Correspondence 0001193125-24-091760 from John Hancock Exchange-Traded Fund Trust (CIK 0001478482)
John Hancock Exchange-Traded Fund Trust (CIK 0001478482)
Date: April 10, 2024 · CIK: 0001478482 · Accession: 0001193125-24-091760
AI Filing Summary & Sentiment
File numbers found in text: 333-183173, 811-22733
Letter
VIA EDGAR Division of Investment Management 100 F Street, N.E. Washington, D.C. Attention: Sonny Oh Re: John Hancock Exchange-Traded Fund Trust (the “Registrant”) — File Nos. 333-183173 and 811-22733; Amendment to Registration Statement on Form N-1A
Dear Mr. Oh:
On behalf of the Registrant, I submit this letter in response to comments received by telephone on March 19, 2024, from the staff (the “Staff”) of the Securities and Exchange Commission (the “SEC”) with respect to Post-effective Amendment No. 62 under the Securities Act of 1933, as amended, and Amendment No. 65 under the Investment Company Act of 1940, as amended (the “1940 Act”), to the Registrant’s Registration Statement on Form N-1A, filed with the SEC on February 1, 2024, accession no. 0001193125-24-021903 (the “Registration Statement”) relating to the registration of John Hancock High Yield ETF (the “Fund”), a new series of the Registrant.
For convenience, I have set forth each comment below, followed by the Registrant’s response. Unless otherwise stated, capitalized terms have the same meaning as in the Registration Statement.
General Comments
1. Comment - The Staff reminds the Registrant that the company and its management are responsible for the accuracy and adequacy of its disclosures not withstanding any review, comments, action or absence of action by the Staff. Where a comment is made in one location it is applicable to all similar disclosures appearing elsewhere in the same registration statement.
Response – The Registrant respectfully acknowledges the Staff’s comment.
Prospectus
2. Comment – The Staff notes that certain information is missing from the Registration Statement. Please include all missing information in the definitive filing. Please also include the completed fee table under “Fund summary — Fees and expenses” and expense example table under “Fund summary — Expense example” as part of this letter. Please note that the Staff may have additional comments on the supplemental materials.
April 10, 2024
Page
Response – The Registrant respectfully acknowledges the comment and has included all missing information in the definitive filing. In addition, the fee table and expense example table for the Fund is included in Appendix A to this letter.
3. Comment – Under “Fund summary — Fees and expenses — Annual Fund Operating Expenses,” in footnote 2, please confirm that the duration of both contractual waivers will be in effect for at least a one-year period from the date of effectiveness of the registration statement. Please also disclose, if applicable, whether the adviser may recoup expenses, and if so, disclose the time period and that recoupment may only occur if it does not result in an expense ratio that exceeds the expense cap in place at the time of both the waiver and recoupment.
Response – The Registrant confirms that any contractual waivers will be in effect for at least one year from the date of effectiveness, and further notes that waived or reimbursed expenses are not subject to recoupment by the adviser.
4. Comment – Under “Fund summary — Fees and expenses — Annual Fund Operating Expenses,” in footnote 2, if the two waivers are not expected to be triggered, please remove the last two line items of the fee table.
Response – The Registrant confirms that the two waivers described in footnote 2 are expected to be triggered in the first year.
5. Comment – The disclosure under “Fund summary — Principal investment strategies” states that “the manager focuses on a consistent portfolio construction process incorporating views on fundamental and relative value with respect to both sector allocation and securities selection, with periodic rebalancing activity designed to capture changes to the constituency of the asset class.” Please confirm whether the Fund expects to focus its investments in one or more specific sectors at launch.
Response – The Registrant notes that the Fund does not intend to focus its investments in any particular economic sector at launch.
6. Comment – The disclosure under “Fund summary — Principal investment strategies” states that “[t]he Fund’s investment policies are designed to provide a portfolio with similar characteristics of the broad U.S.-based high yield corporate bond market.” Please specify the “similar characteristics” being referenced here.
Response – In response to the Staff’s comment, the Registrant has revised the relevant sentence under “Fund summary — Principal investment strategies” and “Fund details — Principal investment strategies” to as follows (new disclosure underlined and deleted disclosure struck through):
The fund’s investment policies are designed to provide a portfolio with similar characteristics to those of the broad U.S.-based high yield corporate bond market as represented by the ICE BofA U.S. High Yield Constrained Index.
April 10, 2024
Page
7. Comment – The disclosure under “Fund summary — Principal investment strategies” states that the Fund may invest in derivatives. Please confirm supplementally whether investment in derivatives will count towards the Fund’s 80% policy, and if so please explain how investments in derivatives will be valued for such purposes. Please also ensure that the Fund’s derivatives disclosure is tailored to the Fund and fully describes how the Fund will use derivatives to achieve its investment objective and the risks associated with the use of derivatives. See the letter from Barry Miller of the Division of Investment Management of the SEC to the Investment Company Institute dated July 30, 2010 (the “Derivatives Disclosure Letter”).
Response – The Registrant reserves the right to use derivatives to count towards the Fund’s 80% Policy. The Fund generally uses market value, and not notional value, to value derivatives in connection with its 80% Policy. The Registrant also confirms that it has reviewed the derivatives disclosure included in the Fund’s prospectus and has determined that it is consistent with the views set forth in the Derivatives Disclosure Letter.
8. Comment – Under “Fund summary — Principal risks,” the Staff notes that the principal risks appear in alphabetical order. Please reorder the risks in order of significance rather than alphabetically.
Response – The Registrant respectfully submits that the current order of the principal risks is in compliance with the requirements of Form N-1A, which does not require listing the principal risks of investing in a fund in any particular order. The Registrant further notes that the alphabetical ordering convention of its “Principal risks” is consistent across the John Hancock complex. However, in order to clarify for shareholders that they should not make any assumptions regarding the significance of the risk factors based on their current order, the Registrant includes the following disclosure in the introductory paragraph under the heading “Fund summary — Principal risks”:
The fund’s main risks are listed below in alphabetical order, not in order of importance.
9. Comment – “Fund summary — Principal risks — Credit and counterparty risk” states: “The issuer or guarantor of a fixed-income security, the counterparty to an over-the-counter derivatives contract, or a borrower of fund securities may not make timely payments or otherwise honor its obligations. A downgrade or default affecting any of the fund’s securities could affect the fund’s performance.” Please explain why the disclosure regarding a borrower of fund securities is relevant to this Fund.
Response –The Registrant confirms that the Fund is permitted to participate in the lending of securities and the Registrant has added “Securities lending” to its “Fund Details – Additional investment strategies” as follows:
Securities lending
The fund may lend its securities so long as such loans do not represent more than 331⁄3% of the fund’s total assets. The borrower will provide collateral to the lending portfolio so that the value of the loaned security will be fully collateralized. The collateral may consist of cash, cash equivalents, or securities issued or guaranteed by the U.S. government or its agencies or instrumentalities. The borrower must also agree to increase the collateral if the value of the loaned securities increases. As with other extensions of credit, there are risks of delay in recovery or even loss of rights in the collateral should the borrower of the securities fail financially. The fund could also lose money if investments made with cash collateral decline in value.
April 10, 2024
Page
10. Comment – Under “Fund summary — Principal risks,” please confirm whether “Currency risk” should be added.
Response – In response to the Staff’s comment, the Registrant has revised the disclosure under “Fund details — Principal risks of investing — Foreign securities risk” to include the sub-risk “Currency risk.” In addition, the Registrant notes that similar concepts are also disclosed in “Fund details — Principal risks of investing — Hedging, derivatives, and other strategic transactions risk.”
11. Comment – Under “Fund summary — Principal risks,” please confirm whether “Exchange-traded fund (“ETF”) risk” should be added.
Response – The “Exchange-traded fund (“ETF”) risk” disclosure contemplates investments in underlying ETFs, including the risk of the lack of liquidity of ETFs and the risk of ETF shares trading at significant premiums or discounts to its NAV. The Registrant does not expect that investments in underlying ETFs will be a principal part of the Fund’s investment strategy. Furthermore, the Registrant respectfully notes that the risks of operating as an ETF are already disclosed in the “Fund summary – Principal risks,” under “Active trading market risk,” “Authorized participant concentration risk,” “ETF trading risk,” “Premium/discount risk,” and “Trading issues risk.” Accordingly, the Registrant respectfully declines to make any changes in response to this comment.
12. Comment – The Staff notes that “Floating rate loans risk” is included under “Fund summary — Principal risks.” Please include corresponding disclosure in the Fund’s principal investment strategies or delete this risk.
Response – Upon further review, the Registrant has deleted “Floating rate loans risk” under “Fund summary — Principal risks” and “Fund details — Principal risks.”
13. Comment – The Staff notes that “Large company risk” and “Small and mid-sized company risk” are included under “Fund summary — Principal risks.” Please include corresponding disclosure in the Fund’s principal investment strategies or delete these risks.
Response – Upon further review, the Registrant has deleted “Large company risk” and “Small and mid-sized company risk” under “Fund summary — Principal risks” and “Fund details — Principal risks.”
14. Comment – “Fund summary — Principal risks — LIBOR discontinuation risk” refers to the fact that synthetic publication of the three-month sterling LIBOR will continue until March 31, 2024. Please update this risk as this date will pass soon.
April 10, 2024
Page
Response – In response to the Staff’s comment, the Registrant has revised the disclosure for LIBOR Discontinuation Risk as follows (deleted disclosure struck through):
Certain debt securities, derivatives and other financial instruments have traditionally utilized LIBOR as the reference or benchmark rate for interest rate calculations. However, following allegations of manipulation and concerns regarding liquidity, the U.K. Financial Conduct Authority (“UK FCA”) announced that LIBOR would be discontinued on June 30, 2023. The UK FCA elected to require the ICE Benchmark Administration Limited, the administrator of LIBOR, to continue publishing a subset of British pound sterling and U.S. dollar LIBOR settings on a “synthetic” basis. The synthetic publication of the three-month sterling LIBOR will continue until March 31, 2024, and the publication of the one, three- and six-month U.S. dollar LIBOR will continue until September 30, 2024.
15. Comment – While past performance is not shown in the “Fund summary — Past performance” section because the Fund has not yet commenced operations, please supplementally provide the broad-based market index the Fund intends to use when it is appropriate to display past performance in this section.
Response – It is anticipated that the broad-based market index will be the Bloomberg U.S. Aggregate Bond Index, but the Registrant respectfully notes that the adviser may determine to select a different broad-based market index when preparing the performance disclosure in the future.
16. Comment – In “Fund summary — Portfolio management” and “Who’s who — Subadvisor,” please state the month and year that each portfolio manager began managing the Fund, rather than stating that each portfolio manager managed the Fund since inception.
Response – The Registrant notes that if a portfolio manager is expected to manage a fund when it commences operations, the John Hancock funds’ usual practice is to disclose that the portfolio manager has managed the fund since inception. In order to achieve consistency of disclosure across all of the relevant John Hancock funds, the Registrant respectfully declines to make any changes in response to this comment.
17. Comment – Under “Fund details — Principal investment strategies,” the disclosure states that the fund may temporarily invest extensively in investment-grade short-term securities, cash, or cash equivalents for the purpose of protecting the fund in the event the manager determines that market, economic, political or other conditions warrant a defensive posture. Please clarify what is meant by the term “extensively” (i.e., by providing a percentage amount).
Response – The Registrant believes that investors generally understand the use of the term “extensively” in this context to mean that the Fund may invest some or all of its assets in short-term securities or cash under adverse market conditions. The Registrant believes that the particular percentage of assets that would be invested in this manner would depend on prevailing market conditions at the time and that specifying a particular percentage of assets could limit the Fund’s flexibility to manage appropriately the Fund’s assets in stressed market conditions. Further, the Registrant believes it is commonplace in the industry for issuers to disclose temporary defensive measures qualitatively in a manner similar to the Registrant’s disclosure. Accordingly, the Registrant respectfully declines to make any changes in response to this comment.
April 10, 2024
Page
18. Comment – The staff notes that “Investment-grade fixed-income securities in the lowest rating category risk” is included under “Fund details — Principal risks.” Please confirm whether this disclosure is relevant to this Fund.
Response – Upon further review, the Registrant has deleted “Investment-grade fixed-income securities in the lowest rating category risk” under “Fund summary — Principal risks” and “Fund details — Principal risks.”
19. Comment – In “Fund details — Who’s who — Management fee,” please disclose the period to be covered by the shareholder report, i.e., the annual or semiannual shareholder report, pursuant to Item 10(a)(1)(iii) of Form N-1A.
Response – The Registrant respectfully notes that current disclosure states: “The basis for the Board of Trustees’ approval of the advisory fees, and of the investment advisory agreement overall, including the subadvisory agreement, will
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CORRESP 1 filename1.htm John Hancock Exchange-Traded Fund Trust One International Place, 40th Floor 100 Oliver Street Boston, MA 02110 +1 617 728 7100 Main +1 617 275 8384 Fax www.dechert.com Kaitlin McGrath kaitlin.mcgrath@dechert.com +1 617 728 7116 Direct +1 617 275 8395 Fax April 10, 2024 VIA EDGAR Division of Investment Management U.S. Securities and Exchange Commission 100 F Street, N.E. Washington, D.C. 20549 Attention: Sonny Oh Re: John Hancock Exchange-Traded Fund Trust (the “Registrant”) — File Nos. 333-183173 and 811-22733; Amendment to Registration Statement on Form N-1A Dear Mr. Oh: On behalf of the Registrant, I submit this letter in response to comments received by telephone on March 19, 2024, from the staff (the “Staff”) of the Securities and Exchange Commission (the “SEC”) with respect to Post-effective Amendment No. 62 under the Securities Act of 1933, as amended, and Amendment No. 65 under the Investment Company Act of 1940, as amended (the “1940 Act”), to the Registrant’s Registration Statement on Form N-1A, filed with the SEC on February 1, 2024, accession no. 0001193125-24-021903 (the “Registration Statement”) relating to the registration of John Hancock High Yield ETF (the “Fund”), a new series of the Registrant. For convenience, I have set forth each comment below, followed by the Registrant’s response. Unless otherwise stated, capitalized terms have the same meaning as in the Registration Statement. General Comments 1. Comment - The Staff reminds the Registrant that the company and its management are responsible for the accuracy and adequacy of its disclosures not withstanding any review, comments, action or absence of action by the Staff. Where a comment is made in one location it is applicable to all similar disclosures appearing elsewhere in the same registration statement. Response – The Registrant respectfully acknowledges the Staff’s comment. Prospectus 2. Comment – The Staff notes that certain information is missing from the Registration Statement. Please include all missing information in the definitive filing. Please also include the completed fee table under “Fund summary — Fees and expenses” and expense example table under “Fund summary — Expense example” as part of this letter. Please note that the Staff may have additional comments on the supplemental materials. April 10, 2024 Page 2 Response – The Registrant respectfully acknowledges the comment and has included all missing information in the definitive filing. In addition, the fee table and expense example table for the Fund is included in Appendix A to this letter. 3. Comment – Under “Fund summary — Fees and expenses — Annual Fund Operating Expenses,” in footnote 2, please confirm that the duration of both contractual waivers will be in effect for at least a one-year period from the date of effectiveness of the registration statement. Please also disclose, if applicable, whether the adviser may recoup expenses, and if so, disclose the time period and that recoupment may only occur if it does not result in an expense ratio that exceeds the expense cap in place at the time of both the waiver and recoupment. Response – The Registrant confirms that any contractual waivers will be in effect for at least one year from the date of effectiveness, and further notes that waived or reimbursed expenses are not subject to recoupment by the adviser. 4. Comment – Under “Fund summary — Fees and expenses — Annual Fund Operating Expenses,” in footnote 2, if the two waivers are not expected to be triggered, please remove the last two line items of the fee table. Response – The Registrant confirms that the two waivers described in footnote 2 are expected to be triggered in the first year. 5. Comment – The disclosure under “Fund summary — Principal investment strategies” states that “the manager focuses on a consistent portfolio construction process incorporating views on fundamental and relative value with respect to both sector allocation and securities selection, with periodic rebalancing activity designed to capture changes to the constituency of the asset class.” Please confirm whether the Fund expects to focus its investments in one or more specific sectors at launch. Response – The Registrant notes that the Fund does not intend to focus its investments in any particular economic sector at launch. 6. Comment – The disclosure under “Fund summary — Principal investment strategies” states that “[t]he Fund’s investment policies are designed to provide a portfolio with similar characteristics of the broad U.S.-based high yield corporate bond market.” Please specify the “similar characteristics” being referenced here. Response – In response to the Staff’s comment, the Registrant has revised the relevant sentence under “Fund summary — Principal investment strategies” and “Fund details — Principal investment strategies” to as follows (new disclosure underlined and deleted disclosure struck through): The fund’s investment policies are designed to provide a portfolio with similar characteristics to those of the broad U.S.-based high yield corporate bond market as represented by the ICE BofA U.S. High Yield Constrained Index. 2 April 10, 2024 Page 3 7. Comment – The disclosure under “Fund summary — Principal investment strategies” states that the Fund may invest in derivatives. Please confirm supplementally whether investment in derivatives will count towards the Fund’s 80% policy, and if so please explain how investments in derivatives will be valued for such purposes. Please also ensure that the Fund’s derivatives disclosure is tailored to the Fund and fully describes how the Fund will use derivatives to achieve its investment objective and the risks associated with the use of derivatives. See the letter from Barry Miller of the Division of Investment Management of the SEC to the Investment Company Institute dated July 30, 2010 (the “Derivatives Disclosure Letter”). Response – The Registrant reserves the right to use derivatives to count towards the Fund’s 80% Policy. The Fund generally uses market value, and not notional value, to value derivatives in connection with its 80% Policy. The Registrant also confirms that it has reviewed the derivatives disclosure included in the Fund’s prospectus and has determined that it is consistent with the views set forth in the Derivatives Disclosure Letter. 8. Comment – Under “Fund summary — Principal risks,” the Staff notes that the principal risks appear in alphabetical order. Please reorder the risks in order of significance rather than alphabetically. Response – The Registrant respectfully submits that the current order of the principal risks is in compliance with the requirements of Form N-1A, which does not require listing the principal risks of investing in a fund in any particular order. The Registrant further notes that the alphabetical ordering convention of its “Principal risks” is consistent across the John Hancock complex. However, in order to clarify for shareholders that they should not make any assumptions regarding the significance of the risk factors based on their current order, the Registrant includes the following disclosure in the introductory paragraph under the heading “Fund summary — Principal risks”: The fund’s main risks are listed below in alphabetical order, not in order of importance. 9. Comment – “Fund summary — Principal risks — Credit and counterparty risk” states: “The issuer or guarantor of a fixed-income security, the counterparty to an over-the-counter derivatives contract, or a borrower of fund securities may not make timely payments or otherwise honor its obligations. A downgrade or default affecting any of the fund’s securities could affect the fund’s performance.” Please explain why the disclosure regarding a borrower of fund securities is relevant to this Fund. Response –The Registrant confirms that the Fund is permitted to participate in the lending of securities and the Registrant has added “Securities lending” to its “Fund Details – Additional investment strategies” as follows: Securities lending The fund may lend its securities so long as such loans do not represent more than 331⁄3% of the fund’s total assets. The borrower will provide collateral to the lending portfolio so that the value of the loaned security will be fully collateralized. The collateral may consist of cash, cash equivalents, or securities issued or guaranteed by the U.S. government or its agencies or instrumentalities. The borrower must also agree to increase the collateral if the value of the loaned securities increases. As with other extensions of credit, there are risks of delay in recovery or even loss of rights in the collateral should the borrower of the securities fail financially. The fund could also lose money if investments made with cash collateral decline in value. 3 April 10, 2024 Page 4 10. Comment – Under “Fund summary — Principal risks,” please confirm whether “Currency risk” should be added. Response – In response to the Staff’s comment, the Registrant has revised the disclosure under “Fund details — Principal risks of investing — Foreign securities risk” to include the sub-risk “Currency risk.” In addition, the Registrant notes that similar concepts are also disclosed in “Fund details — Principal risks of investing — Hedging, derivatives, and other strategic transactions risk.” 11. Comment – Under “Fund summary — Principal risks,” please confirm whether “Exchange-traded fund (“ETF”) risk” should be added. Response – The “Exchange-traded fund (“ETF”) risk” disclosure contemplates investments in underlying ETFs, including the risk of the lack of liquidity of ETFs and the risk of ETF shares trading at significant premiums or discounts to its NAV. The Registrant does not expect that investments in underlying ETFs will be a principal part of the Fund’s investment strategy. Furthermore, the Registrant respectfully notes that the risks of operating as an ETF are already disclosed in the “Fund summary – Principal risks,” under “Active trading market risk,” “Authorized participant concentration risk,” “ETF trading risk,” “Premium/discount risk,” and “Trading issues risk.” Accordingly, the Registrant respectfully declines to make any changes in response to this comment. 12. Comment – The Staff notes that “Floating rate loans risk” is included under “Fund summary — Principal risks.” Please include corresponding disclosure in the Fund’s principal investment strategies or delete this risk. Response – Upon further review, the Registrant has deleted “Floating rate loans risk” under “Fund summary — Principal risks” and “Fund details — Principal risks.” 13. Comment – The Staff notes that “Large company risk” and “Small and mid-sized company risk” are included under “Fund summary — Principal risks.” Please include corresponding disclosure in the Fund’s principal investment strategies or delete these risks. Response – Upon further review, the Registrant has deleted “Large company risk” and “Small and mid-sized company risk” under “Fund summary — Principal risks” and “Fund details — Principal risks.” 14. Comment – “Fund summary — Principal risks — LIBOR discontinuation risk” refers to the fact that synthetic publication of the three-month sterling LIBOR will continue until March 31, 2024. Please update this risk as this date will pass soon. 4 April 10, 2024 Page 5 Response – In response to the Staff’s comment, the Registrant has revised the disclosure for LIBOR Discontinuation Risk as follows (deleted disclosure struck through): Certain debt securities, derivatives and other financial instruments have traditionally utilized LIBOR as the reference or benchmark rate for interest rate calculations. However, following allegations of manipulation and concerns regarding liquidity, the U.K. Financial Conduct Authority (“UK FCA”) announced that LIBOR would be discontinued on June 30, 2023. The UK FCA elected to require the ICE Benchmark Administration Limited, the administrator of LIBOR, to continue publishing a subset of British pound sterling and U.S. dollar LIBOR settings on a “synthetic” basis. The synthetic publication of the three-month sterling LIBOR will continue until March 31, 2024, and the publication of the one, three- and six-month U.S. dollar LIBOR will continue until September 30, 2024. 15. Comment – While past performance is not shown in the “Fund summary — Past performance” section because the Fund has not yet commenced operations, please supplementally provide the broad-based market index the Fund intends to use when it is appropriate to display past performance in this section. Response – It is anticipated that the broad-based market index will be the Bloomberg U.S. Aggregate Bond Index, but the Registrant respectfully notes that the adviser may determine to select a different broad-based market index when preparing the performance disclosure in the future. 16. Comment – In “Fund summary — Portfolio management” and “Who’s who — Subadvisor,” please state the month and year that each portfolio manager began managing the Fund, rather than stating that each portfolio manager managed the Fund since inception. Response – The Registrant notes that if a portfolio manager is expected to manage a fund when it commences operations, the John Hancock funds’ usual practice is to disclose that the portfolio manager has managed the fund since inception. In order to achieve consistency of disclosure across all of the relevant John Hancock funds, the Registrant respectfully declines to make any changes in response to this comment. 17. Comment – Under “Fund details — Principal investment strategies,” the disclosure states that the fund may temporarily invest extensively in investment-grade short-term securities, cash, or cash equivalents for the purpose of protecting the fund in the event the manager determines that market, economic, political or other conditions warrant a defensive posture. Please clarify what is meant by the term “extensively” (i.e., by providing a percentage amount). Response – The Registrant believes that investors generally understand the use of the term “extensively” in this context to mean that the Fund may invest some or all of its assets in short-term securities or cash under adverse market conditions. The Registrant believes that the particular percentage of assets that would be invested in this manner would depend on prevailing market conditions at the time and that specifying a particular percentage of assets could limit the Fund’s flexibility to manage appropriately the Fund’s assets in stressed market conditions. Further, the Registrant believes it is commonplace in the industry for issuers to disclose temporary defensive measures qualitatively in a manner similar to the Registrant’s disclosure. Accordingly, the Registrant respectfully declines to make any changes in response to this comment. 5 April 10, 2024 Page 6 18. Comment – The staff notes that “Investment-grade fixed-income securities in the lowest rating category risk” is included under “Fund details — Principal risks.” Please confirm whether this disclosure is relevant to this Fund. Response – Upon further review, the Registrant has deleted “Investment-grade fixed-income securities in the lowest rating category risk” under “Fund summary — Principal risks” and “Fund details — Principal risks.” 19. Comment – In “Fund details — Who’s who — Management fee,” please disclose the period to be covered by the shareholder report, i.e., the annual or semiannual shareholder report, pursuant to Item 10(a)(1)(iii) of Form N-1A. Response – The Registrant respectfully notes that current disclosure states: “The basis for the Board of Trustees’ approval of the advisory fees, and of the investment advisory agreement overall, including the subadvisory agreement, will