The Fund is an actively managed exchange-traded fund (“ETF”). The Fund seeks long-term total return by using a proprietary methodology to invest in and allocate among energy-related derivative instruments based upon oil, petroleum, and natural gas, as well as other energy-related derivative instruments. Specifically, the Fund anticipates that it will invest in futures contracts including, but not limited to, West Texas Intermediate (“WTI”) crude oil, Henry Hub natural gas, New York Harbor ultra-low sulfur diesel (formerly heating oil), Reformulated Blendstock for Oxygenate Blending (“RBOB”) gasoline, Brent crude oil and gasoil. The Fund may also invest in other types of futures contracts, including futures based on “clean energy” sources, such as wind and solar power, as part of this investment strategy.

The Fund’s proprietary methodology is quantitative in nature and may utilize any of the following to make a determination about the likely direction of the futures contracts noted above: technical signals on price and volume, fundamental signals on specific energy commodities, and general economic signals. Examples of these signals may include, but are not limited to, such factors as momentum, open interest, relative value, supply and demand for specific commodities, and inflation expectations. The Fund may take long, short, or spread positions in any of these contracts across different contract maturities.

The Fund does not track any specific energy benchmark or index, although at times it may exhibit correlation or inverse correlation with one or more benchmarks, indexes, energy futures contracts or other energy-related derivatives. The Fund may also exhibit little to no correlation with such benchmarks, indexes, energy futures contracts or other energy-related derivatives at any given time or over the long-term. The Adviser may use its discretion when applying its proprietary methodology to select the Fund’s investments.

The instruments in which the Fund invests may include commodity-related exchange-traded futures and options contracts, swap agreements, and structured notes (collectively, “Commodity-Linked Investments”). The Fund’s investments are not restricted in terms of geography. Accordingly, the Fund may invest in both U.S.-listed and non-U.S.-listed energy instruments, including derivatives denominated in U.S. dollars.

Commodities may be physically traded at their current market prices (or spot prices), but are more commonly traded through the purchase and sale of futures contracts (i.e., agreements to buy or sell a specific quantity of a commodity in the future at a specific price), and the Fund will invest in commodities only through its investments in derivative instruments such as futures contracts, and not directly. Futures contracts expire by default on a monthly basis. Investors can close futures contracts prior to expiration, “roll” to a later contract, or allow the contract to expire and take settlement of the underlying commodity or financial instrument specified by the contract.

Although the Fund is permitted to invest in Commodity-Linked Investments directly, the Fund intends to invest in Commodity-Linked Investments primarily through a wholly-owned subsidiary of the Fund incorporated in the Cayman Islands, USCF Cayman Commodity 3 (the “Subsidiary”). By investing in the Subsidiary, the Fund is able to obtain greater exposure to the energy markets while maintaining compliance with U.S. federal income tax requirements applicable to investment companies. The Fund will not invest more than 25% of its total assets in the Subsidiary, as determined at the end of each fiscal quarter.

The Subsidiary is advised by the Adviser and has the same investment objective as the Fund. The Subsidiary is subject to the same investment restrictions and limitations, and follows the same compliance policies and procedures, as the Fund, except that the Subsidiary may invest without limitation in Commodity-Linked Instruments. The Subsidiary’s investments are considered to be part of the Fund’s portfolio. Neither the Fund nor the Subsidiary invests directly in commodities.

The portion of the Fund’s assets that are not invested in Commodity-Linked Investments will be primarily invested, directly or indirectly through the Subsidiary, in cash, cash equivalents, investment grade fixed-income investments, money market funds, repurchase agreements or a combination thereof. The primary purpose of such investments will be to meet coverage and collateral requirements associated with the Fund’s Commodity-Linked Investments.

The Fund is not “diversified,” as that term is defined in the Investment Company Act of 1940, as amended (the “1940 Act”).

The CFTC has adopted certain requirements that subject a registered investment company and its investment adviser to regulation by the CFTC if the registered investment company invests more than a prescribed level of its net asset value (“NAV”) in CFTC-regulated futures, options, or swaps, or if the registered investment company markets itself as providing investment exposure to such instruments. Due to the Fund’s expected use of such CFTC-regulated instruments above the prescribed levels, the Fund is considered a “commodity pool” under the Commodity Exchange Act (“CEA”).