Fund Description: Direxion Daily FTSE China Bear 3X Shares, formerly Direxion Daily China Bear 3X Shares is an exchange-traded index fund or Index ETF which is a separate investment portfolio of the Direxion Shares ETF Trust, an investment management company. INVESTMENT OBJECTIVE: Direxion Daily FTSE China Bear 3X Shares seeks daily investment results, before fees and expenses, of 300% of the inverse (or opposite) of the price performance of the FTSE China 25 Index, formerly BNY China Select ADR Index. The Fund seeks daily leveraged investment results and does not seek to achieve its stated investment objective over a period of time greater than one day. The Fund is different and much riskier than most exchange-traded fund and is designed to be utilized only by knowledgeable investors who understand the potential consequences of seeking daily leveraged investment results, understand the risks associated with the use of leverage and are willing to monitor their portfolios as frequently as daily. INDEX DESCRIPTION: The FTSE China 25 Index consists of the 25 largest and most liquid Chinese stocks listed and trading on the Stock Exchange of Hong Kong (SEHK). The Index is weighted based on the total market value of each company so that companies with higher total market values generally have a higher representation in the Index. The Index is specifically designed for international investors, combining the ease of trading on SEHK with a methodology to meet certain investment company regulatory requirements. The Index is concentrated in the financial sector, but this concentration may change in the future based on the Index’s methodology and the varying nature of China’s economy. FUND STRATEGY: The Fund, under normal circumstances, creates short positions by investing at least 80% of its net assets in: futures contracts; options on securities, indices and futures contracts; equity caps, collars and floors; swap agreements; forward contracts; short positions, reverse repurchase agreements; and other financial instruments that, in combination, provide leveraged and unleveraged exposure to the Index. The Fund invests the remainder of its assets in short-term debt instruments that have terms-to-maturity of less than 397 days and exhibit high quality credit profiles, including U.S. government securities and repurchase agreements. The Fund does not invest in equity securities. China is considered an emerging market which refers to an economy that is in the initial stages of industrialization and has been historically marked by low per capita income and lack of capital market transparency, but appears to be implementing political and/or market reforms resulting in greater capital market transparency, increased access for foreign investors and generally improved economic conditions. Emerging markets have the potential for significantly higher or lower rates of return and carry greater risks than more developed economies. The Fund seeks to remain fully invested at all times consistent with its stated goal. At the close of the markets each trading day, the Fund’s portfolio is positioned so that its exposure to the Index is consistent with the Fund’s investment objective. The impact of the Index’s movements during the day will affect whether the Fund’s portfolio needs to be re-positioned. FUND MANAGEMENT: Rafferty Asset Management, LLC is the Fund’s investment adviser.