The following provides notice to shareholders
of important additions to the Fund’s principal investment strategies and risks.
Principal Investment Strategies
Arrow Insights, a
division of the Advisor, is the index provider. The Index selects investments pursuant to a proprietary Tri-Factor™ methodology
that seeks to identify the components with the strongest fundamental performance characteristics. The
Tri-Factor™ methodology evaluates momentum factors to determine the allocation between the quality component and the
value component of the Index, and to allocate to cash for temporary defensive purposes The quality component consists of 50
stocks that exhibit quality factors such as profitability, consistency of earnings, dividend yield, price to earnings,
management confidence, and long-term performance. The value component consists of the Dow 30, which the Index uses
as a measure of the stock market's overall value based on the performance of 30 large U.S.
companies.
The Index was created
in 2014 and revised in 2020. In selecting securities for the Index, the model considers quality, value and momentum factors. Quality
factors include earning per share variability, return on equity, and return of earnings to shareholders in the form of dividends
or share buybacks. The value factor provides the ability to capture the price appreciation of stocks representing the broader U.S.
economy. The momentum factors measure the relative strength of quality, value and short term treasury to determine the overall
weighting of the Index. Equity exposure is reduced to 10% when overall equity relative strength is weak based the Index methodology.
When equity exposure is reduced the Index invests in exchange traded funds that invest in short term T-Bills.
The quality
factors component selects common stocks pursuant to a proprietary selection methodology from a universe of approximately 3,500
common stocks traded on U.S. exchanges that meet minimum liquidity (three month average daily dollar volume above $1 million) and
price standards (minimum price of $5 per share). Securities are ranked based on the following factors:
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Profitability on shareholder’s equity
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Consistency of historical earnings
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Dividend yield paid to shareholders
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Share buyback, reducing actual shares outstanding
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Valuation, or is the price of the company reasonably valued
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Long term price performance, or has the company been recognized historically
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The securities ranked
by each quality factor are then summed to get the 50 highest ranked securities in the universe. The top 50 ranked companies as
of December
and June of each calendar year are checked
for news or corporate actions that may change the rankings and then implemented in the next subsequent month, January and July,
respectively. The quality component is equally weighted and rebalanced quarterly at the end of January, April, July, and October
of each calendar year. The composition of the Fund’s portfolio therefore will change to the extent necessary to replicate
the Index.
Under normal market
conditions the Fund will invest at least 80% of its assets (defined as net assets plus any borrowing for investment purposes) in
securities that comprise the Index. The Fund uses an “indexing” investment approach to seek investment results that
generally correspond, before fees and expenses to the performance of the Index. The Advisor seeks correlation over time of 0.95
or better between the Fund’s performance and the performance of the Index; a figure of 1.00 would represent perfect correlation.
The Fund generally
invests in all of the securities comprising the Index in proportion to the weightings of the securities in the Index. However,
under various circumstances, it may not be possible or practicable to purchase all of those securities in those same weightings.
In those circumstances, a Fund may purchase a sample of securities in the Index. There also may be instances in which the Advisor
may choose to (i) overweight a security in the Index, (ii) purchase securities not contained the Index that the Advisor believes
are appropriate to substitute for certain securities in the Index, or (iii) utilize various combinations of other available investment
techniques in seeking to track the Index. The Fund may sell securities included in the Index in anticipation of their removal from
the Index, or purchase securities not included in the Index in anticipation of their addition to the Index.
Although the Advisor
intends for the Fund to replicate the Index, the Fund may employ representative sampling to achieve its investment objective. In
particular, the Fund may use representative sampling when securities in the Index are not available in the quantities needed by
the Fund, when any security in the Index is subjecting to trading in round lots that are too large for inclusion in the basket
of in-kind securities deposited for a Creation Unit, and until the Fund achieves scale.
The Fund may invest up to 20% of its
assets in instruments that are not component securities of the Index if the Advisor believes that such instruments will help the
Fund to track its Index. For example, provided that the Fund continues to invest at least 80% of its total assets in the components
of the Index and the Advisor believes it will help the Fund to track its Index, the Fund may invest in securities not included
in the Index, such as other ETFs, and money market instruments, including repurchase agreements or other funds that invest exclusively
in money market instruments (subject to applicable limitations under the Investment Company Act of 1940, as amended, (the “1940
Act”), or rules under the 1940 Act). Further, the Fund may sell securities included in its Index in anticipation of their
removal from the Index, purchase securities not included in the Index in anticipation of their addition
to the Index and/or hold a security no
longer included in the Index. The Advisor anticipates that it may take approximately three business days (a business day is any
day that the New York Stock Exchange (“NYSE”) is open) for the Advisor to reflect fully the additions and deletions
to the Index in the portfolio composition of the Fund.
The AI Quality Value Momentum
Index is calculated and maintained by Solactive AG on behalf of the index provider.
The following principal investment
risks should be added to “Principal Investment Risks” starting on page 2 of the Prospectus and Summary
Prospectus and to “Additional Information
About The Principal Investment Strategies And Risks – Principal Investment Risks” starting on
page 6 of the Prospectus:
Calculation Methodology Risk.
The Index relies directly or indirectly on various sources of information to assess the criteria of issuers included in the Index,
including information that may be based on assumptions and estimates. Neither the Fund, the Index Provider, nor the Advisor can
offer assurances that the Index’s calculation methodology or sources of information will provide an accurate assessment of
included issuers or a correct valuation of securities, nor can they guarantee the availability or timeliness of the production
of the Index.
Fixed Income Risk.
The value of the Fund’s direct or indirect investments in fixed income securities will fluctuate with changes in interest
rates. Typically, a rise in interest rates causes a decline in the value of fixed income securities owned by the Fund. On the other
hand, if rates fall, the value of the fixed income securities generally increases. The Fund may be subject to a greater Risk of
rising interest rates due to the current period of historically low rates and the effect of potential government fiscal policy
initiatives and resulting market reaction to those initiatives. In general, the market price of fixed income securities with longer
maturities will increase or decrease more in response to changes in interest rates than shorter-term securities. The value of the
Fund’s direct or indirect investments in fixed income securities may be affected by the inability of issuers to repay principal
and interest or illiquidity in debt securities markets.
Government Obligations
Risk. The Fund may invest in securities issued by the U.S. government. There can be no guarantee that the United States will
be able to meet its payment obligations with respect to such securities. Additionally, market prices and yields of securities supported
by the full faith and credit of the U.S. government may decline or be negative for short or long periods of time.
High Portfolio Turnover Risk.
At times, the Fund may have a portfolio turnover rate substantially greater than 100%. A high portfolio turnover rate would result
in correspondingly greater transaction expenses, including brokerage commissions, dealer markups and other transaction cost on
the sale of securities and on reinvestment in other securities and may result in reduced performance
and the distribution to shareholders
of additional capital gains for tax purposes. These factors may negatively affect the Fund’s performance.
Other Investment Companies. The
Fund will incur higher and duplicative expenses when it invests in other investment companies such as ETFs. There is also the risk
that the Fund may suffer losses due to the investment practices of the underlying funds. When the Fund invests in other investment
companies, the Fund will be subject to substantially the same risks as those associated with the direct ownership of securities
held by such investment companies. Investments in ETFs are also subject to the ETF Risk.
This Supplement dated May 8, 2020 and the
Summary Prospectus, Prospectus and Statement of Additional Information dated June 1, 2019, provide relevant information for all
shareholders and should be retained for future reference. The Summary Prospectus, Prospectus and Statement of Additional Information
dated June 1, 2019, have been filed with the Securities and Exchange Commission, are incorporated by reference and can be obtained
without charge by calling the Fund at 1-877-277-6933.