Annual Report. USCF Restaurant Leaders Fund NYSE: MENU Stock Split Index Fund NYSE: TOFR

Transcription

1 Annual Report USCF Restaurant Leaders Fund NYSE: MENU Stock Split Index Fund NYSE: TOFR

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3 USCF ETF TRUST TABLE OF CONTENTS Letter to Shareholders Disclosure of Fund Expenses Schedules of Investments Statements of Assets and Liabilities Statements of Operations Statements of Changes in Net Assets Financial Highlights Notes to Financial Statements Report of Independent Registered Public Accounting Firm Additional Information (Unaudited)

4 LETTER TO SHAREHOLDERS STOCK SPLIT INDEX FUND In a 2013 Wall Street Journal article, Mark Hulbert wrote about one of the investment newsletters his iconic Hulbert Financial Digest had been following for many years, called 2 for 1. The newsletter was based on research that showed that companies that had recently implemented or announced stock splits outperformed the broad market for a period of time. USCF found the 2 for 1 concept so compelling that it licensed the index and launched the Stock Split Index Fund ( TOFR ) in September 2014, with the ticker TOFR (as in two-fer ). While other funds bet on corporate actions spinoffs, stock buy backs, etc. investing in a portfolio of stocks that had recently undergone a stock split was a novel concept. As TOFR approaches its 3-year anniversary, the fund has returned 9.14% on an annualized basis, after fees since inception. This is slightly behind the S&P 500 total return of 9.75% over the same period. TOFR s benchmark, the 2 for 1 Index TM ( SPLITS ), returned 9.76% on an annualized basis, just beating the S&P 500. Over the 12 months, 6 months, and 3 months, TOFR (net asset value) returns were 15.52%, 4.79%, and 2.65% respectively. Comparatively, the S&P 500 returned 17.90%, 9.34%, and 3.09%. TOFR was negatively impacted by two specific holdings in the past year: Amtrust Financial and First Business Financial. Since there are only 30 stocks that typically comprise the portfolio and strict criteria are followed, one or two holdings can have greater impact on performance than they would in a more diversified portfolio. There are periods when TOFR beat the S&P 500, particularly during its first year of operation. Unfortunately, performance has not yet lived up to expectations compared to actual stock split results from the past. Reasons for this may include the fact that there are significantly fewer listed companies today than in the recent past, and thus fewer choices for TOFR s investment universe. Likewise, fewer companies choose to split their stock these days than in the past, compounding the lack of opportunities. Finally, a plethora of broad indexing options means that more investors actions may lift the entire stock market rather than specific, higher quality companies. As with any investment thesis, no strategy works all of the time, and market conditions change. As the easy money era draws to a close, we believe TOFR s strategy will have new opportunity to succeed and offers a unique way to seek outperformance. 2 Annual Report June 30, 2017

5 USCF RESTAURANT LEADERS FUND In November 2016, USCF launched its second equity ETF, the USCF Restaurant Leaders Fund ( MENU ). The restaurant industry falls under the broader Consumer Discretionary sector. MENU is a pure industry play within that sector. We believe this important industry has the potential to grow ahead of most industries. It is benchmarked to the Restaurant Leaders INDXX index. Two primary segments within the restaurant industry are Full Service Restaurant (FSR) such as Cheesecake Factory and Denny s and Quick Serve Restaurants (QSR) such as McDonalds and Starbucks. The index contains roughly 70% QSR names and 30% FSR names. MENU only has 8 months of history and over that time period and for the last 6 months and the last 3 months, MENU has returned 16.29%, 6.30%, and 1.13% respectively based on net asset value. Comparatively, the S&P 500 Restaurant Index returned 23.33%, 17.78%, and 10.08%. We believe this is too short a time period to draw any long-term conclusions about the strategy. At times, either the QSR or FSR segments of the industry may outperform the other, although we believe greater opportunity lies in QSR which, if realized, would benefit the fund relative to the broader industry. FSR, in particular, may tend to outperform during periods of economic expansion, reduced unemployment, decent consumer confidence, and broad market expansion, as we have seen since the fund launched on Election Day, For those looking to play this dynamic slice of the U.S. stock market, MENU may be ripe for consideration as part of a balanced portfolio diet. Thank you for your interest in TOFR and MENU. As always, we welcome any questions you may have. Andrew F Ngim Portfolio Manager The 2 for 1 Index contains approximately 30 companies which trade on major U.S. stock exchanges. Companies eligible for inclusion in the index have all announced a 2 for 1 (or higher) stock split within the 6 months prior to selection for the index. Definitions: S&P 500 TR Index: The total return index tracks both the capital gains of a group of stocks over time and assumes that any cash distributions, such as dividends, are reinvested back into the index. S&P 500 Restaurant Index : The index is composed of select industry indices designed to measure the performance of narrow GICS sub-industries. The index comprises stocks in the S&P Total Market Index that are classified in the GICS restaurant sub-industry. It is not possible to invest directly in an index. Past performance is not a guarantee of future results. 3

6 COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN STOCK SPLIT INDEX FUND (TOFR), THE 2 FOR 1 INDEX 1 AND S&P 500 INDEX 2 FROM SEPTEMBER 15, 2014 (INCEPTION DATE)* TO JUNE 30, The following graph depicts the performance of Stock Split Index Fund (net asset value and market value) vs. the 2 For 1 Index 1 and S&P 500 Index 2 Growth of a $10,000 Investment $13,000 Stock Split Index Fund (NAV) ($12,760) Stock Split Index Fund (Market) ($12,699) 2 For 1 Index 1 ($12,964) S&P 500 Index 2 ($12,959) $12,500 $12,000 $11,500 $11,000 $10,500 $10,000 09/15/ /30/ /30/ /30/2017 Annualized Since Inception One Year Return Return (9/15/2014) Stock Split Index Fund (NAV) % 9.14% Stock Split Index Fund (Market) % 8.95% 2 For 1 Index % 9.76% S&P 500 Index % 9.75% * The inception date is the date the first shares were purchased to meet the outstanding shares required for listing on the NYSE Arca, Inc. TOFR was listed on the NYSE Arca, Inc. on September 16, The 2 For 1 Index is an equally-weighted index, rebalanced monthly, comprised of companies listed on a U.S. stock exchange, such as the New York Stock Exchange ( NYSE ) and NASDAQ Global Market, that have recently undergone a stock split of two new shares for every one existing share (or, in some cases, an exchange ratio of greater than two shares for one share). Under normal market circumstances, the index will consist of 30 stocks. You cannot directly invest in an index. 2 The Standard & Poor s (S&P) 500 Index is an unmanaged index consisting of 500 stocks chosen for market size, liquidity, and industry group representation. It is a market-weighted index (stock price times number of shares outstanding) with each stock s weight in the index proportionate to its market value. You cannot directly invest in an index. 4 Annual Report June 30, 2017

7 The performance shown represents past performance. Past performance is no guarantee of future results and current performance may be higher or lower than the performance shown. Return calculations assume the reinvestment of distributions and do not reflect taxes that a shareholder would pay on distributions or on the sale of shares. Performance figures for TOFR reflect fee waivers and/or expense reimbursements. In the absence of fee waivers and/or expense reimbursements, the total return for TOFR would have been lower. Principal value and investments returns will fluctuate and investors shares, when sold, may be worth more or less than the original cost. To obtain the most recent month-end performance data visit or call The Fund s NAV is calculated by dividing the value of the Fund s total assets less total liabilities by the number of shares outstanding. Share price returns are based on closing prices for the Fund and do not represent the returns an investor would receive if shares were traded at other times. Shares of ETFs are bought and sold at market price (not NAV) and are not individually redeemed from the Fund. Brokerage commissions apply and will reduce returns. Market returns are based upon the midpoint of the bid/ask spread at 4:00 p.m. Eastern time (when NAV is normally determined for most ETFs), and do not represent the returns you would receive if you traded shares at other times. 5

8 COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN USCF RESTAURANT LEADERS FUND (MENU), THE RESTAURANT LEADERS INDXX INDEX 1, S&P 500 INDEX 2 AND S&P 500 RESTAURANTS INDEX 3 FROM NOVEMBER 8, 2016 (INCEPTION DATE)* TO JUNE 30, The following graph depicts the performance of USCF Restaurant Leaders Fund (net asset value and market value) vs. the Restaurant Leaders INDXX Index 1, S&P 500 Index 2 and S&P 500 Restaurants Index 3 Growth of a $10,000 Investment $12,500 $12,000 $11,500 $11,000 $10,500 $10,000 USCF Restaurant Leaders Fund (NAV) ($11,629) USCF Restaurant Leaders Fund (Market) ($11,673) Restaurant Leaders INDXX Index 1 ($11,696) S&P 500 Index 2 ($11,479) S&P 500 Restaurants Index 3 ($12,333) 11/08/ /31/ /31/ /30/2017 Since Inception Return (11/8/2016) USCF Restaurant Leaders Fund (NAV) % USCF Restaurant Leaders Fund (Market) % Restaurant Leaders INDXX Index % S&P 500 Index % S&P 500 Restaurants Index % * The inception date is the date the first shares were purchased to meet the outstanding shares required for listing on the NYSE Arca, Inc. MENU was listed on the NYSE Arca, Inc. on November 9, The Restaurant Leaders INDXX Index is composed of the common stock of U.S. and international restaurant companies ( Restaurant Companies ). A Restaurant Company is a company that derives a majority of its revenue from serving food and/or beverages directly to customers. The index seeks to include the leaders among Restaurant Companies by using a proprietary smart beta four-step selection process that includes two quantitative screens and two dynamic screens to identify Restaurant Companies that are outperforming or expected to outperform their industry peers. You cannot directly invest in an index. 2 The Standard & Poor s (S&P) 500 Index is an unmanaged index consisting of 500 stocks chosen for market size, liquidity, and industry group representation. It is a market-weighted index (stock price times number of shares outstanding) with each stock s weight in the index proportionate to its market value. You cannot directly invest in an index. 3 The Standard & Poor s (S&P) 500 Restaurants Index is composed of select industry indices designed to measure the performance of narrow GICS sub-industries. The index comprises stocks in the S&P Total Market Index that are classified in the GICS restaurant sub-industry. You cannot directly invest in an index. 6 Annual Report June 30, 2017

9 The performance shown represents past performance. Past performance is no guarantee of future results and current performance may be higher or lower than the performance shown. Return calculations assume the reinvestment of distributions and do not reflect taxes that a shareholder would pay on distributions or on the sale of shares. Performance figures for MENU reflect fee waivers and/or expense reimbursements. In the absence of fee waivers and/or expense reimbursements, the total return for MENU would have been lower. Principal value and investments returns will fluctuate and investors shares, when sold, may be worth more or less than the original cost. To obtain the most recent month-end performance data visit or call The Fund s NAV is calculated by dividing the value of the Fund s total assets less total liabilities by the number of shares outstanding. Share price returns are based on closing prices for the Fund and do not represent the returns an investor would receive if shares were traded at other times. Shares of ETFs are bought and sold at market price (not NAV) and are not individually redeemed from the Fund. Brokerage commissions apply and will reduce returns. Market returns are based upon the midpoint of the bid/ask spread at 4:00 p.m. Eastern time (when NAV is normally determined for most ETFs), and do not represent the returns you would receive if you traded shares at other times. Definitions Easy Money: A policy by which a central monetary authority, such as the Federal Reserve System, seeks to make money plentiful and available at low interest rates. An easymoney policy is often pursued to encourage investment and economic growth. It can lead to inflation, however. 7

10 DISCLOSURE OF FUND EXPENSES As a shareholder of the Stock Split Index Fund or the USCF Restaurant Leaders Fund (each a Fund and collectively, the Funds ), each a series of the USCF ETF Trust (the Trust ), you may incur two potential types of costs: (1) transaction costs, such as brokerage commissions paid on purchases and sales of your Fund shares, and (2) ongoing costs, including management fees and other Fund expenses. The following examples are intended to help you understand the ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other funds. The examples are based on an investment of $1,000 invested at the beginning of the period and held for the entire period from January 1, 2017 until June 30, Actual Expenses. The table below provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading Actual Expenses Paid During the Period to estimate the expenses you paid on your account during this period. Hypothetical 5% Return. The table below provides information about hypothetical account values and hypothetical expenses based on the Funds actual net expense ratios and an assumed rate of return of 5% per year before expenses, which is not representative of the Funds actual returns. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare ongoing costs of investing in the Funds and other exchange traded funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. The expenses shown in the table are meant to highlight ongoing costs only and do not reflect any transaction fees, such as brokerage commissions paid on purchases and sales of Fund shares. Therefore, the number under the heading Hypothetical Expenses Paid During the Period is useful in comparing ongoing costs only, and may not help you determine the relative total costs of owning different funds. 8 Annual Report June 30, 2017

11 DISCLOSURE OF FUND EXPENSES (continued) USCF ETF TRUST Fund Beginning Account Value 1/1/17 Actual Ending Account Value 6/30/17 Hypothetical Ending Account Value 6/30/17 Actual Expenses Paid During the Period (a) Hypothetical Expenses Paid During the Period (a) Annualized Expense Ratio Stock Split Index Fund.... $ 1, $1, $ 1, $ 2.79 $ % USCF Restaurant Leaders Fund... $ 1, $1, $ 1, $ 3.32 $ % (a) Expenses (net of fee waivers and/or expense reimbursements) are equal to the Fund s annualized expense ratio multiplied by the average account value over the period, multiplied by the number of days (181 days) in the most recent fiscal halfyear, then divided by 365 (to reflect the one-half year period). 9

12 USCF ETF TRUST STOCK SPLIT INDEX FUND SCHEDULE OF INVESTMENTS AT JUNE 30, 2017 % of Total Net Assets Shares Market Value Common Stocks % Auto Components % Gentex Corp./MI % 5,803 $ 110,083 Magna International, Inc % 2, , ,785 Banks % First Business Financial Services, Inc % 4, ,153 Home BancShares, Inc./AR % 4, ,480 Lakeland Financial Corp % 2, , ,451 Building Products % AO Smith Corp % 1, ,055 Capital Markets % Intercontinental Exchange, Inc % 1, ,229 Chemicals % CF Industries Holdings, Inc % 3, ,220 PPG Industries, Inc % , ,441 Commercial Services & Supplies % Copart, Inc.(a) % 3, ,022 Containers & Packaging % Silgan Holdings, Inc % 3, ,844 Electric Utilities % Alliant Energy Corp % 2, ,956 Electronic Equipment, Instruments & Components % Amphenol Corp. - Class A % 1, ,677 Badger Meter, Inc % 2, , ,518 Food Products % Cal-Maine Foods, Inc.(a) % 2, ,830 Hain Celestial Group, Inc. (The)(a) % 3, ,311 Hormel Foods Corp % 3, , ,701 The accompanying notes are an integral part of the financial statements. 10 Annual Report June 30, 2017

13 USCF ETF TRUST STOCK SPLIT INDEX FUND SCHEDULE OF INVESTMENTS AT JUNE 30, 2017 (continued) % of Total Net Assets Shares Market Value Gas Utilities % New Jersey Resources Corp % 2,531 $ 100,481 Health Care Providers & Services % Ensign Group, Inc. (The) % 5, ,811 Hotels, Restaurants & Leisure % Starbucks Corp % 1, ,742 Household Products % Church & Dwight Co., Inc % 1, ,552 Insurance % AmTrust Financial Services, Inc % 7, ,700 Navigators Group, Inc. (The) % 1, , ,171 IT Services % DST Systems, Inc % 1, ,332 Machinery % Toro Co. (The) % 1, ,926 Media % Comcast Corp. - Class A % 2,567 99,908 Pharmaceuticals, Biotechnology & Life Sciences.. 3.3% AstraZeneca PLC ADR % 3, ,577 Professional Services % Exponent, Inc % 1, ,115 Software % Open Text Corp % 3, ,460 Textiles, Apparel & Luxury Goods % NIKE, Inc. - Class B % 2, ,717 Total Common Stocks (Cost $3,186,599) % 3,229,794 The accompanying notes are an integral part of the financial statements. 11

14 USCF ETF TRUST STOCK SPLIT INDEX FUND SCHEDULE OF INVESTMENTS AT JUNE 30, 2017 (continued) % of Total Net Assets Face Amount Market Value Short-Term Investment % Time Deposit % Brown Brothers Harriman & Co., 0.58% due 07/03/ % $3,282 $ 3,282 Total Short-Term Investment (Cost $3,282) % 3,282 Total Investments (Cost $3,189,881)(b) % 3,233,076 Other Assets in Excess of Liabilities % 4,175 Total Net Assets % $3,237,251 ADR American Depositary Receipts (a) Non income producing security. (b) The aggregate cost of investments for tax purposes was $3,216,679. The net unrealized appreciation was $16,397 which consisted of aggregate gross unrealized appreciation of $247,013 and aggregate gross unrealized depreciation of ($230,616). Summary of Investments by Country^ United States % Canada United Kingdom % Summary of Investments by Sector^ Financials % Consumer Discretionary Consumer Staples Information Technology Industrials Materials Health Care Utilities Short-Term Investment % ^ As a percentage of total investments. All stocks are listed on U.S. Exchanges. The accompanying notes are an integral part of the financial statements. 12 Annual Report June 30, 2017

15 USCF ETF TRUST USCF RESTAURANT LEADERS FUND SCHEDULE OF INVESTMENTS AT JUNE 30, 2017 % of Total Net Assets Shares Market Value Common Stocks % Hotels, Restaurants & Leisure % Arcos Dorados Holdings, Inc. - Class A(a) % 8,147 $ 60,695 BJ s Restaurants, Inc.(a) % 1,109 41,310 Bloomin Brands, Inc % 1,982 42,078 Bojangles, Inc.(a) % 4,009 65,146 Buffalo Wild Wings, Inc.(a) % ,797 Carrols Restaurant Group, Inc.(a) % 5,230 64,067 Cheesecake Factory, Inc. (The) % ,447 Chipotle Mexican Grill, Inc. - Class A(a) % ,663 Cracker Barrel Old Country Store, Inc % ,812 Darden Restaurants, Inc % ,783 Dave & Buster s Entertainment, Inc.(a) % ,438 Del Frisco s Restaurant Group, Inc.(a) % 2,540 40,894 Del Taco Restaurants, Inc.(a) % 4,642 63,827 Denny s Corp.(a) % 3,577 42,101 Domino s Pizza, Inc % ,978 Dunkin Brands Group, Inc % 1,159 63,884 El Pollo Loco Holdings, Inc.(a) % 4,523 62,644 Fogo De Chao, Inc.(a) % 2,973 41,325 Habit Restaurants, Inc. (The) - Class A(a) % 4,022 63,548 Jack in the Box, Inc % ,858 McDonald s Corp % ,860 Red Robin Gourmet Burgers, Inc.(a) % ,390 Restaurant Brands International, Inc % 1,346 84,179 Ruth s Hospitality Group, Inc % 1,882 40,933 Sonic Corp % 2,269 60,106 Starbucks Corp % 1,399 81,576 Texas Roadhouse, Inc. - Class A % ,932 Wendy s Co. (The) % 4,137 64,165 Wingstop, Inc % 2,054 63,469 Yum China Holdings, Inc.(a) % 2,092 82,488 Yum! Brands, Inc % 1,118 82,464 1,769,857 Total Common Stocks (Cost $1,584,345) % 1,769,857 The accompanying notes are an integral part of the financial statements. 13

16 USCF ETF TRUST USCF RESTAURANT LEADERS FUND SCHEDULE OF INVESTMENTS AT JUNE 30, 2017 (continued) % of Total Net Assets Face Amount Market Value Short-Term Investment % Time Deposit % Brown Brothers Harriman & Co., 0.58% due 07/03/ % $ 4,098 $ 4,098 Total Short-Term Investment (Cost $4,098) % 4,098 Total Investments (Cost $1,588,443)(b) % 1,773,955 Liabilities in Excess of other Assets... (0.1)% (1,221) Total Net Assets % $ 1,772,734 (a) (b) Non income producing security. The aggregate cost of investments for tax purposes was $1,588,443. The net unrealized appreciation was $185,512 which consisted of aggregate gross unrealized appreciation of $198,504 and aggregate gross unrealized depreciation of ($12,992). Summary of Investments by Country^ United States % Canada Uruguay % Summary of Investments by Sector^ Consumer Discretionary % Short-Term Investment % ^ As a percentage of total investments. All stocks are listed on U.S. Exchanges. The accompanying notes are an integral part of the financial statements. 14 Annual Report June 30, 2017

17 USCF ETF TRUST STATEMENTS OF ASSETS AND LIABILITIES JUNE 30, 2017 Stock Split Index Fund USCF Restaurant Leaders Fund Assets: Investments, at Market Value... $ 3,233,076 $ 1,773,955 Receivables: From Manager... 80,637 72,617 Investments Sold ,370 Dividends... 5, Total Assets... 3,318,811 2,245,164 Liabilities: Payables: Investments Purchased ,842 Accrued Management Fees... 1, Accrued Administrative Agency Fees... 59,612 51,632 Accrued Miscellaneous Expenses... 20,497 20,985 Total Liabilities... 81, ,430 Total Net Assets... $ 3,237,251 $ 1,772,734 Net Assets Consist of: Capital Paid In... $ 3,081,445 $ 1,528,320 Accumulated Undistributed Net Investment Income (Loss)... 17,318 4 Accumulated Net Realized Gain (Loss) on Investments... 95,293 58,898 Net Unrealized Appreciation (Depreciation) on Investments... 43, ,512 Total Net Assets... $ 3,237,251 $ 1,772,734 Net Asset Value Per Share Total Net Assets... $ 3,237,251 $ 1,772,734 Shares of Beneficial Interest Outstanding (Unlimited Shares of $0.001 Par Value Authorized) , ,002 Net Asset Value... $ $ Investments, at Cost... $ 3,189,881 $ 1,588,443 The accompanying notes are an integral part of the financial statements. 15

18 USCF ETF TRUST STATEMENTS OF OPERATIONS FOR THE YEAR ENDED JUNE 30, 2017 AND FOR THE PERIOD ENDED JUNE 30, 2017* Stock Split Index Fund USCF Restaurant Leaders Fund* Investment Income: Dividend Income (less net foreign withholding tax $1,520 and $118, respectively) $ 70,512 $ 10,995 Interest Income Total Investment Income... 70,519 11,002 Expenses: Management Fees... 21,089 7,245 Administrative Agency Fees ,558 80,139 Trustees Fees... 28,788 15,657 Professional Fees... 32,399 25,626 Shareholder Reporting Fees... 19,859 23,745 Miscellaneous Expenses... 16,385 15,804 Total Expenses , ,216 Less Fees Waived (Note 3)... (235,989) (160,971) Net Expenses... 21,089 7,245 Net Investment Income (Loss)... 49,430 3,757 Realized and Unrealized Gain (Loss) on Investments: Net Realized Gain (Loss) on Investments ,613 58,898 Net Change in Unrealized Appreciation (Depreciation) on Investments , ,512 Net Change in Realized and Unrealized Gain (Loss) on Investments , ,410 Net Increase (Decrease) in Net Assets Resulting from Operations... $ 546,756 $ 248,167 * Inception Date, November 8, The accompanying notes are an integral part of the financial statements. 16 Annual Report June 30, 2017

19 USCF ETF TRUST STATEMENTS OF CHANGES IN NET ASSETS Stock Split Index Fund For the Year Ended June 30, 2017 For the Year Ended June 30, 2016 Operations: Net Investment Income (Loss)... $ 49,430 $ 69,661 Net Realized Gain (Loss) on Investments , ,793 Net Changes in Unrealized Appreciation (Depreciation) on Investments ,713 (444,955) Net Increase (Decrease) in Net Assets Resulting from Operations ,756 4,499 Distributions to Shareholders from: Net Investment Income... (49,395) (69,512) Capital Gains... (143,400) (204,237) Total Distributions to Shareholders... (192,795) (273,749) Shareholder Transactions: Proceeds from Shares Sold ,593 Shares Issued as Reinvestment of Dividends and Distributions... Cost of Shares Redeemed... (833,222) (1,533,850) Net Increase (Decrease) in Net Assets from Shares Transactions (833,222) (891,257) Net Increase (Decrease) in Net Assets... (479,261) (1,160,507) Net Assets: Beginning of Year... 3,716,512 4,877,019 End of Year 1... $ 3,237,251 $ 3,716,512 1 Includes Accumulated Undistributed Net Investment Income (Loss) of:... $ 17,318 $ 17,283 Changes in Shares Outstanding: Shares Outstanding, Beginning of Year , ,000 Shares Issued... 40,000 Shares Issued in Reinvestment of Dividends and Distributions... Shares Redeemed... (50,000) (100,000) Shares Outstanding, End of Year , ,000 The accompanying notes are an integral part of the financial statements. 17

20 USCF ETF TRUST STATEMENT OF CHANGES IN NET ASSETS USCF Restaurant Leaders Fund For the Period Ended June 30, 2017* Operations: Net Investment Income (Loss)... $ 3,757 Net Realized Gain (Loss) on Investments... 58,898 Net Changes in Unrealized Appreciation (Depreciation) on Investments ,512 Net Increase (Decrease) in Net Assets Resulting from Operations ,167 Distributions to Shareholders from: Net Investment Income... (3,753) Capital Gains... Total Distributions to Shareholders.... (3,753) Shareholder Transactions: Proceeds from Shares Sold... 1,528,290 Shares Issued as Reinvestment of Dividends and Distributions... Cost of Shares Redeemed... Net Increase (Decrease) in Net Assets from Shares Transactions.... 1,528,290 Net Increase (Decrease) in Net Assets... 1,772,704 Net Assets: Beginning of Period End of Period 1... $ 1,772,734 1 Includes Accumulated Undistributed Net Investment Income (Loss) of:... $ 4 Changes in Shares Outstanding: Shares Outstanding, Beginning of Period... 2* Shares Issued ,000 Shares Issued in Reinvestment of Dividends and Distributions... Shares Redeemed... Shares Outstanding, End of Period ,002 * Inception Date, November 8, The accompanying notes are an integral part of the financial statements. 18 Annual Report June 30, 2017

21 USCF ETF TRUST STOCK SPLIT INDEX FUND FINANCIAL HIGHLIGHTS SELECTED DATA FOR A SHARE OF COMMON STOCK OUTSTANDING THROUGHOUT THE PERIOD INDICATED: For the Year Ended June 30, 2017 For the Year Ended June 30, 2016 For the Period Ended June 30, 2015* Net Asset Value, Beginning of Period... $ $ $ Income (Loss) from Operations: Net Investment Income (Loss) (a) Net Realized and Unrealized Gain (Loss) (0.18) 1.25 Total Income (Loss) from Operations Less Distributions From: Net Investment Income... (0.21) (0.22) (0.22) Capital Gains... (0.60) (0.60) Total Distributions... (0.81) (0.82) (0.22) Net Assets Value, End of Period... $ $ $ Total Return (b) % 0.53% 9.88% Net Assets, End of Period (thousands)... $ 3,237 $ 3,717 $ 4,877 Ratios of Average Net Assets: Gross Expenses % 6.22% 4.66%** Net Expenses % 0.55% 0.55%** Net Investment Income (Loss) % 1.47% 1.87%** Portfolio Turnover Rate (c)... 62% 60% 57% * Inception Date, September 15, ** Annualized. (a) Per share amounts have been calculated using the average shares method. (b) Total Return reflects fee waivers and/or expense reimbursements and assumes reinvestment of dividend distribution. In the absence of fee waivers and/or expense reimbursements, the total return would have been lower. Past performance is no guarantee of future results. (c) Portfolio turnover rate is not annualized for periods less than one year and does not include securities received or delivered from processing creations or redemptions. The accompanying notes are an integral part of the financial statements. 19

22 USCF ETF TRUST USCF RESTAURANT LEADERS FUND FINANCIAL HIGHLIGHTS SELECTED DATA FOR A SHARE OF COMMON STOCK OUTSTANDING THROUGHOUT THE PERIOD INDICATED: For the Period Ended June 30, 2017* Net Asset Value, Beginning of Period... $ Income (Loss) from Operations: Net Investment Income (Loss) (a) Net Realized and Unrealized Gain (Loss) Total Income (Loss) from Operations Less Distributions From: Net Investment Income... (0.04) Capital Gains... Total Distributions... (0.04) Net Assets Value, End of Period... $ Total Return (b) % Net Assets, End of Period (thousands)... $ 1,773 Ratios of Average Net Assets: Gross Expenses %** Net Expenses %** Net Investment Income (Loss) %** Portfolio Turnover Rate (c)... 50% * Inception Date, November 8, ** Annualized. (a) Per share amounts have been calculated using the average shares method. (b) Total Return reflects fee waivers and/or expense reimbursements and assumes reinvestment of dividend distribution. In the absence of fee waivers and/or expense reimbursements, the total return would have been lower. Past performance is no guarantee of future results. (c) Portfolio turnover rate is not annualized for periods less than one year and does not include securities received or delivered from processing creations or redemptions. The accompanying notes are an integral part of the financial statements. 20 Annual Report June 30, 2017

23 USCF ETF TRUST NOTES TO FINANCIAL STATEMENTS JUNE 30, ) ORGANIZATION USCF ETF Trust (the Trust ) was organized as a Delaware statutory trust on November 8, The Trust is authorized to have multiple series or portfolios, and may establish additional series or portfolios in the future. The Trust is an open-end management investment company, registered under the Investment Company Act of 1940, as amended (the 1940 Act ). The Funds issue shares of beneficial interest with $0.001 par value. The Trust currently consists of two investment portfolios: the Stock Split Index Fund and the USCF Restaurant Leaders Fund (each a Fund and collectively, the Funds ). The Funds are exchange-traded funds ( ETFs ) that seek to track the price and yield performance, before fees and expenses, of an index. The Stock Split Index Fund ( TOFR ) tracks the performance of the 2 For 1 Index and the USCF Restaurant Leaders Fund ( MENU ) tracks the performance of the Restaurant Leaders INDXX Index (each an Index and together, the Indices ). The Funds employ a passive management or indexing investment approach designed to track the performance of the Indices. Each Fund generally uses a replication strategy to achieve its investment objective, meaning it generally will invest in substantially all of the securities in the Index in approximately the same proportion as the Index. Under normal market conditions, the Funds generally invest substantially all, but at least 80% of the Funds total assets in the securities comprising the Funds respective Indices. In addition, the Funds may invest in cash and cash equivalents or money market instruments. TOFR and MENU commenced operations on September 15, 2014 and November 8, 2016, respectively. TOFR and MENU were listed on the NYSE Arca, Inc. ( NYSE Arca ) on September 16, 2014 and November 9, 2016, respectively. 2) SIGNIFICANT ACCOUNTING POLICIES The accompanying financial statements were prepared in accordance with U.S. Generally Accepted Accounting Principles ( GAAP ), which require the use of estimates and assumptions made by management. These may affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. The following is a summary of significant accounting policies consistently followed by the Funds in preparation of their financial statements. Basis of Presentation The financial statements have been prepared in conformity with GAAP as detailed in the Financial Accounting Standards Board s ( FASB ) Accounting Standards Codification 21

24 ( ASC ). The Funds are investment companies and follow the accounting and reporting guidance in FASB Topic 946. Calculation of Net Asset Value Per Share The Net Asset Value ( NAV ) of the Funds shares is calculated each day the national securities exchanges are open for trading as of the close of regular trading on the Listing Exchange, ordinarily 4:00 p.m. New York time (the NAV Calculation Time ). NAV per share is calculated by dividing the Fund s net assets by the number of Fund shares outstanding. Security Valuation Investments in securities are carried at market value. All equity securities that are traded on a national securities exchange are valued at the last sale price at the time of the close of the New York Stock Exchange ( NYSE ). If on a particular day an exchange-listed security does not trade, then the mean between the closing bids and asked prices will be used. In the case of securities listed on more than one national securities exchange, the last quoted sale, up to the time of valuation, on the exchange on which the security is principally traded will be/is used. If there were no sales on that exchange, the last quoted sale on the other exchange will be/is used. For securities that are traded on the NASDAQ, the NASDAQ Official Closing Price (e.g., the NASDAQ Closing Cross price, if available) is used. All non-nasdaq equity securities that are not traded on a listed exchange are valued at the last sale price at the close of the NYSE. If a non-exchange listed security does not trade on a particular day, or if a last sales price or NASDAQ Official Closing Price is not available, then the mean between the closing bid and asked price will be used. Securities having a remaining maturity of 60 days or less are valued at amortized cost, which approximates market value. The cost of securities sold is determined on the identified cost basis. When market quotations are not readily available or when events occur that make established valuation methods unreliable, securities of the Funds may be valued at fair value determined in good faith by or under the direction of the Board of Trustees. Security transactions are recorded on the dates the transactions are entered, which is the trade date. Fair Value Measurement The Funds utilize various methods to measure the fair value of most of their investments on a recurring basis. GAAP establishes a hierarchy that prioritizes inputs to valuation methods. The three levels of inputs are: Level 1 Unadjusted quoted prices in active markets for identical assets or liabilities that the Funds have the ability to access. 222 Annual Report June 30, 2017

25 Level 2 Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument or an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data. Level 3 Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Funds own assumptions about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available. The availability of observable inputs can vary from security to security and is affected by a wide variety of factors, including, for example, the type of security, whether the security is new and not yet established in the marketplace, the liquidity of markets, and other characteristics particular to the security. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety, is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The following tables summarize the valuation of securities at June 30, 2017 for the Funds, using the fair value hierarchy: TOFR Investments, at value Total Level 1 Level 2 Level 3 Common Stocks: Auto Components... $ 221,785 $ 221,785 $ $ Banks , ,451 Building Products , ,055 Capital Markets , ,229 Chemicals , ,441 Commercial Services & Supplies , ,022 Containers & Packaging , ,844 Electric Utilities , ,956 Electronic Equipment, Instruments & Components , ,518 Food Products , ,701 Gas Utilities , ,481 Health Care Providers & Services , ,811 Hotels, Restaurants & Leisure , ,742 Household Products , ,552 23

26 Investments, at value Total Level 1 Level 2 Level 3 Insurance... $ 225,171 $ 225,171 $ $ IT Services , ,332 Machinery , ,926 Media... 99,908 99,908 Pharmaceuticals, Biotechnology & Life Sciences , ,577 Professional Services , ,115 Software , ,460 Textiles, Apparel & Luxury Goods , ,717 Short-Term Investment: Time Deposit... 3,282 3,282 Total Investments, at value... $ 3,233,076 $ 3,229,794 $ 3,282 $ MENU Investments, at value Total Level 1 Level 2 Level 3 Common Stocks: Hotels, Restaurants & Leisure... $ 1,769,857 $ 1,769,857 $ $ Short-Term Investment: Time Deposit... 4,098 4,098 Total Investments, at value... $ 1,773,955 $ 1,769,857 $ 4,098 $ For the period ended June 30, 2017, the Funds did not have any transfers between Level 1, Level 2 and Level 3 securities. Income Dividend income is recorded on the ex-dividend date, as soon as information is available to the Funds. Distributions to shareholders, which are determined in accordance with income tax regulations, are also recorded on the ex-dividend date. Interest income is recorded as earned. Discounts and premiums on securities purchased are amortized over the life of the respective securities. As of and during the period ended June 30, 2017, the Funds did not have a liability for any unrecognized tax benefits in the accompanying financial statements. The Funds file income tax returns in the U.S. federal jurisdiction and Delaware. The Funds follow ASC 740 Income Taxes, which requires that the financial statements effects of a tax position taken or expected to be taken in a tax return be recognized in the financial statements when it is more likely than not, based on the technical merits, that the position will be sustained upon examination. Management has concluded that the Funds have taken no uncertain tax positions that require adjustment to the financial statements. 24 Annual Report June 30, 2017

27 Federal and Other Taxes It is the Trust s policy to comply with the federal income and excise tax requirements of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies. Accordingly, the Funds intend to distribute substantially all of their income and net realized gains on investments, if any, to shareholders each year. Therefore, no federal income tax provision is required in the Funds financial statements. Under the applicable foreign tax laws, a withholding tax may be imposed on interest, dividends and capital gains at various rates. GAAP requires that certain components of net assets be adjusted to reflect permanent differences between financial and tax reporting. These reclassifications have no effect on net assets or NAV per share. The following permanent differences as of June 30, 2017, attributable to realized gains (losses) from in-kind redemptions, were reclassified to the following accounts: TOFR MENU* Capital Paid In... $ 85,269 $ Undistributed (Distribution in Excess) Net Investment Income... $ $ Undistributed (Accumulated) Net Realized Gain (Loss).. $ (85,269) $ * Inception date, November 8, Management has reviewed the tax positions and has concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions taken on returns filed for open tax years or expected to be taken with the 2016 tax returns. Each Fund s federal tax returns for the prior three fiscal years remain subject to examination by the Internal Revenue Service. Dividends and Distributions Dividends are paid on a quarterly basis. Dividends and distributions are recorded on the ex-dividend date. Income dividends and capital gains distributions are determined in accordance with federal tax regulations and may differ from those determined in accordance with GAAP. To the extent these differences are permanent, such amounts are reclassified within the capital accounts based on their federal tax basis treatment. Temporary differences do not require such reclassification. 25

28 Indemnification The Trust will indemnify its officers and trustees for certain liabilities that may arise from the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust enters into contracts that contain a variety of representations and warranties and which provide general indemnities. The Funds maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Funds that have not yet occurred. However, the Trust expects the risk of loss due to these warranties and indemnities to be remote. Other The Funds follow industry practice and record security transactions on the trade date. Dividend income is recognized on the ex-dividend date, and interest income is recognized on an accrual basis. Discounts and premiums on securities purchased are amortized over the lives of the respective securities. 3) INVESTMENT ADVISORY AND OTHER AGREEMENTS Investment Adviser USCF Advisers LLC (the Adviser ) is the investment adviser to the Funds and as such has overall responsibility for the general management and administration of the Trust. Pursuant to the Investment Advisory Agreement between the Adviser and the Trust entered into as of October 13, 2016, the Adviser provides an investment program for MENU and manages the investment of MENU s assets. In addition, the Adviser provides an investment program for TOFR and manages the investment of TOFR s assets pursuant to an Investment Advisory Agreement between the Adviser and the Trust dated June 18, The Adviser has arranged for custody, distribution, fund administration, transfer agency and all other non-distribution related services necessary for the Funds to operate. The Adviser bears all of its own costs associated with providing these advisory services and the expenses of the members of the Board of Trustees who are affiliated with the Adviser. The Adviser may make payments from its own resources to broker-dealers and other financial institutions in connection with the sale of the Funds shares. As compensation for its services and its assumption of certain expenses, the Funds pay the Adviser a management fee, which is calculated daily and paid monthly, equal to 0.55% and 0.65%, of the average daily net assets of TOFR and MENU, respectively. For the period ended June 30, 2017, the Adviser earned $21,089 and $7,245 from TOFR and MENU, respectively. The Adviser has entered into Expense Limitation Agreements with each of the Funds under which it has agreed to waive or reduce its fees and to assume other expenses of the Funds, if necessary, in an amount that limits Total Annual Fund Operating Expenses 26 Annual Report June 30, 2017

29 (exclusive of interest, taxes, brokerage commissions, expenses related to short sales, other expenses that are capitalized in accordance with GAAP, dividend, interest and brokerage expenses paid, acquired fund fees and expenses, if any, extraordinary expenses, if any, and payments, if any, under the Funds Rule 12b-1 Plan) to not more than 0.55% and 0.65% of the average daily net assets for TOFR and MENU, respectively. The Expense Limitation Agreements for each of the Funds will remain in effect until at least October 31, 2017 (unless terminated earlier by the Board of Trustees). After such dates, the Adviser may terminate the Expense Limitation Agreements at any time upon not less than 90 days notice to the Board of Trustees. The terms of the Expense Limitation Agreements may be revised upon renewal, if renewed. The Adviser is permitted to recoup from each Fund previously waived fees or reimbursed expenses for three years from the date on which fees were waived or expenses reimbursed, as long as such recoupment does not cause such Fund s operating expenses to exceed the expense cap that was applicable during the period in which the fees were waived or expenses were reimbursed. As of June 30, 2017, the amount of expenses eligible for recoupment by the Adviser is as follows: Amount Eligible: Amount Recouped: Amount Expires: Fund Accrued in Fiscal Year: TOFR*... 9/15/2014 6/30/2015 $ 97,322 $ /1/2015 6/30/2016 $ 268,956 $ /1/2016 6/30/2017 $ 235,989 $ 2020 MENU*... 11/8/2016 6/30/2017 $ 160,971 $ 2020 * Inception date, September 15, 2014 and November 8, 2016 for TOFR and MENU, respectively. Administrator, Custodian and Transfer Agent Brown Brothers Harriman & Company ( BBH ) serves as the administrator, custodian and transfer agent for the Funds. Under the Administrative Agency Agreement with the Trust, BBH performs certain administrative, accounting, transfer agency and dividend disbursing services for the Funds and prepares certain reports filed with the U.S. Securities and Exchange Commission ( SEC ) on behalf of the Trust and the Funds. Under the Custodian Agreement with the Trust, BBH maintains in separate accounts: cash, securities and other assets of the Funds; keeps all necessary accounts and records, and provides other services. BBH is required, upon the order of the Trust, to deliver securities held by BBH and to make payments for securities purchased by the Trust for the Funds. As compensation for the foregoing services, BBH receives certain out-of-pocket costs, transaction fees, and asset-based fees, which are charged to the Funds

30 Buying and Selling Fund Shares Shares are issued and redeemed by the Funds only in large blocks of shares ( Creation Baskets and Redemption Baskets, respectively). Currently, Creation Baskets and Redemption Baskets generally consist of blocks of 50,000 shares or multiples thereof at net asset value. Such transactions are generally permitted on an in-kind basis, with a balancing cash component to equate the transaction to the net asset value per share of the Funds on the transaction date. Only entities who have entered into an authorized participant agreement (an Authorized Participant ) with the Trust s distributor will be permitted to purchase and redeem shares directly from the Trust. An Authorized Participant who wishes to purchase a Creation Basket or redeem a Redemption Basket at net asset value is subject to a standard transaction fee of $350 on the date of such creation or redemption, regardless of the number of Creation Baskets or Redemption Baskets created or redeemed on that day. Distributor ALPS Distributors, Inc. (the Distributor ) is the distributor of the Trust. The Distributor has entered into a Distribution Agreement with the Trust pursuant to which it distributes shares of the Funds in Creation Basket aggregations. The Distributor is a broker-dealer registered under the Securities Exchange Act of 1934, as amended, and a member of the Financial Industry Regulatory Authority. Fees under the Distribution Agreement are paid by the Adviser. The Adviser may, from time to time and from its own resources, make other distribution-related payments to the Distributor or other persons. Licensing Agreement The index providers for TOFR and MENU are Neil Macneale, Inc. and Access ETF Solutions LLC (together, the Index Providers ), respectively. The Index Providers are not affiliated with the Funds, the Trust, the Adviser or the Distributor. The Adviser has entered into license agreements with each of the Index Providers to use the Indices. Fees under the licensing agreement are charged to the Adviser. 4) INVESTMENT TRANSACTIONS PURCHASES AND SALES During the period ended June 30, 2017, the aggregate cost of purchases and proceeds from sales of investments (excluding short-term investments and in-kind transactions) were as follows: Fund Purchases Sales TOFR... $ 2,319,471 $ 2,467,288 MENU* , ,723 * Inception date, November 8, Annual Report June 30, 2017