FINAL TERMS
Dated 4 June 2024
WisdomTree Foreign Exchange Limited
(formerly ETFS Foreign Exchange Limited)
LEI: 213800X2UDCFSIYXXR28
(Incorporated and registered in Jersey under
the Companies (Jersey) Law 1991 (as amended) with registered number 103518)
(the ''Issuer'')
Programme for the Issue of Collateralised Currency Securities
Issue of
1000 WisdomTree Short USD Long GBP 3x Daily Collateralised Currency Securities
(the ''Collateralised Currency Securities'')
These Final Terms (as referred to in the Prospectus (the ''Prospectus'') dated 13 November 2023 in relation
to the above Programme) relates to the issue of the Collateralised Currency Securities referred to above. The Collateralised Currency Securities have the terms provided for in the Trust Instrument dated 5 November 2009 (as amended) between the Issuer and The Law Debenture Trust Corporation p.l.c. as Trustee constituting the Collateralised Currency Securities. Terms used in these Final Terms bear the same meaning as in the Prospectus.
These Final Terms have been prepared for the purpose of 1) filing with a competent authority (within the meaning of the Prospectus Regulation) for the purpose of Article 8(4) of Prospectus Regulation and 2) the Prospectus Regulation Rules and must be read in conjunction with the Prospectus and any supplement, which are published in accordance with Article 21 of Prospectus Regulation and Rule PRR3.2 of the Prospectus Regulation Rules on the website of the Issuer: https://www.wisdomtree.eu/. In order to get the full information both the Prospectus (and any supplement) and these Final Terms must be read in conjunction. A summary of the individual issue is annexed to these Final Terms.
The particulars in relation to this issue of Collateralised Currency Securities are as follows:
ISIN: | JE00B43NB445 |
Issue Date: | 5 June 2024 |
Class: | WisdomTree Short USD Long GBP 3x Daily |
Creation Price: | 8.4832720 GBP |
Aggregate Number of | 1000 |
Collateralised Currency | |
Securities to which these | |
Final Terms apply: | |
Estimated net proceeds | 8483.27 GBP |
of issue of the | |
Collateralised Currency | |
Securities to which these | |
Final Terms apply: | |
Maximum | |
number/amount of | |
Collateralised Currency | The aggregate Principal Amount of all GBP denominated Collateralised |
Securities that may be | Currency Securities (including those issued pursuant to these final |
issued of the Class being | terms) may not exceed GBP1,000,000,000 unless increased by the |
issued pursuant to these | Issuer in accordance with the Trust Instrument. |
Final Terms: | |
Exchange[s] on which | London Stock Exchange |
Collateralised Currency | |
Securities are admitted to | |
trading: | * Please note that admission to the UK Official List and to trading on the Main Market of |
the London Stock Exchange are not offers or admission to trading made under the | |
Prospectus Regulation but are such offers and admission to trading for the purposes of | |
the UK Prospectus Regulation. | |
The amount or any | Application Fees: £500, |
expenses or taxes | Management Fees: 0.98 %; |
specifically charged to the | Swap Fees 0.85 % |
subscriber or purchaser: | |
Currency of the securities | GBP |
issue: | |
Issuer Specific Summary | ||||
Section A - Introduction and warnings | ||||
1. | Name | of | WisdomTree Short USD Long GBP 3x Daily | |
Security: | ||||
2. | ISIN: | JE00B43NB445 | ||
3. | Issuer | Ordnance House | ||
Contact | 31 Pier Road | |||
Details: | St. Helier | |||
Jersey JE4 8PW | ||||
Channel Islands | ||||
Tel: +44 1534 825200 | ||||
https://www.wisdomtree.eu/ | ||||
LEI: 213800X2UDCFSIYXXR28 | ||||
4. | Competent | For UK: FCA, | ||
Authority: | Financial Conduct Authority | |||
12 Endeavour Square, London E20 1JN | ||||
Phone: +44 20 7066 1000 | ||||
For EU: CBI | ||||
Central Bank of Ireland | ||||
PO Box 559 | ||||
New Wapping Street | ||||
Dublin 1. | ||||
Phone: +353 1 2246000 | ||||
5. | Warnings: | • | This summary should be read as an introduction to and in | |
conjunction with the base prospectus of WisdomTree Foreign | ||||
Exchange Limited (the "Issuer") relating to the programme for the | ||||
issue of Collateralised Currency Securities dated 13 November | ||||
2023 (the "Prospectus"); | ||||
• | Any decision to invest in the Collateralised Currency Securities | |||
should be based on consideration of the Prospectus as a whole by | ||||
the investor; | ||||
• | Where a claim relating to the information contained in the | |||
Prospectus is brought before a court, the plaintiff investor might, | ||||
under the national legislation of the member states, have to bear the | ||||
costs of translating the Prospectus before the legal proceedings are | ||||
initiated; | ||||
• | Civil liability attaches only to those persons who have tabled the | |||
summary including any translation thereof, but only if the summary | ||||
is misleading, inaccurate or inconsistent when read together with | ||||
the other parts of the Prospectus or it does not provide, when read | ||||
together with the other parts of the Prospectus, key information in | ||||
order to aid investors when considering whether to invest in the | ||||
Collateralised Currency Securities. | ||||
Section B - Key information on the Issuer
Who is the issuer of the securities?
1. | Domicile/Legal | The Issuer is a public company incorporated and registered in Jersey |
Form/Country | under the Companies (Jersey) Law 1991 (as amended) with registered | |
number 103518. |
of | |||
Incorporation: | |||
2. | Principal | The principal | activity of the Issuer is issuing several classes of |
Activities | |||
Collateralised | Currency Securities. The Collateralised Currency | ||
Securities are designed to provide exposure to movements in indices | |||
calculated and published by Morgan Stanley & Co. LLC which track | |||
movements in | different exchange rates (the "Currency Indices" or | ||
"MSFXSM Indices"). The Issuer gains exposure to the movements in | |||
Currency Indices by entering into unfunded collateralised derivative | |||
contracts (the "Currency Transactions"). Payments under Currency | |||
Transactions vary (before any applicable fees) by reference to changes | |||
to the Currency Indices. The Collateralised Currency Securities are also | |||
backed by the collateral (the "Collateral") in accounts of the Issuer at The | |||
Bank of New York Mellon ("BONY"). The operation of those accounts is | |||
governed by the terms of (i) a custody agreement between the Issuer | |||
and BONY (the "Custody Agreement"); and (ii) a collateral | |||
administration master agreement between the Issuer and BONY (the | |||
"Collateral Administration Agreement") as supplemented by a | |||
"Supplemental Agreement" between the Issuer and BONY. Any cash | |||
received by the Issuer on the issue of Collateralised Currency Securities | |||
or under the terms of the Currency Transactions (which is not required to | |||
make payments to Security Holders on redemption) is used to purchase | |||
assets as collateral from MSIP (defined below) under the terms of an | |||
agreement between the Issuer and MSIP dated 5 November 2009 and | |||
entitled "Global Master Repurchase Agreement" or "Repo". | |||
3. | Major | The shares in the Issuer are held entirely by WisdomTree Holdings | |
shareholders | Jersey Limited ("HoldCo"), a holding company incorporated in Jersey. | ||
The shares in HoldCo are ultimately owned by WisdomTree, Inc. The | |||
Issuer is neither directly or indirectly owned or controlled by any other | |||
party to the programme. | |||
4. | Key managing | Stuart Bell | |
directors | Chris Foulds | ||
Steven Ross | |||
Peter M. Ziemba | |||
5. | Statutory | Ernst & Young LLP | |
auditors | Liberation House | ||
Castle Street | |||
St Helier | |||
Jersey JE1 1EY | |||
Channel Islands |
What is the key financial information regarding the issuer?
Income statement for SPVs in relation to asset backed securities
Net Profit or loss
31-Dec-23 | 31-Dec-21 |
USD | USD |
1,289,714 | -3,046,091 |
Balance sheet for SPVs in relation to asset backed securities
31-Dec-23 | 31-Dec-22 | |
USD | USD | |
Total assets | 280,739,121 | 394,338,161 |
Total liabilities | 280,198,126 | 395,086,880 |
Financial Assets designated at fair value through | 280,739,121 | 394,338,161 |
profit or loss | ||
Derivative financial assets | nil | nil |
Non-financial assets if material to the | Nil | Nil |
entity's business | ||
Financial Liabilities designated at fair | 280,198,126 | 395,086,880 |
value through profit or loss | ||
Derivative financial liabilities | Nil | Nil |
What are the key risks that are specific to the issuer?
Investors in Collateralised Currency Securities may lose the value of their entire investment or part of it. An investor's potential loss is limited to the amount of the investor's investment.
The Issuer has been established as a special purpose vehicle for the purpose of issuing the Collateralised Currency Securities and has no assets other than those attributable to the Collateralised Currency Securities. No member of the Morgan Stanley Group of any other person has guaranteed the Issuer's obligations. The ability of the Issuer to meet its obligations in relation to Collateralised Currency Securities will be wholly dependent on its receipt of payments under Currency Transactions from Currency Transaction Counterparties and its ability to sell the Collateral under the Repo to MSIP. The amounts that a Security Holder could receive following a claim against the Issuer are, therefore, limited to the proceeds of realisation of the secured property applicable to such Security Holder's class of Collateralised Currency Securities and as the Issuer is a special purpose vehicle formed only for the purpose of issuing the Collateralised Currency Securities, and as the Collateralised Currency Securities are not guaranteed by any other person, the Issuer would have no further assets against which the Security Holder could claim. In the event that the proceeds of realisation of the secured property is insufficient to cover the amount payable to the Security Holder, the Security Holder would suffer a loss.
Although Collateralised Currency Securities are secured by the Collateral, the value of such Collateralised Currency Securities and the ability of the Issuer to pay any redemption amounts remains partly dependent on the receipt of amounts due from the relevant Currency Transaction Counterparty under the Facility Agreement, the ISDA Master Agreement and the Repo.
At the date of this Prospectus, there is one Currency Transaction Counterparty (MSIP) which is the obligor.
There can be no assurance that MSIP, any other Currency Transaction Counterparty or any other entity will be able to fulfill their payment obligations under the relevant Currency Transactions, Facility Agreement, ISDA Master Agreement or Repo. Consequently, there can be no assurance that the Issuer will be able to redeem Collateralised Currency Securities at their redemption price which could lead to an investor receiving less than the redemption price upon redemption of their Collateralised Currency Securities.
Section C - Key information on the Securities
What are the main features of the securities?
1.
Offer Price
8.4832720 GBP
2. | The Index | MSFXSM Triple Short US Dollar/GBP Index (TR) | ||
3. | Leverage Factor | |||
an exposure to -3 times the movements in a foreign exchange rate of | ||||
a currency versus GBP, EUR or USD (such that if the currency | ||||
weakens versus the GBP, EUR or USD on a particular day then the | ||||
value of the Collateralised Currency Security will increase on a three | ||||
times leveraged basis) minus 3 times the interest rate differential | ||||
between those two currencies. | ||||
4. | Currency | The Collateralised Currency Securities being issued pursuant to | ||
the Final Terms are denominated in GBP | ||||
5. | Minimum denomination | Each Collateralised Currency Security has a face value known | ||
as a "Principal Amount" as follows: | ||||
• | For Collateralised Currency Securities denominated in US | |||
Dollars the Principal Amount is US$1. | ||||
• | For Collateralised Currency Securities denominated in | |||
Euros the Principal Amount is €1. | ||||
• | For Collateralised Currency Securities denominated in | |||
Pounds Sterling the Principal Amount is £1. | ||||
Issue specific summary: | ||||
Class of Collateralised | GBP Developed Market | |||
Currency Security | Currency Securities - | |||
WisdomTree Short USD Long | ||||
GBP 3x Daily | ||||
Principal Amount | GBP 1 | |||
6. | Restrictions on transfer | Not applicable; the Collateralised Currency Securities are freely | ||
transferable. | ||||
7. | Rights | A Collateralised Currency Security entitles a Security Holder to require | ||
the Issuer to redeem their security in return for payment of the higher | ||||
of (i) the minimum denomination for that class of Collateralised | ||||
Currency Security (known as the "Principal Amount"); and (ii) the | ||||
price of that class of that Collateralised Currency Security on the | ||||
applicable day determined using the formula set out in element C.15 | ||||
below. | ||||
Generally only Authorised Participants will deal directly with the Issuer | ||||
in redeeming Collateralised Currency Securities. In circumstances, | ||||
where there are no Authorised Participants, or as the Issuer may in its | ||||
sole discretion determine, Security Holders who are not Authorised | ||||
Participants may require the Issuer to redeem their securities directly. | ||||
Limited Recourse |
The obligations of the Issuer in respect of each class of Collateralised Currency Securities are secured by a charge in favour of the Trustee and an assignment to the Trustee by way of security of the Issuer's rights in so far as they relate to that class. The Trustee and the Security Holders of any class of Collateralised Currency Securities shall have recourse only to the sums derived from the assets relating to that class. If the net proceeds are insufficient for the Issuer to make all payments due, the Trustee or any other person acting on behalf of the Trustee, will not be entitled to take any further steps against the Issuer and no debt shall be owed by the Issuer in respect of such further sum.
Priority of Payments
All moneys received by the Trustee upon realisation of the assets relevant to a particular class of Collateralised Currency Securities will be held on trust by the Trustee and applied in the following order:
- Payments due to the Trustee (and persons appointed by the Trustee) and payments due to any receiver and the costs of realisation of the security;
- Payments or performance of all amounts due and unpaid and all obligations due in respect of Collateralised Currency Securities of that class; and
- In payment of the balance (if any) to the Issuer.
Issue Specific Summary
The Principal Amount and class of each of the Collateralised Currency
Securities being issued pursuant to the Final Terms is as follows:
Class of Collateralised | WisdomTree Short USD Long |
Currency Security | GBP 3x Daily |
Principal Amount | GBP 1 |
Where will the securities be traded?
8.
Application has been made for the Collateralised Currency Securities being issued pursuant to the Final Terms to trading on the Main Market of the London Stock Exchange.
What are the key risks that are specific to the securities?
Although Collateralised Currency Securities are backed (among other things) by the Collateral, there is no guarantee that if realised it would produce sufficient value to cover the Issuer's obligations to Security Holders. In addition, in the event that the Security Trustee has to enforce the relevant Security Deed, proceeds from the enforcement of the Security Deed will be applied by the Security Trustee in accordance with the Priority Waterfall. Security Holders rank behind the Security Trustee, the Trustee and MSIP (in respect of such MSIP's claims under the Facility Agreement, the ISDA Master Agreement and the Repo) in the Priority Waterfall. Following the priority of payments, the remaining proceeds from enforcement may be insufficient to cover the full redemption amount due from the Issuer to Security Holders. In both cases Security Holders may be affected as a result, by receiving less than they would otherwise expect upon the redemption of their Collateralised Currency Securities.
If the price of any class of Collateralised Currency Security (less any applicable additional redemption fee) falls below 5 times the Principal Amount of such class, the Issuer may, at any time for so long as the price (less, any applicable additional redemption fee) remains below 5 times the Principal Amount upon no less than two days' notice by regulatory information service announcement, elect to redeem the Collateralised Currency Securities of that class which may result in an investment in Collateralised Currency Securities being redeemed earlier than desired and at short notice. In these circumstances, the Security Holder may suffer a loss if the cash value of the Collateralised Currency Securities are redeemed at a price lower than it would otherwise have been had the Security Holder's investment been redeemed on a day chosen by the Security Holder rather than on the date of the early redemption. Early redemption could also lead to a Security Holder incurring a tax charge that it would otherwise not be subject to and/or if the redemption takes place at a time when the cash value of the Collateralised Currency Securities redeemed is lower than when they were purchased by the Security Holder, the Security Holder could suffer a loss. The Issuer has no obligation to exercise any of these rights and as a result the Price may fall below the Principal Amount. The Price may fall to zero in some circumstances.
Issue specific summary:
The following risk factors apply to the class of Collateralised Currency Securities being issued pursuant to the Final Terms:
Investing in Collateralised Currency Securities which track a leveraged Currency Index is riskier since leveraged Currency Indices adjust by two, three or five times the exposure of corresponding non leveraged Currency Indices. The return of Collateralised Currency Securities which are short or leveraged can be different to the return provided by non-leveraged Collateralised Currency Securities for periods greater than one day.
Investors in Collateralised Currency Securities may lose the value of their entire investment or part of it:
Exchange rates can be highly volatile and therefore the value of Collateralised Currency Securities may fluctuate widely and Collateralised Currency Securities which provide exposure to Currency Indices tracking the exchange rates of emerging markets may be more exposed to the risk of swift political change and economic downturns than their industrialised counterparties. In both cases this could lead to a loss for investors if the price falls rapidly to a level lower than that at which they purchased securities. In certain circumstances the value of a Collateralised Currency Security may fall to zero and so become subject to a Compulsory Redemption. In these circumstances Security Holders may receive no payment on redemption.
Section D - Key information on the offer of securities to the public and/or the admission to trading on a regulated market
1. | Under which | Terms and conditions of the offer | |
conditions | |||
The Collateralised Currency Securities are being made available by the | |||
and timetable | |||
can I invest in | Issuer for subscription only to Authorised Participants who have submitted | ||
this security? | a valid application and will only be issued once the subscription price has | ||
been paid to MSIP. An Authorised Participant must also pay the Issuer a | |||
creation fee of £500. Any applications for Collateralised Currency | |||
Securities made by 2.00 p.m. London time on a business day will generally | |||
enable the Authorised Participant to be registered as the holder of | |||
Collateralised Currency Securities within two business days. | |||
Expenses | |||
The Issuer charges the following costs to investors: To | |||
Authorised Participants only: | |||
- | The Issuer charges a fee of £500 per creation or redemption carried | ||
out directly with the Issuer. | |||
To all Security Holders: | |||
- | a Daily Adjustment amount under the Formula which comprises an | ||
amount payable to MSIP and a Management Fee which will vary | |||
per class of Collateralised Currency Security; and |
an estimated cost of 0.105 per cent. of the price at which the | ||||||||
Collateralised Currency Securities are redeemed (known as the | ||||||||
"Additional Redemption Fee") in the event of the redemption of | ||||||||
WisdomTree Long CNY Short USD Collateralised Currency | ||||||||
Securities, WisdomTree Short CNY Long USD Collateralised | ||||||||
Currency Securities, WisdomTree Long INR Short USD | ||||||||
Collateralised Currency Securities and WisdomTree Short INR | ||||||||
Long USD Collateralised Currency Securities, reflecting the cost to | ||||||||
the Issuer of closing the corresponding Currency Transaction with | ||||||||
MSIP on the date of the redemption of the relevant Collateralised | ||||||||
Currency Securities. | ||||||||
No other costs will be charged to investors by the Issuer. | ||||||||
If an investor purchases the Collateralised Currency Securities from a | ||||||||
financial intermediary, the Issuer estimates that the expenses charged by | ||||||||
such financial intermediary in connection with the sale of Collateralised | ||||||||
Currency Securities to an investor will be 0.15 per cent. of the value of the | ||||||||
Collateralised Currency Securities sold to such investor. | ||||||||
Issue Specific Summary | ||||||||
Application Fee | £500 | |||||||
Redemption Fee | £500 | |||||||
Daily Adjustment | 1.83 | |||||||
Management Fee | 0.98 | |||||||
2. | Why | is this | The | principal | activity of the Issuer is issuing several classes of | |||
prospectus | ||||||||
Collateralised | Currency | Securities. The | Collateralised Currency | |||||
being | ||||||||
Securities are designed to provide exposure to movements in indices | ||||||||
produced? | ||||||||
calculated and published by Morgan Stanley & Co. LLC which track | ||||||||
movements in different | exchange rates (the | "Currency | Indices" or | |||||
"MSFXSM Indices"). The Issuer gains exposure to the movements in | ||||||||
Currency Indices by entering into unfunded collateralised derivative | ||||||||
contracts (the "Currency Transactions"). Payments under Currency | ||||||||
Transactions vary (before any applicable fees) by reference to changes to | ||||||||
the Currency Indices. The Collateralised Currency Securities are also | ||||||||
backed by the collateral (the "Collateral") in accounts of the Issuer at The | ||||||||
Bank of New York Mellon ("BONY"). The operation of those accounts is | ||||||||
governed by the terms of (i) a custody agreement between the Issuer and | ||||||||
BONY (the "Custody Agreement"); and (ii) a collateral administration | ||||||||
master agreement between the Issuer and BONY (the "Collateral | ||||||||
Administration Agreement") as supplemented by a "Supplemental | ||||||||
Agreement" between the Issuer and BONY. Any cash received by the | ||||||||
Issuer on the issue of Collateralised Currency Securities or under the | ||||||||
terms of the Currency Transactions (which is not required to make | ||||||||
payments to Security Holders on redemption) is used to purchase assets | ||||||||
as collateral from MSIP (defined below) under the terms of an agreement | ||||||||
between the Issuer and MSIP dated 5 November 2009 and entitled | ||||||||
"Global Master Repurchase Agreement" or "Repo". | ||||||||
Description | of | Collateralised Currency Securities can be bought and sold for cash on | ||||||
the | flow | of | ||||||
the | London | Stock Exchange, Borsa Italiana S.p.A., | Euronext | |||||
funds | ||||||||
Amsterdam and/or the Frankfurt Stock Exchange (being the stock | ||||||||
exchanges on which the securities are admitted to trading) or in private | ||||||||
off-exchange | transactions. Details of the exchanges on | which a |
particular class of security can be traded are set out in a document entitled "final terms", prepared by the Issuer each time that securities are issued. Market makers provide liquidity on those stock exchanges and for those transactions, but only Authorised Participants can apply directly to the Issuer for the Issue of Collateralised Currency Securities. The Issuer has entered into Authorised Participant Agreements and has agreed to issue and redeem Collateralised Currency Securities to those Authorised Participants on an on-going basis. An Authorised Participant may sell the Collateralised Currency Securities on an exchange or in an off-exchange transaction or may hold the Collateralised Currency Securities themselves.
Upon issue of Collateralised Currency Securities an Authorised Participant must deliver an amount of cash to the Issuer equal to the Price of the Collateralised Currency Securities to be issued in exchange for which the Issuer will issue the Collateralised Currency Securities and deliver them to the Authorised Participant via CREST.
Upon redemption by an Authorised Participant (and in certain limited circumstances, other Security Holders), the Issuer must deliver an amount of cash to the redeeming Security Holder equal to the price of the Collateralised Currency Securities to be redeemed in return for delivery by the redeeming Security Holder of the Collateralised Currency Securities to be redeemed via CREST.
Cash held by the Issuer (other than that required to meet redemptions or that which reflects accrued but unpaid management fees) is delivered to the Currency Transaction Counterparty in return for delivery by the Currency Transaction Counterparty of Collateral of the same value to an account of the Issuer at the Collateral Administrator.
If the Issuer is required to pay any amounts (i) to MSIP under the Currency Transactions; or (ii) to an Authorised Participant upon redemption of Collateralised Currency Securities then it will sell an appropriate proportion of the Collateral to MSIP and use the proceeds of such sale to fund the payments.
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Wisdomtree Foreign Exchange Ltd. published this content on 05 June 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 05 June 2024 13:07:28 UTC.