Ticker Symbol Amex:  MDY
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MidCap Spiders

Frequently Asked Questions about MidCap Spiders

What are exchange traded funds?

Exchange traded funds (ETFs) are index funds or trusts that are listed and traded within a single day on an exchange, like the American Stock Exchange (Amex). An ETF, such as MidCap Spiders, lets you buy or sell shares in the collective performance of an entire stock or bond portfolio, such as the S&P MidCap 400®.

Exchange traded funds add the flexibility, ease, and liquidity of stock-trading to the benefits of traditional index-fund investing.

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How can I buy or sell MidCap Spiders?

You can buy or sell MidCap Spiders through a broker, just like you would stocks.

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How easy is it to buy or sell MidCap Spiders?

MidCap Spiders are listed on the Amex and can be traded throughout the day as easily as you would buy or sell shares of stock.

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What is the minimum size purchase of MidCap Spiders?

You can purchase as little as one share.

Find out How to Invest.

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Why invest in an index, like the S&P MidCap 400®?

Often called passive management, indexing involves investing in a group of securities that represent the composition of a broad stock market, stock industry sector, international stock, or U.S. bond index. With index funds you get market-level performance because they aim to generally match the performance of a specific index. As an additional benefit, these funds typically have lower management fees and operating expenses than actively managed funds.

Learn more About the S&P MidCap 400.

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What are the benefits of MidCap Spiders?

The unique exchange traded structure offers several advantages to MidCap Spiders investors:

  • Instantly get exposure to the S&P MidCap 400®
  • Buy and sell at any time during the trading day
  • Lower your management fees
  • Realize tax efficiencies
  • Avoid sales loads, although brokerage commissions will apply
  • Buy on margin
  • Sell short, even on a downtick

Review more about the benefits of MidCap Spiders.

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How does the performance of MidCap Spiders compare with the performance of its underlying index, the S&P MidCap400®?

MidCap Spiders provide investment results that generally correspond to the underlying benchmark index, the S&P MidCap 400. The Trust's portfolio includes all of the stocks of the S&P MidCap 400, weighted to give similar price and yield performance to the underlying index. In the secondary market, one method that helps to keep MidCap Spiders trading on the exchange at a price close to the value of its underlying portfolio is arbitrage. Because MidCap Spiders are both created from the securities of an underlying portfolio and can be redeemed into the securities of an underlying portfolio on any day, arbitrage traders may move to profit from any price discrepancies between a MidCap Spider and the portfolio, which in turn helps to close the price gap between the two. (MidCap Spider creations and redemptions are restricted to large transactions, typically in multiples of 50,000 shares but ranging from 25,000 to 600,000 shares, usually transacted by large investors and institutions.) Of course, because of the effects of supply and demand and other market factors, there may be times when shares of a MidCap Spider trade at a premium or discount to its underlying portfolio value.

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Is the value of MidCap Spiders equivalent to the value of the underlying index, the S&P Midcap 400®?

Not necessarily. The share price is initially set at a percentage of the index upon which they are based, but may differ over time due to costs and other factors.

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Can MidCap Spiders be purchased on margin?

Yes, you can purchase MidCap Spiders on margin, subject to the same terms that apply to common stocks. You should contact your broker regarding initial and maintenance margin requirements.

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Can MidCap Spiders be sold short?

Yes, you can sell MidCap Spiders short, representing the sale of "borrowed" shares in anticipation of lower prices. They're exempt from the rule that requires shares to be sold short on a plus or zero plus tick (i.e., a sale price higher than the last different regular-way sale in the security). You're required to make arrangements to borrow securities before selling short.

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Is there a sales load on MidCap Spiders?

MidCap Spiders are not subject to sales loads. Remember, usual brokerage commissions for securities purchases and sales will apply.

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Do I get paid dividends on MidCap Spiders?

MidCap Spiders holders are eligible to receive their pro rata share of dividends, if any, accumulated on the stocks held, less fees and expenses. Of course, past performance is no guarantee of future results. Be sure to discuss the opportunity for dividend reinvestment with your broker.

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Where can I find MidCap Spiders quotes and performance information?

You can find exchange traded funds listed in the financial section of many newspapers under the heading "American Stock Exchange Listed Stocks." In The Wall Street Journal for example, look in the financial section under "Exchange Traded Portfolios." You can also find information on numerous financial websites, including amex.com.

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Where can I get up-to-date price information on MidCap Spiders?

During trading hours, you can obtain continuous pricing information:

  • From your broker
  • On numerous financial websites, such as amex.com
  • From the MidCap Spider Quick Quote (note the 15-minute publishing delay)

Closing prices are also published in major newspapers, like The Wall Street Journal, on the following business day.

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How can I find out more about ETFs?

MidCap Spiders are subject to risks similar to those of stocks. Investment returns will fluctuate and are subject to market volatility, so that when your shares are redeemed or sold, they may be worth more or less than their original cost. Past performance is no guarantee of future results. While mid-cap stocks are subject to greater risk than large-caps, they are less volatile than companies in the often uncertain start-up phase.

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What are the risks of investing in MidCap Spiders?

A great resource to start with is amex.com.  An entire section of this site is dedicated to the features and benefits of exchange traded funds.

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View the prospectus online
Send questions to: ETFinquiries@amex.com