institutional presentation pacer trendpilot etf strategies · institutional presentation pacer...

FOR INVESTMENT PROFESSIONAL USE ONLY. NOT FOR USE WITH THE INVESTING PUBLIC.

Institutional Presentation

PACER TRENDPILOT® ETF STRATEGIES

FOR INVESTMENT PROFESSIONAL USE ONLY. NOT FOR USE WITH THE INVESTING PUBLIC. 1

BEFORE INVESTING YOU SHOULD CAREFULLY CONSIDER THE FUNDS’ INVESTMENT OBJECTIVES, RISKS, CHARGES, AND EXPENSES. THIS AND OTHER INFORMATION IS IN THE PROSPECTUS. A COPY MAY BE OBTAINED BY VISITING WWW.PACERETFS.COM OR CALLING 1-877-337-0500. PLEASE READ THE PROSPECTUS CAREFULLY BEFORE INVESTING. An investment in the Funds is subject to investment risk, including the possible loss of principal. Pacer ETF shares may be bought and sold on an exchange through a brokerage account. Brokerage commissions and ETF expenses will reduce investment returns. There can be no assurance that an active trading market for ETF shares will be developed or maintained. The risks associated with these funds are detailed in the prospectus and could include factors such as calculation methodology risk, concentration risk, equity market risk, ETF risks, fixed income risk, government obligations risk, high portfolio turnover risk, large and mid-capitalization investing risk, passive investment risk, tracking risk, trend lag risk, currency exchange rate risk, European investments risk, foreign securities risk, geographic concentration risk, non-diversification risk, sector risk, and/or special risks of exchange traded funds. The Pacer Trendpilot® US Large Cap Index, Pacer Trendpilot® US Mid Cap Index and Pacer Trendpilot® International Index (the “Indices”) are the property of Index Design Group, LLC which has contracted with S&P Opco, LLC (a subsidiary of S&P Dow Jones Indices LLC) to calculate and maintain the Indices. The Indices are not sponsored by S&P Dow Jones Indices or its affiliates or its third party licensors (collectively, “S&P Dow Jones Indices”). S&P Dow Jones Indices will not be liable for any errors or omissions in calculating the Indices. “Calculated by S&P Dow Jones Indices” and the related stylized mark(s) are service marks of S&P Dow Jones Indices and have been licensed for use by Index Design Group, LLC. S&P® is a registered trademark of Standard & Poor’s Financial Services LLC (“SPFS”), and Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”). The Pacer NASDAQ-100® Trendpilot® Index is co-owned by Index Design Group, LLC and Nasdaq, Inc. (which with its affiliates is referred to as the “Corporations”). The NASDAQ-100 is a registered trademark of the Corporations and is licensed for use by Index Design Group, LLC. The Product(s) are not issued, endorsed, sold, or promoted by the Corporations. The Corporations make no warranties and bear no liability with respect to the product(s). Source: FTSE International Limited (“FTSE”) © FTSE 2017. “FTSE®” is a trade mark of the London Stock Exchange Group companies and is used by FTSE International Limited under licence. All rights in the FTSE indices and / or FTSE ratings vest in FTSE and/or its licensors. Neither FTSE nor its licensors accept any liability for any errors or omissions in the FTSE indices and / or FTSE ratings or underlying data and no party may rely on any FTSE indices, ratings and / or data underlying data contained in this communication. No further distribution of FTSE Data is permitted without FTSE’s express written consent. FTSE does not promote, sponsor or endorse the content of this communication. To learn more about each Index methodology, please visit www.indexdesigngroup.com or call 877-337-0500. DEFINITIONS OF CERTAIN DEFINED TERMS USED HEREIN:Annualized average return represents the calculated hypothetical rate of return that, if cumulatively applied to each relevant annual period during the time period indicated, would result in the actual cumulative rate of return for the entire period. Maximum return represents the highest calendar year return as measured during the period indicated.Minimum return represents the lowest calendar year return as measured during the period indicated.Annualized volatility is based on monthly returns from the most recent date indicated on the page and expressed as a standard deviation percentage. Standard deviation is a measure of volatility and illustrates the extent of variation (whether higher or lower) that exists from the average given set of results. A low standard deviation indicates that the results tend to be very close to the average result (a low degree of volatility). In contrast, a high standard deviation indicates that the results are spread out over a large range of outcomes (a high degree of volatility). Because the standard deviation is based on historical data, it may not predict variability in annualized performance of the Pacer ETFs in the future. Maximum drawdown represents the maximum percentage loss that the relevant index incurred from its peak level to its lowest level during the time period indicated. The Barclays Capital Aggregate Bond Index is a market capitalization-weighted index of most U.S. traded investment grade bonds, including Treasury securities, Government agency bonds, Mortgage-backed bonds, Corporate bonds, and a small amount of foreign bonds traded in the U.S. Annualized standard deviation is the standard deviation multiplied by the square root of the number of periods in one year. Standard deviation of return measures the average deviations of a return series from its mean, and is often used as a measure of risk. Trendpilot® is a registered trademark of Index Design Group, LLC.

Distributor: Pacer Financial, Inc., member FINRA, SIPC, an affiliate of Pacer Advisors, Inc. NOT FDIC INSURED | MAY LOSE VALUE | NOT BANK GUARANTEED


PACER ETF LINEUP

Pacer Trend Following ETFs

ETF NameETF Ticker

ETF Inception Date Benchmark Index

Total Expenses

Intraday Indicative Value Ticker CUSIP Exposures

Pacer Trendpilot® US Large Cap ETF PTLC 06/11/15 S&P 500® Index 0.60% PTLC.IV 69374H105

Equity – 100% S&P 500® Index 50/50 – 50% S&P 500® Index; 50% 3-Month US T-Bills T-Bill – 100% 3-Month US T-Bills

Pacer Trendpilot® 100 ETF PTNQ 06/11/15 NASDAQ-100® Index 0.65% PTNQ.IV 69374H303

Equity – 100% NASDAQ-100® Index

50/50 – 50% NASDAQ-100® Index; 50% 3-Month US T-Bills T-Bill – 100% 3-Month US T-Bills

Pacer Trendpilot® US Mid Cap ETF PTMC 06/11/15 S&P MidCap 400® Index 0.60% PTMC.IV 69374H204

Equity – 100% S&P MidCap 400® Index

50/50 – 50% S&P MidCap 400® Index; 50% 3-Month US T-Bills T-Bill – 100% 3-Month US T-Bills

Pacer Trendpilot® International ETF PTIN 5/2/19

S&P Developed Ex-US Large Cap Index

0.65% PTIN.IV 69374H 683

Equity – 100% S&P Developed Ex-US Large Cap Index 50/50 – 50% S&P Developed Ex-US Large Cap Index; 50% 3-Month US T-Bills T-Bill – 100% 3-Month US T-Bills

Pacer Trendpilot® European Index ETF PTEU 12/14/15 FTSE Eurozone Index 0.65% PTEU.IV 69374H808

Equity – 100% FTSE Eurozone Index

50/50 – 50% FTSE Eurozone Index; 50% 3-Month US T-Bills T-Bill – 100% 3-Month US T-Bills

The S&P 500® Index is a popular gauge of large-cap U.S. equities and includes 500 leading companies, capturing approximately 80% coverage of available market capitalization.The S&P MidCap 400® Index is a benchmark for mid-sized companies, measuring the performance of mid-sized companies and reflecting the risk and return characteristics of this market segment.The NASDAQ-100® Index includes approximately 100 of the largest non-financial securities listed on The NASDAQ Stock Market based on market capitalization. The NASDAQ-100® Index comprises securities of companies across major industry groups, including computer, biotechnology, healthcare, telecommunications, and transportation. However, it does not contain securities of financial companies, including investment companies. The NASDAQ-100® Index was developed by NASDAQ OMX®. The FTSE Eurozone Index comprises large- and mid-cap stocks providing coverage of the developed markets in the Eurozone. The Index is derived from the FTSE Global Equity Index Series (GEIS), which covers 98% of the world’s investable market capitalization. The S&P Developed Ex-US Large Cap Index captures approximately 85% coverage of market capitalization excluding the U.S.

Pacer Trendpilot® ETFs use their respective benchmark index and 200 day simple moving average to determine their position in the market. On 11/1/2017, the equity index component of the Pacer Trendpilot® US Large Cap and Pacer Trendpilot® US Mid Cap strategies changed to the S&P 500® and S&P MidCap 400® Index respectively.


PACER TRENDPILOT® STRATEGIES

This graph illustrates the Pacer Trendpilot® methodology based on hypothetical movements in the benchmark index and its 200 day simple moving average. This page does not demonstrate historical data and is not an indication of how any Index or Pacer Trendpilot® methodology will perform in the future. If the conditions mentioned in the graph are not satisfied, the trend of the benchmark index will be the same as the trend of the benchmark index on the immediately preceding business day. (1)Any trend change will become effective at the close of business on the first business day after the indicator for the change is triggered. The Index will be in a new position effective on the second business day.

The Pacer Trendpilot® strategy seeks to participate in the market when it is trending up, pare back market exposure during short-term market down trends, and prevent extended declines by moving to T-bills during long-term market down trends. The example below uses the Large Cap Index to illustrate the strategy.

HYPOTHETICAL ILLUSTRATION

The Pacer Trendpilot® US Large Cap ETF (the “Fund”) is an exchange traded fund that seeks to track the total return performance, before fees and expenses, of the Pacer Trendpilot® US Large Cap Index (the “Index”).

Equity Indicator: When the S&P 500® Total Return Index closes above its 200 day simple moving average (200 Day SMA) for five consecutive business days, the exposure of the Index will be 100% to the S&P 500® Index.1 From the equity position, the Index will change to the 50/50 position or the T-Bill position depending on the 50/50 Indicator and the T-Bill Indicator.

T-Bill Indicator: When the S&P 500® Total Return Index’s 200 Day SMA closes lower than its value from five business days earlier, the exposure of the Index will be 100% to 3-Month US Treasury bills.1 From the T-Bill position, the Index will change to the equity position when the Equity Indicator is triggered. The Index will not return to its 50/50 position unless the Equity Indicator is first triggered.

50/50 Indicator: When the S&P 500® Total Return Index closes below its 200 Day SMA for five consecutive business days, the exposure of the Index will be 50% to the S&P 500® Index and 50% to 3-Month US Treasury bills.1 From the 50/50 position, the Index will return to the equity position or change to the T-Bill position depending on the Equity Indicator or T-Bill Indicator.

100% S&P 500® Index

50% S&P 500® Index, 50% T-Bills

100% T-Bills

Index 200 Day Simple Moving Average

Index Value

Legend:


0

50

100

150

200

250

300

350

400

450

500

12/31/1999 12/31/2001 12/31/2003 12/31/2005 12/31/2007 12/31/2009 12/31/2011 12/31/2013 12/31/2015 12/31/2017 12/31/2019

MARKET HISTORY

AVOIDING THE BIG DECLINES 12/31/1999 – 9/30/2020

Source: S&P. The hypothetical backtested index performance of the Pacer Trendpilot® US Large Cap Index is shown net of fees and reflects the reinvestment of dividends. The annual total expense is 0.60%. The Pacer Trendpilot® Index was released on 06/10/15. On 11/01/17, the equity index the Pacer Trendpilot® Index tracks changed to the S&P 500®. All data shown here is based on the S&P 500® as the equity index and is hypothetical, retrospectively calculated, and based on rules-based criteria applied retroactively with the benefit of hindsight and knowledge of factors that may have positively affected its performance, and cannot account for all financial risk or market and economic factors that may affect the actual performance. The results shown are hypothetical and do not reflect actual returns.PAST PERFORMANCE (WHETHER RETROSPECTIVELY CALCULATED OR ACTUAL HISTORICAL) IS NOT INDICATIVE OF FUTURE RESULTS. YOU CANNOT INVEST DIRECTLY IN AN INDEX.

Date

Inde

x Le

vel

Pacer Trendpilot® US Large Cap Index 70% S&P 500® Index/30% Barclays Capital U.S. Aggregate Bond Index S&P 500® Index

-47.38% S&P 500® Index

March 24, 2000 - October 9, 2002

-55.25% S&P 500® Index

October 9, 2007 - March 9, 2009

-33.79% S&P 500® Index

February 19, 2020 - March 23, 2020


$0

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

$40,000

$45,000

$50,000

12/31/1999 12/31/2001 12/31/2003 12/31/2005 12/31/2007 12/31/2009 12/31/2011 12/31/2013 12/31/2015 12/31/2017 12/31/2019

PACER TRENDPILOT® US LARGE CAP INDEX

(1)All Indexes shown are Total Return Indexes. Source: S&P & Bloomberg. The hypothetical backtested index performance of the Pacer Trendpilot® US Large Cap Index is shown net of fees and reflects the reinvestment of dividends. The annual total expense is 0.60%. The Pacer Trendpilot® Index was released on 06/10/15. On 11/01/17, the equity index the Pacer Trendpilot® Index tracks changed to the S&P 500®. All data shown here is based on the S&P 500® as the equity index and is hypothetical, retrospectively calculated, and based on rules-based criteria applied retroactively with the benefit of hindsight and knowledge of factors that may have positively affected its performance, and cannot account for all financial risk or market and economic factors that may affect the actual performance. The results shown are hypothetical and do not reflect actual returns.PAST PERFORMANCE (WHETHER RETROSPECTIVELY CALCULATED OR ACTUAL HISTORICAL) IS NOT INDICATIVE OF FUTURE RESULTS. YOU CANNOT INVEST DIRECTLY IN AN INDEX.

HYPOTHETICAL GROWTH OF $10,0001 12/31/1999 – 9/30/2020

HISTORICAL PERFORMANCE, VOLATILITY COMPARISON AND MAXIMUM DRAWDOWN (%)1 12/31/1999 – 9/30/2020

Pacer Trendpilot® US Large Cap Index

S&P 500® Index

Annualized Average Return

6.47 6.10

Annualized Volatility

12.14 19.58

Maximum Drawdown

-26.67 -55.25

$36,723

$32,509$34,228

Pacer Trendpilot® US Large Cap Index 70% S&P 500® Index/30% Barclays Capital U.S. Aggregate Bond Index S&P 500® Index 200 Day SMA – S&P 500® Index

Pacer Trendpilot® US Large Cap Index

S&P 500® Index

Maximum Return

31.60 (2013)

32.39 (2013)

Minimum Return

-5.98 (2011)

-37.00 (2008)

Retrospectively calculated Pacer Trendpilot® Index performance and historical comparisons are shown net of fees.

100% S&P 500® Index 50% S&P 500® Index, 50% 3-Month US T-Bill 100% 3-Month US T-Bill

MINIMUM AND MAXIMUM CALENDAR YEAR RETURNS (%)1

12/31/1999 – 9/30/2020


S&P 500® INDEX

Source: FactSet. YOU CANNOT INVEST DIRECTLY IN AN INDEX.

SECTOR BREAKDOWN as of 9/30/2020

Ticker Company Weight (%)

AAPL Apple Inc. 6.68

MSFT Microsoft Corporation 5.71

AMZN Amazon.com, Inc. 4.81

FB Facebook, Inc. Class A 2.26

GOOGL Alphabet Inc. Class A 1.58

GOOG Alphabet Inc. Class C 1.55

BRK.B Berkshire Hathaway Inc. Class B 1.51

JNJ Johnson & Johnson 1.41

PG Procter & Gamble Company 1.24

V Visa Inc. Class A 1.21

Total 27.96

TOP 10 HOLDINGS as of 9/30/2020

LARGE CAP CHARACTERISTICS STABILITY • Known to be stable and incur less risk than mid- and small-cap stocks • May decline less than mid- and small-cap stocks in market downturns• Tend to have less volatile share prices and are more likely to pay dividends SCALE AND RESOURCES • May be better equipped to fend off competitors and pursue growth opportunities • May have cash and capital for strong future growth TRANSPARENCY • Wealth of research and information, allowing investors to be well informed about large cap companies

28.15% Information Technology

10.80% Communication Services

9.67% Financials

8.29% Industrials

2.64% Real Estate

2.62% Materials

14.23% Health Care

11.55% Consumer Discretionary

7.02% Consumer Staples

2.97% Utilities

2.06% Energy

ABOUT THE S&P 500® • Part of a series of S&P Dow Jones U.S. equity indices• Includes approximately 500 of the top companies in leading industries of the US economy• Captures approximately 80% coverage of available market capitalization• Rebalanced quarterly on the third Friday of the quarter-ending month

ABOUT S&P® • The world’s largest global resource for index-based concepts, data and research• More than 120 years of experience constructing innovative and transparent solutions that fulfill the needs of institutional and retail investors


$0

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

12/31/1999 12/31/2001 12/31/2003 12/31/2005 12/31/2007 12/31/2009 12/31/2011 12/31/2013 12/31/2015 12/31/2017 12/31/2019

PACER NASDAQ-100® TRENDPILOT® INDEX

(1)All Indexes shown are Total Return Indexes. Source: NASDAQ & Bloomberg. The hypothetical backtested index performance of the Pacer NASDAQ-100® Trendpilot® Index is shown net of fees and reflects the reinvestment of dividends. The annual total expense is 0.65%. The Index was released on 06/03/15. All Trendpilot® data shown prior to this date is hypothetical, retrospectively calculated, and based on rules-based criteria applied retroactively with the benefit of hindsight and knowledge of factors that may have positively affected its performance, and cannot account for all financial risk or market and economic factors that may affect the actual performance. The results shown are hypothetical and do not reflect actual returns. PAST PERFORMANCE (WHETHER RETROSPECTIVELY CALCULATED OR ACTUAL HISTORICAL) IS NOT INDICATIVE OF FUTURE RESULTS. YOU CANNOT INVEST DIRECTLY IN AN INDEX.



$44,245

$33,697

$35,925

Pacer NASDAQ-100® Trendpilot® Index 70% NASDAQ-100® Index/30% Barclays Capital U.S. Aggregate Bond Index NASDAQ-100® Total Return Index 200 Day SMA – NASDAQ-100® IndexSM

Pacer NASDAQ-100®

Trendpilot® IndexNASDAQ-100®

Index

Maximum Return

36.03 (2013)

54.61 (2009)

Minimum Return

-26.34 (2008)

-41.57 (2008)


100% NASDAQ-100® Index 50% NASDAQ-100® Index, 50% 3-Month US T-Bill 100% 3-Month US T-Bill

Pacer NASDAQ-100®

Trendpilot® IndexNASDAQ-100®

Index


7.42 6.35


18.16 27.86

Maximum Drawdown

-45.34 -82.87


12/31/1999 – 9/30/2020


NASDAQ-100® INDEX

Source: FactSet.YOU CANNOT INVEST DIRECTLY IN AN INDEX.


AAPL Apple Inc. 13.42

MSFT Microsoft Corporation 10.78

AMZN Amazon.com, Inc. 10.69

FB Facebook, Inc. Class A 4.27

TSLA Tesla Inc 3.45

GOOGL Alphabet Inc. Class A 3.42

GOOG Alphabet Inc. Class C 3.32

NVDA NVIDIA Corporation 2.89

ADBE Adobe Inc. 2.03

PYPL PayPal Holdings Inc 2.00

Total 56.27


TECHNOLOGY • Though volatility is common of the tech sector, technology stocks are booming with the growth of the cloud industry. Demand is high for cloud-based services as companies from all sectors benefit from the accessibility they create.

HEALTH CARE/BIOTECHNOLOGY • A new FDA designation has allowed for shorter approval times and faster access to breakthrough drugs. Combined with a greater number of drug discoveries, revenues in healthcare have increased. Pharmaceutical companies are profiting from the unfortunate reality that everyone gets sick.

E-COMMERCE • E-commerce is expanding beyond its early adopters of online retailers and is poised to grow. Business-to-business companies recognize the importance of e-commerce capabilities in their practice and continue to develop these technologies.

5 YEAR COMPOUND ANNUAL GROWTH RATE as of 9/30/2020

0%

5%

10%

15%

20%

Revenue Growth Earnings Growth Dividend Value Growth

4.20%

11.56%

7.31%

15.02%

7.79%

9.53%

S&P 500®

NASDAQ-100®

Grow

th R

ate


19.14% Communication Services



2.01% Industrials


6.67% Health Care

0.61% Utilities


$0

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

$70,000

12/31/1999 12/31/2001 12/31/2003 12/31/2005 12/31/2007 12/31/2009 12/31/2011 12/31/2013 12/31/2015 12/31/2017 12/31/2019

PACER TRENDPILOT® US MID CAP INDEX

(1)All Indexes shown are Total Return Indexes. Source: S&P & Bloomberg. The hypothetical backtested index performance of the Pacer Trendpilot® US Mid Cap Index is shown net of fees and reflects the reinvestment of dividends. The annual total expense is 0.60%. The Pacer Trendpilot® Index was released on 06/10/15. On 11/01/17, the equity index the Pacer Trendpilot® Index tracks changed to the S&P MidCap 400® Index. All data shown here is based on the S&P MidCap 400® as the equity index and is hypothetical, retrospectively calculated, and based on rules-based criteria applied retroactively with the benefit of hindsight and knowledge of factors that may have positively affected its performance, and cannot account for all financial risk or market and economic factors that may affect the actual performance. The results shown are hypothetical and do not reflect actual returns. PAST PERFORMANCE (WHETHER RETROSPECTIVELY CALCULATED OR ACTUAL HISTORICAL) IS NOT INDICATIVE OF FUTURE RESULTS. YOU CANNOT INVEST DIRECTLY IN AN INDEX.



$46,645

$56,074

$47,802

Pacer Trendpilot® US Mid Cap Index 70% S&P MidCap 400® Index/30% Barclays Capital U.S. Aggregate Bond Index S&P MidCap 400® Index

200 Day SMA – S&P MidCap 400® Index

Pacer Trendpilot® US Mid Cap Index

S&P MidCap 400® Index

Maximum Return

35.24 (2003)

37.38 (2009)

Minimum Return

-6.68 (2011)

-36.23 (2008)


100% S&P MidCap 400® Index 50% S&P MidCap 400® Index, 50% 3-Month US T-Bill 100% 3-Month US T-Bill

Pacer Trendpilot® US Mid Cap Index

S&P MidCap 400® Index


7.70 8.66


14.15 21.84

Maximum Drawdown

-24.19 -55.15


12/31/1999 – 9/30/2020


S&P MIDCAP 400® INDEX

Source: FactSet. YOU CANNOT INVEST DIRECTLY IN AN INDEX.

Higher RiskStart-up

Growth

Plateau/Maturity

Small-Cap Mid-Cap Large-Cap



POOL Pool Corporation 0.81

FDS FactSet Research Systems Inc. 0.77

FICO Fair Isaac Corporation 0.75

TRMB Trimble Inc. 0.74

GNRC Generac Holdings Inc. 0.74

SEDG SolarEdge Technologies, Inc. 0.72

MASI Masimo Corporation 0.72

MPWR Monolithic Power Systems, Inc. 0.72

CGNX Cognex Corporation 0.68

CRL Charles River Laboratories International, Inc. 0.68

Total 7.33

THE SWEET SPOT FOR GROWTH • Mid-cap investing exposes investors to companies that are rapidly growing, yet past the startup phase where many smaller companies fail.

OPPORTUNITY • Mid-cap is an under-owned asset class because the companies can be hard to research and good managers are hard to find. • Often good mid-cap funds close to new investors because of size constraints.

RETURNS • Over time mid-cap can be expected to provide higher returns than large cap, but not without increased volatility and bigger drawdowns.


17.69% Industrials

13.68% Financials

11.15% Health Care

9.33% Real Estate


3.76% Utilities



5.86% Materials

1.78% Communication Services 1.15% Energy

Asset Class20 Year Average Annualized

Return (%)20 Year Monthly Standard

Deviation (%)

S&P 500® 6.42 15.00

S&P MidCap 400® 7.92 17.64

S&P SmallCap 600® 8.35 19.22

20 YEAR AVERAGE ANNUALIZED RETURN as of 9/30/2020


$0

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

12/31/1999 12/31/2001 12/31/2003 12/31/2005 12/31/2007 12/31/2009 12/31/2011 12/31/2013 12/31/2015 12/31/2017 12/31/2019

PACER TRENDPILOT® INTERNATIONAL INDEX

(1)All Indexes shown are Total Return Indexes. Source: Pacer Advisors and S&P. The hypothetical backtested index performance of the Pacer Trendpilot® International Index is shown net of fees and reflects the reinvestment of dividends. The annual total expense is 0.65%. The Pacer Trendpilot® Index was released on 4/12/19. All data shown here is based on the S&P Developed Ex-US Large Cap Index as the equity index and is hypothetical, retrospectively calculated, and based on rules-based criteria applied retroactively with the benefit of hindsight and knowledge of factors that may have positively affected its performance, and cannot account for all financial risk or market and economic factors that may affect the actual performance. The start data for this index was chosen based on the available data for the S&P Developed Ex-US Large Cap Index. The results shown are hypothetical and do not reflect actual returns.PAST PERFORMANCE (WHETHER RETROSPECTIVELY CALCULATED OR ACTUAL HISTORICAL) IS NOT INDICATIVE OF FUTURE RESULTS. YOU CANNOT INVEST DIRECTLY IN AN INDEX.



Pacer Trendpilot® International Index



4.44 3.34


10.42 17.26

Maximum Drawdown

-25.66 -60.11

$24,638

$19,792

Pacer Trendpilot® International Index S&P Developed Ex-US Large Cap Index

Pacer Trendpilot® International Index


Maximum Return

30.23 (2009)

38.30 (2003)

Minimum Return

-11.98 (2018)

-43.48 (2008)


100% S&P Developed Ex-US Large Cap Index

50% S&P Developed Ex-US Large Cap Index, 50% 3-Month US T-Bill

100% 3-Month US T-Bill


12/31/1999 – 9/30/2020


S&P DEVELOPED EX-US LARGE CAP INDEX

Source: FactSet, Bloomberg and ICI.org.YOU CANNOT INVEST DIRECTLY IN AN INDEX.

Company Weight (%)

Nestle S.A. 2.51

Samsung Electronics Co., Ltd. 1.87

Roche Holding AG 1.76

Novartis AG 1.57

SAP SE 1.24

Toyota Motor Corp. 1.22

ASML Holding NV 1.15

AstraZeneca PLC 1.05

LVMH Moet Hennessy Louis Vuitton SE 0.92

AIA Group Limited 0.87

Total 14.16


COUNTRY BREAKDOWN as of 9/30/2020

11.33% United Kingdom

8.05% Switzerland

3.30% Sweden

24.51% Japan

7.67% Canada

7.46% Germany

5.20% South Korea

3.51% Netherlands

15.32% Other

5.76% Australia

7.86% France

HOME COUNTRY BIAS Investors are traditionally under allocated in international stocks while missing out on the appropriate global market cap exposure.

DUE FOR AN INTERNATIONAL CYCLE More than 10 years into a cycle favoring the US, we are well past the average of 5 years. When the cycle will change is unknown, but now might be a good time to consider international.

EAFA S&P 500® Years

12/31/69 6/29/73 70.73% 26.70% 3.50

6/29/73 10/29/76 -26.19% 13.17% 3.34

10/29/76 12/29/78 76.00% 4.07% 2.17

12/29/78 10/29/82 5.72% 71.27% 3.84

10/29/82 11/30/88 550.87% 160.41% 6.09

11/30/88 1/29/93 -16.22% 83.60% 4.17

1/29/93 6/30/94 44.22% 5.46% 1.42

6/30/94 1/31/02 15.67% 190.38% 7.59

1/31/02 11/30/07 141.35% 45.63% 5.83

11/30/07 9/30/20 15.77% 197.63% 12.84

Average 5.08

55.70% US44.30% Non US

Market Cap in S&P Global BMI as of 9/30/2020

ETF Assets as of 9/30/2020

76.73% US

23.27% Global/International Equity


Pacer Trendpilot®

European Index

FTSE Eurozone

Index (USD)

Maximum Return

36.49 (2006)

44.89 (2003)

Minimum Return

-18.54 (2010)

-46.73 (2008)

$0

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

$70,000

$80,000

10/6/1994 10/6/1996 10/6/1998 10/6/2000 10/6/2002 10/6/2004 10/6/2006 10/6/2008 10/6/2010 10/6/2012 10/6/2014 10/6/2016 10/6/2018

PACER TRENDPILOT® EUROPEAN INDEX

(1)All Indexes shown are Total Return Indexes. Source: FTSE Russell & Bloomberg. The FTSE Eurozone Index was created on 5/31/2000. Data presented before that date was calculated by Bloomberg. The hypothetical backtested index performance of the Pacer Trendpilot® European Index is shown net of fees and reflects the reinvestment of dividends. The annual total expense is 0.65%. This Pacer Trendpilot® Index was released on 12/09/15. All Trendpilot® data shown prior to this date is hypothetical, retrospectively calculated, and based on rules-based criteria applied retroactively with the benefit of hindsight and knowledge of factors that may have positively affected its performance, and cannot account for all financial risk or market and economic factors that may affect the actual performance. The start data for this index was chosen based on the available data for the FTSE Eurozone Index from Bloomberg. The results shown are hypothetical and do not reflect actual returns. PAST PERFORMANCE (WHETHER RETROSPECTIVELY CALCULATED OR ACTUAL HISTORICAL) IS NOT INDICATIVE OF FUTURE RESULTS. YOU CANNOT INVEST DIRECTLY IN AN INDEX.


HISTORICAL PERFORMANCE AND VOLATILITY COMPARISON (%)1

10/06/1994 – 9/30/2020

$56,123

$52,669

$57,339

Pacer Trendpilot®

European Index

FTSE Eurozone

Index (USD)


6.86 6.95


14.39 22.04

Maximum Drawdown

-35.23 -64.16


10/06/1994 – 9/30/2020


100% FTSE Eurozone Index (USD) 50% FTSE Eurozone Index (USD), 50% 3-Month US T-Bill 100% 3-Month US T-Bill

Pacer Trendpilot® European Index FTSE Eurozone Index (USD) 70% FTSE Eurozone Index/30% Barclays Capital U.S. Aggregate Bond Index


FTSE EUROZONE INDEX

Source: FactSet.YOU CANNOT INVEST DIRECTLY IN AN INDEX.

Company Weight (%)

SAP SE 3.92

ASML Holding NV 3.30

LVMH Moet Hennessy Louis Vuitton SE 2.62

Sanofi 2.45

Siemens AG 2.17

Unilever NV 1.97

Total SE 1.86

Allianz SE 1.79

L'Oreal SA 1.75

Air Liquide SA 1.66

Total 23.49


COUNTRY BREAKDOWN as of 9/30/2020

30.24% Germany

3.02% Belgium

31.71% France

13.86% Netherlands

7.08% Spain

6.97% Italy

3.92% Finland

0.81% Ireland0.56% Portugal 0.55% Sweden

1.27% Other

EUROPE IS LESS EXPENSIVE European stocks have been historically less expensive than US stocks. Currently, the P/E ratio is lower than the US.

Source: FactSet & Bloomberg. Price to Earnings ratio (P/E ratio) is a fundamental measure used to determine if an investment is valued appropriately. Each holding’s P/E is the latest closing price divided by the latest fiscal year’s earnings per share. Negative P/E ratios are excluded from this calculation.

DUE FOR A EUROPEAN CYCLE More than 10 years into a cycle favoring the US, we are well past the average of 5 years. When the cycle will change is unknown, but now might be a good time to consider Europe.

MSCI Europe S&P 500® Years

12/31/69 6/29/73 50.96% 26.70% 3.50

6/29/73 10/29/76 -31.95% 13.17% 3.34

10/29/76 12/29/78 68.72% 4.07% 2.17

12/29/78 10/29/82 7.25% 71.27% 3.84

10/29/82 11/30/88 298.95% 160.41% 6.09

11/30/88 1/29/93 34.12% 83.60% 4.17

1/29/93 6/30/94 25.44% 5.46% 1.42

6/30/94 1/31/02 98.77% 190.38% 7.59

1/31/02 11/30/07 144.57% 45.63% 5.83

11/30/07 9/30/20 7.86% 197.63% 12.84

Average 5.08

TRAILING 12 MONTH P/E RATIO 12/29/2000 – 9/30/2020

Russell 1000 Trailing 12 Month PEFTSE Eurozone Trailing 12 Month PE

27.61

18.94

0

5

10

15

20

25

30

12/1/2000 10/1/2003 8/1/2006 6/1/2009 4/1/2012 2/1/2015 12/1/2017


COMPLEMENT AN EXISTING EQUITY POSITION

Beta: Part of a portfolio that is correlated directly to market returns, i.e. stocks, ETFs.Alpha: Active return component of the portfolio – creates excess returns relative to the return of the benchmark index, i.e. actively managed mutual funds.Risk Management Strategies: Investments with a goal of limiting risk, i.e. options, volatility controlled strategies, trend following investments.

EXPECTED MOVEMENT OF EQUITY PORTFOLIO COMPONENTS IN DIFFERENT MARKETS

Beta AlphaPacer

Trendpilot®Total Portfolio

Equity

Rising Markets Ç Equal Rise may be greaterEqual or rise may

be lessEqual or rise may be

greater

Falling Markets È Equal Fall may be greater Fall may be lessEqual or fall may

be less60%Equity

25%Bonds

U.S. Large-Cap15% Alternatives

60% Equity

U.S. Mid-Cap

SAMPLE PORTFOLIO ALLOCATION

50% Pacer Trendpilot®/ 50% S&P

-21.40

-19.13

Larg

e-C

ap

-36.23

-37.00

-6.56

-1.26

100% Pacer Trendpilot® US Index Returns

100% S&P

Returns

Mid

-Cap

2008 CALENDAR-YEAR RETURNS

8.18%

6.28%

8.66%

6.10%

7.70%

6.47%

12/31/99-9/30/20 RETURNS

Larg

e-C

apM

id-C

ap

The charts to the right show different allocations to the S&P 500® and S&P MidCap 400® and the Pacer Trendpilot® US Large Cap Index and Pacer Trendpilot® US Mid Cap Index over two separate time periods.

50% Pacer Trendpilot®/ 50% S&P

100% Pacer Trendpilot® US Index Returns

100% S&P

Returns

Source: S&P. The hypothetical backtested index performance of the Pacer Trendpilot® Indices is shown net of fees and reflects the reinvestment of dividends. The annual total expense for each is 0.60%. These Pacer Trendpilot® Indices were released on 06/10/15. On 11/1/2017, the equity index component of the Pacer Trendpilot® US Large Cap and Pacer Trendpilot® US Mid Cap strategies changed to the S&P 500® and S&P MidCap 400® Index respectively. All data shown here is based on the S&P 500® or S&P MidCap 400® Index as the equity index and is hypothetical, retrospectively calculated, and based on rules-based criteria applied retroactively with the benefit of hindsight and knowledge of factors that may have positively affected its performance, and cannot account for all financial risk or market and economic factors that may affect the actual performance. The results shown are hypothetical and do not reflect actual returns. PAST PERFORMANCE (WHETHER RETROSPECTIVELY CALCULATED OR ACTUAL HISTORICAL) IS NOT INDICATIVE OF FUTURE RESULTS. YOU CANNOT INVEST IN AN INDEX.

The Pacer Trendpilot® ETF Series is designed to complement an existing equity portfolio. In using a risk management strategy alongside alpha and beta equities, clients are better positioned for more downside risk management from the market.


LONG TERM EFFECTS OF INCORPORATING TRENDPILOT®

Quarterly (12/31/99 – 9/30/20) S&P 500®

50% PTLCTR/ 50% S&P 500® PTLCTR

Total Number of Periods 64 64 64

Number of Periods with Negative Rolling Returns 10 1 0

Average Negative Rolling Return -2.07% -0.11% N/A

Max. Rolling Return 21.16% 16.64% 13.58%

Min. Rolling Return -4.76% -0.11% 2.86%

Average Rolling Return 7.70% 7.81% 7.59%

Source: S&P. The hypothetical backtested index performance of the Pacer Trendpilot® US Large Cap Index is shown net of fees and reflects the reinvestment of dividends. The annual total expense is 0.60%. The Pacer Trendpilot® Index was released on 06/10/15. On 11/01/17, the equity index the Pacer Trendpilot® Index tracks changed to the S&P 500®. All data shown here is based on the S&P 500® as the equity index and is hypothetical, retrospectively calculated, and based on rules-based criteria applied retroactively with the benefit of hindsight and knowledge of factors that may have positively affected its performance, and cannot account for all financial risk or market and economic factors that may affect the actual performance. The results shown are hypothetical and do not reflect actual returns. PAST PERFORMANCE (WHETHER RETROSPECTIVELY CALCULATED OR ACTUAL HISTORICAL) IS NOT INDICATIVE OF FUTURE RESULTS. YOU CANNOT INVEST IN AN INDEX.

The Pacer Trendpilot® ETF Series may be appropriate for clients who are fearful of the market, but still in need of growth. The chart below shows the effects of incorporating the Pacer Trendpilot US Large Cap Index (PTLCTR) into a standard large-cap position over time. In the long run,

• Minimum rolling returns were more favorable to Trendpilot®.• Periods with negative rolling returns were reduced to zero.

5 YEAR ROLLING


TRENDPILOT® QUARTERLY ROLLING RETURNS

1 YEAR ROLLING 12/31/1999 – 9/30/2020


Pacer Trendpilot® US Large Cap Index S&P 500® Index

-50%

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

50%

60%

12/3

1/20

00

12/3

1/20

01

12/3

1/20

02

12/3

1/20

03

12/3

1/20

04

12/3

1/20

05

12/3

1/20

06

12/3

1/20

07

12/3

1/20

08

12/3

1/20

09

12/3

1/20

10

12/3

1/20

11

12/3

1/20

12

12/3

1/20

13

12/3

1/20

14

12/3

1/20

15

12/3

1/20

16

12/3

1/20

17

12/3

1/20

18

12/3

1/20

19


TRENDPILOT® QUARTERLY ROLLING RETURNS


5 YEAR ROLLING 12/31/1999 – 9/30/2020

10 YEAR ROLLING 12/31/1999 – 9/30/2020



-10%

-5%

0%

5%

10%

15%

20%

25%

12/3

1/20

04

12/3

1/20

05

12/3

1/20

06

12/3

1/20

07

12/3

1/20

08

12/3

1/20

09

12/3

1/20

10

12/3

1/20

11

12/3

1/20

12

12/3

1/20

13

12/3

1/20

14

12/3

1/20

15

12/3

1/20

16

12/3

1/20

17

12/3

1/20

18

12/3

1/20

19

-4%

-2%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

12/3

1/20

09

12/3

1/20

10

12/3

1/20

11

12/3

1/20

12

12/3

1/20

13

12/3

1/20

14

12/3

1/20

15

12/3

1/20

16

12/3

1/20

17

12/3

1/20

18

12/3

1/20

19


PACER ETF PERFORMANCE

Source: US Bank, S&P, FTSE Russell and NASDAQ. PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS. YOU CANNOT INVEST IN AN INDEX.

Returns less than 1 year are cumulative. Returns greater than 1 year are annualized. Performance quoted represents past performance and does not guarantee future results. Investment return and principal value will fluctuate, so shares may be worth more or less when redeemed or sold. Current performance may be lower or higher than the performance quoted. Visit http://www.paceretfs.com for the most recent month-end performance. Index returns are for illustrative purposes only. Index performance does not reflect any management fees, transaction costs, or expenses. You cannot invest directly in an index. The 3-Month US T-Bill rate on 9/30/20 is 0.0915%. On 11/1/2017, the equity index component of the Pacer Trendpilot® US Large Cap and Pacer Trendpilot® US Mid Cap strategies changed to the S&P 500® and S&P MidCap 400® Index respectively. NAV (net asset value) is the value of one share of the Fund calculated daily. The NAV return is based on the NAV of the Fund. It may not reflect the actual return for the investor. Market Price is the price investors can buy and sell ETF shares for in the stock market and is used to calculate market return. It is based on the price at the Cboe listed exchange market close. This is when NAV is determined for most ETFs. If shares trade at another time, the return may differ. Market and NAV returns assume that dividends and capital gain distributions have been reinvested in the Fund at Market Price and NAV respectively.

Total Returns (%) as of 9/30/20 Total Returns (%) as of 9/30/20

TickerTotal

ExpensesFund

Inception 1 Month 3 Month YTD 1 Year 3 Year 5 YearSince Fund Inception

Pacer Trendpilot® US Large Cap ETF PTLC 0.60% 6/11/15NAV -3.82 8.75 -11.73 -3.85 3.98 5.53 4.09

Market Price -3.81 8.61 -11.75 -3.91 3.93 5.52 4.08

Pacer Trendpilot® US Large Cap Index -3.84 8.79 -11.65 -3.78 4.12 5.89 4.44

Pacer Trendpilot® US Mid Cap ETF PTMC 0.60% 6/11/15NAV -3.35 -0.21 -11.11 -5.04 -1.61 4.05 2.39

Market Price -3.43 -0.29 -11.16 -5.13 -1.67 4.05 2.38

Pacer Trendpilot® US Mid Cap Index -3.29 0.18 -10.64 -4.45 -1.38 4.49 2.83

Pacer Trendpilot® 100 ETF PTNQ 0.65% 6/11/15NAV -5.73 12.55 19.07 34.44 19.89 15.85 13.50

Market Price -5.93 12.63 19.19 34.44 19.86 15.82 13.49

Pacer NASDAQ-100® Trendpilot® Index -5.67 12.62 19.47 34.99 20.50 16.52 14.15

Pacer Trendpilot® European Index ETF PTEU 0.65% 12/14/15

NAV -3.59 -5.26 -18.15 -11.71 -7.67 N/A -0.98

Market Price -3.70 -5.53 -18.52 -12.27 -8.14 N/A -1.08

Pacer Trendpilot® European Index -3.67 -4.65 -17.41 -10.67 -6.30 N/A 0.39

Pacer Trendpilot® International ETF PTIN 0.65% 5/2/19NAV -2.36 -2.35 -14.34 -7.83 N/A N/A -5.29

Market Price -2.11 -2.73 -15.01 -8.52 N/A N/A -5.52

Pacer Trendpilot® International Index -2.55 -1.79 -13.31 -6.46 N/A N/A -4.14


CLIENTS AND SOURCES

1 Clients who have more in cash than they should because they are afraid to invest in equities.

2 Clients who are invested in equities (large-cap, mid-cap, etc.) and are nervous about major drawdowns.

3 Clients who purchased alternatives after the 2007-2009 bear market and are dissatisfied with performance.

CLIENTS WHO TRENDPILOT® MAY BE A GOOD FIT FOR:


HOW TO DO BUSINESS

TIP #2: DO NOT USE MARKET ORDERSTo reduce potential poor execution, do not use market orders. WHY NOT: In the example above, what happens when a market order to buy is placed for 5,000 shares? The first 1,000 shares would fill at $20.65. Immediately, the next 1,000 shares would fill at the next level - $20.67. The remainder would be priced at $20.80.

TIP #3: TRADING VOLUME DOES NOT EQUAL LIQUIDITY Unlike stocks, an ETF’s trading volume does not equal its liquidity. This is due to how ETFs are traded. With ETFs, new shares can be created and existing shares redeemed at any time based on investor demand. The creation and redemption process works by evaluating the liquidity of an ETF’s underlying portfolio of securities. If the underlying stocks are liquid, the ETF will have a potential for greater liquidity, mirroring its underlying securities.

TIP #4: Place Your Limit Order Close to the IIV/IOPVThe bid and ask will be close to the IIV (Intraday Indicative Value)/IOPV (Indicative Optimized Portfolio Value). If the IIV/IOPV deviates too far from the bid/ask, the market makers will arbitrage (simultaneously buy and sell the ETF shares for a profit). Check the current IIV/IOPV using Google.com, Yahoo.com, Bloomberg, Reuters, etc. Place your bid close to the IIV/IOPV.

TIP #5: Large Orders Do Not Affect the IIV/IOPVSince share price is based on the underlying value of the securities that make up an index, not supply and demand, a large order will not “move this market” (except in cases where the underlying securities are thinly traded). Historically, large market orders generally receive the worst execution prices, therefore, remember TIP #1: Use Limit Orders.

TIP #6: Redeem Shares at Any Time for a Fair PriceThe market maker will always create or redeem shares based on the value of the underlying securities plus a spread (bid/ask). Once again, using limit orders will greatly improve your overall execution prices. The IIV/IOPV is NOT determined by buys and sells. TIP #7: IOPV Can Be Inaccurate for ETFs That Hold Foreign SecuritiesThe securities in the ETF may be traded on an exchange that is closed during market hours. Contact the fund sponsor or your trade desk to discuss the best way to execute a trade.

TIP #1: USE LIMIT ORDERSIn order to know exactly what price you will get, place a limit order. What happens when you place a limit order to buy 5,000 shares at $20.65?

The first 1,000 shares will immediately fill at $20.65. The remainder will “stay on the books” and fill at $20.65 or better when the shares are replenished by the market maker.

3

2

1

Caution: Watch your order. It is possible the market will move away from your order and it will not be filled. If that happens, readjust your limit order.

Hypothetical ETF Volume: 1,000,000

Bid Ask

CBOE 20.64 1000 CBOE 20.65 1000

ARCA 20.63 1000 ARCA 20.67 1000

NSDQ 20.61 4400 NSDQ 20.80 3000

EDGX 20.60 8000 EDGX 20.81 5000

3

1

2

1

Source: Investopedia.com

Limit Order — An order placed to buy or sell a set number of shares at a specified price or better. Market Order — An order to buy or sell a stock immediately at the best available current price. Bid — The price a buyer is willing to pay for a security. Ask — The price a seller is willing to accept for a security. Bid-Ask Spread — The amount by which the ask price exceeds the bid. Intraday Indicative Value (IIV)/Indicative Optimized Portfolio Value (IOPV) — A real-time estimate of the ETF’s fair value, based on the underlying holdings that make up an index.


NOTES

www.paceretfs.com

PCR150630_PB 9/30/20 CAR 0217-03065

877-337-0500 § www.paceretfs.com

institutional presentation pacer trendpilot etf strategies · institutional presentation pacer...

Documents