What are the tax implications for the investors in CurrencyShares products?
Shareholders of each CurrencyShares Trust will continue to be treated, for U.S. federal income tax purposes, as if they owned a pro rata share of the assets held by the particular Trust. Because of this, the income and expenses of each Trust “flow through” to the Trust’s shareholders. Any U.S. person who owns CurrencyShares is required to recognize currency exchange gains or losses when the Trust converts the foreign currency it holds to U.S. dollars to make distributions to the shareholders, or uses the foreign currency it holds to pay the sponsor’s fee. Any U.S. person who owns CurrencyShares is also required to recognize interest income at the time that the corresponding Trust receives interest earnings. Shareholders should refer to the applicable CurrencyShares Trust prospectus for important tax information. The preferential federal income tax rate generally applicable to long-term capital gains does not apply to any gains (long-term or short-term) on CurrencyShares or to any inter
