Sprott Junior Gold Miners ETF (SGDJ US) – Portfolio Construction Methodology

The underlying Solactive Junior Gold Miners Custom Factors Index TR targets junior gold miners from the Solactive Global Gold Explorers & Developers universe with security-level market cap <2 bn USD; the set is split into explorers (ranked by 12-month price momentum) and producers (ranked by revenue growth). Initial weights are market-cap based, then the top half of each group receives a 3.5% weight boost while the bottom half is penalized −3.5% (per-name floor 0.5%); names <0.5% and in the bottom half are further scaled to 80% of cap weight. Final weights are normalized with two concentration brakes: no single name >9%, and no more than 50% of the index can be in members >4.5% weight; excess above caps is prorated to the rest. ADR/GDR shares may be used. The index is reviewed semi-annually and rebalanced on the third Friday of March and September.

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