WisdomTree Short EUR Long GBP

WisdomTree Short EUR Long GBP is designed to provide investors with exposure to Euro (EUR) relative to Pounds Sterling (GBP) by tracking the MSFX Short Euro/GBP Index (TR) (the Index), which aims to reflect the performance of a position in forward contracts which are rolled on a daily basis. WisdomTree Short EUR Long GBP is an exchange traded currency (ETC).

Its securities can be created and redeemed on demand by authorised participants and traded on exchange just like shares in a company. The ETC obtains exposure to the Index by entering into unfunded swaps with a counterparty. There is no upfront cash payment by the Issuer to the counterparty when an unfunded swap is created.

However, daily cash payments are made between the Issuer and the counterparty to reflect the daily movements in the value of the Index. Separately, the Issuer uses the cash it holds to purchase eligible collateral from the counterparty under a daily reverse repurchase agreement (reverse repo), an agreement whereby the counterparty agrees to repurchase such eligible collateral from the Issuer the following day.

The eligible collateral is held by the custodian in a custody account..