Use and Risk Disclosures

IT IS VERY IMPORTANT THAT YOU READ AND FULLY UNDERSTAND THE FOLLOWING RISKS OF TRADING AND INVESTING IN YOUR SELF-DIRECTED CACHE SECURITIES SERVICES ACCOUNT.

All Customer Accounts are self-directed. Accordingly, unless Cache Securities LLC (“Cache Securities”) clearly identifies a communication as a recommendation, Customers are solely responsible for any and all orders placed in their Accounts and understand that all orders entered by them are unsolicited and based on their own investment decisions or the investment decisions of their duly authorized representative or agent. Consequently, any Customer of Cache Securities agrees that neither Cache Securities nor any of its employees, agents, principals, or representatives:

1. provide investment advice in connection with a Customer Account;
2. recommend any security, transaction or order;
3. solicit orders;
4. act as a market maker in any security;
5. make discretionary trades; and
6. produce or provide research. To the extent research materials or similar information is available through the Cache Securities website or mobile application, or the websites of any of its affiliates, these materials are intended for informational and educational purposes only and they do not constitute a recommendation to enter into any securities transactions or to engage in any investment strategies.

GENERAL RISKS OF TRADING AND INVESTING

All securities trading, whether in stocks, exchange-traded funds (“ETFs”), options, exchange funds (“Exchange Funds”), or other investment vehicles, is speculative in nature and involves substantial risk of loss. Cache Securities encourages its Customers to invest carefully and to use the information available at the websites of the SEC at http://www.sec.gov, and FINRA at http://FINRA.org. Customers can review public companies’ filings at the SEC’s EDGAR page. FINRA has published information on how to invest carefully at its website. Cache Securities Services may also make some of this information available on the website (the “Platform”) operated by Cache Financials Inc. and its affiliates (together, “Cache Financials”).

Cache Securities believes it is very important that every Customer understands all of the risks of any form of trading or investing prior to trading or investing real dollars. Past performance is not indicative of future results. By investing their money and/or exchanging assets in securities through Cache Securities, Customers are taking full responsibility for all trading actions, and should make every effort to understand the risks involved.

1. You may lose money trading and investing. For that reason, Customers should trade or invest only with money and/or assets they can afford to lose. Investing in securities involves HIGH RISK, and YOU can LOSE a lot of money or value. 
2. Past performance is not necessarily indicative of future results. All investments carry risk, and all trading decisions of an individual remain the responsibility of that individual. There is no guarantee that systems, indicators, or trading signals will result in profits or that they will not result in losses. All Customers are advised to fully understand all risks associated with any kind of trading or investing they choose to do.

RISKS OF INVESTING IN EXCHANGE FUNDS

All investments entail some degree of risk. Investing in Exchange Funds involves certain risks and special investment considerations as set forth below. Investing a substantial portion of liquid assets in Exchange Funds exposes you to a greater degree of risk than investing a smaller percentage. 

You should carefully review the risks of investing in Exchange Funds and should evaluate the merits and risks of an investment in Exchange Funds in the context of your overall financial circumstances. Before you make an investment in an Exchange Fund, you should carefully review the offering documents and fully understand the associated risks involved.

Tax Considerations and Risks:

• When you invest in an Exchange Fund by exchanging your stocks or other securities, your taxes are not reduced, but rather deferred. You will eventually need to pay taxes when you sell your shares. 
• While you participate in an Exchange Fund, you may owe taxes. If the Exchange Fund sells assets, receives dividends, or liquidates another investor’s interests in the Exchange Fund, during the term in which you are invested, the Exchange Fund may allocate a gain from that sale because you are a limited partner in the Exchange Fund, and thus be required to pay the applicable taxes. 
• You are required to hold your interest in an Exchange Fund for the duration of the holding period. During this time, tax rates may fluctuate. In the future if taxes increase, it may be more advantageous to pay taxes you owe today instead of paying taxes at a later time. 
• Tax laws may change in the future, which may impact the favorable tax treatment of an investment in an Exchange Fund. While the benefits may be grandfathered in any new tax regulations, retroactive treatment is not guaranteed.

Investment Considerations and Risks:

• The value of shares held by an Exchange Fund may fluctuate or decline, reflecting a variety of factors. Changes in investor outlook and political and economic environments may have an impact on the Exchange Fund’s value. 
• An Exchange Fund’s performance is not guaranteed. There is no guarantee that an Exchange Fund will outperform the index it is designed to track. Additionally, it is possible that the positions you contribute will outperform the Exchange Fund. 
• Investments in diverse and sometimes complex strategies are sometimes affected in different ways and at different times by changing market conditions. Strategies may at times be unfavorable, compared to market conditions, for periods of time, which may have adverse consequences for the Exchange Fund’s portfolio. 
• When you redeem your shares in an Exchange Fund, you may receive an in-kind redemption in a form other than your initial contribution. 
• Exchange Funds typically have a portfolio of concentrated positions. If one or more of the positions in these holdings experience a significant decline in value, this can have an adverse impact on the overall performance of the Exchange Fund.

Liquidity & Redemption Considerations and Risks:

• Exchange Funds are not as liquid compared to other investment types, such as investing in stocks, ETFs, or other investment vehicles. Therefore, you should be prepared to maintain your position in an Exchange Fund for an extended period of time. If you require liquidity, an investment in an Exchange Fund may not be suitable for you. 
• Investing in an Exchange Fund through Cache Securities will subject you to a two-year lockup period on the shares you contribute to the Exchange Fund. This means you will be unable to request a redemption for a period of two years. If you have short-term liquidity needs, you should consider carefully whether participation in an Exchange Fund is suitable to your needs. 
• To take advantage of the tax benefits of participating in an Exchange Fund, you are required to hold your shares in an Exchange Fund for at least seven years. 
• If you seek to redeem your shares after the lockup period but before the end of the holding period, you may receive your original contribution at a rate that is the lower of the contributed stock value or the fund’s net asset value. Additionally, early redemptions may be subject to penalty fees. You should carefully review the terms of the Exchange Fund documents before deciding to participate in an Exchange Fund. 

RISKS OF INVESTING IN STOCK AND ETFs

Investments always entail some degree of risk. Be aware that:

• Some investments in stock cannot easily be sold or converted to cash. You should check to see if there is any penalty or charge if you must sell an investment quickly.
• Some investment strategies utilize certain order types to fulfill buy or sell orders. Not all order types are available through Cache Securities. For instance, stop market orders are not available. A stop market order is an order to buy or sell a particular stock at market price if and when the price reaches a specified level. Stop market orders may help reduce risk. By trading stocks through Cache Securities, stop market orders will not be available to you to help you reduce your trading risk. 
• Investments in stock issued by a company with little or no operating history or published information involves greater risk than investing in a public company with an operating history and extensive public information. Stock investments are not federally insured against a loss in market value.
• Stock you own may be subject to tender offers, mergers, reorganizations, or third-party actions that can affect the value of your ownership interest. Pay careful attention to public announcements and information sent to you about such transactions. They involve complex investment decisions. Be sure you fully understand the terms of any offer to exchange or sell your shares before you act. In some cases, such as partial or two-tier tender offers, failure to act can have detrimental effects on your investment.
• The greatest risk in buying shares of stock is having the value of the stock fall to zero.
• Investors should consider the investment objectives and unique risk profile of an ETF carefully before investing. ETFs are subject to risks similar to those of other diversified portfolios. Leveraged and Inverse ETFs may not be suitable for all investors and may increase exposure to volatility through the use of leverage, short sales of securities, derivatives and other complex investment strategies.
• Although ETFs are designed to provide investment results that generally correspond to the performance of their respective underlying indices, they may not be able to exactly replicate the performance of the indices because of expenses and other factors. A prospectus contains this and other information about the ETF and should be read carefully before investing. Customers should obtain prospectuses from issuers and/or their third-party agents who distribute and make prospectuses available for review. ETFs are required to distribute portfolio gains to shareholders at year end. These gains may be generated by portfolio rebalancing or the need to meet diversification requirements. ETF trading will also generate tax consequences.