supplement and the prospectus relating to the applicable offering.
 
This information is not intended to provide and should not be relied upon as providing accounting, legal, regulatory or tax advice. We urge you to consult your investment, legal, tax, accounting and other advisers before you invest in the ETNs.

 

MicroSectors™ and REX™ are registered trademarks of REX Shares, LLC (“REX”). The trademarks have been licensed for use for certain purposes by Bank of Montreal. The ETNs are not sponsored or sold by REX or any of its affiliates or third-party licensors (collectively, “REX Index Parties”). REX Index Parties make no representation or warranty, express or implied, to the owners of the ETNs or any member of the public regarding the advisability of investing in securities generally or in the ETNs particularly or the ability of the Index to track general market performance. REX Index Parties’ only relationship to Bank of Montreal with respect to the Index is the licensing of the Index and certain trademarks, service marks and/or trade names of REX Index Parties. REX Index Parties are not responsible for and have not participated in the determination of the prices, and amount of the ETNs or the timing of the issuance or sale of the ETNs or in the determination or calculation of the equation by which the ETNs are to be converted into cash. REX Index Parties have no obligation or liability in connection with the administration, marketing or trading of the ETNs. Inclusion of a security within an index is not a recommendation by REX Index Parties to buy, sell, or hold such security, nor is it considered to be investment advice.

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