Fund Description: Legg Mason Low Volatility High Dividend ETF is an exchange-traded index fund or Index ETF which is a separate investment portfolio of the Legg Mason ETF Equity Trust, an open-end investment management company. INVESTMENT OBJECTIVE: The Legg Mason Low Volatility High Dividend ETF seeks to provide investment returns that closely correspond to the price and yield performance of the QS Low Volatility High Dividend Index. INDEX DESCRIPTION: The QS Low Volatility High Dividend Index seeks to provide more stable income through investments in stocks of profitable U.S. companies with relatively high dividend yields and lower price and earnings volatility. The Index is based on a proprietary methodology created and sponsored by QS Investors, LLC (QS), the Fund’s subadviser. The Index is composed of stocks of U.S. companies across a wide range of market capitalizations, including the largest 3,000 U.S. stocks as determined by the Solactive US Broad Market Index. Stocks in the Index must have demonstrated profitability over the last four fiscal quarters as a whole. Stocks whose yields are not supported by earnings are excluded from the Index. The methodology calculates a composite stable yield score, with the yield of stocks with relatively higher price volatility and earnings volatility adjusted downward and the yield of stocks with relatively lower price volatility and earnings volatility adjusted upward. The Index’s components are reconstituted annually and rebalanced quarterly. FUND STRATEGY: The Fund uses a passive or indexing investment approach to achieve its investment objective. Unlike many investment companies, the fund does not try to outperform its Index and does not seek temporary defensive positions when markets decline or appear overvalued. Indexing may eliminate the chance that the fund will substantially outperform the Index and also may reduce some of the risks of active management, such as poor security selection. Indexing seeks to achieve lower costs and better after-tax performance by keeping portfolio turnover low in comparison to actively managed investment companies. Representative sampling is an indexing strategy that may be used which involves investing in a representative sample of securities that collectively has an investment profile similar to that of the Index. When sampling is used, the securities selected are expected to have, in the aggregate, investment characteristics (based on factors such as return variability, risk, market capitalization and sector exposures) and fundamental characteristics (such as portfolio yield, price/earnings ratios and price/book ratios) similar to those of the Index. The Fund may or may not hold all of the securities in the Index. The Fund will invest at least 80% of its net assets, plus borrowings for investment purposes, if any, in securities that compose the Index. The Fund may invest up to 20% of its net assets in certain index futures, options, options on index futures, swap contracts or other derivatives (Financial Instruments) related to its Index and its component securities; cash and cash equivalents; other investment companies, including exchange-traded funds; exchange-traded notes; and in securities and other instruments not included in its Index but which QS believes will help the Fund track its Index. The Fund may invest in exchange-traded equity index futures to manage sector exposure and for cash management purposes. FUND MANAGEMENT: Legg Mason Partners Fund Advisor, LLC (LMPFA) serves as the investment manager and QS Investors, LLC (QS) serves as the sub-adviser to the Fund.