UTES

Virtus Reaves Utilities ETF (UTES) is an exchange-traded fund designed to provide exposure to the U.S. utilities sector through an actively managed strategy. The ETF is managed by Virtus Investment Partners, with portfolio management by Reaves Asset Management, and trades under the ticker UTES on NYSE Arca.

Classified as a U.S. sector-focused equity ETF, UTES follows an active management approach. Unlike traditional index-tracking funds, it does not seek to replicate a specific benchmark.

The portfolio is constructed based on fundamental analysis conducted by the management team within the utilities sector, taking into account regulatory frameworks, operational characteristics, and structural factors of the selected companies.

Asset weighting is determined by portfolio managers based on sector relevance, regulatory profile, and company-specific characteristics. The composition is reviewed periodically in response to market conditions and fund guidelines.

Diversification and sector exposure

UTES provides concentrated exposure to the U.S. utilities sector. The portfolio may include companies operating in areas such as:

• Electric utilities.
• Natural gas utilities.
• Water utilities.
• Utilities infrastructure.
• Regulated public service providers.

This structure reflects the organization of the utilities sector within the U.S. equity market.

Structure and costs

UTES shares trade on the secondary market on NYSE Arca throughout the regular trading session. Creation and redemption of shares occur through authorized participants, helping maintain alignment between market price and net asset value.

The fund charges a management fee as outlined in its prospectus and does not apply a performance fee. UTES distributes income derived from dividends paid by the companies held in its portfolio in accordance with its distribution policy.

History and evolution of the ETF

Virtus Reaves Utilities ETF was launched in 2015 during a period of growing interest in investment vehicles focused on essential economic sectors.

Over time, UTES has maintained its active management approach and exclusive focus on the utilities sector, adapting to regulatory and structural developments within the industry.

In recent years, the ETF reflected the traditionally defensive characteristics of utilities during market volatility, as well as the impact of rising interest rates and energy transition discussions, while preserving its active investment strategy.