NEWTON, MA -- 06/22/09 --
Direxion, a pioneer in providing alternative
investment strategies to sophisticated investors, announced today that it
will execute a 1-for-2 reverse split of the shares of Direxion Daily Mid
Cap Bear 3x Shares after the closing of the markets on Wednesday, June 24,
2009. MWN shares will begin trading on NYSE Arca, Inc. (NYSE Arca) on a
split-adjusted basis on Thursday, June 25, 2009.
The CUSIP for MWN will change to 25459W 524 from 25459W 672.
As a result of the reverse split, every two shares of MWN will be exchanged
for one share. Accordingly, the number of MWN shares will decrease by
approximately 50%, and the net asset value (NAV) and price of each share at
the opening of the markets on Thursday, June 25, 2009 will double. The
total market value of the MWN shares outstanding will not be affected as a
result of this reverse split except with respect to the redemption of
fractional shares, as discussed below.
Hypothetical Example of 1-for-2 reverse split:
# of Shares Hypothetical Hypothetical Total Market
Period Owned NAV Market Price Value
------------ ------------ ------------ ------------
Pre-Split 100 $ 30.05 $ 30 $ 3,000
------------ ------------ ------------ ------------
Post-Split 50 $ 60.10 $ 60 $ 3,000
------------ ------------ ------------ ------------
Shareholders of MWN on June 24, 2009 will participate in the reverse split.
The Depository Trust Company ("DTC"), the registered owner of all MWN
shares, has been notified of the reverse split and is instructed to adjust
each shareholder's investment accordingly.
Redemption of Fractional Shares and Tax Consequences for each Reverse Split
As a result of the reverse split, a shareholder of MWN could potentially
hold a fractional share. However, fractional shares cannot trade on NYSE
Arca. Thus, MWN will redeem for cash a shareholder's fractional shares at
MWN's split-adjusted NAV as of June 24, 2009. Such redemptions could cause
a shareholder to realize a gain or loss in connection with the redemption
of the shareholder's fractional share. Otherwise, the reverse split will
not result in a taxable transaction for holders of MWN shares. No
transaction fee will be imposed on shareholders for such redemption.
"Odd Lot" Unit
As a result of the reverse split, MWN will have outstanding one aggregarion
of less than 50,000 shares to make a creation unit, or an "odd lot unit."
Thus, MWN will provide one authorized participant with a one-time
opportunity to redeem the odd lot unit at the split-adjusted NAV or the NAV
on such date the authorized participant seeks to redeem the odd lot unit.
To request more information on Direxion Shares 3x ETFs, or to speak to a
member of the Direxion team, please contact Melinda Staab at
melinda@jcpublicrelations.com or (973) 400-1341.
About Direxion
Direxion Shares and Direxion Funds, managed by Rafferty Asset Management,
LLC, offer leveraged index funds, ETFs and alternative-class fund products
for investment advisors and sophisticated investors who seek to effectively
manage risk and return in both bull and bear markets. Founded in 1997, the
company has approximately $6.5 billion in assets under management as of May
31, 2009. The company's business model is built on continuous product
innovation, exceptional customer service and a commitment to building
strategic relationships with distribution partners. For more information,
please visit www.direxionshares.com.
Disclosure:
An investor should consider the investment objectives, risks, charges, and
expenses of Direxion Shares carefully before investing. The prospectus
contains this and other information about Direxion Shares. To obtain a
prospectus, please visit www.direxionshares.com. The prospectus should be
read carefully before investing. There is no assurance that the Funds will
achieve their objectives and an investment in a Fund could lose money. No
single Fund is a complete investment program.
Investing in index funds may be more volatile than investing in broadly
diversified funds. The use of leverage by a fund increases the risk to the
fund. The more a fund invests in leveraged instruments the more the
leverage will magnify gains or losses on those investments. The Funds are
not suitable for all investors. The Funds should be utilized only by
sophisticated investors who (a) understand the risks associated with the
use of leverage, (b) understand the consequences of seeking daily leveraged
investment results, (c) understand the risk of shorting and (d) intend to
actively monitor and manage their investments on a daily basis. Investors
who do not understand the Funds or do not intend to manage
the Funds on a daily basis should not buy the Funds.
The risks associated with the funds are detailed in the prospectus which
include: adverse market condition risk, adviser's investment strategy risk,
aggressive investment techniques risk, concentration risk, counterparty
risk, credit and lower-quality debt securities risk, equity securities
risk, currency exchange risk, daily correlation risk, daily rebalancing and
market volatility risk, depository receipt risk, foreign and emerging
markets securities risk, sector securities risk, interest rate risk,
inverse correlation risk, leverage risk, market risk, non-diversification
risk, shorting risk, small and mid cap company risk, tracking error risk,
and special risks of exchange-traded funds.
Foreside Fund Services, LLC. distributor for Direxion Shares
Contact:
Melinda Staab
JCPR, Inc.
(973) 400-1341
Email Contact
