Correspondence 0001398344-24-012330 from FINANCIAL INVESTORS TRUST (CIK 0000915802)
FINANCIAL INVESTORS TRUST (CIK 0000915802)
Date: July 5, 2024 · CIK: 0000915802 · Accession: 0001398344-24-012330
AI Filing Summary & Sentiment
File numbers found in text: 811-8194
Letter
VIA EDGAR Division of Investment Management F Street, N.E. Washington, DC 20549 Re: Financial Investors Trust (the “Registrant”) File Nos. 33-72424, 811-8194
Dear Ms. Browning:
On behalf of the Registrant, set forth below are the Registrant’s responses to certain comments received from the staff of the Division of Investment Management on May 31, 2024 and supplemental comments received on June 26, 2024 and July 2, 2024, regarding post-effective amendment No. 265 (“PEA 265”) to the Registrant’s registration statement under the Securities Act of 1933, as amended (the “1933 Act”), and Post-Effective Amendment No. PEA 266 under the Investment Company Act of 1940, as amended (the “Investment Company Act”), filed pursuant to Rule 485(a) on April 15, 2024, with respect to the ALPS | CoreCommodity CoreCommodity Natural Resources ETF (the “Fund”). Capitalized terms not otherwise defined herein shall have the meanings given to them in PEA 265.
In connection with this response letter, and on or around July 5, 2024, the Registrant anticipates filing, pursuant to Rule 485(b), a new post-effective amendment to the Registrant’s registration statement under the 1933 Act, which is expected to include (i) changes to PEA 265 in response to the Staff’s comments, (ii) certain other non-material information; and (ii) certain other required exhibits.
4.11
U.S. Securities and Exchange Commission
Division of Investment Management
July 5, 2024
Page
Staff Comments (May 31, 2024):
Preliminary Comments
A. Staff Comment: Please acknowledge that Registrant has reviewed the SEC’s public announcement from 2016 and that the Registrant is responsible for all disclosures in the Fund’s registration statement.
Registrant’s Response: Registrant understands, in accordance with the SEC’s public announcement from 2016, that Fund management and the Registrant are responsible for the accuracy of the disclosures in the Fund’s registration statement.
B. Staff Comment: The Staff comments are universal and may apply to multiple sections of the Registration statement.
Registrant’s Response: Registrant acknowledges that comments are universal and may apply to multiple sections of the Registration statement.
C. Staff Comment: Supplementally confirm to the Staff that any areas of the registration statement that are not complete in PEA 265 will be completed in the subsequent post-effective amendment to the registration statement with respect to the Fund.
Registrant’s Response: Registrant confirms that any information not completed in PEA 265 will be completed in the subsequent post-effective amendment to the registration statement with respect to the Fund.
D. Staff Comment: Please provide a copy of any changes to the registration statement at least five business days prior to the date of effectiveness.
Registrant’s Response: Comment complied with.
E. Staff Comment: Should the Registrant decline a Staff comment, please supplementally explain the rationale for declining the comment and cite to any applicable laws, regulations, rules, etc.
Registrant’s Response: To the extent Registrant has declined a Staff comment, Registrant has included the rationale for declining the comment, including, any applicable citations.
F. Staff Comment: The Staff notes that any comments that are being provided for the Registrant’s consideration will be specifically identified as such in the applicable comment.
U.S. Securities and Exchange Commission
Division of Investment Management
July 5, 2024
Page
Registrant’s Response: Registrant acknowledges the Staff’s comment.
General Comments
1. Staff Comment: If the Fund will provide shareholders with prior notice regarding any changes to the Fund’s investment objectives, please state such policy in the appropriate location in the prospectus (e.g., that the Fund will provide shareholders with at least 60 days’ notice prior to the implementation of any change to the Fund’s investment objective).
Registrant’s Response: The Fund does not have a policy to provide sixty days' notice prior to changing the Fund’s investment objective. The Registrant notes that Form N-1A requires disclosure of whether a fund's investment objective may be changed without shareholder approval but does not require disclosure of any notice requirement or notice period. For this reason, the Registrant respectfully declines to make any changes in response to this comment.
2. Staff Comment: In the preamble to the Fund’s fees and expenses table, please include, “[y]ou may pay other fees, such as brokerage commissions and other fees to financial intermediaries, which are not reflected in the tables and examples below.”
Registrant’s Response: Comment complied with.
3. Staff Comment: In the summary of the Fund’s principal investment strategies, please consider whether the Fund must include prior performance information pursuant to CFTC Rule 4.12(c)(3)(i)(A) under the Commodity Exchange Act (the “CEA”).
Registrant’s Response: Rule 4.5 under the CEA provides that investment advisers registered under the Investment Advisers Act of 1940, shall be excluded from the definition of the term “commodity pool operator” with respect to the operation of an investment company registered under the Investment Company Act, provided that, among other requirements, (i) the investment company will use commodity futures or commodity options contracts, or swaps solely for bona fide hedging transactions and positions for excluded commodities, and for any such positions not used for bona fide hedging purposes, the investment company may represent that the aggregate initial margin and premiums required to establish such positions will not exceed 5% of the liquidation value of the investment company’s portfolio after accounting for unrealized profits and unrealized losses on any such contracts; or (ii) the aggregate net notional value of commodity futures, commodity options contracts, or swaps positions not used solely for bona fide hedging purposes within the meaning and intent of the definition of bona fide hedging transactions and positions for excluded commodities in Sections 1.3 and 151.5 the CEA determined at the time the most recent position was established, does not exceed 100% of the liquidation value of the pool's portfolio, after taking into account unrealized profits and unrealized losses on any such positions it has entered into.
U.S. Securities and Exchange Commission
Division of Investment Management
July 5, 2024
Page
Registrant notes that, as further discussed in the responses to subsequent Staff Comments, the Fund intends to invest primarily in equity securities, and will not invest in excess of the of the above described limits under Rule 4.5. Accordingly, Registrant does not believe the requirements of Rule 4.12 of the CEA are applicable to the Fund.
4. Staff Comment: Pursuant to Items 4 and 9 of Form N-1A, the Fund is required to specify how the Fund intends to achieve its investment objective by identifying the Fund’s principal investment strategies and the attendant risks. Please remove from the Fund’s principal investment strategies and principal risks phrases that indicate that the discussion includes an incomplete description of the Fund’s principal investment strategies and principal risks. For example, the Staff objects the inclusion of “generally includes but is not limited to,” “such as,” “for example,” and any other phrase not in conformity with the requirements of Items 4 and 9 of Form N-1A.
Registrant’s Response: Comment complied with.
5. Staff Comment: Based on the inclusion of “Small- to Mid-Capitalization Companies Risk” in the Fund’s principal risks, please include in the Fund’s principal investment strategies a discussion of the market capitalizations of companies in which the Fund may invest.
Registrant’s Response: Comment complied with. The Fund’s principal investment strategies have been revised to indicate that the Fund may invest in companies across all market capitalizations.
6. Staff Comment: The registration statement states that the Fund, under normal circumstances, will invest at least 80% of its net assets (plus the amount of any borrowings for investment purposes) in “equity securities” of companies that own, explore or develop natural resources and other basic commodities or supply goods and services to such companies (the “80% Test”).
Please add to the Fund’s principal investment strategies disclosure regarding the types of equity securities (e.g., common stock) and the types of issuers (e.g., foreign, emerging market, and/or domestic issuers; open-end funds; closed-end funds; or private issuers) that will be counted towards the Fund’s 80% Test. The discussion should be specific with respect to the issuers and the type of securities. If private issuers will be counted towards the Fund’s 80% Test, disclose the type of private issuers and the risks attendant thereto, if not already disclosed. Depending on the response, the Staff may have additional comments.
U.S. Securities and Exchange Commission
Division of Investment Management
July 5, 2024
Page
Registrant’s Response: In light of this Staff Comment as well at Supplemental Staff Comments 1, 3, 4, 5, 6, 8, and 13, Registrant has deleted and replaced the Fund’s principal investment strategies with the following:
“The Fund seeks to achieve its objective by investing, under normal circumstances, at least 80% of its net assets (plus the amount of any borrowings for investment purposes) in equity securities of natural resources companies.
For these purposes, “natural resources” means:
● Energy: Traditional energy (electricity and gas utilities, oil and gas producers/developers, oilfield equipment/services, storage/transportation, refining and marketing, service/drilling, pipelines, and coal) and alternative energy (uranium, nuclear, hydrogen, wind, solar, hydroelectric, biofuels, geothermal, and fuel cells) (collectively, “Energy”);
● Agriculture: (grains and other food products, seeds, fertilizers, pesticides, animal producers, animal processors, dairy, aquaculture, water, and supporting agricultural transport and machinery) and forest products (timber assets, lumber, plywood, pulp, paper, and packaging) (collectively, “Agriculture”);
● Base metals and minerals: (aluminum, copper, nickel, zinc, iron ore, lithium, lead, tin, steel, aggregate, metallurgical coal, supporting transport and mining machinery), specialty metals (manganese, silicon, vanadium, cobalt, tungsten, zirconium, chromium, titanium, niobium, and molybdenum) and rare earth elements (collectively, “Base Metals and Minerals”); and
● Precious metals and minerals: (gold, silver, platinum group metals, diamonds, and gemstones) (collectively, “Precious Metals and Minerals”).
The Fund considers “natural resources companies” to be foreign and domestic companies that in the most recent fiscal year, derived at least 50% of their revenue from or used 50% or more of their assets for: (i) owning, exploring, or developing natural resources; or (ii) producing or supplying goods, equipment, or services principally to companies that own, explore, or develop natural resources. The Fund’s investments in equity securities will primarily consist of investments in common stock. The Fund’s investments in foreign markets include investments in companies located in emerging markets.
Under normal market conditions, the Fund:
● expects 30-50% of the Fund’s portfolio to be allocated to Energy companies; 20-40% of the Fund’s portfolio to be allocated to Agriculture companies; 10-30% of the Fund’s portfolio to be allocated to Base Metals and Minerals companies; and 0-20% of the Fund’s portfolio to be allocated to Precious Metals and Minerals companies;
● will concentrate its investments (i.e., hold 25% or more of its total net assets) in companies in the Energy, Agriculture, Base Metals and Minerals, and Precious Metals and Minerals group of industries;
U.S. Securities and Exchange Commission
Division of Investment Management
July 5, 2024
Page
● does not intend to invest more than 5% of its net assets in any individual company, calculated at the time of purchase;
● may invest in companies across all market capitalizations; and
● may invest in foreign securities, including emerging markets securities, without limitation.
The Fund’s sub-adviser, CoreCommodity Management, LLC (the “Sub-Adviser”), employs an actively managed quantitative approach which incorporates multifactor top-down and bottom-up analysis. The Sub-Adviser examines the underlying businesses of natural resource companies, seeking to understand the commodities produced and their relationships to the individual companies.
The Fund typically sells an investment when, in the Sub-Adviser's view, the reasons for buying it no
Show Raw Text
CORRESP
1
filename1.htm
Financial
Investors Trust
1290
Broadway, Suite 1000
Denver,
Colorado 80203
July
5, 2024
VIA
EDGAR
Ms.
Kimberly Browning
Division
of Investment Management
U.S.
Securities and Exchange Commission
100
F Street, N.E.
Washington,
DC 20549
Re: Financial
Investors Trust (the “Registrant”)
File
Nos. 33-72424, 811-8194
Dear
Ms. Browning:
On
behalf of the Registrant, set forth below are the Registrant’s responses to certain comments received from the staff of
the Division of Investment Management on May 31, 2024 and supplemental comments received on June 26, 2024 and July 2, 2024, regarding
post-effective amendment No. 265 (“PEA 265”) to the Registrant’s registration statement under the Securities
Act of 1933, as amended (the “1933 Act”), and Post-Effective Amendment No. PEA 266 under the Investment Company
Act of 1940, as amended (the “Investment Company Act”), filed pursuant to Rule 485(a) on April 15, 2024, with
respect to the ALPS | CoreCommodity CoreCommodity Natural Resources ETF (the “Fund”). Capitalized terms not
otherwise defined herein shall have the meanings given to them in PEA 265.
In
connection with this response letter, and on or around July 5, 2024, the Registrant anticipates filing, pursuant to Rule 485(b),
a new post-effective amendment to the Registrant’s registration statement under the 1933 Act, which is expected to include
(i) changes to PEA 265 in response to the Staff’s comments, (ii) certain other non-material information; and (ii) certain
other required exhibits.
4.11
U.S.
Securities and Exchange Commission
Division of Investment Management
July 5, 2024
Page
2
Staff
Comments (May 31, 2024):
Preliminary
Comments
A. Staff
Comment: Please acknowledge that Registrant has reviewed the SEC’s public
announcement from 2016 and that the Registrant is responsible for all disclosures in
the Fund’s registration statement.
Registrant’s
Response: Registrant understands, in accordance with the SEC’s public announcement from 2016, that Fund management
and the Registrant are responsible for the accuracy of the disclosures in the Fund’s registration statement.
B. Staff
Comment: The Staff comments are universal and may apply to multiple sections
of the Registration statement.
Registrant’s
Response: Registrant acknowledges that comments are universal and may apply to multiple sections of the Registration statement.
C. Staff
Comment: Supplementally confirm to the Staff that any areas of the registration
statement that are not complete in PEA 265 will be completed in the subsequent post-effective
amendment to the registration statement with respect to the Fund.
Registrant’s
Response: Registrant confirms that any information not completed in PEA 265 will be completed in the subsequent post-effective
amendment to the registration statement with respect to the Fund.
D. Staff
Comment: Please provide a copy of any changes to the registration statement at
least five business days prior to the date of effectiveness.
Registrant’s
Response: Comment complied with.
E. Staff
Comment: Should the Registrant decline a Staff comment, please supplementally
explain the rationale for declining the comment and cite to any applicable laws, regulations,
rules, etc.
Registrant’s
Response: To the extent Registrant has declined a Staff comment, Registrant has included the rationale for declining the
comment, including, any applicable citations.
F. Staff
Comment: The Staff notes that any comments that are being provided for the Registrant’s
consideration will be specifically identified as such in the applicable comment.
2
U.S.
Securities and Exchange Commission
Division of Investment Management
July 5, 2024
Page
3
Registrant’s
Response: Registrant acknowledges the Staff’s comment.
General
Comments
1. Staff
Comment: If the Fund will provide shareholders with prior notice regarding any
changes to the Fund’s investment objectives, please state such policy in the appropriate
location in the prospectus (e.g., that the Fund will provide shareholders with at least
60 days’ notice prior to the implementation of any change to the Fund’s investment
objective).
Registrant’s
Response: The Fund does not have a policy to provide sixty days' notice prior to changing the Fund’s investment
objective. The Registrant notes that Form N-1A requires disclosure of whether a fund's investment objective may be changed without
shareholder approval but does not require disclosure of any notice requirement or notice period. For this reason, the Registrant
respectfully declines to make any changes in response to this comment.
2. Staff
Comment: In the preamble to the Fund’s fees and expenses table, please
include, “[y]ou may pay other fees, such as brokerage commissions and other fees
to financial intermediaries, which are not reflected in the tables and examples below.”
Registrant’s
Response: Comment complied with.
3. Staff
Comment: In the summary of the Fund’s principal investment strategies,
please consider whether the Fund must include prior performance information pursuant
to CFTC Rule 4.12(c)(3)(i)(A) under the Commodity Exchange Act (the “CEA”).
Registrant’s
Response: Rule 4.5 under the CEA provides that investment advisers registered under the Investment Advisers Act of 1940,
shall be excluded from the definition of the term “commodity pool operator” with respect to the operation of an investment
company registered under the Investment Company Act, provided that, among other requirements, (i) the investment company will
use commodity futures or commodity options contracts, or swaps solely for bona fide hedging transactions and positions for excluded
commodities, and for any such positions not used for bona fide hedging purposes, the investment company may represent that the
aggregate initial margin and premiums required to establish such positions will not exceed 5% of the liquidation value of the
investment company’s portfolio after accounting for unrealized profits and unrealized losses on any such contracts; or (ii)
the aggregate net notional value of commodity futures, commodity options contracts, or swaps positions not used solely for bona
fide hedging purposes within the meaning and intent of the definition of bona fide hedging transactions and positions for excluded
commodities in Sections 1.3 and 151.5 the CEA determined at the time the most recent position was established, does not exceed
100% of the liquidation value of the pool's portfolio, after taking into account unrealized profits and unrealized losses on any
such positions it has entered into.
3
U.S.
Securities and Exchange Commission
Division of Investment Management
July 5, 2024
Page
4
Registrant
notes that, as further discussed in the responses to subsequent Staff Comments, the Fund intends to invest primarily in equity
securities, and will not invest in excess of the of the above described limits under Rule 4.5. Accordingly, Registrant does not
believe the requirements of Rule 4.12 of the CEA are applicable to the Fund.
4. Staff
Comment: Pursuant to Items 4 and 9 of Form N-1A, the Fund is required to specify
how the Fund intends to achieve its investment objective by identifying the Fund’s
principal investment strategies and the attendant risks. Please remove from the Fund’s
principal investment strategies and principal risks phrases that indicate that the discussion
includes an incomplete description of the Fund’s principal investment strategies
and principal risks. For example, the Staff objects the inclusion of “generally
includes but is not limited to,” “such as,” “for example,”
and any other phrase not in conformity with the requirements of Items 4 and 9 of Form
N-1A.
Registrant’s
Response: Comment complied with.
5. Staff
Comment: Based on the inclusion of “Small- to Mid-Capitalization Companies
Risk” in the Fund’s principal risks, please include in the Fund’s principal
investment strategies a discussion of the market capitalizations of companies in which
the Fund may invest.
Registrant’s
Response: Comment complied with. The Fund’s principal investment strategies have been revised to indicate that the
Fund may invest in companies across all market capitalizations.
6. Staff
Comment: The registration statement states that the Fund, under normal circumstances,
will invest at least 80% of its net assets (plus the amount of any borrowings for investment
purposes) in “equity securities” of companies that own, explore or develop
natural resources and other basic commodities or supply goods and services to such companies
(the “80% Test”).
Please
add to the Fund’s principal investment strategies disclosure regarding the types of equity securities (e.g., common stock)
and the types of issuers (e.g., foreign, emerging market, and/or domestic issuers; open-end funds; closed-end funds; or private
issuers) that will be counted towards the Fund’s 80% Test. The discussion should be specific with respect to the issuers
and the type of securities. If private issuers will be counted towards the Fund’s 80% Test, disclose the type of private
issuers and the risks attendant thereto, if not already disclosed. Depending on the response, the Staff may have additional comments.
4
U.S.
Securities and Exchange Commission
Division of Investment Management
July 5, 2024
Page
5
Registrant’s
Response: In light of this Staff Comment as well at Supplemental Staff Comments 1, 3, 4, 5, 6, 8, and 13, Registrant has
deleted and replaced the Fund’s principal investment strategies with the following:
“The
Fund seeks to achieve its objective by investing, under normal circumstances, at least 80% of its net assets (plus the amount
of any borrowings for investment purposes) in equity securities of natural resources companies.
For
these purposes, “natural resources” means:
● Energy:
Traditional energy (electricity and gas utilities, oil and gas producers/developers,
oilfield equipment/services, storage/transportation, refining and marketing, service/drilling,
pipelines, and coal) and alternative energy (uranium, nuclear, hydrogen, wind, solar,
hydroelectric, biofuels, geothermal, and fuel cells) (collectively, “Energy”);
● Agriculture:
(grains and other food products, seeds, fertilizers, pesticides, animal producers, animal
processors, dairy, aquaculture, water, and supporting agricultural transport and machinery)
and forest products (timber assets, lumber, plywood, pulp, paper, and packaging) (collectively,
“Agriculture”);
● Base
metals and minerals: (aluminum, copper, nickel, zinc, iron ore, lithium, lead, tin, steel,
aggregate, metallurgical coal, supporting transport and mining machinery), specialty
metals (manganese, silicon, vanadium, cobalt, tungsten, zirconium, chromium, titanium,
niobium, and molybdenum) and rare earth elements (collectively, “Base Metals and
Minerals”); and
● Precious
metals and minerals: (gold, silver, platinum group metals, diamonds, and gemstones) (collectively,
“Precious Metals and Minerals”).
The
Fund considers “natural resources companies” to be foreign and domestic companies that in the most recent fiscal year,
derived at least 50% of their revenue from or used 50% or more of their assets for: (i) owning, exploring, or developing natural
resources; or (ii) producing or supplying goods, equipment, or services principally to companies that own, explore, or develop
natural resources. The Fund’s investments in equity securities will primarily consist of investments in common stock. The
Fund’s investments in foreign markets include investments in companies located in emerging markets.
Under
normal market conditions, the Fund:
● expects
30-50% of the Fund’s portfolio to be allocated to Energy companies; 20-40% of the
Fund’s portfolio to be allocated to Agriculture companies; 10-30% of the Fund’s
portfolio to be allocated to Base Metals and Minerals companies; and 0-20% of the Fund’s
portfolio to be allocated to Precious Metals and Minerals companies;
● will
concentrate its investments (i.e., hold 25% or more of its total net assets) in companies
in the Energy, Agriculture, Base Metals and Minerals, and Precious Metals and Minerals
group of industries;
5
U.S.
Securities and Exchange Commission
Division of Investment Management
July 5, 2024
Page
6
● does
not intend to invest more than 5% of its net assets in any individual company, calculated
at the time of purchase;
● may
invest in companies across all market capitalizations; and
● may
invest in foreign securities, including emerging markets securities, without limitation.
The
Fund’s sub-adviser, CoreCommodity Management, LLC (the “Sub-Adviser”), employs an actively managed quantitative
approach which incorporates multifactor top-down and bottom-up analysis. The Sub-Adviser examines the underlying businesses of
natural resource companies, seeking to understand the commodities produced and their relationships to the individual companies.
The
Fund typically sells an investment when, in the Sub-Adviser's view, the reasons for buying it no