PowerShares DB Energy Fund just came out with a new prospectus, available here. This is an SEC requirement for firms looking to issue certain types of securities. An excerpt of the prospectus is provided below:
A substantial amount of proceeds of the offering of the Shares of each Fund are used by each Fund to engage in the trading of exchange-traded futures on its Index Commodities with a view to tracking the changes, positive or negative, in the level of its Index over time, less the expenses of the operations of the Fund. Each Funds portfolio also includes United States Treasury securities for deposit with such Funds Commodity Broker as margin.
To the extent that a Fund trades in futures contracts on United States exchanges, the assets deposited by such Fund with its Commodity Broker as margin must be segregated pursuant to the regulations of the CFTC. Such segregated funds may be invested only in a limited range of instrumentsprincipally U.S. government obligations.
To the extent, if any, that a Fund trades in futures on markets other than regulated United States futures exchanges, funds deposited to margin positions held on such exchanges are invested in bank deposits or in instruments of a credit standing generally comparable to those authorized by the CFTC for investment of customer segregated funds, although applicable CFTC rules prohibit funds employed in trading on foreign exchanges from being deposited in customer segregated fund accounts.
Although the following percentages may vary substantially over time, as of the date of this Prospectus, each Fund estimates that approximately 100% of the net asset value of each Fund is maintained in segregated accounts in the name of such Fund with the Commodity Broker in the form of cash or United States Treasury bills. Approximately 10% of the net asset value of each Fund may be held in cash at any one time. Such funds are segregated pursuant to CFTC rules.
The Managing Owner, a registered commodity pool operator and commodity trading advisor, is responsible for the cash management activities of each Fund, including investing in United States Treasury and United States Government Agencies issues.
In addition, assets of each Fund not required to margin positions may be maintained in United States
The above information was disclosed in a filing to the SEC. To see the filing, click here.
To receive a free e-mail notification whenever PowerShares DB Energy Fund makes a similar move, sign up!
Other recent filings from the company include the following: