GROW FISCAL YEAR 2020 RESULTS WEBCAST · 2020. 9. 11. · GROW FISCAL YEAR 2020 RESULTS WEBCAST Frank Holmes, CEO and Chief Investment Officer Lisa Callicotte, Chief Financial Officer

GROW FISCAL YEAR 2020 RESULTS WEBCASTFrank Holmes, CEO and Chief Investment OfficerLisa Callicotte, Chief Financial OfficerHolly Schoenfeldt, Marketing and Public Relations Manager

usfunds.com 1.800.US.FUNDS September 2020

usfunds.comSeptember 2020

TODAY’S PRESENTERS

Frank Holmes Lisa Callicotte Holly Schoenfeldt

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FORWARD-LOOKING STATEMENTSDuring this webcast we may make forward-looking statements about our relative business outlook. Any forward-looking statements and all other statements made during this webcast that don’t pertain to historical facts are subject to risks and uncertainties that may materially affect actual results. Please refer to our press release and the corresponding Form 10-K filing for more detail on factors that could cause actual results to differ materially from any described today in forward-looking statements. Any such statements are made as of today, and U.S. Global Investors accepts no obligation to update them in the future.

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usfunds.comSeptember 2020 4

ABOUT U.S. GLOBAL INVESTORS (GROW) U.S. Global Investors, Inc. is an innovative investment manager with vast experience in global markets and specialized sectors.

Founded as an investment club, the company became a registered investment adviser in 1968 and has a longstanding history of global investing and launching first-of-their kind investment products, including the first no-load gold fund.

U.S. Global Investors is well known for expertise in gold and precious metals, natural resources and emerging markets.

5usfunds.comSeptember 2020

GROW STRENGTHS Strive to be the “go-to” stock for exposure to emerging markets,

resources, gold and digital currencies Strong balance sheet with a reflexive cost structure Monthly dividend and return on equity discipline


TOP INSTITUTIONAL HOLDERS OF GROW

*Percentage of shares outstanding

Source: NASDAQ, Data as of June 2020

1. Perritt Capital Management 5.62%

2. Royce and Associates 4.81%

3. Heartland Advisors 4.24%

4. Financial & Investment Management Group

3.88%

5. BlackRock Institutional Trust Company

2.66%

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GROW DIVIDENDS — PAID MONTHLY

Consistently paid for more than

11 yearsCurrent yield at share price of $3.44 as of 09/08/2020

0.87%Monthly dividend payment of $0.0025Approved through September 2020Reviewed by the Board quarterly

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SHARE REPURCHASE PROGRAM IN MOTIONThe board approved a repurchase of up to $2.75 million of its outstanding common stock on the open market through December 31, 2020.

During the three months ended June 30, 2020, the Company repurchased 32,901of its class A shares using cash of approximately $39,000. May be suspended or discontinued at any time.


QUARTERLY AVERAGEASSETS UNDER MANAGEMENT

*Investment in Galileo was sold effective March 2, 2020 9


AN OVERVIEW OF ETF REVENUE EARNED

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ETF ASSETS UNDER MANAGEMENT ETF EXPENSE RATIO ADVISER ETF

REVENUE*

$100 Million 60 BPS $600,000

$500 Million 60 BPS $3 Million

$2 Billion 60 BPS $12 Million

*USGI pays all expenses of the ETFs


BALANCE SHEET STRENGTH

Investment inHIVE BlockchainTechnologies

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EARNINGS PER SHARE – LAST FOUR FISCAL YEARS

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3¢

4¢

22¢

31¢


EARNINGS PER SHARE QUARTERLY

8¢

Mainly due to indirect investment

in HIVE accounted for using the equity method of accounting

5¢

7¢

2¢

8¢

21¢

Volatility in cryptocurrency space 5¢

24¢Volatility of

long-term investments

6¢

11¢

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10¢

2¢

DuringCOVID


HOLMES FUND CHANGES NAME & STRATEGY Effective July 1, 2020, the Holmes Macro Trends Fund (MEGAX) changed to the Global

Luxury Goods Fund (USLUX).

USLUX provides investors access to companies around the world that are involved in the design, manufacture and sale of products and services that are not considered to be essential but are highly desired within a culture of society.

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RETHINKING LUXURY DURING THE PANDEMIC

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$8.08


JETS ETF SENDS TOTAL ASSETS HIGHER

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Source: Bloomberg, U.S. Global Investors


JETS CROSSED $1 BILLION IN ASSETS

70 STRAIGHT DAYS OF INFLOWS


MARCH 11- TRUMP STOPS INTERNATIONAL TRAVEL

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JETS ETF: QUANT APPROACH SMART BETA 2.0 HAS OUTPERFORMED NYSE

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BREAKOUT: TSA SHOWS PEOPLE ARE FLYING AGAIN

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20usfunds.comSeptember 202020

“An exchange-traded fund that tracks airlines has become the hottest theme ETF in history, with bargain-hunting day-traders from sites such as Robinhood taking the other side of the trade from Warren Buffett, who recently sold carrier stocks.

The ETF has added $635 million over 45 straight days, a run never matched by HACK, ROBO or MJ.”

Eric Balchunas, Bloomberg Intelligence Senior ETF Analyst



WHERE IS JETS AVAILABLE?

Distributed by Quasar Distributors, LLC. U.S. Global Investors is the investment adviser to JETS. 22

• Wells Fargo• Morgan Stanley• UBS• Citi• Oppenheimer• Janney• Stifel• RBC

• Raymond James• LPL• Cetera Financial• Commonwealth Network• Advisor Group• Schwab• Fidelity/National Financial• TD Ameritrade• Pershing/BNY

Wirehouse Platforms RIAs and Independent Firms

Online Brokerage Platforms• Robinhood• E Trade• Interactive Brokers


UNDERSTANDING THE DNA OF VOLATILITY

Standard Deviation For One Year, as of June 30, 2020

One Day Ten Day

S&P 500 Index (SPX) ±1% ±3%

Gold Bullion ±1% ±3%

Bitcoin ±5% ±16%

Gold Stocks ±3% ±9%

Oil ±5% ±17%

Past performance is no guarantee of future results. Standard deviation is a measure of the dispersion of a set of data from its mean. The more spread apart the data, the higher the deviation. Standard deviation is also known as historical volatility.

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THE INVERSE RELATIONSHIPBETWEEN GOLD & REAL RATES


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GOLD HAS BEATEN THE S&P 500 INDEXSO FAR THIS CENTURY

GOLD UP 3X GREATER THAN THE MARKET


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18 MONTHS LATER, GOLD CONTINUES TO TRADE IN A GOLDEN CROSS

Free Cash Flow (FCF) represents the cash that a company is able to generate after laying out the money required to maintain or expand its asset base.

WATCH ON

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WARREN BUFFETT HAD “FOMO”?

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Berkshire Hathaway took a $565 million position in Barrick Gold


THE “ORACLE OF OMAHA” HASN’TALWAYS BEEN RIGHT

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“I was too dumb to realize. I did not think [Bezos] could succeed on the scale he has.”

Warren Buffett in 2018, explaining how he missed Amazon early on


CNBC ASIA: CAN GOLD REACH $4,000?

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GOAU ETF HIT NEW MILESTONE

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The U.S. Global GO GOLD and Precious Metal Miners ETF (GOAU) Crosses Above $100 Million Milestone


WHERE IS GOAU AVAILABLE?

31Distributed by Quasar Distributors, LLC. U.S. Global Investors is the investment adviser to GOAU.

• Oppenheimer• Janney• RBC• Stifel

• Raymond James• LPL• Cetera Financial• Advisor Group• Commonwealth Network• Schwab• Fidelity/National Financial• TD Ameritrade• Pershing/BNY

Wirehouse Platforms RIAs and Independent Firms

Online Brokerage Platforms• Robinhood• E Trade• Interactive Brokers


MAJOR EVENTS MOVING THE PRICEOF BITCOIN

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BITCOIN PRICE INCREASES FOLLOWING MOST RECENT HALVING

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ETHEREUM TRANSACTION FEES SHOOT UP DUE TO MASSIVE GROWTH IN DECENTRALIZED FINANCE

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ETHEREUM MINERS REVENUE SPIKE

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ETHEREUM MINERS GENERATED ALL-TIME HIGH FEE REVENUE OF $17 MILLION

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Ethereum miners are gaining big as transaction costs or gas fees continue to rise amid decentralized finance (DeFi) boom.

This is positive news for HIVE Blockchain.


HIVE HAS OUTPERFORMED THE COMPETITION IN PRICE AND LIQUIDITY


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HIVE BLOCKCHAIN TECHNOLOGIES AND ETHEREUM PRICE HAVE BEEN HIGHLY CORRELATED

70% CORRELATION

Source: Bloomberg, GoldMinerPulse, U.S. Global Investors

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HIVE – LATEST UPDATES

JUN18

JUN2

JUN1

JUN12

JUN23

JUL28

AUG31

Announces Appointment of Ian Mann to Board of Directors Announces of Anticipated Cost

Reductions and Higher Computer Efficiency from New Agreements for

Iceland Operation

Increases Bitcoin Hash Rate and MiningEfficiency at Recently Acquired Quebec Mining Facility

Announces Planned Investments toUpdate and Maximize Iceland Operation

Announces Successful Installation of Next Generation Miners at Green Energy-Powered Quebec Facility

Partners With EcoCooling toMaximize Operational Excellence

Announces Next Generation Bitcoin Mining Power at Green Energy-Powered Operation in Quebec

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THUNDERBIRD MOVES ON GROWING REVENUE, CASH FLOW & EMMY WINS

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CONGRATULATIONS, THUNDERBIRD!

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THUNDERBIRD RECENTLY RECEIVED SOME WELL-DESERVED ACCOLADES:

• An Emmy award

• Four Leo awards for Netflix series “The Last Kids on Earth”

• Three Leo awards for Canadian sitcom “Kim’s Convenience”

• One Leo award for documentary “Highway Thru Hell”


U.S. GLOBAL INVESTORS, INC. (GROW)INCOME STATEMENT – FINANCIAL ANALYSIS

Lisa CallicotteCFO

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CONSOLIDATED STATEMENTS OF OPERATIONS(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)

Operating RevenuesYear Ended June 30,

2020 2019Advisory fees $ 4,311 $ 3,274

Administrative service fees 165 185

$ 4,476 $ 3,459

Operating Expenses

Employee compensation and benefits $ 2,840 $ 2,884

General and administrative 3,663 2,920

Advertising 174 198

Depreciation and amortization 202 214

$ 6,879 $ 6,216

Operating Loss (2,403) (2,757)

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CONSOLIDATED STATEMENTS OF OPERATIONS(DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

Year Ended June 30, 20202020 2019

Operating Loss $ (2,403) $ (2,757)

Other Income (Loss)

Investment loss (2,211) (1,582)

Income (loss) from equity method investments (142) 23

Other income 117 47

(2,236) (1,512)

Loss from Continuing Operations Before Income Taxes $ (4,639) $ (4,269)

Provision for Income Taxes

Tax benefit (175) (977)

Loss from Continuing Operations $ (4,464) $ (3,292)

Discontinued Operations

Loss from discontinued operations of investment management services in Canada before income taxes (338) (147)

Tax benefit - -

Loss from Discontinued Operations (338) (147)

Net Loss (4,802) (3,439)

Less: Net Loss Attributable to Non-Controlling Interest from Discontinued Operations (118) (51)

Net Loss Attributable to U.S. Global Investors, Inc. $ (4,684) $ (3,388)

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CONSOLIDATED STATEMENTS OF OPERATIONS(DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

Year Ended June 30, 20202020 2019

Earnings Per Share Attributable to U.S. Global Investors, Inc.

Basic Net Loss per Share

Loss from continuing operations $ (0.30) $ (0.22)

Loss from discontinued operations $ (0.01) $ -

Net loss $ (0.31) $ (0.22)

Diluted Net Loss per Share

Loss from continuing operations $ (0.30) $ (0.22)

Loss from discontinued operations $ (0.01) $ -

Net loss $ (0.31) $ (0.22)

Basic weighted average number of common shares outstanding 15,108,394 15,138,351

Diluted weighted average number of common shares outstanding 15,108,394 15,138,351

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CONSOLIDATED BALANCE SHEETS(DOLLARS IN THOUSANDS)

Assets (dollars in thousands) June 30, 2020 June 30, 2019

Current Assets

Cash and cash equivalents $ 1,936 $ 1,466

Restricted cash 1,025 1,025

Investments in securities at fair value 6,322 8,021

Accounts and other receivables 974 309

Note receivable - 199

Prepaid expenses 285 293

Total assets held related to discontinued operations - 1,780

Total Current Assets 10,542 13,093

Net Property and Equipment 1,506 1,708

Other Assets

Investments in securities at fair value, non-current 5,142 7,166

Other investments 1,283 1,404

Equity method investments 158 309

Right of use assets 93 -

Other assets, non-current 92 64

Total Other Assets 6,768 8,943

Total Assets $ 18,816 $ 23,744

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Liabilities June 30, 2020 June 30, 2019

Current Liabilities

Accounts payable $ 29 $ 31

Accrued compensation and related costs 360 311

Dividends payable 113 113

Lease liability, short-term 50 -

Other accrued expenses 1,015 496

Note payable, current 442 -

Total liabilities held related to discontinued operations - 481

Total Current Liabilities 2,009 1,432

Long-Term Liabilities

Deferred tax liability - 133

Lease liability, long-term 43 -

Total Long-Term Liabilities 43 133

Total Liabilities 2,052 1,565

Commitments and Contingencies (Note 19)

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Shareholders’ Equity June 30, 2020 June 30, 2019

Shareholders’ Equity

Common stock (class A) - $0.025 par value; nonvoting; authorized, 28,000,000 shares; issued, 13,866,913 shares and 13,866,751 shares at June 30, 2020, and June 30, 2019, respectively

347 347

Common stock (class B) - $0.025 par value; nonvoting; authorized, 4,500,000 shares; no shares issued - -

Convertible common stock (class C) - $0.025 par value; voting; authorized, 3,500,000 shares; Ï issued, 2,068,635 shares and 2,068,797 shares at June 30, 2020, and June 30, 2019, respectively

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Additional paid-in-capital 15,623 15,646

Treasury stock, class A shares at cost; 855,432 and 804,959 shares at June 30, 2020, and June 30, 2019, respectively (1,879) (1,888)

Accumulated other comprehensive income (loss), net of tax (4) (206)

Retained Earnings 2,625 7,761

Total U.S. Global Investors Inc. Shareholders’ Equity 16,764 21,712

Non-Controlling Interest in Subsidiary - 467

Total Shareholders’ Equity 16,764 22,179

Total Liabilities and Shareholders’ Equity $ 18,816 $ 23,744

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SIGNIFICANT EVENTS

Holly SchoenfeldtMarketing and Public Relations Manager


ASSET BREAKDOWN — U.S. GLOBAL INVESTORS FUNDS

50Data for SEC-registered mutual funds as of June 30, 2020


VIRAL PUBLICITY GAINED THROUGHMEDIA INTERVIEWS

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NEWSLETTER RECOMMENDATIONS FORU.S. GLOBAL INVESTORS FUNDS

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No-Load Mutual Fund Selections& Timing Newsletter


BRANDING AND MARKETING OF GROW

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15 TV/Radio/Podcasts 33 Total Interviews 437 Web Mentions

23 Frank Talk Blog Entries 82 Newsletter

Recommendations

*Data from April – June 2020


GOLD GAME FILM CONTINUES SUCCESSON KITCO NEWS

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Kitco audience >30 million monthly visitors

TheStreet audience 7.8 million monthly visitors

186EPISODES



TOP REFERRAL WEBSITES

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1. 321Gold.com

2. Kitco News

3. ETF Trends

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RECOGNITION AS AN INDUSTRY LEADER IN INVESTOR EDUCATION

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88 STAR Awards,the education awards for the investment management industryThe Investment Management Education Alliance (IMEA) is a national industry association committed to investor education, and its STAR Awards program recognizes marketing communications efforts in the mutual fund industry. The awards competition is judged by industry professionals, and based on criteria including educational value, content, design and functionality.


JOIN OUR LOYAL SUBSCRIBERS!

Over 50,000subscribers receive our award-winning content.INVESTOR ALERT

FLASH FACTSFRANK TALKETF UPDATES

FOLLOW US ON SOCIAL MEDIA

FEELING LEFT OUT?



WE’RE GROWING OUR YOUTUBE CHANNEL –SUBSCRIBE TODAY!

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INSTITUTIONAL GOLD BRANDING –THOUGHT LEADERSHIP

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Virtual Presentations Give Us the Opportunity to Educate Thousands of Investors


VIRTUAL PRESENTATIONS HAVE BECOME“THE NEW NORMAL”

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Q&A


DISCLOSURES

All opinions expressed and data provided are subject to change without notice. Some of these opinions may not be appropriate to every investor.

The NYSE Arca Gold BUGS (Basket of Unhedged Gold Stocks) Index (HUI) is a modified equal dollar weighted index of companies involved in gold mining. The HUI Index was designed to provide significant exposure to near term movements in gold prices by including companies that do not hedge their gold production beyond 1.5 years.

The Purchasing Manager’s Index is an indicator of the economic health of the manufacturing sector. The PMI index is based on five major indicators: new orders, inventory levels, production, supplier deliveries and the employment environment.

The S&P 500 Stock Index is a widely recognized capitalization-weighted index of 500 common stock prices in U.S. companies. The Russell 2000 Index is a small-cap stock market index of the bottom 2,000 stocks in the Russell 3000 Index. The U.S. Trade Weighted Dollar Index provides a general indication of the international value of the U.S. dollar.

Standard deviation is a measure of the dispersion of a set of data from its mean. The more spread apart the data, the higher the deviation. Standard deviation is also known as historical volatility. The Consumer Price Index (CPI) is one of the most widely recognized price measures for tracking the price of a market basket of goods and services purchased by individuals. The weights of components are based on consumer spending patterns.

The MSCI Emerging Markets Index is a free float-adjusted market capitalization index that is designed to measure equity market performance in the global emerging markets.

Cash Flow is a measure of the amount of cash generated by a company’s normal business operations.

There is no guarantee that the issuers of any securities will declare dividends in the future or that, if declared, will remain at current levels or increase over time. Note that stocks and Treasury bonds differ in investment objectives, costs and expenses, liquidity, safety, guarantees or insurance, fluctuation of principal or return, and tax features.

None of U.S. Global Investors Funds held any of the securities mentioned in this presentation as of 06/30/2020.

Frank Holmes has been appointed non-executive chairman of the Board of Directors of HIVE Blockchain Technologies. Both Mr. Holmes and U.S. Global Investors own shares of HIVE. Effective 8/31/2018, Frank Holmes serves as the interim executive chairman of HIVE.

Frank Holmes serves on the board of Thunderbird Entertainment. Both Mr. Holmes and U.S. Global Investors own shares of Thunderbird.

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DISCLOSURES

Please consider carefully a fund’s investment objectives, risks, charges and expenses. For this and other important information, obtain a statutory and summary prospectus for JETS and GOAU by visiting www.usglobaletfs.com. Read it carefully before investing.

Investing involves risk, including the possible loss of principal. Shares of any ETF are bought and sold at market price (notNAV), may trade at a discount or premium to NAV and are not individually redeemed from the funds. Brokerage commissions will reduce returns. Because the funds concentrate their investments in specific industries, the funds may be subject to greater risks and fluctuations than a portfolio representing a broader range of industries. The funds are non-diversified, meaning they may concentrate more of their assets in a smaller number of issuers than diversified funds. The funds invest in foreign securities which involve greater volatility and political, economic and currency risks and differences in accounting methods. These risks are greater for investments in emerging markets. The funds may invest in the securities of smaller-capitalization companies, which may be more volatile than funds that invest in larger, more established companies. The performance of the funds may diverge from that of the index. Because the funds may employ a representative sampling strategy and may also invest in securities that are not included in the index, the funds may experience tracking error to a greater extent than funds that seek to replicate an index. The funds are not actively managed and may be affected by a general decline in market segments related to the index.

Airline Companies may be adversely affected by a downturn in economic conditions that can result in decreased demand for air travel and may also be significantly affected by changes in fuel prices, labor relations and insurance costs.

Gold, precious metals, and precious minerals funds may be susceptible to adverse economic, political or regulatory developments due to concentrating in a single theme. The prices of gold, precious metals, and precious minerals are subject to substantial price fluctuations over short periods of time and may be affected by unpredicted international monetary and political policies. We suggest investing no more than 5% to 10% of your portfolio in these sectors.

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http://www.usglobaletfs.com/

Documents

GROW FISCAL YEAR 2020 RESULTS WEBCAST · 2020. 9. 11. · GROW FISCAL YEAR 2020 RESULTS WEBCAST Frank Holmes, CEO and Chief Investment Officer Lisa Callicotte, Chief Financial Officer