The CurrencyShares® Australian Dollar Trust (the “Trust”) is
a grantor trust that was formed on June 8, 2006. The Shares began trading on
the New York Stock Exchange under the ticker symbol “FXA” on June
26, 2006. The primary listing of the Shares was transferred to NYSE Arca, Inc.
(“NYSE Arca”) on October 30, 2007. The Trust issues shares (the
“Shares”) in blocks of 50,000 (a “Basket”) in exchange
for deposits of Australian Dollars and distributes Australian Dollars in connection
with the redemption of Baskets.
The investment objective of the Trust is for the Shares to reflect the price
in USD of Australian Dollars plus accrued interest, if any, less the expenses
of the Trust’s operations. The Shares are intended to offer investors
an opportunity to participate in the market for the Australian Dollar through
an investment in securities. The Shares are intended to provide institutional
and retail investors with a simple, cost-effective means of gaining investment
benefits similar to those of holding the Australian Dollar. The Shares are bought
and sold on NYSE Arca like any other exchange-listed security. The Shares are
backed by the assets of the Trust, which does not hold or use derivative products.
The Trust is a passive investment vehicle and does not have any officers, directors
or employees. The Trust does not engage in any activities designed to obtain
profit from, or ameliorate losses caused by, changes in the price of the Australian
Dollar. Investing in the Shares does not insulate the investor from certain
risks, including price volatility. The value of the holdings of the Trust is
reported on the Trust’s website, www.currencyshares.com, each business
day.
The Trust holds Australian Dollars and, from time to time, issues Baskets in
exchange for deposits of Australian Dollars and distributes Australian Dollars
in connection with redemptions of Baskets. The Australian Dollars held by the
Trust will be sold only (1) if needed to pay Trust expenses, (2) in the event
the Trust terminates and liquidates its assets or (3) as otherwise required
by law or regulation.
The Sponsor of the Trust generally oversees the performance of the Trustee and
the Trust’s principal service providers, but does not exercise day-to-day
oversight over the Trustee or the Trust’s service providers. The Sponsor
is Guggenheim Specialized Products, LLC, a Delaware limited liability company.
The Sponsor changed its name from Rydex Specialized Products LLC as of March
30, 2012.
The Trust’s only ordinary recurring expense is the Sponsor’s fee.
The Sponsor is responsible for payment of the following administrative and marketing
expenses of the Trust: the Trustee’s monthly fee, typical maintenance
and transaction fees of the Depository, NYSE Arca listing fees, printing and
mailing costs, audit fees and expenses, up to $100,000 per year in legal fees
and expenses, and applicable license fees. The Sponsor also paid the costs of
the Trust’s organization, including the applicable SEC registration fees.
The Sponsor’s fee accrues daily at an annual nominal rate of 0.40% of
the Australian Dollars in the Trust (including all unpaid interest but excluding
unpaid fees, each as accrued through the immediately preceding day). The Sponsor
was paid $836,139 for the fiscal year ended October 31, 2015.
The Bank of New York Mellon, a banking corporation with trust powers organized
under the laws of the State of New York, serves as the Trustee. The Trustee
is responsible for the day-to-day administration of the Trust, including keeping
the Trust’s operational records.
The Trustee calculates, and the Sponsor publishes, the Trust’s Net Asset
Value (“NAV”) each business day. To calculate the NAV, the Trustee
adds to the amount of Australian Dollars in the Trust at the end of the preceding
day accrued but unpaid interest, if any, Australian Dollars receivable under
pending purchase orders and the value of other Trust assets, and subtracts the
accrued but unpaid Sponsor’s fee, Australian Dollars payable under pending
redemption orders and other Trust expenses and liabilities, if any. The NAV
is expressed in U.S. Dollars (“USD”) based on the Australian Dollar/USD
exchange rate as determined by The WM Company, at 4:00 PM (London time / London
fixing) (the “Closing Spot Rate”) on each day that NYSE Arca is
open for regular trading. If, on aparticular evaluation day, the Closing Spot
Rate has not been determined and announced by 6:00 PM (London time), then the
most recent Closing Spot Rate is used to determine the NAV of the Trust unless
the Trustee, in consultation with the Sponsor, determines that such price is
inappropriate to use as the basis for the valuation.
The Trustee also determines the NAV per Share, which equals the NAV of the Trust
divided by the number of outstanding Shares. The NAV of the Trust and the NAV
per Share are published by the Sponsor on each day that NYSE Arca is open for
regular trading and are posted on the Trust’s website, www.currencyshares.com.
Each Share represents a proportional interest, based on the total number of
Shares outstanding, in the Australian Dollars owned by the Trust, plus accrued
and unpaid interest, if any, less accrued but unpaid expenses (both asset-based
and non-asset based) of the Trust. All Shares are of the same class with equal
rights and privileges. Each Share is transferable, is fully paid and non-assessable
and entitles the holder to vote on the limited matters upon which Shareholders
may vote under the Depositary Trust Agreement.