Robotics and Automation Index ETF (RBOT) Horizons. Canada s First Robotics and Automation ETF

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1 Horizons Robotics and Automation Index ETF (RBOT) Canada s First Robotics and Automation ETF Innovation is our capital. Make it yours.

2 On November 29, 2017, Horizons ETFs Management (Canada) Inc. launched the Horizons Robotics and Automation Index ETF (which trades on the Toronto Stock Exchange under the ticker symbol RBOT ). RBOT represents an innovative index strategy that gives investors exposure to the rapidly growing robotics and automation industry.* RBOT seeks to replicate the performance of the Indxx Global Robotics & Artificial Intelligence Thematic Index ( the Index ). The Index is designed to provide exposure to the performance of equity securities of roboticsrelated and/or automation-related companies which are listed anywhere around the globe. RBOT invests in a physical portfolio of equity securities primarily comprising constituent issuers of the Index and seeks to hedge its U.S. currency exposure to the Canadian dollar at all times. *Note: Effective July 4, 2018, the ETF s investment objective, ticker symbol and management fee changed. As at that date, the ETF s investment objective became to seek to replicate, to the extent possible, the performance of the Indxx Global Robotics & Artificial Intelligence Thematic Index, net of expenses. The ETF s new ticker symbols became RBOT (in Canadian dollars) and RBOT.U (in U.S. dollars). In addition, the ETF s management became 0.68% (plus applicable taxes), reduced from 0.75%. Previously, the ETF s investment objective was to seek to replicate, to the extent possible, the performance of the ROBO Global Robotics and Automation Index, net of expenses. The ETF previously traded under the ticker symbols ROBO and ROBO.U. What s Driving this growth? Technological advancements in the processing power of semi-conductors have reached a point where microchips are relatively inexpensive to integrate into almost any type of technology. Doing so can dramatically increase the tasks that these technologies can perform. Most of this technology is focused on key areas of automation, as industries seek to improve the amount of services they can offer, and reduce the overall cost of production by turning to various forms of automation. ETF Snapshot Name: Horizons Robotics and Automation Index ETF Launch Date: November 29, 2017 Ticker: RBOT; RBOT.U 1 Bloomberg Index Ticker: IBOTZ Underlying Index: Indxx Global Robotics & Artificial Intelligence Thematic Index Management Fee: 0.68% (plus applicable sales tax) Investment Manager: Horizons ETFs Management (Canada) Inc. Distribution Frequency: Annually, if any Eligibility: All registered and non-registered investment accounts Currency: All USD exposure is hedged back to Canadian dollars 1 Trades in U.S. dollars.

3 global robotics technology market As the chart below highlights, there is substantial impact to many industries through the increased use of robotics. Size and Forecast ( ) Global Robotics Technology Market The Global Robotics Technology Marketis expected to reach at $82.7 billion by 2020 Growing at a CAGR of 10.11% ( ) Global Robotics Technology Market By Type of Robots Industrial Service Mobile Others Industrial To Be Highest Revenue Generating Segment by 2020 Global Robotics Technology Market By Applications Healthcare Defense and security Aerospace Automotive Electronics Domestic Others Automotive To Be Highest Revenue Generating Segment by 2020 Source: Allied Market Research, May A recent study by PwC concluded that the market for artificial intelligence, which is the capability of a machine to imitate intelligent human behavior, could result in an additional U.S. $15.7 trillion in global economic output by Source: Sizing the Prize PwC s Global Artificial Intelligence Study, April 2017.

4 This type of technology is seen as more than just transformative it might be the single-biggest driver of economic growth in our lifetime. In aggregate, it represents a potential USD $1.2 trillion revenue opportunity by 2025, according to Myria Research. Source: Myria Research. Generally, investors have very low exposure to stocks that deal directly in the development of robotics and automation. Most investors are familiar with large users of automation and A.I. technology, such as Google and Amazon. But what about the companies that are actually building this type of technological infrastructure? Very few of these names are widely known, and even less are widely held by investors. In fact, in the MSCI All-World Country Index, which is the benchmark large-cap equity index for the world, less than 2% of the companies listed in the Indxx Global Robotics & Artificial Intelligence Thematic Index are also found in that index. Investors would therefore need to directly seek out exposure to these technology companies and the Indxx Global Robotics & Artificial Intelligence Thematic Index is one of the few index solutions in the world offering direct exposure to this rapidly growing segment of the global economy.

5 The Indxx Global Robotics & Artificial Intelligence Thematic Index The Index provides exposure to industries and segments that are expected to benefit from the increased adoption of robotics and A.I.: Robotics and Automation: Companies involved in the design, creation and application of mechanical devices that can perform tasks and interact with their environments without human interaction Artificial Intelligence: Companies that are involved in developing applications, technologies and products that utilize A.I. for data analysis, predictive analytics, task automation and other applications Only those companies that derive a significant portion of their revenues from the above industries/ segments or have stated their primary business to be in products and services focused on the above industries/segments are eligible for inclusion in the Index. investable universe The Index is designed to include the most liquid and the investable universe of companies listed on developed markets exchanges as defined by Index. Companies within the Index must have a minimum market capitalization of $100 million. The following segments are the most relevant to the robotics and A.I. theme: Industrial Robots and Automation: Companies that provide robots and robotic automation products and services with a focus on industrial applications Unmanned Vehicles and Drones: Companies that are involved in the development and production of unmanned vehicles (including hardware and software for autonomous cars), drones and robots for both military and consumer markets Non-industrial Robotics: Companies that are involved in developing robots and A.I. that are used for non-industrial applications, including but not limited to agriculture, healthcare, consumer applications and entertainment Artificial Intelligence: Companies that are involved in developing applications, technologies and products that utilize A.I. for data analysis, predictive analytics, task automation and other applications Further Index details: The index is rebalanced annually No stock can have more than an 8% index weight at the time of rebalance The aggregate weight of the top six securities is capped at 40%, all remaining securities are capped at 4.5%

6 Which sectors are being disrupted? Robotics and A.I. have the ability to disrupt a broad range of sectors, particularly manufacturing, military and defence, medicine, transportation and agriculture. Manufacturing In 2015, around 10% of manufacturing functions were automated. Boston Consulting Group estimates the share to increase to around 25% by Defence The U.S. Army expects that by 2030, it could reduce Brigade Combat Teams from 4,000 soldiers to 3,000 using robots to maintain unit s effectiveness despite less manpower. Health Care IBM s Watson supercomputer has a 90% diagnostic accuracy rate for lung cancer compared with the average diagnostic accuracy rate of 50% for human physicians. Transportation By 2030, autonomous cars could account for up to 15% of passenger vehicles sold worldwide. Argiculture The global market for agriculture robots is projected to exceed $15 billion by Source: GlobalX, Key Reasons to Own rbot Growth Opportunity: Gain exposure to one of the fastest-growing segments of the global economy Diversification: Little overlap in holdings with major broad stock indices and significant exposure to non-north American stocks Innovative Index Design: Stocks are selected using a rigorous research process Currency Hedged: All U.S. dollar exposure is currency hedged, making it a more currency efficient strategy for Canadian investors Takeover Premiums: Companies about to experience corporate takeovers typically see their stock value increase

7 HorizonsETFs.com/RBOT

8 Innovation is our capital. Make it yours. Horizons ETFs is a member of Mirae Asset Global Investments. Commissions, management fees and expenses all may be associated with an investment in the Horizons Robotics and Automation Index ETF managed by Horizons ETFs Management (Canada) Inc. (the ETF ). The ETF is not guaranteed, its values change frequently and past performance may not be repeated. The prospectus contains important detailed information about the ETF. Please read the prospectus before investing _H