ProShares Trust II - Quarter Report: 2011 September (Form 10-Q)

Large accelerated filer

Accelerated filer

Non-accelerated filer

¨ (Do not check if a smaller reporting company)

Smaller reporting company

Form 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x	Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

for the quarterly period ended September 30, 2011.

¨	Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

for the transition period from to .

Commission file number: 001-34200

PROSHARES TRUST II

(Exact name of registrant as specified in its charter)

Delaware

87-6284802

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

c/o ProShare Capital Management LLC

7501 Wisconsin Avenue, Suite 1000

Bethesda, Maryland 20814

(Address of principal executive offices) (Zip code)

(240) 497-6400

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. x Yes ¨ No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). x Yes ¨ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ¨ Yes x No

PROSHARES TRUST II

Table of Contents


Part I. FINANCIAL INFORMATION		Page
Item 1.	Condensed Financial Statements.		1

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.		118

Item 3.	Quantitative and Qualitative Disclosures About Market Risk.		157

Item 4.	Controls and Procedures.		174

Part II. OTHER INFORMATION

Item 1.	Legal Proceedings.		175

Item 1A.	Risk Factors.		175

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.		196

Item 3.	Defaults Upon Senior Securities.		198

Item 4.	Removed and Reserved.		198

Item 5.	Other Information.		198

Item 6.	Exhibits.		198

Part I. FINANCIAL INFORMATION

Item 1.

Condensed Financial Statements.

Index


	Page
Documents
Statements of Financial Condition, Schedules of Investments, Statements of Operations, Statements of Changes in Shareholders’ Equity and Statements of Cash Flows:
ProShares Ultra DJ-UBS Commodity		2
ProShares UltraShort DJ-UBS Commodity		7
ProShares Ultra DJ-UBS Crude Oil		12
ProShares UltraShort DJ-UBS Crude Oil		17
ProShares Ultra DJ-UBS Natural Gas		22
ProShares Short DJ-UBS Natural Gas		23
ProShares UltraShort DJ-UBS Natural Gas		24
ProShares Ultra Gold		25
ProShares Short Gold		30
ProShares UltraShort Gold		31
ProShares Ultra Silver		36
ProShares UltraShort Silver		41
ProShares Ultra Euro		46
ProShares UltraShort Euro		51
ProShares Ultra Yen		56
ProShares UltraShort Yen		61
ProShares Ultra VIX Short-Term Futures ETF		66
ProShares VIX Short-Term Futures ETF		67
ProShares Short VIX Short-Term Futures ETF		72
ProShares UltraShort VIX Short-Term Futures ETF		73
ProShares Ultra VIX Mid-Term Futures ETF		74
ProShares VIX Mid-Term Futures ETF		75
ProShares Short VIX Mid-Term Futures ETF		80
ProShares UltraShort VIX Mid-Term Futures ETF		81
ProShares Trust II		82
Notes to Financial Statements		86

-1-

PROSHARES ULTRA DJ-UBS COMMODITY

STATEMENTS OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)		December 31, 2010
Assets
Cash	$	8,799	$	17,743
Short-term U.S. government and agency obligations (Note 3) (cost $15,615,771 and $16,426,195, respectively)		15,615,636		16,426,651
Unrealized appreciation on swap agreements		—		1,755,750

Total assets		15,624,435		18,200,144

Liabilities and shareholders’ equity
Liabilities
Management fee payable		23,641		13,486
Unrealized depreciation on swap agreements		3,889,846		—

Total liabilities		3,913,487		13,486


Shareholders’ equity
Shareholders’ equity		11,710,948		18,186,658

Total liabilities and shareholders’ equity	$	15,624,435	$	18,200,144

Shares outstanding		450,014		500,014

Net asset value per share	$	26.02	$	36.37

Market value per share (Note 2)	$	25.67	$	36.27

See accompanying notes to financial statements.

-2-

PROSHARES ULTRA DJ-UBS COMMODITY

SCHEDULE OF INVESTMENTS

SEPTEMBER 30, 2011

(unaudited)


	Principal Amount		Value
Short-term U.S. government and agency obligations (133% of shareholders’ equity)
U.S. Treasury Bills:
0.018% due 10/06/11†	$	1,950,000	$	1,950,000
0.013% due 10/13/11†		876,000		875,999
0.076% due 10/27/11		676,000		675,996
0.040% due 11/10/11†		1,576,000		1,575,984
0.002% due 12/01/11†		5,941,000		5,940,907
0.015% due 12/08/11†		2,660,000		2,659,954
0.002% due 02/09/12†		1,937,000		1,936,796

Total short-term U.S. government and agency obligations (cost $15,615,771)			$	15,615,636

Swap Agreements^


	Termination Date		Notional Amount at Value*		Unrealized Appreciation (Depreciation)
Swap agreement with Goldman Sachs International based on Dow Jones-UBS Commodity Index		10/06/11	$	6,650,383	$	(999,856	)
Swap agreement with UBS AG based on Dow Jones-UBS Commodity Index		10/06/11		16,811,409		(2,889,990	)

					$	(3,889,846	)

†	All or partial amount segregated as collateral for swap agreements.

^	The positions and counterparties herein are as of September 30, 2011. The Funds continually evaluate different counterparties for their transactions and counterparties are subject to change. New counterparties can be added at anytime.

*	For swap agreements, a positive amount represents “long” exposure to the benchmark Index. A negative amount represents “short” exposure to the benchmark Index.

See accompanying notes to financial statements.

-3-

PROSHARES ULTRA DJ-UBS COMMODITY

STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2011 AND 2010

(unaudited)


	Three months ended September 30, 2011			Three months ended September 30, 2010			Nine months ended September 30, 2011			Nine months ended September 30, 2010

Investment Income
Interest	$	993		$	5,629		$	10,264		$	16,947

Expenses
Management fee		37,054			27,744			131,603			88,670

Total expenses		37,054			27,744			131,603			88,670

Net investment income (loss)		(36,061	)		(22,115	)		(121,339	)		(71,723	)

Realized and unrealized gain (loss) on investment activity
Net realized gain (loss) on
Swap agreements		(1,050,671	)		2,113,541			939,496			(624,603	)
Short-term U.S. government and agency obligations		78			72			201			1,038

Net realized gain (loss)		(1,050,593	)		2,113,613			939,697			(623,565	)

Change in net unrealized appreciation/depreciation on
Swap agreements		(2,076,464	)		178,290			(5,645,596	)		(458,278	)
Short-term U.S. government and agency obligations		(548	)		(1,326	)		(591	)		1,224

Change in net unrealized appreciation/depreciation		(2,077,012	)		176,964			(5,646,187	)		(457,054	)

Net realized and unrealized gain (loss)		(3,127,605	)		2,290,577			(4,706,490	)		(1,080,619	)

Net income (loss)	$	(3,163,666	)	$	2,268,462		$	(4,827,829	)	$	(1,152,342	)

Net income (loss) per weighted-average share	$	(6.92	)	$	4.81		$	(9.40	)	$	(2.30	)

Weighted-average shares outstanding		457,079			471,753			513,750			501,296

See accompanying notes to financial statements.

-4-

PROSHARES ULTRA DJ-UBS COMMODITY

STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011

(unaudited)


Shareholders’ equity, at December 31, 2010	$	18,186,658

Addition of 50,000 shares		1,782,755
Redemption of 100,000 shares		(3,430,636	)

Net addition (redemption) of (50,000) shares		(1,647,881	)


Net investment income (loss)		(121,339	)
Net realized gain (loss)		939,697
Change in net unrealized appreciation/depreciation		(5,646,187	)

Net income (loss)		(4,827,829	)


Shareholders’ equity, at September 30, 2011	$	11,710,948

See accompanying notes to financial statements.

-5-

PROSHARES ULTRA DJ-UBS COMMODITY

STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED

SEPTEMBER 30, 2011 AND 2010

(unaudited)


	Nine months ended September 30, 2011			Nine months ended September 30, 2010
Cash flow from operating activities
Net income (loss)	$	(4,827,829	)	$	(1,152,342	)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Net sale (purchase) of short-term U.S. government and agency obligations		810,424			9,615,037
Change in unrealized appreciation/depreciation on investments		5,646,187			457,054
Increase (Decrease) in management fee payable		10,155			(6,770	)

Net cash provided by (used in) operating activities		1,638,937			8,912,979

Cash flow from financing activities
Proceeds from addition of shares		1,782,755			5,958,070
Payment on shares redeemed		(3,430,636	)		(14,897,881	)

Net cash provided by (used in) financing activities		(1,647,881	)		(8,939,811	)

Net increase (decrease) in cash		(8,944	)		(26,832	)
Cash, beginning of period		17,743			78,112

Cash, end of period	$	8,799		$	51,280

See accompanying notes to financial statements.

-6-

PROSHARES ULTRASHORT DJ-UBS COMMODITY

STATEMENTS OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)		December 31, 2010
Assets
Cash	$	6,447	$	10,654
Short-term U.S. government and agency obligations (Note 3) (cost $11,383,864 and $1,594,783, respectively)		11,383,268		1,594,842
Unrealized appreciation on swap agreements		1,004,988		—

Total assets		12,394,703		1,605,496

Liabilities and shareholders’ equity
Liabilities
Management fee payable		16,645		1,273
Unrealized depreciation on swap agreements		—		164,150

Total liabilities		16,645		165,423

Shareholders’ equity
Shareholders’ equity		12,378,058		1,440,073

Total liabilities and shareholders’ equity	$	12,394,703	$	1,605,496

Shares outstanding		209,997		30,003

Net asset value per share (Note 1)	$	58.94	$	48.00

Market value per share (Note 1) (Note 2)	$	59.30	$	48.30

See accompanying notes to financial statements.

-7-

PROSHARES ULTRASHORT DJ-UBS COMMODITY

SCHEDULE OF INVESTMENTS

SEPTEMBER 30, 2011

(unaudited)


	Principal Amount		Value
Short-term U.S. government and agency obligations (92% of shareholders’ equity)
U.S. Treasury Bills:
0.018% due 10/06/11	$	1,203,000	$	1,203,000
0.011% due 10/20/11		157,000		156,999
0.040% due 11/10/11		613,000		612,994
0.002% due 12/01/11†		1,429,000		1,428,977
0.009% due 12/29/11		1,968,000		1,967,931
0.002% due 02/09/12†		6,014,000		6,013,367

Total short-term U.S. government and agency obligations (cost $11,383,864)			$	11,383,268

Swap Agreements^


	Termination Date		Notional Amount at Value*			Unrealized Appreciation (Depreciation)
Swap agreement with Goldman Sachs International based on Dow Jones-UBS Commodity Index		10/06/11	$	(4,499,693	)	$	674,808
Swap agreement with UBS AG based on Dow Jones-UBS Commodity Index		10/06/11		(20,136,530	)		330,180

						$	1,004,988

†	All or partial amount segregated as collateral for swap agreements.

^	The positions and counterparties herein are as of September 30, 2011. The Funds continually evaluate different counterparties for their transactions and counterparties are subject to change. New counterparties can be added at anytime.

*	For swap agreements, a positive amount represents “long” exposure to the benchmark Index. A negative amount represents “short” exposure to the benchmark Index.

See accompanying notes to financial statements.

-8-

PROSHARES ULTRASHORT DJ-UBS COMMODITY

STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2011 and 2010

(unaudited)


	Three months ended September 30, 2011			Three months ended September 30, 2010			Nine months ended September 30, 2011			Nine months ended September 30, 2010
Investment Income
Interest	$	731		$	949		$	3,522		$	3,267

Expenses
Management fee		32,416			5,480			111,453			24,971

Total expenses		32,416			5,480			111,453			24,971

Net investment income (loss)		(31,685	)		(4,531	)		(107,931	)		(21,704	)

Realized and unrealized gain (loss) on investment activity
Net realized gain (loss) on
Swap agreements		2,148,146			(806,167	)		(3,367,856	)		(254,747	)
Short-term U.S. government and agency obligations		566			105			1,732			23

Net realized gain (loss)		2,148,712			(806,062	)		(3,366,124	)		(254,724	)

Change in net unrealized appreciation/depreciation on
Swap agreements		(1,247,546	)		335,891			1,169,138			114,962
Short-term U.S. government and agency obligations		(870	)		(223	)		(655	)		190

Change in net unrealized appreciation/depreciation		(1,248,416	)		335,668			1,168,483			115,152

Net realized and unrealized gain (loss)		900,296			(470,394	)		(2,197,641	)		(139,572	)

Net income (loss)	$	868,611		$	(474,925	)	$	(2,305,572	)	$	(161,276	)

Net income (loss) per weighted-average share (Note 1)	$	3.01		$	(16.00	)	$	(6.76	)	$	(3.64	)

Weighted-average shares outstanding (Note 1)		288,258			29,677			341,170			44,325

See accompanying notes to financial statements.

-9-

PROSHARES ULTRASHORT DJ-UBS COMMODITY

STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011

(unaudited)


Shareholders’ equity, at December 31, 2010	$	1,440,073

Addition of 1,780,000 shares (Note 1)		84,549,839
Redemption of 1,600,006 shares (Note 1)		(71,306,282	)

Net addition (redemption) of 179,994 shares (Note 1)		13,243,557


Net investment income (loss)		(107,931	)
Net realized gain (loss)		(3,366,124	)
Change in net unrealized appreciation/depreciation		1,168,483

Net income (loss)		(2,305,572	)


Shareholders’ equity, at September 30, 2011	$	12,378,058

See accompanying notes to financial statements.

-10-

PROSHARES ULTRASHORT DJ-UBS COMMODITY

STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED

SEPTEMBER 30, 2011 AND 2010

(unaudited)


	Nine months ended September 30, 2011			Nine months ended September 30, 2010
Cash flow from operating activities
Net income (loss)	$	(2,305,572	)	$	(161,276	)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Decrease (Increase) in segregated cash balances for swap agreements		–			485,000
Net sale (purchase) of short-term U.S. government and agency obligations		(9,789,081	)		1,136,596
Change in unrealized appreciation/depreciation on investments		(1,168,483	)		(115,152	)
Increase (Decrease) in management fee payable		15,372			(1,395	)

Net cash provided by (used in) operating activities		(13,247,764	)		1,343,773

Cash flow from financing activities
Proceeds from addition of shares		84,549,839			3,370,174
Payment on shares redeemed		(71,306,282	)		(4,798,476	)

Net cash provided by (used in) financing activities		13,243,557			(1,428,302	)

Net increase (decrease) in cash		(4,207	)		(84,529	)
Cash, beginning of period		10,654			90,383

Cash, end of period	$	6,447		$	5,854

See accompanying notes to financial statements.

-11-

PROSHARES ULTRA DJ-UBS CRUDE OIL

STATEMENTS OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)		December 31, 2010
Assets
Cash	$	4,131,411	$	905,158
Segregated cash balances with brokers for futures contracts		31,873,500		10,631,250
Short-term U.S. government and agency obligations (Note 3) (cost $408,976,125 and $244,384,335, respectively)		408,957,733		244,394,920
Unrealized appreciation on swap agreements		—		5,649,644
Receivable on open futures contracts		—		3,035,150

Total assets		444,962,644		264,616,122

Liabilities and shareholders’ equity
Liabilities
Payable for capital shares redeemed		11,499,767		36,266,723
Payable on open futures contracts		11,219,495		—
Management fee payable		667,206		216,322
Unrealized depreciation on swap agreements		40,686,650		—

Total liabilities		64,073,118		36,483,045

Shareholders’ equity
Shareholders’ equity		380,889,526		228,133,077

Total liabilities and shareholders’ equity	$	444,962,644	$	264,616,122

Shares outstanding		13,949,170		4,562,504

Net asset value per share (Note 1)	$	27.31	$	50.00

Market value per share (Note 1) (Note 2)	$	27.09	$	49.98

See accompanying notes to financial statements.

-12-

PROSHARES ULTRA DJ-UBS CRUDE OIL

SCHEDULE OF INVESTMENTS

SEPTEMBER 30, 2011

(unaudited)


	Principal Amount		Value
Short-term U.S. government and agency obligations (107% of shareholders’ equity)
U.S. Treasury Bills:
0.010% due 10/06/11	$	3,081,000	$	3,080,999
0.013% due 10/13/11		8,659,000		8,658,991
0.010% due 10/20/11		3,091,000		3,090,988
0.040% due 11/10/11†		40,375,000		40,374,604
0.012% due 11/17/11†		76,951,000		76,950,100
0.002% due 12/01/11†		26,377,000		26,376,589
0.015% due 12/08/11†		73,997,000		73,995,712
0.007% due 12/15/11		3,669,000		3,668,929
0.000% due 12/22/11		7,138,000		7,137,772
0.007% due 12/29/11		66,167,000		66,164,691
0.000% due 02/09/12†		25,000,000		24,997,368
0.000% due 03/01/12		25,000,000		24,994,895
0.003% due 03/08/12		25,000,000		24,994,117
0.001% due 03/15/12†		24,478,000		24,471,978

Total short-term U.S. government and agency obligations (cost $408,976,125)			$	408,957,733

Futures Contracts Purchased


	Number of Contracts		Notional Amount at Value		Unrealized Appreciation (Depreciation)
Crude Oil – NYMEX, expires November 2011		3,935	$	311,652,000	$	(23,095,260	)

Swap Agreements^


	Termination Date		Notional Amount at Value*		Unrealized Appreciation (Depreciation)
Swap agreement with Goldman Sachs International based on Dow Jones-UBS Crude Oil Sub-Index		10/06/11	$	188,482,103	$	(16,311,862	)
Swap agreement with UBS AG based on Dow Jones-UBS Crude Oil Sub-Index		10/06/11		261,660,350		(24,374,788	)

					$	(40,686,650	)

†	All or partial amount segregated as collateral for swap agreements.

^	The positions and counterparties herein are as of September 30, 2011. The Funds continually evaluate different counterparties for their transactions and counterparties are subject to change. New counterparties can be added at anytime.

*	For swap agreements, a positive amount represents “long” exposure to the benchmark Index. A negative amount represents “short” exposure to the benchmark Index.

See accompanying notes to financial statements.

-13-

PROSHARES ULTRA DJ-UBS CRUDE OIL

STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2011 and 2010

(unaudited)


	Three months ended September 30, 2011			Three months ended September 30, 2010			Nine months ended September 30, 2011			Nine months ended September 30, 2010
Investment Income
Interest	$	16,734		$	174,914		$	154,462		$	348,968

Expenses
Management fee		960,393			1,034,809			2,416,617			2,480,271
Brokerage commissions		21,032			32,255			75,805			112,220

Total expenses		981,425			1,067,064			2,492,422			2,592,491

Net investment income (loss)		(964,691	)		(892,150	)		(2,337,960	)		(2,243,523	)

Realized and unrealized gain (loss) on investment activity
Net realized gain (loss) on
Futures contracts		(42,050,522	)		10,928,189			(7,585,638	)		19,006,970
Swap agreements		(45,717,064	)		27,081,389			(5,844,053	)		14,810,482
Short-term U.S. government and agency obligations		(250	)		1,843			12,712			47,218

Net realized gain (loss)		(87,767,836	)		38,011,421			(13,416,979	)		33,864,670

Change in net unrealized appreciation/depreciation on
Futures contracts		(14,534,400	)		14,399,480			(28,508,020	)		(979,200	)
Swap agreements		(31,006,847	)		7,760,550			(46,336,294	)		9,094,718
Short-term U.S. government and agency obligations		(20,697	)		(2,198	)		(28,977	)		39,605

Change in net unrealized appreciation/depreciation		(45,561,944	)		22,157,832			(74,873,291	)		8,155,123

Net realized and unrealized gain (loss)		(133,329,780	)		60,169,253			(88,290,270	)		42,019,793

Net income (loss)	$	(134,294,471	)	$	59,277,103		$	(90,628,230	)	$	39,776,270

Net income (loss) per weighted-average share (Note 1)	$	(11.91	)	$	5.19		$	(11.35	)	$	4.68

Weighted-average shares outstanding (Note 1)		11,280,148			11,414,406			7,982,238			8,493,273

See accompanying notes to financial statements.

-14-

PROSHARES ULTRA DJ-UBS CRUDE OIL

STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011

(unaudited)


Shareholders’ equity, at December 31, 2010	$	228,133,077

Addition of 28,375,000 shares (Note 1)		1,139,475,837
Redemption of 18,988,334 shares (Note 1)		(896,091,158	)

Net addition (redemption) of 9,386,666 shares (Note 1)		243,384,679


Net investment income (loss)		(2,337,960	)
Net realized gain (loss)		(13,416,979	)
Change in net unrealized appreciation/depreciation		(74,873,291	)

Net income (loss)		(90,628,230	)


Shareholders’ equity, at September 30, 2011	$	380,889,526

See accompanying notes to financial statements.

-15-

PROSHARES ULTRA DJ-UBS CRUDE OIL

STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED

SEPTEMBER 30, 2011 AND 2010

(unaudited)


	Nine months ended September 30, 2011			Nine months ended September 30, 2010
Cash flow from operating activities
Net income (loss)	$	(90,628,230	)	$	39,776,270
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Decrease (Increase) in segregated cash balances with brokers for futures contracts		(21,242,250	)		(7,348,388	)
Net sale (purchase) of short-term U.S. government and agency obligations		(164,591,790	)		(101,858,607	)
Change in unrealized appreciation/depreciation on investments		46,365,271			(9,134,323	)
Decrease (Increase) in receivable on futures contracts		3,035,150			(11,263,899	)
Increase (Decrease) in management fee payable		450,884			86,397
Increase (Decrease) in payable on futures contracts		11,219,495			—

Net cash provided by (used in) operating activities		(215,391,470	)		(89,742,550	)

Cash flow from financing activities
Proceeds from addition of shares		1,139,475,837			987,785,499
Payment on shares redeemed		(920,858,114	)		(884,977,522	)

Net cash provided by (used in) financing activities		218,617,723			102,807,977

Net increase (decrease) in cash		3,226,253			13,065,427
Cash, beginning of period		905,158			80,936

Cash, end of period	$	4,131,411		$	13,146,363

See accompanying notes to financial statements.

-16-

PROSHARES ULTRASHORT DJ-UBS CRUDE OIL

STATEMENTS OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)		December 31, 2010
Assets
Cash	$	587,515	$	4,007,347
Segregated cash balances with brokers for futures contracts		5,402,700		4,252,500
Short-term U.S. government and agency obligations (Note 3) (cost $58,148,269 and $135,631,915, respectively)		58,146,838		135,637,192
Unrealized appreciation on swap agreements		7,373,037		—
Receivable on open futures contracts		956,059		—

Total assets		72,466,149		143,897,039

Liabilities and shareholders’ equity
Liabilities
Payable for capital shares redeemed		—		6,313,753
Payable on open futures contracts		—		1,140,144
Management fee payable		108,318		117,277
Unrealized depreciation on swap agreements		—		4,111,608

Total liabilities		108,318		11,682,782

Shareholders’ equity
Shareholders’ equity		72,357,831		132,214,257

Total liabilities and shareholders’ equity	$	72,466,149	$	143,897,039

Shares outstanding		1,119,944		2,600,003

Net asset value per share (Note 1)	$	64.61	$	50.85

Market value per share (Note 1) (Note 2)	$	65.25	$	50.85

See accompanying notes to financial statements.

-17-

PROSHARES ULTRASHORT DJ-UBS CRUDE OIL

SCHEDULE OF INVESTMENTS

SEPTEMBER 30, 2011

(unaudited)


	Principal Amount		Value
Short-term U.S. government and agency obligations (80% of shareholders’ equity)
U.S. Treasury Bills:
0.010% due 10/06/11†	$	101,000	$	101,000
0.013% due 10/13/11		8,826,000		8,825,991
0.041% due 10/20/11†		4,429,000		4,428,983
0.076% due 10/27/11†		7,858,000		7,857,954
0.005% due 11/17/11		1,289,000		1,288,985
0.002% due 12/01/11†		4,027,000		4,026,937
0.015% due 12/08/11†		3,974,000		3,973,931
0.000% due 12/15/11		7,307,000		7,306,858
0.000% due 12/22/11		2,145,000		2,144,932
0.001% due 12/29/11		2,602,000		2,601,909
0.000% due 02/09/12†		15,591,000		15,589,358

Total short-term U.S. government and agency obligations (cost $58,148,269)			$	58,146,838

Futures Contracts Sold


	Number of Contracts		Notional Amount at Value		Unrealized Appreciation (Depreciation)
Crude Oil – NYMEX, expires November 2011		667	$	52,826,400	$	4,143,110

Swap Agreements^


	Termination Date		Notional Amount at Value*			Unrealized Appreciation (Depreciation)
Swap agreement with Goldman Sachs International based on Dow Jones-UBS Crude Oil Sub-Index		10/06/11	$	(35,501,505	)	$	2,588,393
Swap agreement with UBS AG based on Dow Jones-UBS Crude Oil Sub-Index		10/06/11		(56,394,476	)		4,784,644

						$	7,373,037

†	All or partial amount segregated as collateral for swap agreements.

^	The positions and counterparties herein are as of September 30, 2011. The Funds continually evaluate different counterparties for their transactions and counterparties are subject to change. New counterparties can be added at anytime.

*	For swap agreements, a positive amount represents “long” exposure to the benchmark Index. A negative amount represents “short” exposure to the benchmark Index.

See accompanying notes to financial statements.

-18-

PROSHARES ULTRASHORT DJ-UBS CRUDE OIL

STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2011 AND 2010

(unaudited)


	Three months ended September 30, 2011			Three months ended September 30, 2010			Nine months ended September 30, 2011			Nine months ended September 30, 2010
Investment Income
Interest	$	5,491		$	21,433		$	67,925		$	76,927

Expenses
Management fee		236,646			132,890			936,197			539,674
Brokerage commissions		8,341			9,886			40,643			37,608

Total expenses		244,987			142,776			976,840			577,282

Net investment income (loss)		(239,496	)		(121,343	)		(908,915	)		(500,355	)

Realized and unrealized gain (loss) on investment activity
Net realized gain (loss) on
Futures contracts		14,712,451			2,895,091			17,177,834			7,896,349
Swap agreements		26,160,078			5,060,061			41,288,571			23,643,501
Short-term U.S. government and agency obligations		893			46			11,042			8,571

Net realized gain (loss)		40,873,422			7,955,198			58,477,447			31,548,421

Change in net unrealized appreciation/depreciation on
Futures contracts		1,855,210			(2,156,250	)		6,527,530			1,709,680
Swap agreements		473,645			(1,389,552	)		11,484,645			(2,007,799	)
Short-term U.S. government and agency obligations		(2,573	)		(743	)		(6,708	)		7,169

Change in net unrealized appreciation/depreciation		2,326,282			(3,546,545	)		18,005,467			(290,950	)

Net realized and unrealized gain (loss)		43,199,704			4,408,653			76,482,914			31,257,471

Net income (loss)	$	42,960,208		$	4,287,310		$	75,573,999		$	30,757,116

Net income (loss) per weighted-average share (Note 1)	$	21.98		$	5.58		$	26.58		$	27.30

Weighted-average shares outstanding (Note 1)		1,954,183			768,481			2,842,815			1,126,486

See accompanying notes to financial statements.

-19-

PROSHARES ULTRASHORT DJ-UBS CRUDE OIL

STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

FOR THE NINE MONTHS ENDED

SEPTEMBER 30, 2011

(unaudited)


Shareholders’ equity, at December 31, 2010	$	132,214,257

Addition of 8,030,000 shares (Note 1)		352,799,851
Redemption of 9,510,059 shares (Note 1)		(488,230,276	)

Net addition (redemption) of (1,480,059) shares (Note 1)		(135,430,425	)


Net investment income (loss)		(908,915	)
Net realized gain (loss)		58,477,447
Change in net unrealized appreciation/depreciation		18,005,467

Net income (loss)		75,573,999


Shareholders’ equity, at September 30, 2011	$	72,357,831

See accompanying notes to financial statements.

-20-

PROSHARES ULTRASHORT DJ-UBS CRUDE OIL

STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED

SEPTEMBER 30, 2011 AND 2010

(unaudited)


	Nine months ended September 30, 2011			Nine months ended September 30, 2010
Cash flow from operating activities
Net income (loss)	$	75,573,999		$	30,757,116
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Decrease (Increase) in segregated cash balances with brokers for futures contracts		(1,150,200	)		2,137,725
Net sale (purchase) of short-term U.S. government and agency obligations		77,483,646			22,377,506
Change in unrealized appreciation/depreciation on investments		(11,477,937	)		2,000,630
Decrease (Increase) in receivable on futures contracts		(956,059	)		—
Increase (Decrease) in management fee payable		(8,959	)		(36,308	)
Increase (Decrease) in payable on futures contracts		(1,140,144	)		(341,462	)

Net cash provided by (used in) operating activities		138,324,346			56,895,207

Cash flow from financing activities
Proceeds from addition of shares		352,799,851			333,734,191
Payment on shares redeemed		(494,544,029	)		(390,217,297	)

Net cash provided by (used in) financing activities		(141,744,178	)		(56,483,106	)

Net increase (decrease) in cash		(3,419,832	)		412,101
Cash, beginning of period		4,007,347			75,409

Cash, end of period	$	587,515		$	487,510

See accompanying notes to financial statements.

-21-

PROSHARES ULTRA DJ-UBS NATURAL GAS*

STATEMENT OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)
Assets
Cash	$	400
Offering costs (Note 5)		26,624

Total assets		27,024

Liabilities and shareholders’ equity
Liabilities
Payable for offering costs		26,624

Total liabilities		26,624

Shareholders’ equity
Shareholders’ equity	$	400

Total liabilities and shareholders’ equity	$	27,024

*	See Note 1.

See accompanying notes to financial statements.

-22-

PROSHARES SHORT DJ-UBS NATURAL GAS*

STATEMENTS OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)		December 31, 2010
Assets
Cash	$	200	$	200
Offering costs (Note 5)		29,090		—

Total assets		29,290		200

Liabilities and shareholders’ equity
Liabilities
Payable for offering costs		29,090		—

Total liabilities		29,090		—

Shareholders’ equity
Shareholders’ equity		200		200

Total liabilities and shareholders’ equity	$	29,290	$	200

*	See Note 1.

See accompanying notes to financial statements.

-23-

PROSHARES ULTRASHORT DJ-UBS NATURAL GAS*

STATEMENT OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)
Assets
Cash	$	400
Offering costs (Note 5)		26,624

Total assets		27,024

Liabilities and shareholders’ equity
Liabilities
Payable for offering costs		26,624

Total liabilities		26,624

Shareholders’ equity
Shareholders’ equity	$	400

Total liabilities and shareholders’ equity	$	27,024

*	See Note 1.

See accompanying notes to financial statements.

-24-

PROSHARES ULTRA GOLD

STATEMENTS OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)		December 31, 2010
Assets
Cash	$	1,462,618	$	1,262,424
Segregated cash balances with brokers for futures contracts		286,875		467,775
Short-term U.S. government and agency obligations (Note 3) (cost $363,986,667 and $249,242,580, respectively)		363,969,066		249,250,657
Unrealized appreciation on forward agreements		8,990,384		8,724,587
Receivable on open futures contracts		12,491		60,830

Total assets		374,721,434		259,766,273

Liabilities and shareholders’ equity
Liabilities
Management fee payable		711,213		204,198

Total liabilities		711,213		204,198

Shareholders’ equity
Shareholders’ equity		374,010,221		259,562,075

Total liabilities and shareholders’ equity	$	374,721,434	$	259,766,273

Shares outstanding		4,300,014		3,750,014

Net asset value per share	$	86.98	$	69.22

Market value per share (Note 2)	$	87.34	$	70.72

See accompanying notes to financial statements.

-25-

PROSHARES ULTRA GOLD

SCHEDULE OF INVESTMENTS

SEPTEMBER 30, 2011

(unaudited)


	Principal Amount		Value
Short-term U.S. government and agency obligations (97% of shareholders’ equity)
U.S. Treasury Bills:
0.008% due 10/06/11	$	10,254,000	$	10,253,998
0.013% due 10/13/11		20,509,000		20,508,979
0.011% due 10/20/11		40,000,000		39,999,844
0.076% due 10/27/11		4,589,000		4,588,973
0.003% due 11/10/11†		31,326,000		31,325,693
0.016% due 11/17/11†		50,000,000		49,999,415
0.002% due 12/01/11†		46,402,000		46,401,276
0.015% due 12/08/11		32,702,000		32,701,431
0.000% due 12/15/11		4,042,000		4,041,922
0.000% due 12/22/11		4,139,000		4,138,868
0.001% due 12/29/11		16,998,000		16,997,407
0.001% due 02/09/12†		46,596,000		46,591,093
0.000% due 03/01/12†		20,000,000		19,995,916
0.002% due 03/08/12†		20,000,000		19,995,294
0.000% due 03/15/12†		16,433,000		16,428,957

Total short-term U.S. government and agency obligations (cost $363,986,667)			$	363,969,066

Futures Contracts Purchased


	Number of Contracts		Notional Amount at Value		Unrealized Appreciation (Depreciation)
Gold Futures – COMEX, expires December 2011		25	$	4,055,750	$	(557,680	)

Forward Agreements^


	Settlement Date		Commitment to (Deliver)/Receive		Notional Amount at Value*		Unrealized Appreciation (Depreciation)
Forward agreements with Goldman Sachs International based on 0.995 Fine Troy Ounce Gold		10/10/11	$	113,520	$	183,928,510	$	2,468,956
Forward agreements with UBS AG based on 0.995 Fine Troy Ounce Gold		10/10/11		345,700		560,113,511		6,521,428

							$	8,990,384

†	All or partial amount segregated as collateral for forward agreements.

^	The positions and counterparties herein are as of September 30, 2011. The Funds continually evaluate different counterparties for their transactions and counterparties are subject to change. New counterparties can be added at anytime.

*	For forward agreements, a positive amount represents “long” exposure to the underlying commodity. A negative amount represents “short” exposure to the underlying commodity.

See accompanying notes to financial statements.

-26-

PROSHARES ULTRA GOLD

STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2011 AND 2010

(unaudited)


	Three months ended September 30, 2011			Three months ended September 30, 2010			Nine months ended September 30, 2011			Nine months ended September 30, 2010
Investment Income
Interest	$	20,274		$	85,654		$	138,778		$	187,823

Expenses
Management fee		958,522			466,267			2,166,956			1,296,693
Brokerage commissions		1,020			902			2,830			2,973

Total expenses		959,542			467,169			2,169,786			1,299,666

Net investment income (loss)		(939,268	)		(381,515	)		(2,031,008	)		(1,111,843	)

Realized and unrealized gain (loss) on investment activity
Net realized gain (loss) on
Futures contracts		1,329,813			(232,336	)		2,152,978			673,165
Forward agreements		3,464,320			7,410,760			53,273,927			50,218,194
Short-term U.S. government and agency obligations		2,407			29			2,259			5,788

Net realized gain (loss)		4,796,540			7,178,453			55,429,164			50,897,147

Change in net unrealized appreciation/depreciation on
Futures contracts		(340,810	)		541,140			(863,660	)		859,910
Forward agreements		23,670,553			8,728,978			265,797			8,205,673
Short-term U.S. government and agency obligations		(25,972	)		(7,111	)		(25,678	)		7,412

Change in net unrealized appreciation/depreciation		23,303,771			9,263,007			(623,541	)		9,072,995

Net realized and unrealized gain (loss)		28,100,311			16,441,460			54,805,623			59,970,142

Net income (loss)	$	27,161,043		$	16,059,945		$	52,774,615		$	58,858,299

Net income (loss) per weighted-average share	$	6.72		$	4.43		$	14.23		$	16.22

Weighted-average shares outstanding		4,042,405			3,628,275			3,709,721			3,629,501

See accompanying notes to financial statements.

-27-

PROSHARES ULTRA GOLD

STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011

(unaudited)


Shareholders’ equity, at December 31, 2010	$	259,562,075

Addition of 1,250,000 shares		120,484,630
Redemption of 700,000 shares		(58,811,099	)

Net addition (redemption) of 550,000 shares		61,673,531


Net investment income (loss)		(2,031,008	)
Net realized gain (loss)		55,429,164
Change in net unrealized appreciation/depreciation		(623,541	)

Net income (loss)		52,774,615


Shareholders’ equity, at September 30, 2011	$	374,010,221

See accompanying notes to financial statements.

-28-

PROSHARES ULTRA GOLD

STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED

SEPTEMBER 30, 2011 AND 2010

(unaudited)


	Nine months ended September 30, 2011			Nine months ended September 30, 2010
Cash flow from operating activities
Net income (loss)	$	52,774,615		$	58,858,299
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Decrease (Increase) in segregated cash balances with brokers for futures contracts		180,900			72,680
Net sale (purchase) of short-term U.S. government and agency obligations		(114,744,087	)		(29,850,550	)
Change in unrealized appreciation/depreciation on investments		(240,119	)		(8,213,085	)
Decrease (Increase) in receivable on futures contracts		48,339			32,930
Increase (Decrease) in management fee payable		507,015			4,986

Net cash provided by (used in) operating activities		(61,473,337	)		20,905,260

Cash flow from financing activities
Proceeds from addition of shares		120,484,630			68,512,854
Payment on shares redeemed		(58,811,099	)		(86,977,321	)

Net cash provided by (used in) financing activities		61,673,531			(18,464,467	)

Net increase (decrease) in cash		200,194			2,440,793
Cash, beginning of period		1,262,424			96,468

Cash, end of period	$	1,462,618		$	2,537,261

See accompanying notes to financial statements.

-29-

PROSHARES SHORT GOLD*

STATEMENTS OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)		December 31, 2010
Assets
Cash	$	200	$	200
Offering costs (Note 5)		12,424		—

Total assets		12,624		200

Liabilities and shareholders’ equity
Liabilities
Payable for offering costs		12,424		—

Total liabilities		12,424		—

Shareholders’ equity
Shareholders’ equity		200		200

Total liabilities and shareholders’ equity	$	12,624	$	200

*	See Note 1.

See accompanying notes to financial statements.

-30-

PROSHARES ULTRASHORT GOLD

STATEMENTS OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)		December 31, 2010
Assets
Cash	$	929,386	$	404,683
Segregated cash balances with brokers for futures contracts		131,700		364,500
Short-term U.S. government and agency obligations (Note 3) (cost $185,053,985 and $80,111,190, respectively)		185,040,756		80,114,447

Total assets		186,101,842		80,883,630

Liabilities and shareholders’ equity
Liabilities
Payable on open futures contracts		—		94,800
Management fee payable		227,757		64,932
Unrealized depreciation on forward agreements		7,834,590		2,991,391

Total liabilities		8,062,347		3,151,123

Shareholders’ equity
Shareholders’ equity		178,039,495		77,732,507

Total liabilities and shareholders’ equity	$	186,101,842	$	80,883,630

Shares outstanding		9,239,901		2,739,901

Net asset value per share	$	19.27	$	28.37

Market value per share (Note 2)	$	19.17	$	27.80

See accompanying notes to financial statements.

-31-

PROSHARES ULTRASHORT GOLD

SCHEDULE OF INVESTMENTS

SEPTEMBER 30, 2011

(unaudited)


	Principal Amount		Value
Short-term U.S. government and agency obligations (104% of shareholders’ equity)
U.S. Treasury Bills:
0.018% due 10/06/11	$	4,525,000	$	4,524,999
0.013% due 10/13/11		7,094,000		7,093,993
0.076% due 10/27/11†		9,319,000		9,318,945
0.011% due 11/10/11†		25,349,000		25,348,752
0.005% due 11/17/11		994,000		993,988
0.005% due 11/25/11		5,973,000		5,972,875
0.002% due 12/01/11†		19,105,000		19,104,702
0.000% due 12/29/11		45,291,000		45,289,419
0.001% due 02/09/12†		28,671,000		28,667,981
0.000% due 03/01/12		12,000,000		11,997,550
0.003% due 03/08/12		12,000,000		11,997,176
0.000% due 03/15/12†		14,734,000		14,730,376

Total short-term U.S. government and agency obligations (cost $185,053,985)			$	185,040,756

Futures Contracts Sold


	Number of Contracts		Notional Amount at Value		Unrealized Appreciation (Depreciation)
Gold Futures – COMEX, expires December 2011		12	$	1,946,760	$	98,160

Forward Agreements^


	Settlement Date	Commitment to (Deliver)/Receive			Notional Amount at Value*			Unrealized Appreciation (Depreciation)
Forward agreements with Goldman Sachs International based on 0.995 Fine Troy Ounce Gold	10/10/11	$	(52,498	)	$	(85,058,835	)	$	(1,156,697	)
Forward agreements with UBS AG based on 0.995 Fine Troy Ounce Gold	10/10/11		(166,100	)		(269,120,203	)		(6,677,893	)

								$	(7,834,590	)

†	All or partial amount segregated as collateral for forward agreements.

^	The positions and counterparties herein are as of September 30, 2011. The Funds continually evaluate different counterparties for their transactions and counterparties are subject to change. New counterparties can be added at anytime.

*	For forward agreements, a positive amount represents “long” exposure to the underlying commodity. A negative amount represents “short” exposure to the underlying commodity.

See accompanying notes to financial statements.

-32-

PROSHARES ULTRASHORT GOLD

STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2011 AND 2010

(unaudited)


	Three months ended September 30, 2011			Three months ended September 30, 2010			Nine months ended September 30, 2011			Nine months ended September 30, 2010
Investment Income
Interest	$	6,156		$	33,103		$	50,183		$	72,856

Expenses
Management fee		299,227			183,450			729,868			497,988
Brokerage commissions		613			513			2,466			2,338

Total expenses		299,840			183,963			732,334			500,326

Net investment income (loss)		(293,684	)		(150,860	)		(682,151	)		(427,470	)

Realized and unrealized gain (loss) on investment activity
Net realized gain (loss) on
Futures contracts		89,535			(77,504	)		(807,800	)		(391,822	)
Forward agreements		7,191,381			(5,158,437	)		(15,300,608	)		(25,247,833	)
Short-term U.S. government and agency obligations		1,287			139			1,821			2,295

Net realized gain (loss)		7,282,203			(5,235,802	)		(16,106,587	)		(25,637,360	)

Change in net unrealized appreciation/depreciation on
Futures contracts		17,500			(162,330	)		390,910			(223,400	)
Forward agreements		(12,243,530	)		(2,938,770	)		(4,843,199	)		(3,320,188	)
Short-term U.S. government and agency obligations		(13,994	)		84			(16,486	)		6,241

Change in net unrealized appreciation/depreciation		(12,240,024	)		(3,101,016	)		(4,468,775	)		(3,537,347	)

Net realized and unrealized gain (loss)		(4,957,821	)		(8,336,818	)		(20,575,362	)		(29,174,707	)

Net income (loss)	$	(5,251,505	)	$	(8,487,678	)	$	(21,257,513	)	$	(29,602,177	)

Net income (loss) per weighted-average share	$	(0.74	)	$	(4.30	)	$	(4.55	)	$	(18.07	)

Weighted-average shares outstanding		7,079,031			1,974,684			4,671,769			1,637,744

See accompanying notes to financial statements.

-33-

PROSHARES ULTRASHORT GOLD

STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011

(unaudited)


Shareholders’ equity, at December 31, 2010	$	77,732,507

Addition of 8,900,000 shares		172,768,537
Redemption of 2,400,000 shares		(51,204,036	)

Net addition (redemption) of 6,500,000 shares		121,564,501


Net investment income (loss)		(682,151	)
Net realized gain (loss)		(16,106,587	)
Change in net unrealized appreciation/depreciation		(4,468,775	)

Net income (loss)		(21,257,513	)


Shareholders’ equity, at September 30, 2011	$	178,039,495

See accompanying notes to financial statements.

-34-

PROSHARES ULTRASHORT GOLD

STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED

SEPTEMBER 30, 2011 AND 2010

(unaudited)


	Nine months ended September 30, 2011			Nine months ended September 30, 2010
Cash flow from operating activities
Net income (loss)	$	(21,257,513	)	$	(29,602,177	)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Decrease (Increase) in segregated cash balances with brokers for futures contracts		232,800			(65,683	)
Net sale (purchase) of short-term U.S. government and agency obligations		(104,942,795	)		(8,065,126	)
Change in unrealized appreciation/depreciation on investments		4,859,685			3,313,947
Decrease (Increase) in receivable on futures contracts		—			(2,520	)
Increase (Decrease) in management fee payable		162,825			3,724
Increase (Decrease) in payable on futures contracts		(94,800	)		—

Net cash provided by (used in) operating activities		(121,039,798	)		(34,417,835	)

Cash flow from financing activities
Proceeds from addition of shares		172,768,537			66,422,591
Payment on shares redeemed		(51,204,036	)		(29,778,225	)

Net cash provided by (used in) financing activities		121,564,501			36,644,366

Net increase (decrease) in cash		524,703			2,226,531
Cash, beginning of period		404,683			75,790

Cash, end of period	$	929,386		$	2,302,321

See accompanying notes to financial statements.

-35-

PROSHARES ULTRA SILVER

STATEMENTS OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)		December 31, 2010
Assets
Cash	$	1,609,878	$	2,505,032
Segregated cash balances with brokers for futures contracts		1,685,226		2,395,913
Short-term U.S. government and agency obligations (Note 3) (cost $642,154,974 and $495,898,270, respectively)		642,109,717		495,915,529
Unrealized appreciation on forward agreements		57,079,169		46,191,568
Receivable from capital shares sold		10,766,110		—
Receivable on open futures contracts		—		391,421

Total assets		713,250,100		547,399,463

Liabilities and shareholders’ equity
Liabilities
Payable for capital shares redeemed		5,693,957		—
Management fee payable		1,612,811		395,544

Total liabilities		7,306,768		395,544

Shareholders’ equity
Shareholders’ equity		705,943,332		547,003,919

Total liabilities and shareholders’ equity	$	713,250,100	$	547,399,463

Shares outstanding		12,900,028		7,000,028

Net asset value per share (Note 10)	$	54.72	$	78.14

Market value per share (Note 2) (Note 10)	$	51.84	$	79.30

See accompanying notes to financial statements.

-36-

PROSHARES ULTRA SILVER

SCHEDULE OF INVESTMENTS

SEPTEMBER 30, 2011

(unaudited)


	Principal Amount		Value
Short-term U.S. government and agency obligations (91% of shareholders’ equity)
U.S. Treasury Bills:
0.018% due 10/06/11	$	1,036,000	$	1,036,000
0.013% due 10/13/11		15,680,000		15,679,984
0.020% due 10/20/11		28,563,000		28,562,889
0.076% due 10/27/11		6,733,000		6,732,960
0.003% due 11/10/11		29,584,000		29,583,710
0.016% due 11/17/11		50,000,000		49,999,415
0.005% due 11/25/11		62,360,000		62,358,697
0.002% due 12/01/11†		57,026,000		57,025,110
0.007% due 12/15/11		7,121,000		7,120,862
0.000% due 12/22/11		50,000,000		49,998,400
0.002% due 12/29/11		97,764,000		97,760,588
0.000% due 01/19/12†		50,000,000		49,997,815
0.000% due 02/09/12†		31,909,000		31,905,640
0.000% due 03/01/12†		50,000,000		49,989,790
0.003% due 03/08/12†		50,000,000		49,988,235
0.001% due 03/15/12†		54,383,000		54,369,622

Total short-term U.S. government and agency obligations (cost $642,154,974)			$	642,109,717

Futures Contracts Purchased


	Number of Contracts		Notional Amount at Value		Unrealized Appreciation (Depreciation)
Silver Futures – COMEX, expires December 2011		74	$	11,130,710	$	(3,323,660	)

Forward Agreements^


	Settlement Date		Commitment to (Deliver)/Receive		Notional Amount at Value*		Unrealized Appreciation (Depreciation)
Forward agreements with Goldman Sachs International based on 0.999 Fine Troy Ounce Silver		10/10/11	$	12,080,800	$	367,899,019	$	16,861,626
Forward agreements with UBS AG based on 0.999 Fine Troy Ounce Silver		10/10/11		33,924,000		1,033,094,357		40,217,543

							$	57,079,169

†	All or partial amount segregated as collateral for forward agreements.

^	The positions and counterparties herein are as of September 30, 2011. The Funds continually evaluate different counterparties for their transactions and counterparties are subject to change. New counterparties can be added at anytime.

*	For forward agreements, a positive amount represents “long” exposure to the underlying commodity. A negative amount represents “short” exposure to the underlying commodity.

See accompanying notes to financial statements.

-37-

PROSHARES ULTRA SILVER

STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2011 and 2010

(unaudited)


	Three months ended September 30, 2011			Three months ended September 30, 2010			Nine months ended September 30, 2011			Nine months ended September 30, 2010
Investment Income
Interest	$	54,294		$	78,646		$	413,210		$	195,896

Expenses
Management fee		2,423,377			399,644			6,530,746			1,191,495
Brokerage commissions		2,126			1,147			7,354			4,502

Total expenses		2,425,503			400,791			6,538,100			1,195,997

Net investment income (loss)		(2,371,209	)		(322,145	)		(6,124,890	)		(1,000,101	)

Realized and unrealized gain (loss) on investment activity
Net realized gain (loss) on
Futures contracts		(1,862,254	)		190,144			6,745,262			501,563
Forward agreements		(348,455,898	)		35,224,898			(290,050,993	)		59,964,658
Short-term U.S. government and agency obligations		5,732			1,786			46,058			9,769

Net realized gain (loss)		(350,312,420	)		35,416,828			(283,259,673	)		60,475,990

Change in net unrealized appreciation/depreciation on
Futures contracts		(2,236,345	)		1,350,910			(6,379,880	)		2,030,945
Forward agreements		86,729,592			16,104,902			10,887,601			16,115,398
Short-term U.S. government and agency obligations		(68,357	)		(10,906	)		(62,516	)		14,613

Change in net unrealized appreciation/depreciation		84,424,890			17,444,906			4,445,205			18,160,956

Net realized and unrealized gain (loss)		(265,887,530	)		52,861,734			(278,814,468	)		78,636,946

Net income (loss)	$	(268,258,739	)	$	52,539,589		$	(284,939,358	)	$	77,636,845

Net income (loss) per weighted-average share (Note 10)	$	(26.45	)	$	9.99		$	(30.69	)	$	13.91

Weighted-average shares outstanding (Note 10)		10,140,245			5,257,637			9,285,742			5,579,515

See accompanying notes to financial statements.

-38-

PROSHARES ULTRA SILVER

STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011

(unaudited)


Shareholders’ equity, at December 31, 2010	$	547,003,919

Addition of 12,200,000 shares (Note 10)		1,066,780,261
Redemption of 6,300,000 shares (Note 10)		(622,901,490	)

Net addition (redemption) of 5,900,000 shares (Note 10)		443,878,771


Net investment income (loss)		(6,124,890	)
Net realized gain (loss)		(283,259,673	)
Change in net unrealized appreciation/depreciation		4,445,205

Net income (loss)		(284,939,358	)


Shareholders’ equity, at September 30, 2011	$	705,943,332

See accompanying notes to financial statements.

-39-

PROSHARES ULTRA SILVER

STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED

SEPTEMBER 30, 2011 and 2010

(unaudited)


	Nine months ended September 30, 2011			Nine months ended September 30, 2010
Cash flow from operating activities
Net income (loss)	$	(284,939,358	)	$	77,636,845
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Decrease (Increase) in segregated cash balances with brokers for futures contracts		710,687			288,163
Net sale (purchase) of short-term U.S. government and agency obligations		(146,256,704	)		(29,112,472	)
Change in unrealized appreciation/depreciation on investments		(10,825,085	)		(16,130,011	)
Decrease (Increase) in receivable on futures contracts		391,421			—
Increase (Decrease) in management fee payable		1,217,267			16,255

Net cash provided by (used in) operating activities		(439,701,772	)		32,698,780

Cash flow from financing activities
Proceeds from addition of shares		1,056,014,151			76,723,828
Payment on shares redeemed		(617,207,533	)		(104,812,514	)

Net cash provided by (used in) financing activities		438,806,618			(28,088,686	)

Net increase (decrease) in cash		(895,154	)		4,610,094
Cash, beginning of period		2,505,032			75,670

Cash, end of period	$	1,609,878		$	4,685,764

See accompanying notes to financial statements.

-40-

PROSHARES ULTRASHORT SILVER

STATEMENTS OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)		December 31, 2010
Assets
Cash	$	3,748,737	$	3,514,285
Segregated cash balances with brokers for futures contracts		749,250		512,663
Short-term U.S. government and agency obligations (Note 3) (cost $745,847,542 and $105,316,101, respectively)		745,818,445		105,319,504
Receivable on open futures contracts		2,244,439		—

Total assets		752,560,871		109,346,452

Liabilities and shareholders’ equity
Liabilities
Payable for capital shares redeemed		17,083,309		—
Payable on open futures contracts		—		227,423
Management fee payable		852,002		75,903
Unrealized depreciation on forward agreements		201,231,313		10,010,345

Total liabilities		219,166,624		10,313,671

Shareholders’ equity
Shareholders’ equity		533,394,247		99,032,781

Total liabilities and shareholders’ equity	$	752,560,871	$	109,346,452

Shares outstanding		32,694,369		2,482,479

Net asset value per share (Note 1)	$	16.31	$	39.89

Market value per share (Note 1) (Note 2)	$	17.11	$	39.28

See accompanying notes to financial statements.

-41-

PROSHARES ULTRASHORT SILVER

SCHEDULE OF INVESTMENTS

SEPTEMBER 30, 2011

(unaudited)


	Principal Amount		Value
Short-term U.S. government and agency obligations (140% of shareholders’ equity)
U.S. Treasury Bills:
0.011% due 10/06/11	$	59,463,000	$	59,462,988
0.013% due 10/13/11†		73,109,000		73,108,927
0.037% due 10/20/11†		16,636,000		16,635,935
0.076% due 10/27/11†		35,967,000		35,966,788
0.000% due 11/10/11		8,953,000		8,952,912
0.005% due 11/17/11†		52,846,000		52,845,382
0.002% due 12/01/11†		25,739,000		25,738,599
0.015% due 12/08/11†		19,847,000		19,846,655
0.007% due 12/15/11		4,382,000		4,381,915
0.000% due 12/22/11		2,362,000		2,361,924
0.000% due 12/29/11		277,133,000		277,123,328
0.000% due 01/19/12†		50,000,000		49,997,815
0.002% due 02/09/12†		61,146,000		61,139,561
0.000% due 03/01/12†		20,000,000		19,995,916
0.002% due 03/08/12†		20,000,000		19,995,294
0.000% due 03/15/12†		18,269,000		18,264,506

Total short-term U.S. government and agency obligations (cost $745,847,542)			$	745,818,445

Futures Contracts Sold


	Number of Contracts		Notional Amount at Value		Unrealized Appreciation (Depreciation)
Silver Futures – COMEX, expires December 2011		30	$	4,512,450	$	492,525

Forward Agreements^


	Settlement Date		Commitment to (Deliver)/Receive			Notional Amount at Value*			Unrealized Appreciation (Depreciation)
Forward agreements with Goldman Sachs International based on 0.999 Fine Troy Ounce Silver		10/10/11	$	(7,602,500	)	$	(231,520,453	)	$	(45,762,339	)
Forward agreements with UBS AG based on 0.999 Fine Troy Ounce Silver		10/10/11		(27,273,000	)		(830,550,124	)		(155,468,974	)

									$	(201,231,313	)

†	All or partial amount segregated as collateral for forward agreements.

^	The positions and counterparties herein are as of September 30, 2011. The Funds continually evaluate different counterparties for their transactions and counterparties are subject to change. New counterparties can be added at anytime.

*	For forward agreements, a positive amount represents “long” exposure to the underlying commodity. A negative amount represents “short” exposure to the underlying commodity.

See accompanying notes to financial statements.

-42-

PROSHARES ULTRASHORT SILVER

STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED

SEPTEMBER 30, 2011 AND 2010

(unaudited)


	Three months ended September 30, 2011			Three months ended September 30, 2010			Nine months ended September 30, 2011			Nine months ended September 30, 2010
Investment Income
Interest	$	36,609		$	28,202		$	141,157		$	67,469

Expenses
Management fee		1,328,783			146,320			2,812,042			443,414
Brokerage commissions		1,431			789			3,718			2,681

Total expenses		1,330,214			147,109			2,815,760			446,095

Net investment income (loss)		(1,293,605	)		(118,907	)		(2,674,603	)		(378,626	)

Realized and unrealized gain (loss) on investment activity
Net realized gain (loss) on
Futures contracts		2,681,280			(363,579	)		2,891,784			(427,329	)
Forward agreements		181,877,651			(17,463,923	)		129,322,766			(39,581,361	)
Short-term U.S. government and agency obligations		1,907			305			4,428			3,522

Net realized gain (loss)		184,560,838			(17,827,197	)		132,218,978			(40,005,168	)

Change in net unrealized appreciation/depreciation on
Futures contracts		(356,000	)		(186,735	)		1,011,945			(380,020	)
Forward agreements		(216,853,973	)		(5,325,366	)		(191,220,968	)		(6,160,682	)
Short-term U.S. government and agency obligations		(41,346	)		(2,217	)		(32,500	)		5,574

Change in net unrealized appreciation/depreciation		(217,251,319	)		(5,514,318	)		(190,241,523	)		(6,535,128	)

Net realized and unrealized gain (loss)		(32,690,481	)		(23,341,515	)		(58,022,545	)		(46,540,296	)

Net income (loss)	$	(33,984,086	)	$	(23,460,422	)	$	(60,697,148	)	$	(46,918,922	)

Net income (loss) per weighted-average share (Note 1)	$	(0.85	)	$	(46.68	)	$	(2.57	)	$	(110.34	)

Weighted-average shares outstanding (Note 1)		40,109,586			502,587			23,613,283			425,235

See accompanying notes to financial statements.

-43-

PROSHARES ULTRASHORT SILVER

STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

FOR THE NINE MONTHS ENDED

SEPTEMBER 30, 2011

(unaudited)


Shareholders’ equity, at December 31, 2010	$	99,032,781

Addition of 62,887,500 shares (Note 1)		1,089,916,599
Redemption of 32,675,610 shares (Note 1)		(594,857,985	)

Net addition (redemption) of 30,211,890 shares (Note 1)		495,058,614


Net investment income (loss)		(2,674,603	)
Net realized gain (loss)		132,218,978
Change in net unrealized appreciation/depreciation		(190,241,523	)

Net income (loss)		(60,697,148	)


Shareholders’ equity, at September 30, 2011	$	533,394,247

See accompanying notes to financial statements.

-44-

PROSHARES ULTRASHORT SILVER

STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED

SEPTEMBER 30, 2011 AND 2010

(unaudited)


	Nine months ended September 30, 2011			Nine months ended September 30, 2010
Cash flow from operating activities
Net income (loss)	$	(60,697,148	)	$	(46,918,922	)
Adjustments to reconcile net income (loss) to net cash provided by (used in)operating activities:
Decrease (Increase) in segregated cash balances with brokers for futures contracts		(236,587	)		285,653
Net sale (purchase) of short-term U.S. government and agency obligations		(640,531,441	)		2,615,625
Change in unrealized appreciation/depreciation on investments		191,253,468			6,155,108
Decrease (Increase) in receivable on futures contracts		(2,244,439	)		(15,720	)
Increase (Decrease) in management fee payable		776,099			(3,537	)
Increase (Decrease) in payable on futures contracts		(227,423	)		—

Net cash provided by (used in) operating activities		(511,907,471	)		(37,881,793	)

Cash flow from financing activities
Proceeds from addition of shares		1,089,916,599			90,676,225
Payment on shares redeemed		(577,774,676	)		(50,948,251	)

Net cash provided by (used in) financing activities		512,141,923			39,727,974

Net increase (decrease) in cash		234,452			1,846,181
Cash, beginning of period		3,514,285			78,312

Cash, end of period	$	3,748,737		$	1,924,493

See accompanying notes to financial statements.

-45-

PROSHARES ULTRA EURO

STATEMENTS OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)		December 31, 2010
Assets
Cash	$	4,521	$	13,447
Short-term U.S. government and agency obligations (Note 3) (cost $8,937,823 and $7,373,910, respectively)		8,937,326		7,374,157
Unrealized appreciation on foreign currency forward contracts		—		348,179

Total assets		8,941,847		7,735,783

Liabilities and shareholders’ equity
Liabilities
Management fee payable		13,554		6,099
Unrealized depreciation on foreign currency forward contracts		1,212,360		—

Total liabilities		1,225,914		6,099

Shareholders’ equity
Shareholders’ equity		7,715,933		7,729,684

Total liabilities and shareholders’ equity	$	8,941,847	$	7,735,783

Shares outstanding		300,014		300,014

Net asset value per share	$	25.72	$	25.76

Market value per share (Note 2)	$	25.75	$	25.86

See accompanying notes to financial statements.

-46-

PROSHARES ULTRA EURO

SCHEDULE OF INVESTMENTS

SEPTEMBER 30, 2011

(unaudited)


	Principal Amount		Value
Short-term U.S. government and agency obligations (116% of shareholders’ equity)
U.S. Treasury Bills:
0.013% due 10/13/11	$	575,000	$	574,999
0.010% due 10/20/11		670,000		669,997
0.076% due 10/27/11†		526,000		525,997
0.040% due 11/10/11†		1,880,000		1,879,982
0.015% due 12/08/11		1,523,000		1,522,974
0.001% due 12/29/11		231,000		230,992
0.002% due 02/09/12		1,077,000		1,076,887
0.000% due 03/01/12		2,456,000		2,455,498

Total short-term U.S. government and agency obligations (cost $8,937,823)			$	8,937,326

Foreign Currency Forward Contracts^


	Settlement Date		Local Currency			Notional Amount at Value (USD)			Unrealized Appreciation (Depreciation)
Contracts to Purchase
Euro with Goldman Sachs International		10/07/11		6,232,725		$	8,349,073		$	(613,687	)
Euro with UBS AG		10/07/11		6,659,500			8,920,761			(650,960	)

									$	(1,264,647	)

Contracts to Sell
Euro with Goldman Sachs International		10/07/11		(721,200	)	$	(966,087	)	$	25,406
Euro with UBS AG		10/07/11		(646,900	)		(866,558	)		26,881

									$	52,287

†	All or partial amount segregated as collateral for foreign currency forward contracts.

^	The positions and counterparties herein are as of September 30, 2011. The Funds continually evaluate different counterparties for their transactions and counterparties are subject to change. New counterparties can be added at anytime.

See accompanying notes to financial statements.

-47-

PROSHARES ULTRA EURO

STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2011 AND 2010

(unaudited)


	Three months ended September 30, 2011			Three months ended September 30, 2010			Nine months ended September 30, 2011			Nine months ended September 30, 2010
Investment Income
Interest	$	511		$	6,398		$	4,353		$	12,220

Expenses
Management fee		20,668			36,416			60,728			86,347

Total expenses		20,668			36,416			60,728			86,347

Net investment income (loss)		(20,157	)		(30,018	)		(56,375	)		(74,127	)

Realized and unrealized gain (loss) on investment activity
Net realized gain (loss) on
Foreign currency forward contracts		(3,200	)		1,189,073			1,603,888			(1,756,177	)
Short-term U.S. government and agency obligations		—			440			19			829

Net realized gain (loss)		(3,200	)		1,189,513			1,603,907			(1,755,348	)

Change in net unrealized appreciation/depreciation on
Foreign currency forward contracts		(1,321,372	)		1,995,782			(1,560,539	)		2,043,042
Short-term U.S. government and agency obligations		(602	)		248			(744	)		1,048

Change in net unrealized appreciation/depreciation		(1,321,974	)		1,996,030			(1,561,283	)		2,044,090

Net realized and unrealized gain (loss)		(1,325,174	)		3,185,543			42,624			288,742

Net income (loss)	$	(1,345,331	)	$	3,155,525		$	(13,751	)	$	214,615

Net income (loss) per weighted-average share	$	(4.48	)	$	5.01		$	(0.05	)	$	0.43

Weighted-average shares outstanding		300,014			630,449			300,014			495,069

See accompanying notes to financial statements.

-48-

PROSHARES ULTRA EURO

STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011

(unaudited)


Shareholders’ equity, at December 31, 2010	$	7,729,684

Net investment income (loss)		(56,375	)
Net realized gain (loss)		1,603,907
Change in net unrealized appreciation/depreciation		(1,561,283	)

Net income (loss)		(13,751	)


Shareholders’ equity, at September 30, 2011	$	7,715,933

See accompanying notes to financial statements.

-49-

PROSHARES ULTRA EURO

STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED

SEPTEMBER 30, 2011 and 2010

(unaudited)


	Nine months ended September 30, 2011			Nine months ended September 30, 2010
Cash flow from operating activities
Net income (loss)	$	(13,751	)	$	214,615
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Net sale (purchase) of short-term U.S. government and agency obligations		(1,563,913	)		(2,304,440	)
Change in unrealized appreciation/depreciation on investments		1,561,283			(2,044,090	)
Increase (Decrease) in management fee payable		7,455			3,798

Net cash provided by (used in) operating activities		(8,926	)		(4,130,117	)

Cash flow from financing activities
Proceeds from addition of shares		—			20,023,154
Payment on shares redeemed		—			(15,662,727	)

Net cash provided by (used in) financing activities		—			4,360,427

Net increase (decrease) in cash		(8,926	)		230,310
Cash, beginning of period		13,447			79,160

Cash, end of period	$	4,521		$	309,470

See accompanying notes to financial statements.

-50-

PROSHARES ULTRASHORT EURO

STATEMENTS OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)		December 31, 2010
Assets
Cash	$	423,648	$	251,588
Short-term U.S. government and agency obligations (Note 3) (cost $848,079,829 and $471,813,434, respectively)		848,035,536		471,829,446
Unrealized appreciation on foreign currency forward contracts		109,803,643		—

Total assets		958,262,827		472,081,034

Liabilities and shareholders’ equity
Liabilities
Payable for capital shares redeemed		20,120,025		4,109,402
Management fee payable		1,201,789		364,560
Unrealized depreciation on foreign currency forward contracts		—		23,194,077

Total liabilities		21,321,814		27,668,039

Shareholders’ equity
Shareholders’ equity		936,941,013		444,412,995

Total liabilities and shareholders’ equity	$	958,262,827	$	472,081,034

Shares outstanding		48,600,014		21,900,014

Net asset value per share	$	19.28	$	20.29

Market value per share (Note 2)	$	19.28	$	20.31

See accompanying notes to financial statements.

-51-

PROSHARES ULTRASHORT EURO

SCHEDULE OF INVESTMENTS

SEPTEMBER 30, 2011

(unaudited)


	Principal Amount		Value
Short-term U.S. government and agency obligations (91% of shareholders’ equity)
U.S. Treasury Bills:
0.009% due 10/06/11†	$	28,186,000	$	28,185,995
0.013% due 10/13/11		70,906,000		70,905,929
0.017% due 10/20/11†		63,582,000		63,581,752
0.040% due 11/10/11		50,000,000		49,999,510
0.006% due 11/17/11†		47,251,000		47,250,447
0.005% due 11/25/11		23,399,000		23,398,511
0.002% due 12/01/11†		37,497,000		37,496,415
0.015% due 12/08/11		50,524,000		50,523,121
0.000% due 12/15/11		44,607,000		44,606,135
0.000% due 12/22/11		57,619,000		57,617,156
0.003% due 12/29/11		107,297,000		107,293,255
0.000% due 01/19/12		50,000,000		49,997,815
0.001% due 02/09/12†		82,219,000		82,210,342
0.000% due 03/01/12		45,000,000		44,990,811
0.003% due 03/08/12		45,000,000		44,989,412
0.001% due 03/15/12		45,000,000		44,988,930

Total short-term U.S. government and agency obligations (cost $848,079,829)			$	848,035,536

Foreign Currency Forward Contracts^


	Settlement Date		Local Currency			Notional Amount at Value (USD)			Unrealized Appreciation (Depreciation)
Contracts to Purchase
Euro with Goldman Sachs International		10/07/11		63,408,700		$	84,939,392		$	(2,789,168	)
Euro with UBS AG		10/07/11		86,950,300			116,474,642			(2,816,316	)

									$	(5,605,484	)

Contracts to Sell
Euro with Goldman Sachs International		10/07/11		(731,587,225	)	$	(980,000,757	)	$	55,401,624
Euro with UBS AG		10/07/11		(816,704,400	)		(1,094,019,828	)		60,007,503

									$	115,409,127

†	All or partial amount segregated as collateral for foreign currency forward contracts.

^	The positions and counterparties herein are as of September 30, 2011. The Funds continually evaluate different counterparties for their transactions and counterparties are subject to change. New counterparties can be added at anytime.

See accompanying notes to financial statements.

-52-

PROSHARES ULTRASHORT EURO

STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2011 AND 2010

(unaudited)


	Three months ended September 30, 2011			Three months ended September 30, 2010			Nine months ended September 30, 2011			Nine months ended September 30, 2010
Investment Income
Interest	$	36,861		$	182,133		$	255,628		$	415,352

Expenses
Management fee		1,728,002			846,458			3,848,679			2,336,429

Total expenses		1,728,002			846,458			3,848,679			2,336,429

Net investment income (loss)		(1,691,141	)		(664,325	)		(3,593,051	)		(1,921,077	)

Realized and unrealized gain (loss) on investment activity
Net realized gain (loss) on
Foreign currency forward contracts		(11,049,379	)		(33,898,742	)		(112,483,351	)		54,569,532
Short-term U.S. government and agency obligations		131			2,281			3,328			27,615

Net realized gain (loss)		(11,049,248	)		(33,896,461	)		(112,480,023	)		54,597,147

Change in net unrealized appreciation/depreciation on
Foreign currency forward contracts		122,372,805			(49,916,146	)		132,997,720			(46,237,927	)
Short-term U.S. government and agency obligations		(54,049	)		(20,078	)		(60,305	)		26,237

Change in net unrealized appreciation/depreciation		122,318,756			(49,936,224	)		132,937,415			(46,211,690	)

Net realized and unrealized gain (loss)		111,269,508			(83,832,685	)		20,457,392			8,385,457

Net income (loss)	$	109,578,367		$	(84,497,010	)	$	16,864,341		$	6,464,380

Net income (loss) per weighted-average share	$	2.66		$	(5.34	)	$	0.56		$	0.44

Weighted-average shares outstanding		41,215,231			15,810,884			30,309,538			14,723,457

See accompanying notes to financial statements.

-53-

PROSHARES ULTRASHORT EURO

STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011

(unaudited)


Shareholders’ equity, at December 31, 2010	$	444,412,995

Addition of 37,600,000 shares		674,444,672
Redemption of 10,900,000 shares		(198,780,995	)

Net addition (redemption) of 26,700,000 shares		475,663,677


Net investment income (loss)		(3,593,051	)
Net realized gain (loss)		(112,480,023	)
Change in net unrealized appreciation/depreciation		132,937,415

Net income (loss)		16,864,341


Shareholders’ equity, at September 30, 2011	$	936,941,013

See accompanying notes to financial statements.

-54-

PROSHARES ULTRASHORT EURO

STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED

SEPTEMBER 30, 2011 AND 2010

(unaudited)


	Nine months ended September 30, 2011			Nine months ended September 30, 2010
Cash flow from operating activities
Net income (loss)	$	16,864,341		$	6,464,380
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Net sale (purchase) of short-term U.S. government and agency obligations		(376,266,395	)		(218,591,766	)
Change in unrealized appreciation/depreciation on investments		(132,937,415	)		46,211,690
Increase (Decrease) in management fee payable		837,229			201,015

Net cash provided by (used in) operating activities		(491,502,240	)		(165,714,681	)

Cash flow from financing activities
Proceeds from addition of shares		674,444,672			420,921,692
Payment on shares redeemed		(182,770,372	)		(250,614,019	)

Net cash provided by (used in) financing activities		491,674,300			170,307,673

Net increase (decrease) in cash		172,060			4,592,992
Cash, beginning of period		251,588			76,035

Cash, end of period	$	423,648		$	4,669,027

See accompanying notes to financial statements.

-55-

PROSHARES ULTRA YEN

STATEMENTS OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)		December 31, 2010
Assets
Cash	$	2,867	$	10,637
Short-term U.S. government and agency obligations (Note 3) (cost $5,544,942 and $4,733,572, respectively)		5,544,649		4,733,703
Unrealized appreciation on foreign currency forward contracts		—		283,503

Total assets		5,547,516		5,027,843

Liabilities and shareholders’ equity
Liabilities
Management fee payable		8,767		3,603
Unrealized depreciation on foreign currency forward contracts		53,120		—

Total liabilities		61,887		3,603

Shareholders’ equity
Shareholders’ equity		5,485,629		5,024,240

Total liabilities and shareholders’ equity	$	5,547,516	$	5,027,843

Shares outstanding		150,014		150,014

Net asset value per share	$	36.57	$	33.49

Market value per share (Note 2)	$	36.60	$	33.29

See accompanying notes to financial statements.

-56-

PROSHARES ULTRA YEN

SCHEDULE OF INVESTMENTS

SEPTEMBER 30, 2011

(unaudited)


	Principal Amount		Value
Short-term U.S. government and agency obligations (101% of shareholders’ equity)
U.S. Treasury Bills:
0.018% due 10/06/11†	$	584,000	$	584,000
0.012% due 10/13/11		1,556,000		1,555,998
0.010% due 10/20/11†		500,000		499,998
0.040% due 11/10/11		727,000		726,993
0.000% due 12/15/11		532,000		531,990
0.001% due 12/29/11		287,000		286,990
0.003% due 03/08/12		1,359,000		1,358,680

Total short-term U.S. government and agency obligations (cost $5,544,942)			$	5,544,649

Foreign Currency Forward Contracts^


	Settlement Date		Local Currency			Notional Amount at Value (USD)			Unrealized Appreciation (Depreciation)
Contracts to Purchase
Yen with Goldman Sachs International		10/07/11		355,590,000		$	4,609,665		$	(20,244	)
Yen with UBS AG		10/07/11		516,060,000			6,689,905			(32,278	)

									$	(52,522	)

Contracts to Sell
Yen with Goldman Sachs International		10/07/11		(19,800,000	)	$	(256,676	)	$	(793	)
Yen with UBS AG		10/07/11		(5,630,000	)		(72,984	)		195

									$	(598	)

†	All or partial amount segregated as collateral for foreign currency forward contracts.

^	The positions and counterparties herein are as of September 30, 2011. The Funds continually evaluate different counterparties for their transactions and counterparties are subject to change. New counterparties can be added at anytime.

See accompanying notes to financial statements.

-57-

PROSHARES ULTRA YEN

STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2011 and 2010

(unaudited)


	Three months ended September 30, 2011			Three months ended September 30, 2010			Nine months ended September 30, 2011			Nine months ended September 30, 2010
Investment Income
Interest	$	216		$	2,242		$	1,711		$	4,788

Expenses
Management fee		12,492			13,416			28,409			32,485

Total expenses		12,492			13,416			28,409			32,485

Net investment income (loss)		(12,276	)		(11,174	)		(26,698	)		(27,697	)

Realized and unrealized gain (loss) on investment activity
Net realized gain (loss) on
Foreign currency forward contracts		496,377			849,525			722,557			651,232
Short-term U.S. government and agency obligations		—			—			19			(69	)

Net realized gain (loss)		496,377			849,525			722,576			651,163

Change in net unrealized appreciation/depreciation on
Foreign currency forward contracts		(71,257	)		(217,085	)		(336,623	)		368,127
Short-term U.S. government and agency obligations		(314	)		(273	)		(424	)		218

Change in net unrealized appreciation/depreciation		(71,571	)		(217,358	)		(337,047	)		368,345

Net realized and unrealized gain (loss)		424,806			632,167			385,529			1,019,508

Net income (loss)	$	412,530		$	620,993		$	358,831		$	991,811

Net income (loss) per weighted-average share	$	2.86		$	3.36		$	3.07		$	6.13

Weighted-average shares outstanding		144,036			184,797			116,864			161,736

See accompanying notes to financial statements.

-58-

PROSHARES ULTRA YEN

STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011

(unaudited)


Shareholders’ equity, at December 31, 2010	$	5,024,240

Addition of 50,000 shares		1,696,147
Redemption of 50,000 shares		(1,593,589	)

Net addition (redemption) of 0 shares		102,558


Net investment income (loss)		(26,698	)
Net realized gain (loss)		722,576
Change in net unrealized appreciation/depreciation		(337,047	)

Net income (loss)		358,831


Shareholders’ equity, at September 30, 2011	$	5,485,629

See accompanying notes to financial statements.

-59-

PROSHARES ULTRA YEN

STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED

SEPTEMBER 30, 2011 and 2010

(unaudited)


	Nine months ended September 30, 2011			Nine months ended September 30, 2010
Cash flow from operating activities
Net income (loss)	$	358,831		$	991,811
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Net sale (purchase) of short-term U.S. government and agency obligations		(811,370	)		(1,978,125	)
Change in unrealized appreciation/depreciation on investments		337,047			(368,345	)
Increase (Decrease) in management fee payable		5,164			1,469

Net cash provided by (used in) operating activities		(110,328	)		(1,353,190	)

Cash flow from financing activities
Proceeds from addition of shares		1,696,147			1,458,689
Payment on shares redeemed		(1,593,589	)		—

Net cash provided by (used in) financing activities		102,558			1,458,689

Net increase (decrease) in cash		(7,770	)		105,499
Cash, beginning of period		10,637			85,344

Cash, end of period	$	2,867		$	190,843

See accompanying notes to financial statements.

-60-

PROSHARES ULTRASHORT YEN

STATEMENTS OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)		December 31, 2010
Assets
Cash	$	138,919	$	120,494
Short-term U.S. government and agency obligations (Note 3) (cost $276,436,417 and $223,865,319, respectively)		276,427,258		223,873,131
Unrealized appreciation on foreign currency forward contracts		2,181,019		—

Total assets		278,747,196		223,993,625

Liabilities and shareholders’ equity
Liabilities
Payable for capital shares redeemed		6,859,008		—
Management fee payable		447,246		170,158
Unrealized depreciation on foreign currency forward contracts		—		16,137,654

Total liabilities		7,306,254		16,307,812

Shareholders’ equity
Shareholders’ equity		271,440,942		207,685,813

Total liabilities and shareholders’ equity	$	278,747,196	$	223,993,625

Shares outstanding		6,566,671		4,416,671

Net asset value per share (Note 10)	$	41.34	$	47.02

Market value per share (Note 2) (Note 10)	$	41.34	$	47.01

See accompanying notes to financial statements.

-61-

PROSHARES ULTRASHORT YEN

SCHEDULE OF INVESTMENTS

SEPTEMBER 30, 2011

(unaudited)


	Principal Amount		Value
Short-term U.S. government and agency obligations (102% of shareholders’ equity)
U.S. Treasury Bills:
0.018% due 10/06/11†	$	33,399,000	$	33,398,993
0.013% due 10/13/11		27,892,000		27,891,972
0.011% due 10/20/11†		20,000,000		19,999,922
0.076% due 10/27/11†		48,299,000		48,298,715
0.006% due 11/17/11		4,664,000		4,663,946
0.002% due 12/01/11†		19,864,000		19,863,690
0.015% due 12/08/11		3,901,000		3,900,932
0.001% due 12/29/11		6,438,000		6,437,775
0.000% due 01/19/12		50,000,000		49,997,815
0.002% due 02/09/12†		38,219,000		38,214,976
0.000% due 03/01/12		7,000,000		6,998,571
0.003% due 03/08/12		7,000,000		6,998,353
0.000% due 03/15/12		9,764,000		9,761,598

Total short-term U.S. government and agency obligations (cost $276,436,417)			$	276,427,258

Foreign Currency Forward Contracts^


	Settlement Date		Local Currency			Notional Amount at Value (USD)			Unrealized Appreciation (Depreciation)
Contracts to Purchase
Yen with Goldman Sachs International		10/07/11		3,203,440,000		$	41,527,556		$	(219,157	)
Yen with UBS AG		10/07/11		1,423,900,000			18,458,622			(142,900	)

									$	(362,057	)

Contracts to Sell
Yen with Goldman Sachs International		10/07/11		(23,267,420,000	)	$	(301,625,468	)	$	1,129,488
Yen with UBS AG		10/07/11		(23,259,690,000	)		(301,525,261	)		1,413,588

									$	2,543,076

†	All or partial amount segregated as collateral for foreign currency forward contracts.

^	The positions and counterparties herein are as of September 30, 2011. The Funds continually evaluate different counterparties for their transactions and counterparties are subject to change. New counterparties can be added at anytime.

See accompanying notes to financial statements.

-62-

PROSHARES ULTRASHORT YEN

STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2011 and 2010

(unaudited)


	Three months ended September 30, 2011			Three months ended September 30, 2010			Nine months ended September 30, 2011			Nine months ended September 30, 2010
Investment Income
Interest	$	23,905		$	74,322		$	176,008		$	160,451

Expenses
Management fee		725,344			376,573			2,253,245			975,343

Total expenses		725,344			376,573			2,253,245			975,343

Net investment income (loss)		(701,439	)		(302,251	)		(2,077,237	)		(814,892	)

Realized and unrealized gain (loss) on investment activity
Net realized gain (loss) on
Foreign currency forward contracts		(34,105,768	)		(26,657,675	)		(55,833,787	)		(26,358,762	)
Short-term U.S. government and agency obligations		487			580			3,296			5,517

Net realized gain (loss)		(34,105,281	)		(26,657,095	)		(55,830,491	)		(26,353,245	)

Change in net unrealized appreciation/depreciation on
Foreign currency forward contracts		4,607,971			8,158,466			18,318,673			(6,598,615	)
Short-term U.S. government and agency obligations		(17,889	)		(4,590	)		(16,971	)		9,938

Change in net unrealized appreciation/depreciation		4,590,082			8,153,876			18,301,702			(6,588,677	)

Net realized and unrealized gain (loss)		(29,515,199	)		(18,503,219	)		(37,528,789	)		(32,941,922	)

Net income (loss)	$	(30,216,638	)	$	(18,805,470	)	$	(39,606,026	)	$	(33,756,814	)

Net income (loss) per weighted-average share (Note 10)	$	(4.22	)	$	(6.36	)	$	(5.69	)	$	(14.23	)

Weighted-average shares outstanding (Note 10)		7,162,686			2,958,519			6,966,549			2,371,922

See accompanying notes to financial statements.

-63-

PROSHARES ULTRASHORT YEN

STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

FOR THE NINE MONTHS ENDED

SEPTEMBER 30, 2011

(unaudited)


Shareholders’ equity, at December 31, 2010	$	207,685,813

Addition of 6,533,333 shares (Note 10)		302,417,904
Redemption of 4,383,333 shares (Note 10)		(199,056,749	)

Net addition (redemption) of 2,150,000 shares (Note 10)		103,361,155


Net investment income (loss)		(2,077,237	)
Net realized gain (loss)		(55,830,491	)
Change in net unrealized appreciation/depreciation		18,301,702

Net income (loss)		(39,606,026	)


Shareholders’ equity, at September 30, 2011	$	271,440,942

See accompanying notes to financial statements.

-64-

PROSHARES ULTRASHORT YEN

STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED

SEPTEMBER 30, 2011 AND 2010

(unaudited)


	Nine months ended September 30, 2011			Nine months ended September 30, 2010
Cash flow from operating activities
Net income (loss)	$	(39,606,026	)	$	(33,756,814	)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Net sale (purchase) of short-term U.S. government and agency obligations		(52,571,098	)		(97,666,492	)
Change in unrealized appreciation/depreciation on investments		(18,301,702	)		6,588,677
Increase (Decrease) in management fee payable		277,088			80,540

Net cash provided by (used in) operating activities		(110,201,738	)		(124,754,089	)

Cash flow from financing activities
Proceeds from addition of shares		302,417,904			177,810,290
Payment on shares redeemed		(192,197,741	)		(48,172,192	)

Net cash provided by (used in) financing activities		110,220,163			129,638,098

Net increase (decrease) in cash		18,425			4,884,009
Cash, beginning of period		120,494			75,424

Cash, end of period	$	138,919		$	4,959,433

See accompanying notes to financial statements.

-65-

PROSHARES ULTRA VIX SHORT-TERM FUTURES ETF*

STATEMENT OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)
Assets
Cash	$	400
Offering costs (Note 5)		28,764

Total assets		29,164

Liabilities and shareholders’ equity
Liabilities
Payable for offering costs		28,764

Total liabilities		28,764

Shareholders’ equity
Shareholders’ equity	$	400

Total liabilities and shareholders’ equity	$	29,164

*	See Note 1.

See accompanying notes to financial statements.

-66-

PROSHARES VIX SHORT-TERM FUTURES ETF

STATEMENTS OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)		December 31, 2010
Assets
Cash	$	1,091,859	$	400
Short-term U.S. government and agency obligations (Note 3) (cost $28,062,806 and $0, respectively)		28,061,131		—
Receivable from capital shares sold		8,166,838		—
Receivable on open futures contracts		2,250,019		—
Offering costs (Note 5)		51,249		198,998

Total assets		39,621,096		199,398

Liabilities and shareholders’ equity
Liabilities
Payable for capital shares redeemed		10,660,397		—
Management fee payable		62,960		—
Payable for offering costs		—		198,998

Total liabilities		10,723,357		198,998

Shareholders’ equity
Shareholders’ equity		28,897,739		400

Total liabilities and shareholders’ equity	$	39,621,096	$	199,398

Shares outstanding		250,005		5

Net asset value per share	$	115.59	$	80.00

Market value per share (Note 2)	$	114.52	$	80.00

See accompanying notes to financial statements.

-67-

PROSHARES VIX SHORT-TERM FUTURES ETF

SCHEDULE OF INVESTMENTS

SEPTEMBER 30, 2011

(unaudited)


	Principal Amount		Value
Short-term U.S. government and agency obligations (97% of shareholders’ equity)
U.S. Treasury Bills:
0.010% due 10/06/11	$	942,000	$	942,000
0.013% due 10/13/11†		5,141,000		5,140,995
0.033% due 10/20/11†		5,515,000		5,514,978
0.002% due 12/01/11		645,000		644,990
0.015% due 12/08/11		1,206,000		1,205,979
0.000% due 12/15/11		3,117,000		3,116,940
0.000% due 12/22/11		2,364,000		2,363,924
0.001% due 12/29/11		1,169,000		1,168,959
0.002% due 02/09/12		2,309,000		2,308,757
0.001% due 03/15/12†		5,655,000		5,653,609

Total short-term U.S. government and agency obligations (cost $28,062,806)			$	28,061,131

Futures Contracts Purchased


	Number of Contracts		Notional Amount at Value		Unrealized Appreciation (Depreciation)
VIX Futures - CBOE, expires October 2011		429	$	18,082,350	$	2,962,700
VIX Futures - CBOE, expires November 2011		286		10,796,500		578,650

					$	3,541,350

†	All or partial amount segregated as collateral for futures contracts.

See accompanying notes to financial statements.

-68-

PROSHARES VIX SHORT-TERM FUTURES ETF

STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2011

(unaudited)


	Three months ended September 30, 2011			Nine months ended September 30, 2011
Investment Income
Interest	$	1,884		$	11,821

Expenses
Management fee		26,672			62,960
Offering costs		49,621			147,749

Total expenses		76,293			210,709

Net investment income (loss)		(74,409	)		(198,888	)

Realized and unrealized gain (loss) on investment activity
Net realized gain (loss) on
Futures contracts		24,351,300			11,557,660
Short-term U.S. government and agency obligations		—			1,500

Net realized gain (loss)		24,351,300			11,559,160

Change in net unrealized appreciation/depreciation on
Futures contracts		7,994,010			3,541,350
Short-term U.S. government and agency obligations		(2,318	)		(1,675	)

Change in net unrealized appreciation/depreciation		7,991,692			3,539,675

Net realized and unrealized gain (loss)		32,342,992			15,098,835

Net income (loss)	$	32,268,583		$	14,899,947

Net income (loss) per weighted-average share	$	56.28		$	25.51

Weighted-average shares outstanding		573,375			584,172

See accompanying notes to financial statements.

-69-

PROSHARES VIX SHORT-TERM FUTURES ETF

STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011

(unaudited)


Shareholders’ equity, at December 31, 2010	$	400

Addition of 4,375,000 shares		262,501,482
Redemption of 4,125,000 shares		(248,504,090	)

Net addition (redemption) of 250,000 shares		13,997,392


Net investment income (loss)		(198,888	)
Net realized gain (loss)		11,559,160
Change in net unrealized appreciation/depreciation		3,539,675

Net income (loss)		14,899,947


Shareholders’ equity, at September 30, 2011	$	28,897,739

See accompanying notes to financial statements.

-70-

PROSHARES VIX SHORT-TERM FUTURES ETF

STATEMENT OF CASH FLOWS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011

(unaudited)


	Nine months ended September 30, 2011
Cash flow from operating activities
Net income (loss)	$	14,899,947
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Net sale (purchase) of short-term U.S. government and agency obligations		(28,062,806	)
Change in unrealized appreciation/depreciation on investments		1,675
Decrease (Increase) in receivable on futures contracts		(2,250,019	)
Amortization of offering cost		147,749
Increase (Decrease) in management fee payable		62,960
Increase (Decrease) in payable for offering costs		(198,998	)

Net cash provided by (used in) operating activities		(15,399,492	)

Cash flow from financing activities
Proceeds from addition of shares		254,334,644
Payment on shares redeemed		(237,843,693	)

Net cash provided by (used in) financing activities		16,490,951

Net increase (decrease) in cash		1,091,459
Cash, beginning of period		400

Cash, end of period	$	1,091,859

See accompanying notes to financial statements.

-71-

PROSHARES SHORT VIX SHORT-TERM FUTURES ETF*

STATEMENT OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)
Assets
Cash	$	400
Offering costs (Note 5)		28,764

Total assets		29,164

Liabilities and shareholders’ equity
Liabilities
Payable for offering costs		28,764

Total liabilities		28,764

Shareholders’ equity
Shareholders’ equity	$	400

Total liabilities and shareholders’ equity	$	29,164

*	See Note 1.

See accompanying notes to financial statements.

-72-

PROSHARES ULTRASHORT VIX SHORT-TERM FUTURES ETF*

STATEMENT OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)
Assets
Cash	$	400
Offering costs (Note 5)		18,478

Total assets		18,878

Liabilities and shareholders’ equity
Liabilities
Payable for offering costs		18,478

Total liabilities		18,478

Shareholders’ equity
Shareholders’ equity	$	400

Total liabilities and shareholders’ equity	$	18,878

*	See Note 1.

See accompanying notes to financial statements.

-73-

PROSHARES ULTRA VIX MID-TERM FUTURES ETF*

STATEMENT OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)
Assets
Cash	$	400
Offering costs (Note 5)		18,478

Total assets		18,878

Liabilities and shareholders’ equity
Liabilities
Payable for offering costs		18,478

Total liabilities		18,478

Shareholders’ equity
Shareholders’ equity	$	400

Total liabilities and shareholders’ equity	$	18,878

*	See Note 1.

See accompanying notes to financial statements.

-74-

PROSHARES VIX MID-TERM FUTURES ETF

STATEMENTS OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)		December 31, 2010
Assets
Cash	$	508,517	$	400
Short-term U.S. government and agency obligations (Note 3) (cost $14,412,785 and $0, respectively)		14,411,278		—
Receivable from capital shares sold		4,347,490		—
Receivable on open futures contracts		550,076		—
Offering costs (Note 5)		32,031		124,374
Limitation by Sponsor		30,593		—

Total assets		19,879,985		124,774

Liabilities and shareholders’ equity
Liabilities
Payable for capital shares redeemed		6,443,769		—
Payable for offering costs		—		124,374

Total liabilities		6,443,769		124,374

Shareholders’ equity
Shareholders’ equity		13,436,216		400

Total liabilities and shareholders’ equity	$	19,879,985	$	124,774

Shares outstanding		150,005		5

Net asset value per share	$	89.57	$	80.00

Market value per share (Note 2)	$	89.46	$	80.00

See accompanying notes to financial statements.

-75-

PROSHARES VIX MID-TERM FUTURES ETF

SCHEDULE OF INVESTMENTS

SEPTEMBER 30, 2011

(unaudited)


	Principal Amount		Value
Short-term U.S. government and agency obligations (107% of shareholders’ equity)
U.S. Treasury Bills:
0.010% due 10/06/11	$	551,000	$	551,000
0.012% due 10/13/11†		1,433,000		1,432,999
0.010% due 10/20/11		1,000,000		999,996
0.040% due 11/10/11†		2,612,000		2,611,974
0.000% due 12/15/11†		1,131,000		1,130,978
0.005% due 12/29/11		695,000		694,976
0.002% due 03/08/12†		6,991,000		6,989,355

Total short-term U.S. government and agency obligations (cost $14,412,785)			$	14,411,278

Futures Contracts Purchased


	Number of Contracts		Notional Amount at Value		Unrealized Appreciation (Depreciation)
VIX Futures - CBOE, expires January 2012		78	$	2,769,000	$	672,200
VIX Futures - CBOE, expires February 2012		129		4,476,300		796,900
VIX Futures - CBOE, expires March 2012		129		4,418,250		303,150
VIX Futures - CBOE, expires April 2012		52		1,786,200		58,350

					$	1,830,600

†	All or partial amount segregated as collateral for futures contracts.

See accompanying notes to financial statements.

-76-

PROSHARES VIX MID-TERM FUTURES ETF

STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED

SEPTEMBER 30, 2011

(unaudited)


	Three months ended September 30, 2011			Nine months ended September 30, 2011
Investment Income
Interest	$	569		$	3,584

Expenses
Offering costs		31,013			92,343
Limitation by Sponsor		(4,041	)		(30,593	)

Total expenses		26,972			61,750

Net investment income (loss)		(26,403	)		(58,166	)

Realized and unrealized gain (loss) on investment activity
Net realized gain (loss) on
Futures contracts		2,364,290			503,490
Short-term U.S. government and agency obligations		79			277

Net realized gain (loss)		2,364,369			503,767

Change in net unrealized appreciation/depreciation on
Futures contracts		2,244,750			1,830,600
Short-term U.S. government and agency obligations		(1,584	)		(1,507	)

Change in net unrealized appreciation/depreciation		2,243,166			1,829,093

Net realized and unrealized gain (loss)		4,607,535			2,332,860

Net income (loss)	$	4,581,132		$	2,274,694

Net income (loss) per weighted-average share	$	25.66		$	15.87

Weighted-average shares outstanding		178,538			143,338

See accompanying notes to financial statements.

-77-

PROSHARES VIX MID-TERM FUTURES ETF

STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

FOR THE NINE MONTHS ENDED

SEPTEMBER 30, 2011

(unaudited)


Shareholders’ equity, at December 31, 2010	$	400

Addition of 525,000 shares		36,782,014
Redemption of 375,000 shares		(25,620,892	)

Net addition (redemption) of 150,000 shares		11,161,122


Net investment income (loss)		(58,166	)
Net realized gain (loss)		503,767
Change in net unrealized appreciation/depreciation		1,829,093

Net income (loss)		2,274,694


Shareholders’ equity, at September 30, 2011	$	13,436,216

See accompanying notes to financial statements.

-78-

PROSHARES VIX MID-TERM FUTURES ETF

STATEMENT OF CASH FLOWS

FOR THE NINE MONTHS ENDED

SEPTEMBER 30, 2011

(unaudited)


	Nine months ended September 30, 2011
Cash flow from operating activities
Net income (loss)	$	2,274,694
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Net sale (purchase) of short-term U.S. government and agency obligations		(14,412,785	)
Change in unrealized appreciation/depreciation on investments		1,507
Decrease (Increase) in receivable on futures contracts		(550,076	)
Decrease (Increase) in Limitation by Sponsor		(30,593	)
Amortization of offering cost		92,343
Increase (Decrease) in payable for offering costs		(124,374	)

Net cash provided by (used in) operating activities		(12,749,284	)

Cash flow from financing activities
Proceeds from addition of shares		32,434,524
Payment on shares redeemed		(19,177,123	)

Net cash provided by (used in) financing activities		13,257,401

Net increase (decrease) in cash		508,117
Cash, beginning of period		400

Cash, end of period	$	508,517

See accompanying notes to financial statements.

-79-

PROSHARES SHORT VIX MID-TERM FUTURES ETF*

STATEMENT OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)
Assets
Cash	$	400
Offering costs (Note 5)		18,478

Total assets		18,878

Liabilities and shareholders’ equity
Liabilities
Payable for offering costs		18,478

Total liabilities		18,478

Shareholders’ equity
Shareholders’ equity	$	400

Total liabilities and shareholders’ equity	$	18,878

*	See Note 1.

See accompanying notes to financial statements.

-80-

PROSHARES ULTRASHORT VIX MID-TERM FUTURES ETF*

STATEMENT OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)
Assets
Cash	$	400
Offering costs (Note 5)		18,478

Total assets		18,878

Liabilities and shareholders’ equity
Liabilities
Payable for offering costs		18,478

Total liabilities		18,478

Shareholders’ equity
Shareholders’ equity	$	400

Total liabilities and shareholders’ equity	$	18,878

*	See Note 1.

See accompanying notes to financial statements.

-81-

PROSHARES TRUST II

COMBINED STATEMENTS OF FINANCIAL CONDITION


	September 30, 2011 (unaudited)		December 31, 2010
Assets
Cash	$	14,658,722	$	13,024,692
Segregated cash balances with brokers for futures contracts		40,129,251		18,624,601
Short-term U.S. government and agency obligations (Note 3) (cost $3,612,641,799 and $2,036,391,604, respectively)		3,612,458,637		2,036,464,179
Unrealized appreciation on swap agreements		8,378,025		7,405,394
Unrealized appreciation on forward agreements		66,069,553		54,916,155
Unrealized appreciation on foreign currency forward contracts		111,984,662		631,682
Receivable from capital shares sold		23,280,438		—
Receivable on open futures contracts		6,013,084		3,487,401
Offering costs (Note 5)		309,482		323,372
Limitation by Sponsor		30,593		—

Total assets		3,883,312,447		2,134,877,476

Liabilities and shareholders’ equity
Liabilities
Payable for capital shares redeemed		78,360,232		46,689,878
Payable on open futures contracts		11,219,495		1,462,367
Management fee payable		5,953,909		1,633,355
Payable for offering costs		226,202		323,372
Unrealized depreciation on swap agreements		44,576,496		4,275,758
Unrealized depreciation on forward agreements		209,065,903		13,001,736
Unrealized depreciation on foreign currency forward contracts		1,265,480		39,331,731

Total liabilities		350,667,717		106,718,197

Shareholders’ equity
Shareholders’ equity		3,532,644,730		2,028,159,279

Total liabilities and shareholders’ equity	$	3,883,312,447	$	2,134,877,476

Shares outstanding		130,880,160		50,431,669

See accompanying notes to financial statements.

-82-

PROSHARES TRUST II

COMBINED STATEMENTS OF OPERATIONS

FOR THE THREE AND NINE MONTHS ENDED

SEPTEMBER 30, 2011 AND 2010

(unaudited)


	Three months ended September 30, 2011			Three months ended September 30, 2010			Nine months ended September 30, 2011			Nine months ended September 30, 2010
Investment Income
Interest	$	205,228		$	693,625		$	1,432,606		$	1,562,964

Expenses
Management fee		8,789,596			3,669,467			22,089,503			9,993,780
Brokerage commissions		34,563			45,492			132,816			162,322
Offering costs		80,634			—			240,092			—
Limitation by Sponsor		(4,041	)		—			(30,593	)		—

Total expenses		8,900,752			3,714,959			22,431,818			10,156,102

Net investment income (loss)		(8,695,524	)		(3,021,334	)		(20,999,212	)		(8,593,138	)

Realized and unrealized gain (loss) on investment activity
Net realized gain (loss) on
Futures contracts		1,615,893			13,340,005			32,635,570			27,258,896
Swap agreements		(18,459,511	)		33,448,824			33,016,158			37,574,633
Forward agreements		(155,922,546	)		20,013,298			(122,754,908	)		45,353,658
Foreign currency forward contracts		(44,661,970	)		(58,517,819	)		(165,990,693	)		27,105,825
Short-term U.S. government and agency obligations		13,317			7,626			88,692			112,116

Net realized gain (loss)		(217,414,817	)		8,291,934			(223,005,181	)		137,405,128

Change in net unrealized appreciation/depreciation on
Futures contracts		(5,356,085	)		13,786,215			(22,449,225	)		3,017,915
Swap agreements		(33,857,212	)		6,885,179			(39,328,107	)		6,743,603
Forward agreements		(118,697,358	)		16,569,744			(184,910,769	)		14,840,201
Foreign currency forward contracts		125,588,147			(39,978,983	)		149,419,231			(50,425,373	)
Short-term U.S. government and agency obligations		(251,113	)		(49,333	)		(255,737	)		119,469

Change in net unrealized appreciation/depreciation		(32,573,621	)		(2,787,178	)		(97,524,607	)		(25,704,185	)

Net realized and unrealized gain (loss)		(249,988,438	)		5,504,756			(320,529,788	)		111,700,943

Net income (loss)	$	(258,683,962	)	$	2,483,422		$	(341,529,000	)	$	103,107,805

See accompanying notes to financial statements.

-83-

PROSHARES TRUST II

COMBINED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2011

(unaudited)


Shareholders’ equity, at December 31, 2010	$	2,028,159,279

Addition of 172,555,833 shares		5,306,403,728
Redemption of 92,107,342 shares		(3,460,389,277	)

Net addition (redemption) of 80,448,491 shares		1,846,014,451


Net investment income (loss)		(20,999,212	)
Net realized gain (loss)		(223,005,181	)
Change in net unrealized appreciation/depreciation		(97,524,607	)

Net income (loss)		(341,529,000	)


Shareholders’ equity, at September 30, 2011	$	3,532,644,730

See accompanying notes to financial statements.

-84-

PROSHARES TRUST II

COMBINED STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED

SEPTEMBER 30, 2011 AND 2010

(unaudited)


	Nine months ended September 30, 2011			Nine months ended September 30, 2010
Cash flow from operating activities
Net income (loss)	$	(341,529,000	)	$	103,107,805
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Decrease (Increase) in segregated cash balances for swap agreements		—			485,000
Decrease (Increase) in segregated cash balances with brokers for futures contracts		(21,504,650	)		(4,629,850	)
Net sale (purchase) of short-term U.S. government and agency obligations		(1,576,250,195	)		(453,682,814	)
Change in unrealized appreciation/depreciation on investments		75,075,382			28,722,100
Decrease (Increase) in receivable on futures contracts		(2,525,683	)		(11,249,209	)
Decrease (Increase) in offering costs		(226,202	)		—
Decrease (Increase) in Limitation by Sponsor		(30,593	)		—
Amortization of offering cost		240,092			—
Increase (Decrease) in management fee payable		4,320,554			350,174
Increase (Decrease) in payable on futures contracts		9,757,128			(341,462	)
Increase (Decrease) in payable for offering costs		(97,170	)		—

Net cash provided by (used in) operating activities		(1,852,770,337	)		(337,238,256	)

Cash flow from financing activities
Proceeds from addition of shares		5,283,123,290			2,253,397,657
Payment on shares redeemed		(3,428,718,923	)		(1,881,856,425	)

Net cash provided by (used in) financing activities		1,854,404,367			371,541,232

Net increase (decrease) in cash		1,634,030			34,302,976
Cash, beginning of period		13,024,692			967,043

Cash, end of period	$	14,658,722		$	35,270,019

See accompanying notes to financial statements.

-85-

PROSHARES TRUST II

NOTES TO FINANCIAL STATEMENTS

September 30, 2011

(unaudited)

NOTE 1 – ORGANIZATION

Introduction

ProShares Trust II (formerly known as the Commodities and Currencies Trust) (the “Trust”) is a Delaware statutory trust formed on October 9, 2007 and currently organized into separate series (each, a “Fund” and collectively, the “Funds”). The following fourteen series of the Trust, ProShares Ultra DJ-UBS Commodity, ProShares UltraShort DJ-UBS Commodity, ProShares Ultra DJ-UBS Crude Oil, ProShares UltraShort DJ-UBS Crude Oil, ProShares Ultra Gold, ProShares UltraShort Gold, ProShares Ultra Silver, ProShares UltraShort Silver, ProShares Ultra Euro, ProShares UltraShort Euro, ProShares Ultra Yen and ProShares UltraShort Yen (each, a “Leveraged Fund” and collectively, the “Leveraged Funds”), ProShares VIX Short-Term Futures ETF and ProShares VIX Mid-Term Futures ETF (each, a “VIX Fund” and collectively, the “VIX Funds”) issue common units of beneficial interest (“Shares”), which represent units of fractional undivided beneficial interest in and ownership of only that Leveraged or VIX Fund. The Shares of each Leveraged and VIX Fund are listed on the New York Stock Exchange Archipelago (“NYSE Arca”). The Trust has also registered shares for ten additional series: ProShares Short DJ-UBS Natural Gas and ProShares Short Gold (each, a “Short Fund” and collectively, the “Short Funds”), ProShares Ultra DJ-UBS Natural Gas, ProShares UltraShort DJ-UBS Natural Gas (each, a “New Natural Gas Fund” and collectively, the “New Natural Gas Funds”), ProShares Ultra VIX Short-Term Futures ETF, ProShares Short VIX Short-Term Futures ETF, ProShares UltraShort VIX Short-Term Futures ETF, ProShares Ultra VIX Mid-Term Futures ETF, ProShares Short VIX Mid-Term Futures ETF and ProShares UltraShort VIX Mid-Term Futures ETF (each, a “New VIX Fund” and collectively, the “New VIX Funds”). The Short Funds, the New Natural Gas Funds and the New VIX Funds are collectively referred to herein as the “New Funds”. As of September 30, 2011, each of the Short Funds had seed capital of $200, but neither of the Short Funds had commenced investment operations, and each of the New Natural Gas Funds and the New VIX Funds had seed capital of $400, but none of the New Natural Gas Funds or the New VIX Funds had commenced investment operations; therefore, these Financial Statements do not include Schedules of Investments, Statements of Operations, Statements of Changes in Shareholders’ Equity or Statements of Cash Flows for the New Funds. The New Funds, together with the Leveraged Funds, are referred to as the “Geared Funds” in these Notes to Financial Statements. The Trust had no operations prior to November 24, 2008 other than matters relating to its organization, the registration of each series under the Securities Act of 1933, as amended, and the sale and issuance to ProShare Capital Management LLC (the “Sponsor”) of fourteen Shares of each Leveraged Fund at an aggregate purchase price of $350 in each of the Leveraged Funds.

Eight of the Funds, ProShares Ultra DJ-UBS Commodity, ProShares UltraShort DJ-UBS Commodity, ProShares Ultra DJ-UBS Crude Oil, ProShares UltraShort DJ-UBS Crude Oil, ProShares Ultra Euro, ProShares UltraShort Euro, ProShares Ultra Yen and ProShares UltraShort Yen, commenced trading on the NYSE Arca on November 25, 2008. Four of the Funds, ProShares Ultra Gold, ProShares UltraShort Gold, ProShares Ultra Silver and ProShares UltraShort Silver, commenced trading on the NYSE Arca on December 3, 2008. The VIX Funds commenced trading on the NYSE Arca on January 3, 2011. As of September 30, 2011, the New Funds had not yet commenced trading.

Groups of Funds are collectively referred to in several different ways. References to “Ultra Funds,” “Short Funds” or “UltraShort Funds” refer to the different Funds based upon their investment objectives, but without distinguishing among the Funds’ benchmarks. References to “Commodity Index Funds”, “Commodity Funds” and “Currency Funds” refer to the different Funds according to their general benchmark categories without distinguishing among the Funds’ investment objectives or Fund-specific benchmarks. References to “VIX Funds” refer to the different Funds based upon their investment objective and their general benchmark categories.

Each “Ultra” Fund seeks daily investment results (before fees and expenses) that correspond to twice (2x) the daily performance of its corresponding benchmark. Each “Short” Fund seeks daily investment results (before fees and expenses) that correspond to the inverse (-1x) of the daily performance of its corresponding benchmark. Each “UltraShort” Fund seeks daily investment results (before fees and expenses) that correspond to twice the inverse (-2x) of the daily performance of its corresponding benchmark. Daily performance

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is measured from the calculation of one NAV to the next. Each of the Geared Funds generally invests or will invest in Financial Instruments (i.e., commodity-based, currency-based or equity market volatility-based instruments whose value is derived from the value of an underlying asset, rate or index, including futures contracts and options on futures contracts, swap agreements, forward contracts and other commodity-based or currency-based options contracts) as a substitute for investing directly in commodities, currencies or equity market volatility products in order to gain exposure to the commodity index, currency benchmark, commodity, currency or to an equity market volatility index. The Financial Instruments in which ProShares Short DJ-UBS Natural Gas will invest are limited to futures contracts. Financial Instruments also are used to produce economically “leveraged” or “inverse” investment results for the Funds. Each “VIX” Fund seeks daily investment results (before fees and expenses) that match the performance of a benchmark. Each VIX Fund intends to obtain exposure to its benchmark by investing in futures contracts (“VIX futures contracts”) based on the Chicago Board Options Exchange (“CBOE”) Volatility Index (the “VIX”).

The Geared Funds do not seek to achieve their stated investment objective over a period of time greater than one day because mathematical compounding prevents the Geared Funds from achieving such results. Accordingly, results over periods of time greater than one day should not be expected to be a simple multiple (e.g., 2x or -2x) of the period return of the corresponding benchmark and will likely differ significantly. The VIX Funds seek to achieve their stated investment objective both over a single day and over time.

ProShares Ultra DJ-UBS Commodity, ProShares UltraShort DJ-UBS Commodity, ProShares Ultra DJ-UBS Crude Oil and ProShares UltraShort DJ-UBS Crude Oil each have a benchmark that is an index designed to track the performance of commodity futures contracts, as applicable and as listed below. The daily performance of these indexes and the corresponding funds will likely be very different from the daily performance of the price of the related physical commodities.

Renaming of Indexes and Funds

On May 6, 2009, UBS Securities LLC acquired the commodity business of AIG Financial Products Corp. Effective May 7, 2009, the Dow Jones-AIG Commodity Indexes were re-branded as the Dow Jones-UBS Commodity Indexes. The Dow Jones-UBS Commodity Indexes have an identical methodology to the Dow Jones-AIG Commodity Indexes and take the identical form and format of the Dow Jones-AIG Commodity Indexes. In connection therewith:

The following indexes were renamed:


Former Index Name		New Index Name
Dow Jones-AIG Commodity Index		Dow Jones-UBS Commodity Index
Dow Jones-AIG Crude Oil Sub-Index		Dow Jones-UBS Crude Oil Sub-Index

The following Funds were renamed:

Former Fund Name		New Fund Name
ProShares Ultra DJ-AIG Commodity		ProShares Ultra DJ-UBS Commodity
ProShares UltraShort DJ-AIG Commodity		ProShares UltraShort DJ-UBS Commodity
ProShares Ultra DJ-AIG Crude Oil		ProShares Ultra DJ-UBS Crude Oil
ProShares UltraShort DJ-AIG Crude Oil		ProShares UltraShort DJ-UBS Crude Oil

Reverse Splits

Prior to the opening of trading on the NYSE Arca on April 15, 2010, ProShares UltraShort Gold executed a 1-for-5 reverse split of shares, and ProShares UltraShort Silver executed a 1-for-10 reverse split of shares. The funds traded at their post-split prices on April 15, 2010. The ticker symbols for the funds did not change, and they continue to trade on the NYSE Arca.

Prior to the opening of trading on the NYSE Arca on February 25, 2011, ProShares UltraShort DJ-UBS Commodity and ProShares UltraShort DJ-UBS Crude Oil executed a 1-for-5 reverse split of shares and ProShares UltraShort Silver and ProShares Ultra DJ-UBS Crude Oil executed a 1-for-4 reverse split of shares. The funds traded at their post-split prices on February 25, 2011. The ticker symbols for the funds did not change, and they continue to trade on the NYSE Arca.

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The reverse splits were applied retroactively for all periods presented, reducing the number of shares outstanding for each of the ProShares UltraShort Gold Fund, ProShares UltraShort Silver Fund, ProShares UltraShort DJ-UBS Commodity Fund, ProShares Ultra DJ-UBS Crude Oil Fund and ProShares UltraShort DJ-UBS Crude Oil Fund, and resulted in a proportionate increase in the price per share and per share information of each of the ProShares UltraShort Gold Fund, ProShares UltraShort Silver Fund, ProShares UltraShort DJ-UBS Commodity Fund, ProShares Ultra DJ-UBS Crude Oil Fund and ProShares UltraShort DJ-UBS Crude Oil Fund. Therefore, the reverse splits did not change the aggregate net asset value of a shareholder’s investment at the time of the split.

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies followed by each Geared Fund and each VIX Fund, as applicable, in preparation of its financial statements. These policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”).

The accompanying unaudited financial statements were prepared in accordance with GAAP for interim financial information and with the instructions for Form 10-Q and the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”). In the opinion of management, all material adjustments, consisting only of normal recurring adjustments, considered necessary for a fair statement of the interim period financial statements have been made. Interim period results are not necessarily indicative of results for a full-year period. These financial statements and the notes thereto should be read in conjunction with the Trust’s and the Funds’ financial statements included in the Trust’s Annual Report on Form 10-K for the period ended December 31, 2010, as filed with the SEC on March 1, 2011.

Use of Estimates & Indemnifications

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts and disclosures in these financial statements. Actual results could differ from those estimates.

In the normal course of business, the Trust enters into contracts that contain a variety of representations which provide general indemnifications. The Trust’s maximum exposure under these arrangements cannot be known; however, the Trust expects any risk of loss to be remote.

Basis of Presentation

Pursuant to rules and regulations of the SEC, audited financial statements are presented for the Trust as a whole, as the SEC registrant, and for each Fund individually. The debts, liabilities, obligations and expenses incurred, contracted for or otherwise existing with respect to a particular Fund shall be enforceable only against the assets of such Fund and not against the assets of the Trust generally or any other Fund. Accordingly, the assets of one Fund of the Trust include only those funds and other assets that are paid to, held by or distributed to the Trust for the purchase of Units in that Fund.

Statement of Cash Flows

The cash amount shown in the Statements of Cash Flows is the amount reported as cash in the Statement of Financial Condition dated September 30, 2011, and represents non-segregated cash with the custodian and does not include short-term investments.

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Final Net Asset Value for Fiscal Period

The times of the calculation of the Leveraged Funds’ and the VIX Funds’ final net asset value for creation and redemption of fund shares for the period ended September 30, 2011 were as follows. All times are Eastern Standard Time:


	NAV Calculation Time		NAV Calculation Date
Ultra Silver, UltraShort Silver		7:00 A.M.		September 30
Ultra Gold, UltraShort Gold		10:00 A.M.		September 30
Ultra DJ-UBS Commodity, UltraShort DJ-UBS Commodity		2:30 P.M.		September 30
Ultra DJ-UBS Crude Oil, UltraShort DJ-UBS Crude Oil		2:30 P.M.		September 30
Ultra Euro, UltraShort Euro		4:00 P.M.		September 30
Ultra Yen, UltraShort Yen		4:00 P.M.		September 30
VIX Short-Term Futures ETF, VIX Mid-Term Futures ETF		4:15 P.M.		September 30

Although the Leveraged Funds’ and VIX Funds’ shares may continue to trade on secondary markets subsequent to the calculation of the final NAV, these times represent the final opportunity to transact in creation or redemption units for the three and nine months ended September 30, 2011.

Market value per share is determined at the close of the NYSE Arca and may be later than when the Funds’ NAV per share is calculated.

For financial reporting purposes, the Leveraged Funds and VIX Funds value transactions based upon the final closing price in their primary markets. Accordingly, the investment valuations in these financial statements differ from those used in the calculation of some Leveraged Funds’ and VIX Funds’ final creation/redemption NAV for the three and nine months ended September 30, 2011.

Investment Valuation

Short-term investments are valued at market price. Treasury securities having a maturity of greater than sixty days are valued at market price. In each of these situations, valuations are typically categorized as Level 1 in the fair value hierarchy.

Derivatives (e.g., futures, swaps and forward agreements) are generally valued using independent sources and/or agreements with counterparties or other procedures as determined by the Sponsor. Futures contracts, except for those entered into by the Gold and Silver Funds, are generally valued at the last settled price on the applicable exchange on which that future trades. Futures contracts entered into by the Gold and Silver Funds are valued at the last sales price prior to the time at which the NAV per share of a Fund is determined. These valuations are typically categorized as Level 1 in the fair value hierarchy. If there was no sale on that day, and for non-exchange-traded derivatives, the Sponsor may in its sole discretion choose to determine a fair value price as the basis for determining the market value of such position for such day. Such fair value prices would be generally determined based on available inputs about the current value of the underlying financial instrument or commodity and would be based on principles that the Sponsor deems fair and equitable so long as such principles are consistent with normal industry standards. When market closing prices are not available, the Sponsor may fair value an asset of a Fund pursuant to the policies the Sponsor has adopted, which are consistent with normal industry standards. Depending on the source and relevant significance of valuation inputs, these instruments may be classified as Level 2 or Level 3 in the fair value hierarchy.

Fair value pricing may require subjective determinations about the value of an investment. While the Leveraged Funds’ and VIX Funds’ policy is intended to result in a calculation of a Leveraged Fund and VIX Fund’s NAV that fairly reflects investment values as of the time of pricing, the Leveraged Fund and VIX Fund cannot ensure that fair values determined by the Sponsor or persons acting at their direction would accurately reflect the price that a Fund could obtain for an investment if it were to dispose of that investment as of the time of pricing (for instance, in a forced or distressed sale). The prices used by a Leveraged Fund and VIX Fund may differ from the value that would be realized if the investments were sold and the differences could be material to the financial statements.

Fair Value of Financial Instruments

The Funds disclose the fair value of their investments in a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The disclosure requirements establish a fair value hierarchy that distinguishes between: (1) market participant assumptions developed based on market data obtained from sources independent of the Funds (observable inputs); and (2) the Funds’ own assumptions about market participant assumptions developed based on the best information available under the circumstances (unobservable inputs). The three levels defined by the disclosure requirements hierarchy are as follows:

Level I – Quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.

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Level II – Inputs other than quoted prices included within Level I that are observable for the asset or liability, either directly or indirectly. Level II assets include the following: quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability, and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market-corroborated inputs).

Level III – Unobservable pricing input at the measurement date for the asset or liability. Unobservable inputs shall be used to measure fair value to the extent that observable inputs are not available.

In some instances, the inputs used to measure fair value might fall in different levels of the fair value hierarchy. The level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based on the lowest input level that is significant to the fair value measurement in its entirety.

Fair value measurements also require additional disclosure when the volume and level of activity for the asset or liability have significantly decreased, as well as when circumstances indicate that a transaction is not orderly.

The following table summarizes the valuation of investments at September 30, 2011 using the fair value hierarchy:


	Level I - Quoted Prices					Level II - Other Significant Observable Inputs
	Short-Term U.S. Government and Agencies		Futures Contracts			Forward Agreements			Foreign Currency Forward Contracts			Swap Agreements			Total
Ultra DJ-UBS Commodity	$	15,615,636	$	—		$	—		$	—		$	(3,889,846	)	$	11,725,790
UltraShort DJ-UBS Commodity		11,383,268		—			—			—			1,004,988			12,388,256
Ultra DJ-UBS Crude Oil		408,957,733		(23,095,260	)		—			—			(40,686,650	)		345,175,823
UltraShort DJ-UBS Crude Oil		58,146,838		4,143,110			—			—			7,373,037			69,662,985
Ultra Gold		363,969,066		(557,680	)		8,990,384			—			—			372,401,770
UltraShort Gold		185,040,756		98,160			(7,834,590	)		—			—			177,304,326
Ultra Silver		642,109,717		(3,323,660	)		57,079,169			—			—			695,865,226
UltraShort Silver		745,818,445		492,525			(201,231,313	)		—			—			545,079,657
Ultra Euro		8,937,326		—			—			(1,212,360	)		—			7,724,966
UltraShort Euro		848,035,536		—			—			109,803,643			—			957,839,179
Ultra Yen		5,544,649		—			—			(53,120	)		—			5,491,529
UltraShort Yen		276,427,258		—			—			2,181,019			—			278,608,277
VIX Short-Term Futures ETF		28,061,131		3,541,350			—			—			—			31,602,481
VIX Mid-Term Futures ETF		14,411,278		1,830,600			—			—			—			16,241,878

Total Trust	$	3,612,458,637	$	(16,870,855	)	$	(142,996,350	)	$	110,719,182		$	(36,198,471	)	$	3,527,112,143

At September 30, 2011, there were no Level III portfolio investments for which significant unobservable inputs were used to determine fair value.

At September 30, 2011, there were no significant transfers in or out of Level I and Level II fair value measurements.

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The inputs or methodology used for valuing investments are not necessarily an indication of the risk associated with investing in those securities.

The following table summarizes the valuation of investments at December 31, 2010 using the fair value hierarchy:


	Level I - Quoted Prices					Level II - Other Significant Observable Inputs
	Short-Term U.S. Government and Agencies		Futures Contracts			Forward Agreements			Foreign Currency Forward Contracts			Swap Agreements			Total
Ultra DJ-UBS Commodity	$	16,426,651	$	—		$	—		$	—		$	1,755,750		$	18,182,401
UltraShort DJ-UBS Commodity		1,594,842		—			—			—			(164,150	)		1,430,692
Ultra DJ-UBS Crude Oil		244,394,920		5,412,760			—			—			5,649,644			255,457,324
UltraShort DJ-UBS Crude Oil		135,637,192		(2,384,420	)		—			—			(4,111,608	)		129,141,164
Ultra Gold		249,250,657		305,980			8,724,587			—			—			258,281,224
UltraShort Gold		80,114,447		(292,750	)		(2,991,391	)		—			—			76,830,306
Ultra Silver		495,915,529		3,056,220			46,191,568			—			—			545,163,317
UltraShort Silver		105,319,504		(519,420	)		(10,010,345	)		—			—			94,789,739
Ultra Euro		7,374,157		—			—			348,179			—			7,722,336
UltraShort Euro		471,829,446		—			—			(23,194,077	)		—			448,635,369
Ultra Yen		4,733,703		—			—			283,503			—			5,017,206
UltraShort Yen		223,873,131		—			—			(16,137,654	)		—			207,735,477

Total Trust	$	2,036,464,179	$	5,578,370		$	41,914,419		$	(38,700,049	)	$	3,129,636		$	2,048,386,555

At December 31, 2010, there were no Level III portfolio investments for which significant unobservable inputs were used to determine fair value.

At December 31, 2010, there were no significant transfers in or out of Level I and Level II fair value measurements.

The inputs or methodology used for valuing investments are not necessarily an indication of the risk associated with investing in those securities.

Investment Transactions and Related Income

Investment transactions are recorded on the trade date. All such transactions are recorded on the identified cost basis and marked to market daily. Unrealized appreciation/depreciation on open contracts are reflected in the Statements of Financial Condition and changes in the unrealized appreciation/depreciation between periods are reflected in the Statements of Operations. Discounts on short-term securities purchased are amortized and reflected as Interest Income in the Statements of Operations.

Brokerage Commissions and Fees

Each Geared Fund pays its respective brokerage commissions, including applicable exchange fees, National Futures Association (“NFA”) fees, give-up fees, pit brokerage fees and other transaction related fees and expenses charged in connection with trading activities for each Fund’s investment in U.S. Commodity Futures Trading Commission regulated investments. The effects of trading spreads, financing costs/fees associated with Financial Instruments, and costs relating to the purchase of U.S. Treasury securities or similar high credit quality short-term fixed-income or similar securities would also be borne by the Funds. Brokerage commissions on futures contracts are recognized on a half-turn basis. For the period ended September 30, 2011, the Sponsor paid and is currently paying brokerage commissions on futures contracts for the VIX Funds by reimbursing the VIX Funds monthly for the brokerage commissions paid.

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Federal Income Tax

Each Fund is registered as a series of a Delaware statutory trust and is or will be treated as a partnership for U.S. federal income tax purposes. Accordingly, no Fund expects to incur U.S. federal income tax liability; rather, each beneficial owner of a Fund’s Shares is or will be required to take into account its allocable share of its Fund’s income, gain, loss, deductions and other items for its Fund’s taxable year ending with or within the beneficial owner’s taxable year.

Management of the Funds has reviewed all open tax years and major jurisdictions and concluded that there is no tax liability resulting from unrecognized tax benefits relating to uncertain income tax positions taken or expected to be taken in future tax returns. The Funds are also not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months. On an ongoing basis, management will monitor its tax positions taken under the interpretation to determine if adjustments to conclusions are necessary based on factors including, but not limited to, further implementation of guidance expected from the Financial Accounting Standards Board and on-going analysis of tax law, regulation, and interpretations thereof.

NOTE 3 – INVESTMENTS

Short-Term Investments

The Funds may purchase U.S. Treasury Bills, agency securities, and other high-credit quality short-term fixed income or similar securities with original maturities of one year or less. A portion of these investments may be posted as collateral in connection with swap agreements and/or used as collateral for a Fund’s trading in futures and forward contracts.

Accounting for Derivative Instruments

In seeking to achieve each Fund’s investment objective, the Sponsor uses a mathematical approach to investing. Using this approach, the Sponsor determines the type, quantity and mix of investment positions that the Sponsor believes in combination should produce returns consistent with a Fund’s objective.

All open derivative positions at period-end for each Fund are disclosed in the Schedule of Investments and the notional value of these open positions relative to the shareholders’ equity of each Fund is generally representative of the notional value of open positions to shareholders’ equity throughout the reporting period for each respective Fund. The volume associated with derivative positions varies on a daily basis as each Fund transacts derivative contracts in order to achieve the appropriate exposure, as expressed in notional value, in comparison to shareholders’ equity consistent with each Fund’s investment objective.

Following is a description of the derivative instruments used by the Funds during the reporting period, including the primary underlying risk exposures related to each instrument type.

Futures Contracts

The Funds enter into futures contracts to gain exposure to changes in the value of an underlying index or commodity. A futures contract obligates the seller to deliver (and the purchaser to accept) the future delivery of a specified quantity and type of a commodity at a specified time and place. The contractual obligations of a buyer or seller may generally be satisfied by taking or making physical delivery of the underlying commodity, if applicable, or by making an offsetting sale or purchase of an identical futures contract on the same or linked exchange before the designated date of delivery, or by cash settlement at expiration of contract.

Upon entering into a futures contract, each Fund is required to deposit and maintain as collateral at least such initial margin as required by the exchange on which the transaction is effected. The initial margin is segregated as cash balances with brokers for futures contracts, as disclosed in the Statements of Financial Condition, and is restricted as to its use. The VIX Funds maintain collateral at the broker in the form of U.S. Treasury securities. These securities are restricted as to their use and are denoted as such on the Schedules of Investments. Pursuant to the futures contract, each Fund generally agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in value of the futures contract. Such receipts or payments are known as variation margin and are recorded by each Fund as unrealized gains or losses. Each Fund will realize a gain or loss upon closing of a futures transaction.

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Futures contracts involve, to varying degrees, elements of market risk (specifically commodity price risk or equity market volatility risk) and exposure to loss in excess of the amount of variation margin. The face or contract amounts reflect the extent of the total exposure each Fund has in the particular classes of instruments. Additional risks associated with the use of futures contracts are imperfect correlation between movements in the price of the futures contracts and the market value of the underlying index or commodity and the possibility of an illiquid market for a futures contract. With futures contracts, there is minimal counterparty risk to the Funds since futures contracts are exchange-traded and the exchange’s clearinghouse, as counterparty to all exchange-traded futures contracts, guarantees the futures contracts against default.

Swap Agreements

Certain of the Funds enter into swap agreements for purposes of pursuing their investment objectives or as a substitute for investing directly in (or shorting) commodities, or to create an economic hedge against a position. Swap agreements are two-party contracts entered into primarily with institutional investors for a specified period, ranging from a day to more than one year. In a standard swap transaction, two parties agree to exchange the returns earned or realized on a particular predetermined investment, instrument or index in exchange for a fixed or floating rate of return in respect of a predetermined notional amount. In the case of futures contracts based indices, such as those used by the Commodity Index Funds, the reference interest rate is zero. The gross returns to be exchanged are calculated with respect to a notional amount and the benchmark returns to which the swap is linked. Swap agreements do not involve the delivery of underlying instruments.

Generally, swap agreements entered into by the Funds calculate and settle the obligations of the parties to the agreement on a “net basis” with a single payment. Consequently, each Fund’s current obligations (or rights) under a swap agreement will generally be equal only to the net amount to be paid or received under the agreement based on the relative values of such obligations (or rights) (the “net amount”). In a typical swap agreement entered into by an Ultra Fund, the Ultra Fund would be entitled to settlement payments in the event the benchmark increases and would be required to make payments to the swap counterparties in the event the benchmark decreases, adjusted for any transaction costs or trading spreads on the notional amount the Funds may pay. In a typical swap agreement entered into by an UltraShort Fund, the UltraShort Fund would be required to make payments to the swap counterparties in the event the benchmark increases and would be entitled to settlement payments in the event the benchmark decreases, adjusted for any transaction costs or trading spreads on the notional amount the Funds may pay.

The net amount of the excess, if any, of each Fund’s obligations over its entitlements with respect to each swap agreement is accrued on a daily basis and an amount of cash and/or securities having an aggregate NAV at least equal to such accrued excess is maintained in a segregated account by the Funds’ Custodian. Until a swap agreement is settled in cash, the gain or loss on the notional amount less any transaction costs or trading spreads payable by each Fund on the notional amount are recorded as “unrealized appreciation or depreciation on swap agreements” and, when cash is exchanged, the gain or loss realized is recorded as “realized gains or losses on swap agreements.” Swap agreements are generally valued at the last settled price of the benchmark referenced Index.

The Trust, on behalf of a Fund, may enter into agreements with certain counterparties for derivative transactions. These agreements contain various conditions, events of default, termination events, covenants and representations. The triggering of certain events or the default on certain terms of the agreement could allow a party to terminate a transaction under the agreement and request immediate payment in an amount equal to the net positions owed the party under the agreement. This could cause a Fund to have to enter into a new transaction with the same counterparty, enter into a transaction with a different counterparty or seek to achieve its investment objective through any number of different investments or investment techniques.

Swap agreements involve, to varying degrees, elements of market risk (commodity price risk) and exposure to loss in excess of the unrealized gain/loss reflected. The notional amounts reflect the extent of the total investment exposure each Fund has under the swap agreement, which may exceed the NAV of each Fund. Additional risks associated with the use of swap agreements are imperfect correlation between movements in the notional amount and the price of the underlying reference index and the inability of

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counterparties to perform. Each Fund bears the risk of loss of the amount expected to be received under a swap agreement in the event of the default or bankruptcy of a swap agreement counterparty. A Fund will enter into swap agreements only with large, well-capitalized and well established financial institutions. The creditworthiness of each of the firms that is a party to a swap agreement is monitored by the Sponsor. The Sponsor may use various techniques to minimize credit risk including early termination and payment, using different counterparties, limiting the net amount due from any individual counterparty and generally requiring collateral to be posted by the counterparty in an amount approximately equal to that owed to the Funds. All of the outstanding swap agreements at September 30, 2011 contractually terminate within one month but may be terminated without penalty by either party daily. Upon termination, the Fund is entitled to pay or receive the “unrealized appreciation or depreciation” amount.

The Funds, as applicable, collateralize swap agreements by segregating or designating cash and/or certain securities as indicated on the Statements of Financial Condition or Schedules of Investments. Such collateral is held for the benefit of the counterparty in a segregated tri-party account at the Custodian to protect the counterparty against non-payment by the Funds. In the event of a default by the counterparty, the Funds will seek withdrawal of this collateral from the segregated account and may incur certain costs in exercising its right with respect to the collateral. If a counterparty becomes bankrupt or otherwise fails to perform its obligations due to financial difficulties, the Funds may experience significant delays in obtaining any recovery in a bankruptcy or other reorganizational proceeding. The Funds may obtain only limited recovery or may obtain no recovery in such circumstances.

The Funds remain subject to credit risk with respect to the amount they expect to receive from counterparties. However, the Funds have sought to mitigate these risks by generally requiring that the counterparties for each Fund agree to post collateral for the benefit of the Fund, marked to market daily, in an amount approximately equal to what the counterparty owes the Fund. In the event of the bankruptcy of a counterparty, the Fund will have direct access to the collateral received from the counterparty, generally as of the day prior to the bankruptcy, because there is a one day time lag between the Fund’s request for collateral and the delivery of such collateral. To the extent any such collateral is insufficient, the Funds will be exposed to counterparty risk as described above, including the possible delays in recovering amounts as a result of bankruptcy proceedings. As of September 30, 2011, the collateral posted by counterparties consisted of U.S. Treasury securities.

Forward Contracts

Certain of the Funds enter into forward contracts for purposes of pursuing their investment objectives and as a substitute for investing directly in (or shorting) commodities and/or currencies. A forward contract is an agreement between two parties to purchase or sell a specified quantity of a commodity or currency at or before a specified date in the future at a specified price. Forward contracts are typically traded in the over-the-counter (“OTC”) markets and all details of the contract are negotiated between the counterparties to the agreement. Accordingly, the forward contracts are valued by reference to the contracts traded in the OTC markets.

The contractual obligations of a buyer or seller may generally be satisfied by taking or making physical delivery of the underlying commodity or currency, establishing an opposite position in the contract and recognizing the profit or loss on both positions simultaneously on the delivery date or, in some instances, paying a cash settlement before the designated date of delivery. The forward contracts are adjusted by the daily fluctuation of the underlying commodity or currency and any gains or losses are recorded for financial statement purposes as unrealized gains or losses until the contract settlement date.

Forward contracts are, in general, not cleared or guaranteed by a third party. The Funds may collateralize forward commodity contracts by segregating or designating cash and/or certain securities as indicated on their Statements of Financial Condition or Schedules of Investments. Such collateral is held for the benefit of the counterparty in a segregated tri-party account at the Custodian to protect the counterparty against non-payment by the Funds. In the event of a default by the counterparty, the Funds will seek withdrawal of this collateral from the segregated account and may incur certain costs in exercising its right with respect to the collateral. If a counterparty becomes bankrupt or otherwise fails to perform its obligations due to financial difficulties, the Funds may experience significant delays in obtaining any recovery in a bankruptcy or other reorganizational proceeding. The Funds may obtain only limited recovery or may obtain no recovery in such circumstances.

-94-

The Funds remain subject to credit risk with respect to the amount they expect to receive from counterparties, as those amounts are not similarly collateralized by the counterparty. However, the Funds have sought to mitigate these risks by generally requiring that the counterparties for each Fund agree to post collateral for the benefit of the Fund, marked to market daily, in an amount approximately equal to what the counterparty owes the Fund. In the event of the bankruptcy of a counterparty, the Fund will have direct access to the collateral received from the counterparty, generally as of the day prior to the bankruptcy, because there is a one day time lag between the Fund’s request for collateral and the delivery of such collateral. To the extent any such collateral is insufficient, the Funds will be exposed to counterparty risk as described above, including the possible delays in recovering amounts as a result of bankruptcy proceedings. As of September 30, 2011, the collateral posted by counterparties consisted of U.S. Treasury securities.

Participants in trading foreign exchange forward contracts often do not require margin deposits, but rely upon internal credit limitations and their judgments regarding the creditworthiness of their counterparties.

A Fund will enter into forward contracts only with large, well-capitalized and well established financial institutions. The creditworthiness of each of the firms that is a party to a forward contract is monitored by the Sponsor.

-95-

Fair Value of Derivative Instruments

as of September 30, 2011

Asset Derivatives

Liability Derivatives

Derivatives not
accounted for as hedging
instruments

Statements of
Financial
Condition
Location

Fund

Unrealized
Appreciation

Statements of
Financial
Condition
Location

Fund

Unrealized
Depreciation

Commodities Contracts

Receivables
on open
futures
contracts,
unrealized
appreciation
on swap
and/or
forward
agreements

ProShares UltraShort
DJ-UBS Commodity

1,004,988

Payable on
open
futures
contracts,
unrealized
depreciation
on swap
and/or
forward
agreements

ProShares Ultra DJ-
UBS Commodity

3,889,846

ProShares UltraShort
DJ-UBS Crude Oil

11,516,147

ProShares Ultra DJ-
UBS Crude Oil

63,781,910

ProShares Ultra Gold

8,990,384

ProShares Ultra Gold

557,680

ProShares UltraShort
Gold

98,160

ProShares UltraShort
Gold

7,834,590

ProShares Ultra
Silver

57,079,169

ProShares Ultra
Silver

3,323,660

ProShares UltraShort
Silver

492,525

ProShares UltraShort
Silver

201,231,313

Foreign Exchange Contracts

Unrealized
appreciation
on foreign
currency
forward
contracts

ProShares Ultra Euro

52,287

Unrealized
depreciation
on foreign
currency
forward
contracts

ProShares Ultra Euro

1,264,647

ProShares UltraShort
Euro

115,409,127

ProShares UltraShort
Euro

5,605,484

ProShares Ultra Yen

195

ProShares Ultra Yen

53,315

ProShares UltraShort
Yen

2,543,076

ProShares UltraShort
Yen

362,057

VIX Futures Contracts

Receivables
on open
futures
contracts

ProShares VIX
Short-Term Futures
ETF

3,541,350

Payable on
open
futures
contracts

ProShares VIX Mid-
Term Futures ETF

1,830,600

Total Trust

202,558,008

Total Trust

287,904,502

*	Includes cumulative appreciation/depreciation of futures contracts as reported in the Schedules of Investments. Only current day’s variation margin is reported within the Statements of Financial Condition in receivable/payable on open futures contracts.

-96-

Fair Value of Derivative Instruments

as of December 31, 2010

Asset Derivatives

Liability Derivatives

Derivatives not
accounted for as hedging
instruments

Statements of
Financial
Condition
Location

Fund

Unrealized
Appreciation

Statements of
Financial
Condition
Location

Fund

Unrealized
Depreciation

Commodities Contracts

Receivables
on open
futures
contracts,
unrealized
appreciation
on swap
and/or
forward
agreements

ProShares Ultra DJ-
UBS Commodity

1,755,750

Payable on
open
futures
contracts,
unrealized
depreciation
on swap
and/or
forward
agreements

ProShares UltraShort
DJ-UBS Commodity

164,150

ProShares Ultra DJ-
UBS Crude Oil

11,062,404

ProShares UltraShort
DJ-UBS Crude Oil

6,496,028

ProShares Ultra Gold

9,030,567

ProShares UltraShort
Gold

3,284,141

ProShares Ultra
Silver

49,247,788

ProShares UltraShort
Silver

10,529,765

Foreign Exchange Contracts

Unrealized
appreciation
on foreign
currency
forward
contracts

ProShares Ultra Euro

353,487

Unrealized
depreciation
on foreign
currency
forward
contracts

ProShares Ultra Euro

5,308

ProShares UltraShort
Euro

930,978

ProShares UltraShort
Euro

24,125,055

ProShares Ultra Yen

292,768

ProShares Ultra Yen

9,265

ProShares UltraShort
Yen

1,856,768

ProShares UltraShort
Yen

17,994,422

Total Trust

74,530,510

Total Trust

62,608,134

*	Includes cumulative appreciation/depreciation of futures contracts as reported in the Schedules of Investments. Only current day’s variation margin is reported within the Statements of Financial Condition in receivable/payable on open futures contracts.

-97-

The Effect of Derivative Instruments on the Statements of Operations

For the three months ended September 30, 2011


Derivatives not accounted for as hedging instruments	Location of Gain or (Loss) on Derivatives Recognized in Income	Fund	Realized Gain or (Loss) on Derivatives Recognized in Income			Change in Unrealized Appreciation or Depreciation on Derivatives Recognized in Income
Commodity Contracts	Net realized gain (loss) on futures contracts, swap and/or forward agreements/changes in unrealized appreciation/ depreciation on futures contracts, swap and/or forward agreements	ProShares Ultra DJ-UBS Commodity	$	(1,050,671	)	$	(2,076,464	)
		ProShares UltraShort DJ-UBS Commodity		2,148,146			(1,247,546	)
		ProShares Ultra DJ-UBS Crude Oil		(87,767,586	)		(45,541,247	)
		ProShares UltraShort DJ-UBS Crude Oil		40,872,529			2,328,855
		ProShares Ultra Gold		4,794,133			23,329,743
		ProShares UltraShort Gold		7,280,916			(12,226,030	)
		ProShares Ultra Silver		(350,318,152	)		84,493,247
		ProShares UltraShort Silver		184,558,931			(217,209,973	)

Foreign Exchange Contracts	Net realized gain (loss) on foreign currency forward contracts/changes in unrealized appreciation/ depreciation on foreign currency forward contracts	ProShares Ultra Euro		(3,200	)		(1,321,372	)
		ProShares UltraShort Euro		(11,049,379	)		122,372,805
		ProShares Ultra Yen		496,377			(71,257	)
		ProShares UltraShort Yen		(34,105,768	)		4,607,971

VIX Futures Contracts	Net realized gain (loss) on futures contracts/changes in unrealized appreciation/ depreciation on futures contracts	ProShares VIX Short-Term Futures ETF		24,351,300			7,994,010
VIX Futures Contracts		ProShares VIX Mid-Term Futures ETF		2,364,290			2,244,750

		Total Trust	$	(217,428,134	)	$	(32,322,508	)

-98-

The Effect of Derivative Instruments on the Statements of Operations

For the three months ended September 30, 2010


Derivatives not accounted for as hedging instruments	Location of Gain or (Loss) on Derivatives Recognized in Income	Fund	Realized Gain or (Loss) on Derivatives Recognized in Income			Change in Unrealized Appreciation/ Depreciation on Derivatives Recognized in Income
Commodity Contracts	Net realized gain (loss) on futures contracts, swap and/or forward agreements/changes in unrealized appreciation/depreciation on futures contracts, swap and/or forward agreements	ProShares Ultra DJ-UBS Commodity	$	2,113,541		$	178,290
		ProShares UltraShort DJ-UBS Commodity		(806,167	)		335,891
		ProShares Ultra DJ-UBS Crude Oil		38,009,578			22,160,030
		ProShares UltraShort DJ-UBS Crude Oil		7,955,152			(3,545,802	)
		ProShares Ultra Gold		7,178,424			9,270,118
		ProShares UltraShort Gold		(5,235,941	)		(3,101,100	)
		ProShares Ultra Silver		35,415,042			17,455,812
		ProShares UltraShort Silver		(17,827,502	)		(5,512,101	)

Foreign Exchange Contracts	Net realized gain (loss) on foreign currency forward contracts/changes in unrealized appreciation/ depreciation on foreign currency forward contracts	ProShares Ultra Euro		1,189,073			1,995,782
		ProShares UltraShort Euro		(33,898,742	)		(49,916,146	)
		ProShares Ultra Yen		849,525			(217,085	)
		ProShares UltraShort Yen		(26,657,675	)		8,158,466

		Total Trust	$	8,284,308		$	(2,737,845	)

-99-

The Effect of Derivative Instruments on the Statements of Operations

For the nine months ended September 30, 2011


Derivatives not accounted for as hedging instruments	Location of Gain or (Loss) on Derivatives Recognized in Income	Fund	Realized Gain or (Loss) on Derivatives Recognized in Income			Change in Unrealized Appreciation or Depreciation on Derivatives Recognized in Income
Commodity Contracts	Net realized gain (loss) on futures contracts, swap and/or forward agreements/changes in unrealized appreciation/depreciation on futures contracts, swap and/or forward agreements	ProShares Ultra DJ-UBS Commodity	$	939,496		$	(5,645,596	)
		ProShares UltraShort DJ-UBS Commodity		(3,367,856	)		1,169,138
		ProShares Ultra DJ-UBS Crude Oil		(13,429,691	)		(74,844,314	)
		ProShares UltraShort DJ-UBS Crude Oil		58,466,405			18,012,175
		ProShares Ultra Gold		55,426,905			(597,863	)
		ProShares UltraShort Gold		(16,108,408	)		(4,452,289	)
		ProShares Ultra Silver		(283,305,731	)		4,507,721
		ProShares UltraShort Silver		132,214,550			(190,209,023	)

Foreign Exchange Contracts	Net realized gain (loss) on foreign currency forward contracts/changes in unrealized appreciation/ depreciation on foreign currency forward contracts	ProShares Ultra Euro		1,603,888			(1,560,539	)
		ProShares UltraShort Euro		(112,483,351	)		132,997,720
		ProShares Ultra Yen		722,557			(336,623	)
		ProShares UltraShort Yen		(55,833,787	)		18,318,673
VIX Futures Contracts	Net realized gain (loss) on futures contracts/changes in unrealized appreciation/ depreciation on futures contracts	ProShares VIX Short-Term Futures ETF		11,557,660			3,541,350
VIX Futures Contracts		ProShares VIX Mid-Term Futures ETF		503,490			1,830,600

		Total Trust	$	(223,093,873	)	$	(97,268,870	)

-100-

The Effect of Derivative Instruments on the Statements of Operations

For the nine months ended September 30, 2010


Derivatives not accounted for as hedging instruments	Location of Gain or (Loss) on Derivatives Recognized in Income	Fund	Realized Gain or (Loss) on Derivatives Recognized in Income			Change in Unrealized Appreciation/ Depreciation on Derivatives Recognized in Income
Commodity Contracts	Net realized gain (loss) on futures contracts, swap and/ or forward agreements/changes in unrealized appreciation/ depreciation on futures contracts, swap and/or forward agreements	ProShares Ultra DJ-UBS Commodity	$	(624,603	)	$	(458,278	)
		ProShares UltraShort DJ-UBS Commodity		(254,747	)		114,962
		ProShares Ultra DJ-UBS Crude Oil		33,817,452			8,115,518
		ProShares UltraShort DJ-UBS Crude Oil		31,539,850			(298,119	)
		ProShares Ultra Gold		50,891,359			9,065,583
		ProShares UltraShort Gold		(25,639,655	)		(3,543,588	)
		ProShares Ultra Silver		60,466,221			18,146,343
		ProShares UltraShort Silver		(40,008,690	)		(6,540,702	)

Foreign Exchange Contracts	Net realized gain (loss) on foreign currency forward contracts/changes in unrealized appreciation /depreciation on foreign currency forward contracts	ProShares Ultra Euro		(1,756,177	)		2,043,042
		ProShares UltraShort Euro		54,569,532			(46,237,927	)
		ProShares Ultra Yen		651,232			368,127
		ProShares UltraShort Yen		(26,358,762	)		(6,598,615	)

		Total Trust	$	137,293,012		$	(25,823,654	)

-101-

NOTE 4 – AGREEMENTS

Management Fee

Each Geared Fund pays or will pay the Sponsor a Management Fee, monthly in arrears, in an amount equal to 0.95% per annum of its average daily NAV of such Fund. In the first year of the Leveraged Funds’ operations, the Sponsor did not charge its fee in an amount equal to the organization and offering costs. The Sponsor reimbursed each Leveraged Fund, if applicable, to the extent that its offering costs exceeded 0.95% of its average daily NAV of each Fund for the first year of operations. Each VIX Fund pays the Sponsor a Management Fee, monthly in arrears, in an amount equal to 0.85% per annum of its average daily NAV. The Sponsor will not charge its fee in the first year of operation of each New Fund (as defined below) in an amount equal to the offering costs. The Sponsor has agreed to reimburse each New Fund to the extent that its offering costs exceed the Management Fee for the first year of operations. The Management Fee is or will be paid in consideration of the Sponsor’s services as commodity pool operator and commodity trading advisor, and for managing the business and affairs of the Geared Funds and the VIX Funds. From the Management Fee, the Sponsor pays or will pay the fees and expenses of the Administrator, Custodian, Distributor, Transfer Agent and the licensors for the Commodity Index Funds (Dow Jones & Company, Inc. and UBS Securities LLC, together, “DJ-UBS”), the routine operational, administrative and other ordinary expenses of each Fund, and the normal and expected expenses incurred in connection with the continuous offering of Shares of each Fund after the commencement of its trading operations, including, but not limited to, expenses such as ongoing SEC registration fees not exceeding 0.021% per annum of a Fund and Financial Industry Regulatory Authority (“FINRA”) filing fees. For the period ended September 30, 2011, the Sponsor paid and is currently paying brokerage commissions on futures contracts for the VIX Funds. Each Leveraged Fund and VIX Fund incurs and pays, and each New Fund will incur and pay, its non-recurring and unusual fees and expenses.

The Administrator

The Sponsor and the Trust, for itself and on behalf of each Fund, has appointed Brown Brothers Harriman & Co. (“BBH&Co.”) as the Administrator of the Funds, and the Sponsor, the Trust, on its own behalf and on behalf of each Fund, and BBH&Co. have entered into an Administrative Agency Agreement (the “Administration Agreement”) in connection therewith. Pursuant to the terms of the Administration Agreement and under the supervision and direction of the Sponsor and the Trust, BBH&Co. prepares and files certain regulatory filings on behalf of the Funds. BBH&Co. may also perform other services for the Funds pursuant to the Administration Agreement as mutually agreed upon by the Sponsor, the Trust and BBH&Co. from time to time. Pursuant to the terms of the Administration Agreement, BBH&Co. also serves as the Transfer Agent of the Funds. The Administrator’s fees are or will be paid on behalf of the Funds by the Sponsor.

The Custodian

BBH&Co. serves as Custodian of the Funds, and the Trust, on its own behalf and on behalf of each Fund, and BBH&Co. have entered into a Custodian Agreement in connection therewith. Pursuant to the terms of the Custodian Agreement, BBH&Co. is responsible for the holding and safekeeping of assets delivered to it by the Funds, and performing various administrative duties in accordance with instructions delivered to BBH&Co. by the Funds. The Custodian’s fees are or will be paid on behalf of the Funds by the Sponsor.

The Distributor

SEI Investments Distribution Co. (“SEI”), serves as Distributor of the Funds and assists the Sponsor and the Administrator with certain functions and duties relating to distribution and marketing, including taking creation and redemption orders, consulting with the marketing staff of the Sponsor and its affiliates with respect to compliance with the requirements of FINRA and/or the NFA in connection with marketing efforts, and reviewing and filing of marketing materials with FINRA and/or the NFA. SEI retains all marketing materials separately for each Fund, at c/o SEI, One Freedom Valley Drive, Oaks, PA 19456. The Sponsor, on behalf of each Fund, has entered into a Distribution Services Agreement with SEI.

-102-

Routine Operational, Administrative and Other Ordinary Expenses

The Sponsor pays or will pay all of the routine operational, administrative and other ordinary expenses of each Fund generally, as determined by the Sponsor including, but not limited to, fees and expenses of the Administrator, Custodian, Distributor, Transfer Agent, DJ-UBS, accounting and auditing fees and expenses, tax preparation expenses, legal fees not in excess of $100,000 per annum, ongoing SEC registration fees not exceeding 0.021% per annum of the NAV of a Fund, FINRA filing fees, individual K-1 preparation and mailing fees not exceeding 0.10% per annum of the NAV of a Fund, and report preparation and mailing expenses.

Non-Recurring Fees and Expenses

Each Leveraged Fund and VIX Fund pays and each New Fund will pay all non-recurring and unusual fees and expenses, if any, as determined by the Sponsor. Non-recurring fees and expenses are fees and expenses such as legal claims and liabilities, litigation costs or indemnification or other material expenses which are not currently anticipated obligations of the Funds. Such fees and expenses are those that are non-recurring, unexpected or unusual in nature.

NOTE 5 – ORGANIZATION AND OFFERING COSTS

Organization costs are expensed as incurred and offering costs will be amortized by the Funds over a twelve month period on a straight-line basis. The Sponsor did not charge its Management Fee in the first year of operation of each Leveraged Fund in an amount equal to the organization and offering fees. The Sponsor reimbursed each Leveraged Fund if its organization and offering costs exceeded 0.95% of its average daily NAV for the first year of operations.

Offering costs on the VIX Funds and the New Funds will be amortized over a twelve month period on a straight-line basis. The Sponsor will not charge its Management Fee in the first year of operation of each VIX and New Fund in an amount equal to the offering costs. The Sponsor has agreed to reimburse each VIX and New Fund to the extent that its offering costs exceed 0.85% and 0.95%, respectively, of its average daily NAV for the first year of operations. At September 30, 2011, amounts payable for offering costs are reflected in the Statement of Financial Condition for each VIX Fund and each New Fund.

NOTE 6 – CREATION AND REDEMPTION OF CREATION UNITS

Each Leveraged Fund and VIX Fund issues and redeems Shares and each New Fund will issue and redeem shares from time to time, but only in one or more Creation Units. A Creation Unit is a block of 50,000 Shares of a Geared Fund and 25,000 Shares of a VIX Fund. Creation Units may be created or redeemed only by Authorized Participants. As a result of the reverse share splits as described in Note 1, certain redemptions as disclosed in the Statements of Changes in Shareholders’ Equity reflect payment of fractional share balances on beneficial shareholder accounts.

Except when aggregated in Creation Units, the Shares are not redeemable securities. Retail investors, therefore, generally will not be able to purchase or redeem Shares directly from or with a Fund. Rather, most retail investors will purchase or sell Shares in the secondary market with the assistance of a broker. Thus, some of the information contained in these Notes to Financial Statements—such as references to the Transaction Fees imposed on purchases and redemptions—is not relevant to retail investors.

Transaction Fees on Creation and Redemption Transactions

The manner by which Creation Units are purchased or redeemed is dictated by the terms of the Authorized Participant Agreement and Authorized Participant Handbook. By placing a purchase order, an Authorized Participant agrees to: (1) deposit cash with BBH&Co., the custodian of the Funds (the “Custodian”); and (2) if permitted by the Sponsor in its sole discretion with respect to a VIX Fund, enter into or arrange for an exchange of futures contract for related position (“EFCRP”) or block trade with the VIX Fund whereby the Authorized Participant would also transfer to such Fund a number and type of exchange-traded VIX futures contracts at or near the closing settlement price for such contracts on the purchase order date.

-103-

Authorized Participants, generally, pay a fixed transaction fee of $500 in connection with each order to create or redeem a Creation Unit in order to compensate BBH&Co. for services in processing the creation and redemption of Creation Units. The fixed transaction fee for the VIX Funds is currently being paid for by the Sponsor. Authorized Participants may be required to pay a variable transaction fee of up to 0.10% of the value of the Creation Unit that is purchased or redeemed. The current variable transaction fee is 0.022% for the Commodity and Commodity Index Funds. There is currently no variable transaction fee for the Currency and VIX Funds. Authorized Participants may sell the Shares included in the Creation Units they purchase from the Funds to other investors in the secondary market. Currently there are no additional fees being charged for related EFCRP or block trade transactions.

The transaction fees that are included in the Sale and/or Redemption of Shares on the Statements of Changes in Shareholders’ Equity were as follows:


Fund	Three Months Ended September 30, 2011		Nine Months Ended September 30, 2011
Ultra DJ-UBS Commodity	$	388	$	1,143
UltraShort DJ-UBS Commodity		4,029		34,229
Ultra DJ-UBS Crude Oil		139,525		451,173
UltraShort DJ-UBS Crude Oil		49,779		185,005
Ultra Gold		26,488		39,310
UltraShort Gold		32,225		48,827
Ultra Silver		134,624		382,309
UltraShort Silver		114,589		363,017
Ultra Euro		—		—
UltraShort Euro		—		—
Ultra Yen		—		—
UltraShort Yen		—		—
VIX Short-Term Futures ETF		—		—
VIX Mid-Term Futures ETF		—		—

Total Trust	$	501,647	$	1,505,013

-104-

NOTE 7 – FINANCIAL HIGHLIGHTS

Selected data for a Share outstanding throughout the three months ended September 30, 2011:

Ultra ProShares

For the Three Months Ended September 30, 2011 (unaudited)


Per Share Operating Performance	Ultra DJ- UBS Commodity			Ultra DJ- UBS Crude Oil			Ultra Gold			Ultra Silver^^			Ultra Euro			Ultra Yen
Net asset value, at June 30, 2011	$	33.3896		$	42.6433		$	77.4697		$	83.9930		$	30.2028		$	33.7648

Net investment income (loss)		(0.0789	)		(0.0855	)		(0.2324	)		(0.2338	)		(0.0672	)		(0.0852	)
Net realized and unrealized gain (loss)		(7.2872	)		(15.2523	)		9.7415			(29.0350	)		(4.4170	)		2.8878
Change in net asset value from operations		(7.3661	)		(15.3378	)		9.5091			(29.2688	)		(4.4842	)		2.8026
Net asset value, at September 30, 2011	$	26.0235		$	27.3055		$	86.9788		$	54.7242		$	25.7186		$	36.5674

Market value per share, at June 30, 2011†	$	33.38		$	42.18		$	76.78		$	82.47		$	30.16		$	33.78
Market value per share, at September 30, 2011†	$	25.67		$	27.09		$	87.34		$	51.84		$	25.75		$	36.60

Total Return, at net asset value^		(22.1	)%		(36.0	)%		12.3	%		(34.8	)%		(14.8	)%		8.3	%
Total Return, at market value^		(23.1	)%		(35.8	)%		13.8	%		(37.1	)%		(14.6	)%		8.3	%

Ratios to Average Net Assets**

Expense ratio		(0.95	)%		(0.97	)%		(0.95	)%		(0.95	)%		(0.95	)%		(0.95	)%
Expense ratio, excluding brokerage commissions		(0.95	)%		(0.95	)%		(0.95	)%		(0.95	)%		(0.95	)%		(0.95	)%
Net investment income (loss)		(0.92	)%		(0.95	)%		(0.93	)%		(0.93	)%		(0.93	)%		(0.93	)%

^^	See Note 10 of these Notes to Financial Statements.

†	Market values are determined at the close of the New York Stock Exchange, which may be later than when the Funds’ net asset value is calculated.

^	Percentages are not annualized for the period ended September 30, 2011.

**	Percentages are annualized.

-105-

UltraShort ProShares

For the Three Months Ended September 30, 2011 (unaudited)


Per Share Operating Performance	UltraShort DJ- UBS Commodity			UltraShort DJ- UBS Crude Oil			UltraShort Gold			UltraShort Silver			UltraShort Euro			UltraShort Yen^^
Net asset value, at June 30, 2011	$	48.3540		$	48.2805		$	23.9418		$	18.6738		$	16.7504		$	45.4035

Net investment income (loss)		(0.1099	)		(0.1226	)		(0.0415	)		(0.0323	)		(0.0410	)		(0.0979	)
Net realized and unrealized gain (loss)		10.6999			16.4505			(4.6317	)		(2.3269	)		2.5692			(3.9694	)
Change in net asset value from operations		10.5900			16.3279			(4.6732	)		(2.3592	)		2.5282			(4.0673	)
Net asset value, at September 30, 2011	$	58.9440		$	64.6084		$	19.2686		$	16.3146		$	19.2786		$	41.3362

Market value per share, at June 30, 2011†	$	48.67		$	48.80		$	24.14		$	18.99		$	16.76		$	45.39
Market value per share, at September 30, 2011†	$	59.30		$	65.25		$	19.17		$	17.11		$	19.28		$	41.34

Total Return, at net asset value^		21.9	%		33.8	%		(19.5	)%		(12.6	)%		15.1	%		(9.0	)%
Total Return, at market value^		21.8	%		33.7	%		(20.6	)%		(9.9	)%		15.0	%		(8.9	)%

Ratios to Average Net Assets**

Expense ratio		(0.95	)%		(0.98	)%		(0.95	)%		(0.95	)%		(0.95	)%		(0.95	)%
Expense ratio, excluding brokerage commissions		(0.95	)%		(0.95	)%		(0.95	)%		(0.95	)%		(0.95	)%		(0.95	)%
Net investment income (loss)		(0.93	)%		(0.96	)%		(0.93	)%		(0.92	)%		(0.93	)%		(0.92	)%

^^	See Note 10 of these Notes to Financial Statements.

†	Market values are determined at the close of the New York Stock Exchange, which may be later than when the Funds’ net asset value is calculated.

^	Percentages are not annualized for the period ended September 30, 2011.

**	Percentages are annualized.

-106-

VIX ProShares

For the Three Months Ended September 30, 2011 (unaudited)


Per Share Operating Performance	VIX Short- Term Futures ETF			VIX Mid- Term Futures ETF
Net asset value, at June 30, 2011	$	45.4655		$	61.7574

Net investment income (loss)		(0.1298	)		(0.1479	)
Net realized and unrealized gain (loss)		70.2529			27.9623
Change in net asset value from operations		70.1231			27.8144
Net asset value, at September 30, 2011	$	115.5886		$	89.5718

Market value per share, at June 30, 2011†	$	45.68		$	61.78
Market value per share, at September 30, 2011†	$	114.52		$	89.46

Total Return, at net asset value^		154.2	%		45.0	%
Total Return, at market value^		150.7	%		44.8	%

Ratios to Average Net Assets**

Expense ratio		(0.85	)%		(0.85	)%
Expense ratio, excluding brokerage commissions		(0.85	)%		(0.85	)%
Net investment income (loss)		(0.83	)%		(0.83	)%

†	Market values are determined at the close of the New York Stock Exchange, which may be later than when the Funds’ net asset value is calculated.

^	Percentages are not annualized for the period ended September 30, 2011.

**	Percentages are annualized.

-107-

Selected data for a Share outstanding throughout the three months ended September 30, 2010:

Ultra ProShares

For the Three Months Ended September 30, 2010 (unaudited)


Per Share Operating Performance	Ultra DJ-UBS Commodity			Ultra DJ-UBS Crude Oil*			Ultra Gold			Ultra Silver^^			Ultra Euro			Ultra Yen
Net asset value, at June 30, 2010	$	22.3721		$	38.5208		$	55.8196		$	31.7676		$	21.7716		$	28.6112

Net investment income (loss)		(0.0469	)		(0.0782	)		(0.1052	)		(0.0613	)		(0.0476	)		(0.0605	)
Net realized and unrealized gain (loss)		5.2502			2.1350			5.0930			11.0534			5.1794			3.3059
Change in net asset value from operations		5.2033			2.0568			4.9878			10.9921			5.1318			3.2454
Net asset value, at September 30, 2010	$	27.5754		$	40.5776		$	60.8074		$	42.7597		$	26.9034		$	31.8566

Market value per share, at June 30, 2010†	$	22.16		$	38.12		$	55.83		$	31.33		$	21.76		$	28.65
Market value per share, at September 30, 2010†	$	27.73		$	40.36		$	61.02		$	41.63		$	26.93		$	31.93

Total Return, at net asset value^		23.3	%		5.3	%		8.9	%		34.6	%		23.6	%		11.3	%
Total Return, at market value^		25.1	%		5.9	%		9.3	%		32.9	%		23.8	%		11.4	%

Ratios to Average Net Assets**

Expense ratio		(0.95	)%		(0.98	)%		(0.95	)%		(0.95	)%		(0.95	)%		(0.95	)%
Expense ratio, excluding brokerage commissions		(0.95	)%		(0.95	)%		(0.95	)%		(0.95	)%		(0.95	)%		(0.95	)%
Net investment income (loss)		(0.76	)%		(0.82	)%		(0.78	)%		(0.77	)%		(0.78	)%		(0.79	)%

*	See Note 1 of these Notes to Financial Statements.

^^	See Note 10 of these Notes to Financial Statements.

†	Market values are determined at the close of the New York Stock Exchange, which may be later than when the Funds’ net asset value is calculated.

^	Percentages are not annualized for the period ended September 30, 2010.

**	Percentages are annualized.

-108-

UltraShort ProShares

For the Three Months Ended September 30, 2010 (unaudited)


Per Share Operating Performance	UltraShort DJ- UBS Commodity*			UltraShort DJ- UBS Crude Oil*			UltraShort Gold*			UltraShort Silver*			UltraShort Euro			UltraShort Yen^^
Net asset value, at June 30, 2010	$	84.5350		$	75.4792		$	37.9468		$	128.0603		$	24.9905		$	56.6231

Net investment income (loss)		(0 .1527	)		(0 .1579	)		(0 .0764	)		(0 .2366	)		(0 .0420	)		(0 .1022	)
Net realized and unrealized gain (loss)#		(17.6499	)		(8 .6238	)		(4 .0922	)		(40 .1754	)		(5 .1185	)		(6 .5100	)
Change in net asset value from operations		(17.8026	)		(8 .7817	)		(4 .1686	)		(40 .4120	)		(5 .1605	)		(6 .6122	)
Net asset value, at September 30, 2010	$	66 .7324		$	66.6975		$	33.7782		$	87 .6483		$	19.8300		$	50.0109

Market value per share, at June 30, 2010†	$	85 .05		$	76 .20		$	37 .95		$	129 .84		$	25 .01		$	56 .52
Market value per share, at September 30, 2010†	$	68 .00		$	66 .90		$	33 .69		$	90 .02		$	19 .82		$	50 .03

Total Return, at net asset value^		(21 .1	)%		(11 .6	)%		(11 .0	)%		(31 .6	)%		(20 .6	)%		(11 .7	)%
Total Return, at market value^		(20 .0	)%		(12 .2	)%		(11 .2	)%		(30 .7	)%		(20 .8	)%		(11 .5	)%

Ratios to Average Net Assets**

Expense ratio		(0 .95	)%		(1 .02	)%		(0 .95	)%		(0 .96	)%		(0 .95	)%		(0 .95	)%
Expense ratio, excluding brokerage commissions		(0 .95	)%		(0 .95	)%		(0 .95	)%		(0 .95	)%		(0 .95	)%		(0 .95	)%
Net investment income (loss)		(0 .79	)%		(0 .87	)%		(0 .78	)%		(0 .77	)%		(0 .75	)%		(0 .76	)%

*	See Note 1 of these Notes to Financial Statements.

^^	See Note 10 of these Notes to Financial Statements.

#	The amount shown for a share outstanding throughout the period may not accord with the change in aggregate gains and losses during the period because of timing of creation and redemption units in relation to fluctuating net asset value during the period.

†	Market values are determined at the close of the New York Stock Exchange, which may be later than when the Funds’ net asset value is calculated.

^	Percentages are not annualized for the period ended September 30, 2010.

**	Percentages are annualized.

-109-

Selected data for a Share outstanding throughout the nine months ended September 30, 2011:

Ultra ProShares

For the Nine Months Ended September 30, 2011 (unaudited)


Per Share Operating Performance	Ultra DJ- UBS Commodity			Ultra DJ- UBS Crude Oil*			Ultra Gold			Ultra Silver^^			Ultra Euro			Ultra Yen
Net asset value, at December 31, 2010	$	36.3723		$	50.0017		$	69.2163		$	78.1431		$	25.7644		$	33.4918

Net investment income (loss)		(0 .2362	)		(0 .2929	)		(0 .5475	)		(0 .6596	)		(0 .1879	)		(0 .2285	)
Net realized and unrealized gain (loss)		(10.1126	)		(22.4033	)		18 .3100			(22.7593	)		0 .1421			3 .3041
Change in net asset value from operations		(10.3488	)		(22.6962	)		17 .7625			(23.4189	)		(0 .0458	)		3 .0756
Net asset value, at September 30, 2011	$	26 .0235		$	27 .3055		$	86.9788		$	54 .7242		$	25.7186		$	36.5674

Market value per share, at December 31, 2010†	$	36 .27		$	49 .98		$	70 .72		$	79 .30		$	25 .86		$	33 .29
Market value per share, at September 30, 2011†	$	25 .67		$	27 .09		$	87 .34		$	51 .84		$	25 .75		$	36 .60

Total Return, at net asset value^		(28 .5	)%		(45 .4	)%		25 .7	%		(30 .0	)%		(0 .2	)%		9 .2	%
Total Return, at market value^		(29 .2	)%		(45 .8	)%		23 .5	%		(34 .6	)%		(0 .4	)%		9 .9	%

Ratios to Average Net Assets**

Expense ratio		(0 .95	)%		(0 .98	)%		(0 .95	)%		(0 .95	)%		(0 .95	)%		(0 .95	)%
Expense ratio, excluding brokerage commissions		(0 .95	)%		(0 .95	)%		(0 .95	)%		(0 .95	)%		(0 .95	)%		(0 .95	)%
Net investment income (loss)		(0 .88	)%		(0 .92	)%		(0 .89	)%		(0 .89	)%		(0 .88	)%		(0 .89	)%

*	See Note 1 of these Notes to Financial Statements.

^^	See Note 10 of these Notes to Financial Statements.

†	Market values are determined at the close of the New York Stock Exchange, which may be later than when the Funds’ net asset value is calculated.

^	Percentages are not annualized for the period ended September 30, 2011.

**	Percentages are annualized.

-110-

UltraShort ProShares

For the Nine Months Ended September 30, 2011 (unaudited)


Per Share Operating Performance	UltraShort DJ-UBS Commodity*			UltraShort DJ-UBS Crude Oil*			UltraShort Gold			UltraShort Silver*			UltraShort Euro			UltraShort Yen^^
Net asset value, at December 31, 2010	$	47.9976		$	50.8516		$	28.3706		$	39.8927		$	20.2928		$	47.0232

Net investment income (loss)		(0 .3164	)		(0 .3197	)		(0 .1460	)		(0 .1133	)		(0 .1185	)		(0 .2982	)
Net realized and unrealized gain (loss)#		11 .2628			14 .0765			(8 .9560	)		(23.4648	)		(0 .8957	)		(5 .3888	)
Change in net asset value from operations		10 .9464			13 .7568			(9 .1020	)		(23.5781	)		(1 .0142	)		(5 .6870	)
Net asset value, at September 30, 2011	$	58.9440		$	64.6084		$	19.2686		$	16 .3146		$	19.2786		$	41.3362

Market value per share, at December 31, 2010†	$	48 .30		$	50 .85		$	27 .80		$	39 .28		$	20 .31		$	47 .01
Market value per share, at September 30, 2011†	$	59 .30		$	65 .25		$	19 .17		$	17 .11		$	19 .28		$	41 .34

Total Return, at net asset value^		22 .8	%		27 .1	%		(32 .1	)%		(59 .1	)%		(5 .0	)%		(12 .1	)%
Total Return, at market value^		22 .8	%		28 .3	%		(31 .0	)%		(56 .4	)%		(5 .1	)%		(12 .1	)%

Ratios to Average Net Assets**

Expense ratio		(0 .95	)%		(0 .99	)%		(0 .95	)%		(0 .95	)%		(0 .95	)%		(0 .95	)%
Expense ratio, excluding brokerage commissions		(0 .95	)%		(0 .95	)%		(0 .95	)%		(0 .95	)%		(0 .95	)%		(0 .95	)%
Net investment income (loss)		(0 .92	)%		(0 .92	)%		(0 .89	)%		(0 .90	)%		(0 .89	)%		(0 .88	)%

*	See Note 1 of these Notes to Financial Statements.

^^	See Note 10 of these Notes to Financial Statements.

#	The amount shown for a share outstanding throughout the period may not accord with the change in aggregate gains and losses during the period because of timing of creation and redemption units in relation to fluctuating net asset value during the period.

†	Market values are determined at the close of the New York Stock Exchange, which may be later than when the Funds’ net asset value is calculated.

^	Percentages are not annualized for the period ended September 30, 2011.

**	Percentages are annualized.

-111-

VIX ProShares

For the Nine Months Ended September 30, 2011 (unaudited)


Per Share Operating Performance	VIX Short- Term Futures ETF			VIX Mid- Term Futures ETF
Net asset value, at December 31, 2010	$	80.0000		$	80.0000

Net investment income (loss)		(0.3405	)		(0.4058	)
Net realized and unrealized gain (loss)		35.9291			9.9776
Change in net asset value from operations		35.5886			9.5718
Net asset value, at September 30, 2011	$	115.5886		$	89.5718

Market value per share, at December 31, 2010†	$	80.00		$	80.00
Market value per share, at September 30, 2011†	$	114.52		$	89.46

Total Return, at net asset value^		44.5	%		12.0	%
Total Return, at market value^		43.2	%		11.8	%

Ratios to Average Net Assets**

Expense ratio		(0.85	)%		(0.85	)%
Expense ratio, excluding brokerage commissions		(0.85	)%		(0.85	)%
Net investment income (loss)		(0.80	)%		(0.80	)%

†	Market values are determined at the close of the New York Stock Exchange, which may be later than when the Funds’ net asset value is calculated.

^	Percentages are not annualized for the period ended September 30, 2011.

**	Percentages are annualized.

-112-

Selected data for a Share outstanding throughout the nine months ended September 30, 2010:

Ultra ProShares

For the Nine Months Ended September 30, 2010 (unaudited)


Per Share Operating Performance	Ultra DJ- UBS Commodity			Ultra DJ- UBS Crude Oil*			Ultra Gold			Ultra Silver^^			Ultra Euro			Ultra Yen
Net asset value, at December 31, 2009	$	28.2051		$	50.4982		$	44.0778		$	28.5129		$	30.1257		$	26.1393

Net investment income (loss)		(0.1431	)		(0.2642	)		(0.3063	)		(0.1792	)		(0.1497	)		(0.1712	)
Net realized and unrealized gain (loss)#		(0.4866	)		(9.6564	)		17.0359			14.4260			(3.0726	)		5.8885
Change in net asset value from operations		(0.6297	)		(9.9206	)		16.7296			14.2468			(3.2223	)		5.7173
Net asset value, at September 30, 2010	$	27.5754		$	40.5776		$	60.8074		$	42.7597		$	26.9034		$	31.8566

Market value per share, at December 31, 2009†	$	28.43		$	50.72		$	44.68		$	28.08		$	30.17		$	26.58
Market value per share, at September 30, 2010†	$	27.73		$	40.36		$	61.02		$	41.63		$	26.93		$	31.93

Total Return, at net asset value^		(2.2	)%		(19.6	)%		38.0	%		50.0	%		(10.7	)%		21.9	%
Total Return, at market value^		(2.5	)%		(20.4	)%		36.6	%		48.3	%		(10.7	)%		20.1	%

Ratios to Average Net Assets**

Expense ratio		(0.95	)%		(0.99	)%		(0.95	)%		(0.95	)%		(0.95	)%		(0.95	)%
Expense ratio, excluding brokerage commissions		(0.95	)%		(0.95	)%		(0.95	)%		(0.95	)%		(0.95	)%		(0.95	)%
Net investment income (loss)		(0.77	)%		(0.86	)%		(0.81	)%		(0.80	)%		(0.82	)%		(0.81	)%

*	See Note 1 of these Notes to Financial Statements.

^^	See Note 10 of these Notes to Financial Statements.

#	The amount shown for a share outstanding throughout the period may not accord with the change in aggregate gains and losses during the period because of timing of creation and redemption units in relation to fluctuating net asset value during the period.

†	Market values are determined at the close of the New York Stock Exchange, which may be later than when the Funds’ net asset value is calculated.

^	Percentages are not annualized for the period ended September 30, 2010.

**	Percentages are annualized.

-113-

UltraShort ProShares

For the Nine Months Ended September 30, 2010 (unaudited)


Per Share Operating Performance	UltraShort DJ- UBS Commodity*			UltraShort DJ- UBS Crude Oil*			UltraShort Gold*			UltraShort Silver*			UltraShort Euro			UltraShort Yen^^
Net asset value, at December 31, 2009	$	73.1052		$	68.4432		$	52.4052		$	188.3683		$	18.6755		$	64.2739

Net investment income (loss)		(0.4897	)		(0.4442	)		(0.2610	)		(0.8904	)		(0.1305	)		(0.3436	)
Net realized and unrealized gain (loss)#		(5.8831	)		(1.3015	)		(18.3660	)		(99.8296	)		1.2850			(13.9194	)
Change in net asset value from operations		(6.3728	)		(1.7457	)		(18.6270	)		(100.7200	)		1.1545			(14.2630	)
Net asset value, at September 30, 2010	$	66.7324		$	66.6975		$	33.7782		$	87.6483		$	19.8300		$	50.0109

Market value per share, at December 31, 2009†	$	73.23		$	68.25		$	51.75		$	191.60		$	18.70		$	63.90
Market value per share, at September 30, 2010†	$	68.00		$	66.90		$	33.69		$	90.02		$	19.82		$	50.03

Total Return, at net asset value^		(8.7	)%		(2.6	)%		(35.5	)%		(53.5	)%		6.2	%		(22.2	)%
Total Return, at market value^		(7.2	)%		(2.0	)%		(34.9	)%		(53.0	)%		6.0	%		(21.7	)%

Ratios to Average Net Assets**

Expense ratio		(0.95	)%		(1.02	)%		(0.95	)%		(0.96	)%		(0.95	)%		(0.95	)%
Expense ratio, excluding brokerage commissions		(0.95	)%		(0.95	)%		(0.95	)%		(0.95	)%		(0.95	)%		(0.95	)%
Net investment income (loss)		(0.83	)%		(0.88	)%		(0.82	)%		(0.81	)%		(0.78	)%		(0.79	)%

*	See Note 1 of these Notes to Financial Statements.

^^	See Note 10 of these Notes to Financial Statements.

#	The amount shown for a share outstanding throughout the period may not accord with the change in aggregate gains and losses during the period because of timing of creation and redemption units in relation to fluctuating net asset value during the period.

†	Market values are determined at the close of the New York Stock Exchange, which may be later than when the Funds’ net asset value is calculated.

^	Percentages are not annualized for the period ended September 30, 2010.

**	Percentages are annualized.

-114-

NOTE 8 – RISK

Correlation and Compounding Risk

The Geared Funds do not seek to achieve their stated investment objective over a period of time greater than one day because mathematical compounding prevents the Funds from achieving such results. Accordingly, results over periods of time greater than one day should not be expected to be a simple inverse correlation (-1x) or multiple (2x or -2x) of the period return of the corresponding benchmark and will likely differ significantly. Geared Funds seek daily results as measured from the calculation of one NAV to the next. The VIX Funds seek to achieve their stated investment objective both over a single day and over time.

While the Funds expect to meet their investment objectives, several factors may affect their ability to do so. Among these factors are: (1) a Fund’s expenses, including fees, transaction costs and the cost of the investment techniques employed by that Fund (such as costs related to the purchase, sale and storage of the commodities or currencies and the cost of leverage, all of which may be embedded in financial instruments used by a Fund); (2) less than all of the commodities in the relevant benchmark index being held by a Commodity Index Fund or its weighting of investment exposure to such commodities being different from that of the relevant benchmark index; (3) an imperfect correlation between the performance of instruments held by a Fund, such as swaps, futures contracts and/or forward contracts, and the performance of the applicable underlying indices, commodities or currencies in the cash market; (4) bid-ask spreads; (5) holding instruments traded in a market that has become illiquid or disrupted; (6) a Fund’s share prices being rounded to the nearest cent; (7) changes to a benchmark index that are not disseminated in advance; (8) the need to conform a Fund’s portfolio holdings to comply with investment restrictions or policies or regulatory or tax law requirements; (9) early and unanticipated closings of the markets on which the holdings of a Fund trade, resulting in the inability of the Fund to execute intended portfolio transactions.

A number of factors may affect a Geared Fund’s ability to achieve a high degree of correlation with its benchmark, and there can be no guarantee that a Fund will achieve a high degree of correlation. Failure to achieve a high degree of correlation may prevent a Geared Fund from achieving its investment objective. A number of factors may adversely affect a Geared Fund’s correlation with its benchmark, including fees, expenses, transaction costs, costs and risks associated with the use of leveraged investment techniques, income items, accounting standards and disruptions or illiquidity in the markets for the commodities or Financial Instruments (i.e., commodity-based or currency-based instruments whose value is derived from the value of an underlying asset, rate or index) in which the Fund invests. A Geared Fund may not have investment exposure to all of the commodities or currencies in its underlying benchmark index, or its weighting of investment exposure to such commodities or currencies may be different from that of the index. In addition, a Geared Fund may invest in commodities or currencies or Financial Instruments not included in the index underlying its benchmark. A Geared Fund may be subject to large movements of assets into and out of the Fund, potentially resulting in the Fund being over- or under-exposed to its benchmark. Activities surrounding annual index reconstitutions and other index rebalancing or reconstitution events may hinder a Geared Fund’s ability to meet its daily investment objective on or around that day. Each Geared Fund seeks to rebalance its portfolio daily to keep leverage consistent with its daily investment objective.

Compounding affects all investments, but has a more significant impact on a Geared Fund. The Geared Funds are “geared” in the sense that they have investment objectives to match a multiple, the inverse or a multiple of the inverse of the performance of an index on a given day. These Funds are subject to all of the correlation risks described above. In addition, there is a special form of correlation risk that derives from such Funds’ having a single day investment objective in combination with the use of leverage, which is that for periods greater than one day, the effect of compounding may cause the performance of a Fund to be either greater than or less than the index performance (or the inverse of the index performance) times the stated multiple in the Fund objective, before accounting for fees and fund expenses. This effect can be even more significant in the case of the Leveraged Funds due to the use of leverage. The Geared Funds are designed to provide leveraged (e.g. 2x), inverse (e.g. -1x) or inverse leveraged (e.g. -2x) results on a daily basis (before fees and expenses). Investors should monitor their holdings consistent with their strategies, as frequently as daily.

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Counterparty Risk

A Fund will be subject to credit risk with respect to the amount it expects to receive from counterparties to Financial Instruments entered into by the Fund. The Funds structure the agreements such that either party can terminate the contract without penalty prior to the termination date. A Fund may be negatively impacted if a counterparty becomes bankrupt or otherwise fails to perform its obligations due to financial difficulties. A Fund may experience significant delays in obtaining any recovery in a bankruptcy or other reorganization proceeding and a Fund may obtain only limited recovery or may obtain no recovery in such circumstances. The Funds have sought to mitigate risks by generally requiring that the counterparties for each Fund agree to post collateral for the benefit of the Fund, marked to market daily, in an amount approximately equal to what the counterparty owes the Fund. In the event of the bankruptcy of a counterparty, the Fund will have direct access to the collateral received from the counterparty, generally as of the day prior to the bankruptcy, because there is a one day time lag between the Fund’s request for collateral and the delivery of such collateral. To the extent any such collateral is insufficient, the Funds will be exposed to counterparty risk as described above, including the possible delays in recovering amounts as a result of bankruptcy proceedings. The Funds typically enter into transactions with counterparties whose credit rating, at the time of the transaction, is investment grade, as determined by a nationally recognized statistical rating organization, or, if unrated, judged by the Sponsor to be of comparable quality.

Leverage Risk

The Funds use investment techniques that may be considered aggressive, including the use of futures contracts, swap agreements and forward agreements. The Funds’ investment in Financial Instruments may involve a small investment relative to the amount of investment exposure assumed and may result in losses exceeding the amounts invested. Such instruments, particularly when used to create leverage, may expose the Funds to potentially dramatic changes (losses or gains) in the value of the instruments.

Liquidity Risk

In certain circumstances, such as the disruption of the orderly markets for the commodities or Financial Instruments in which a Fund invests, a Fund might not be able to dispose of certain holdings quickly or at prices that represent true market value in the judgment of the Sponsor. Such a situation may prevent a Fund from limiting losses, realizing gains or achieving a high correlation or inverse correlation with its underlying index.

“Contango” and “Backwardation” Risk

In Funds that hold futures contracts, as the futures contracts near expiration, they are generally replaced by contracts that have a later expiration. Thus, for example, a contract purchased and held in August 2011 may specify an October 2011 expiration. For an Ultra Fund and a VIX Fund, as that contract nears expiration, it may be replaced by selling the October 2011 contract and purchasing the contract expiring in December 2011. This process is referred to as “rolling.” Rolling may have a positive or negative impact on performance. For example, historically, the prices of certain types of futures contracts have frequently been higher for contracts with shorter-term expirations than for contracts with longer-term expirations, which is referred to as “backwardation.” In these circumstances, absent other factors, the sale of the October 2011 contract would take place at a price that is higher than the price at which the December 2011 contract is purchased, thereby creating a gain in connection with rolling. While certain types of futures contracts have historically exhibited consistent periods of backwardation, backwardation will likely not exist in these markets at all times. The presence of contango (where prices of contracts are higher in the distant delivery months than in the nearer delivery months due to the costs of long-term storage of a physical commodity prior to delivery or other factors) in certain futures contracts at the time of rolling would be expected to adversely affect an Ultra Fund or a VIX Fund that invests in such futures and positively affect an UltraShort Fund or Short Fund that invests in such futures. Similarly, the presence of backwardation in certain futures contracts at the time of rolling such contracts would be expected to adversely affect the Short Funds and UltraShort Funds and positively affect the Ultra Funds and existing VIX Funds.

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Since the introduction of VIX futures contracts, there have frequently been periods where VIX futures prices reflect higher expected volatility levels further out in time. This can result in a loss from “rolling” the VIX futures to maintain the constant weighted average maturity of the VIX Futures Index. Losses from exchanging a lower priced VIX future for a higher priced longer-term future in the rolling process would adversely affect the value of each VIX Futures Index and the VIX Funds and, accordingly, decrease the return of the VIX Funds.

Gold and silver historically exhibit persistent “contango” markets rather than backwardation. Natural gas, like crude oil, moves in and out of backwardation and contango but historically has been in contango most commonly. It is generally believed this is because the market needs to build inventories for most of the year in order to have enough storage to make it through a normal winter. Periods of backwardation are typically thought to be caused by demand shocks or supply shortages such as an unusually cold winter or a hurricane.

NOTE 9 – LEGAL PROCEEDINGS

The Trust and certain principals of the Sponsor are defendants (along with several other parties) in a consolidated class action lawsuit styled In re ProShares Trust Securities Litigation, Civ. No. 09-cv-6935, filed in the United States District Court for the Southern District of New York. The complaint, as amended, alleges that the defendants violated Sections 11 and 15 of the Securities Act of 1933 by including untrue statements of material fact and omitting material facts in the Registration Statement for one or more ProShares ETFs, allegedly failing to adequately disclose the Funds’ investment objectives and risks. The six Funds of the Trust named in the complaint are ProShares Ultra Silver, ProShares UltraShort Gold, ProShares Ultra Gold, ProShares UltraShort DJ-UBS Crude Oil, ProShares Ultra DJ-UBS Crude Oil and ProShares UltraShort Silver. The Trust believes the complaint is without merit and that the anticipated outcome will not adversely impact the operation of the Trust or any of its Funds. Accordingly, no loss contingency has been recorded in the balance sheet and the amount of loss, if any, cannot be reasonably estimated at this time.

NOTE 10 – SUBSEQUENT EVENTS

Management has evaluated the possibility of subsequent events existing in the Trust’s and the Funds’ financial statements through the date the financial statements were issued. The subsequent events were as follows:

On October 3, 2011, ProShares Ultra VIX Short-Term Futures ETF and ProShares Short VIX Short-Term Futures ETF commenced investment operations. On October 4, 2011, ProShares Ultra DJ-UBS Natural Gas and ProShares UltraShort DJ-UBS Natural Gas commenced investment operations.

On September 27, 2011, the Trust announced a 1-for-3 reverse split of the shares of beneficial interest of ProShares UltraShort Yen (NYSE Arca symbol “YCS”). The reverse split was effective prior to the opening of trading on NYSE Arca on October 13, 2011.

The reverse split was effective for shareholders of record after the close of the markets on October 12, 2011. The Fund traded at its post-split price on October 13, 2011. The ticker symbol for the Fund did not change, and it will continue to trade on NYSE Arca.

The reverse split was applied retroactively for all periods presented, reducing the number of shares outstanding for the ProShares UltraShort Yen Fund, and resulted in a proportionate increase in the price per share and per share information of the ProShares UltraShort Yen Fund. Therefore, the reverse split did not change the aggregate net asset value of a shareholder’s investment at the time of the split.

On September 27, 2011, the Trust announced a 2-for-1 split of the shares of beneficial interest of ProShares Ultra Silver (NYSE Arca symbol “AGQ”). The split was effective prior to the opening of trading on NYSE Arca on October 13, 2011.

The split was effective for shareholders of record after the close of the markets on October 10, 2011, payable after the close of the markets on October 12, 2011. The Fund traded at its post-split price on October 13, 2011. The ticker symbol for the Fund did not change, and it will continue to trade on NYSE Arca.

The split was applied retroactively for all periods presented, increasing the number of shares outstanding for ProShares Ultra Silver, and resulted in a proportionate decrease in the price per share and per share information of ProShares Ultra Silver. Therefore, the split did not change the aggregate net asset value of a shareholder’s investment at the time of the split.

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Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

This information should be read in conjunction with the financial statements and notes to the financial statements included with this Quarterly Report on Form 10-Q. The discussion and analysis that follows may contain statements that relate to future events or future performance. In some cases, such forward-looking statements can be identified by terminology such as “will,” “may,” “should,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or the negative of these terms or other comparable terminology. None of the Trust, the Sponsor or the Trustee (as each term is defined below) assumes responsibility for the accuracy or completeness of any forward-looking statements. Except as expressly required by federal securities laws, none of the Trust, the Sponsor or the Trustee is under a duty to update any of the forward-looking statements to conform such statements to actual results or to a change in expectations or predictions.

Introduction

ProShares Trust II (formerly known as the Commodities and Currencies Trust) (the “Trust”) is a Delaware statutory trust formed on October 9, 2007 and currently organized into separate series (each, a “Fund” and collectively, the “Funds”). The following fourteen series of the Trust, ProShares Ultra DJ-UBS Commodity, ProShares UltraShort DJ-UBS Commodity, ProShares Ultra DJ-UBS Crude Oil, ProShares UltraShort DJ-UBS Crude Oil, ProShares Ultra Gold, ProShares UltraShort Gold, ProShares Ultra Silver, ProShares UltraShort Silver, ProShares Ultra Euro, ProShares UltraShort Euro, ProShares Ultra Yen and ProShares UltraShort Yen (each, a “Leveraged Fund” and collectively, the “Leveraged Funds”), ProShares VIX Short-Term Futures ETF and ProShares VIX Mid-Term Futures ETF (each, a “VIX Fund” and collectively, the “VIX Funds”) issue common units of beneficial interest (“Shares”), which represent units of fractional undivided beneficial interest in and ownership of only that Leveraged or VIX Fund. The Shares of each Leveraged and VIX Fund are listed on the New York Stock Exchange Archipelago (“NYSE Arca”). The Trust has also registered shares for ten additional series: ProShares Short DJ-UBS Natural Gas and ProShares Short Gold (each, a “Short Fund” and collectively, the “Short Funds”), ProShares Ultra DJ-UBS Natural Gas, ProShares UltraShort DJ-UBS Natural Gas (each, a “New Natural Gas Fund” and collectively, the “New Natural Gas Funds”), ProShares Ultra VIX Short-Term Futures ETF, ProShares Short VIX Short-Term Futures ETF, ProShares UltraShort VIX Short-Term Futures ETF, ProShares Ultra VIX Mid-Term Futures ETF, ProShares Short VIX Mid-Term Futures ETF and ProShares UltraShort VIX Mid-Term Futures ETF (each, a “New VIX Fund” and collectively, the “New VIX Funds”). The Short Funds, the New Natural Gas Funds and the New VIX Funds are collectively referred to herein as the “New Funds”. As of September 30, 2011, each of the Short Funds had seed capital of $200, but neither of the Short Funds had commenced investment operations, and each of the New Natural Gas Funds and the New VIX Funds had seed capital of $400, but none of the New Natural Gas Funds or the New VIX Funds had commenced investment operations; therefore, the Financial Statements in this Quarterly Report on Form 10-Q do not include Schedules of Investments, Statements of Operations, Statements of Changes in Shareholders’ Equity or Statements of Cash Flows for the New Funds. The New Funds, together with the Leveraged Funds, are referred to as the “Geared Funds” in this Quarterly Report on Form 10-Q. The Trust had no operations prior to November 24, 2008 other than matters relating to its organization, the registration of each series under the Securities Act of 1933, as amended, and the sale and issuance to ProShare Capital Management LLC (the “Sponsor”) of fourteen Shares of each Leveraged Fund at an aggregate purchase price of $350 in each of the Funds.

ProShare Capital Management LLC serves as the Trust’s Sponsor (the “Sponsor”), commodity pool operator and commodity trading advisor. Wilmington Trust Company serves as the Trustee of the Trust (the “Trustee”). The Funds are commodity pools, as defined under the Commodity Exchange Act and the applicable regulations of the Commodity Futures Trading Commission (the “CFTC”) and are operated by the Sponsor, a commodity pool operator registered with the CFTC. The Trust is not an investment company registered under the Investment Company Act of 1940, as amended.

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Groups of Funds are collectively referred to in this Quarterly Report on Form 10-Q in several different ways. References to “Ultra Funds,” “Short Funds” or “UltraShort Funds” refer to the different Funds based upon their investment objectives, but without distinguishing among the Funds’ benchmarks. References to “Commodity Index Funds,” “Commodity Funds” and “Currency Funds” refer to the different Funds according to their general benchmark categories without distinguishing among the Funds’ investment objectives or Fund-specific benchmarks. References to “VIX Funds” refer to the different Funds based upon their investment objective and their general benchmark categories.

Each “Ultra” Fund seeks daily investment results (before fees and expenses) that correspond to twice (2x) the daily performance of its corresponding benchmark, as measured from the calculation of one NAV to the next. Each “Short” Fund will seek daily investment results (before fees and expenses) that correspond to the inverse (-1x) of the daily performance of its corresponding benchmark. Each “UltraShort” Fund seeks daily investment results (before fees and expenses) that correspond to twice the inverse (-2x) of the daily performance of its corresponding benchmark. Each of the Geared Funds generally invests or will invest in Financial Instruments (i.e., commodity-based, currency-based or equity market volatility-based instruments whose value is derived from the value of an underlying asset, rate or index, including futures contracts and options on futures contracts, swap agreements, forward contracts and other commodity-based or currency-based options contracts) as a substitute for investing directly in commodities, currencies or equity market volatility products in order to gain exposure to the commodity index, currency benchmark, commodity, currency or to an equity market volatility index. The Financial Instruments in which ProShares Short DJ-UBS Natural Gas will invest are limited to futures contracts. Financial Instruments also are used to produce economically “leveraged” or “inverse” investment results for the Funds. Each “VIX Fund” seeks daily investment results (before fees and expenses) that match the performance of a benchmark. Each VIX Fund obtains exposure to its benchmark by investing in futures contracts (“VIX futures contracts”) based on the Chicago Board Options Exchange (“CBOE”) Volatility Index (the “VIX”).

Each Geared Fund seeks investment results for a single day only, not for longer periods. This is different from most exchange-traded funds and means that the return of such Fund for a period longer than a single trading day will be the result of each day’s returns compounded over the period, which will very likely differ from 2x, -1x or -2x of the return of the index to which such Fund is benchmarked for that period. In periods of higher market volatility, the volatility of the benchmark may be at least as important to a Geared Fund’s return for the period as the return of the benchmark. Geared Funds are riskier than similarly benchmarked exchange-traded funds that are not geared. Accordingly, these funds may not be suitable for all investors and should be used only by knowledgeable investors who understand the potential consequences of seeking daily inverse investment results. Shareholders should actively monitor their investments.

The VIX Funds seek to achieve their stated investment objective both over a single day and over time.

ProShares Ultra DJ-UBS Commodity, ProShares UltraShort DJ-UBS Commodity, ProShares Ultra DJ-UBS Crude Oil and ProShares UltraShort DJ-UBS Crude Oil each have a benchmark designed to track the performance of commodity futures contracts. The daily performance of these indexes and the corresponding funds will likely be very different from the daily performance of the price of the related physical commodities.

Each Geared Fund continuously offers and redeems or will offer and redeem its Shares in blocks of 50,000 Shares and each VIX Fund continuously offers and redeems shares in blocks of 25,000 Shares (each such block a “Creation Unit”). Only Authorized Participants may purchase and redeem Shares from a Fund and then only in Creation Units. An Authorized Participant is an entity that has entered into an Authorized Participant Agreement with one or more of the Funds. Shares of the Funds are offered to Authorized Participants in Creation Units at each Fund’s respective net asset value per Share (“NAV”). Authorized Participants may then offer to the public, from time to time, Shares from any Creation Unit they create at a per-Share market price that varies depending on, among other factors, the trading price of the Shares of each Fund on the NYSE Arca, the NAV and the supply of and demand for the Shares at the time of the offer. Shares from the same Creation Unit may be offered at different times and may have different offering prices based upon the above factors. The form of Authorized Participant Agreement and related Authorized Participant Handbook set forth the terms and conditions under which an Authorized Participant may purchase or redeem a Creation Unit. Authorized Participants do not receive from any Fund, the Sponsor, or any of their affiliates, any underwriting fees or compensation in connection with their sale of Shares to the public.

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Liquidity and Capital Resources

In order to collateralize derivatives positions in indices, commodities or currencies, a significant portion of the NAV of each Fund is held in cash and/or U.S. Treasury Securities, agency securities, or other high credit quality short-term fixed-income or similar securities (such as shares of money market funds, bank deposits, bank money market accounts, certain variable rate-demand notes and repurchase agreements collateralized by government securities, whether denominated in U.S. dollars or the applicable foreign currency with respect to a Currency Fund). A portion of these investments may be posted as collateral in connection with swap agreements and each Fund’s trading in futures and forward contracts. The percentage that U.S. Treasury bills and other short-term fixed-income securities bear to the shareholders’ equity of each Fund varies from period to period as the market values of the underlying swaps, futures contracts and forward contracts change. During the three and nine months ended September 30, 2011 and September 30, 2010, each of the Leveraged and VIX Funds earned interest income as follows:


Fund	Interest Income Three Months Ended September 30, 2011		Interest Income Three Months Ended September 30, 2010		Interest Income Nine Months Ended September 30, 2011		Interest Income Nine Months Ended September 30, 2010
ProShares Ultra DJ-UBS Commodity	$	993	$	5,629	$	10,264	$	16,947
ProShares UltraShort DJ-UBS Commodity		731		949		3,522		3,267
ProShares Ultra DJ-UBS Crude Oil		16,734		174,914		154,462		348,968
ProShares UltraShort DJ-UBS Crude Oil		5,491		21,433		67,925		76,927
ProShares Ultra Gold		20,274		85,654		138,778		187,823
ProShares UltraShort Gold		6,156		33,103		50,183		72,856
ProShares Ultra Silver		54,294		78,646		413,210		195,896
ProShares UltraShort Silver		36,609		28,202		141,157		67,469
ProShares Ultra Euro		511		6,398		4,353		12,220
ProShares UltraShort Euro		36,861		182,133		255,628		415,352
ProShares Ultra Yen		216		2,242		1,711		4,788
ProShares UltraShort Yen		23,905		74,322		176,008		160,451
ProShares VIX Short-Term Futures ETF		1,884		—		11,821		—
ProShares VIX Mid-Term Futures ETF		569		—		3,584		—

Each Fund’s underlying swaps, futures and forward contracts, as the case may be, are subject to periods of illiquidity because of market conditions, regulatory considerations and other reasons. For example, swaps and forward contracts are not traded on an exchange, do not have uniform terms and conditions, and in general are not transferable without the consent of the counterparty. In the case of futures contracts, commodity exchanges may limit fluctuations in certain futures contract prices during a single day by regulations referred to as “daily limits.” During a single day, no futures trades may be executed at prices beyond the daily limit. Once the price of a futures contract has increased or decreased by an amount equal to the daily limit, positions in such futures contracts can neither be taken nor liquidated unless the traders are willing to effect trades at or within the limit. Futures contract prices have occasionally moved the daily limit for several consecutive days with little or no trading. Such market conditions could prevent a Fund from promptly liquidating its futures positions.

Entry into swap agreements or forward contracts may further impact liquidity because these contractual agreements are executed “off-exchange” between private parties and, therefore, the time required to offset or “unwind” these positions may be greater than that for exchange-traded instruments. This potential delay could be exacerbated to the extent a counterparty is not a United States person.

The Trust is unaware of any other trends, demands, conditions or events that are reasonably likely to result in material changes to the Trust’s liquidity needs.

Because each Fund may enter into swaps and may trade futures and forward contracts, its capital is at risk due to changes in the value of these contracts (market risk) or the inability of counterparties to perform under the terms of the contracts (credit risk).

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Results of Operations for the Three Months Ended September 30, 2011 Compared to the Three Months Ended September 30, 2010

NAV of ProShares Ultra DJ-UBS Commodity

Fund Performance

The following table provides summary performance information for the Fund for the three months ended September 30, 2011 and 2010:


	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
NAV beginning of period	$	16,695,263		$	12,304,949
NAV end of period	$	11,710,948		$	9,651,779
Percentage change in NAV		(29.9	%)		(21.6	%)
Shares outstanding beginning of period		500,014			550,014
Shares outstanding end of period		450,014			350,014
Percentage change in shares outstanding		(10.0	%)		(36.4	%)
Shares created		—			—
Shares redeemed		50,000			200,000
Per share NAV beginning of period	$	33.39		$	22.37
Per share NAV end of period	$	26.02		$	27.58
Percentage change in per share NAV		(22.1	%)		23.3	%
Percentage change in benchmark		(11.3	%)		11.6	%
Benchmark annualized volatility		20.2	%		12.5	%

During the three months ended September 30, 2011, the decrease in the Fund’s NAV resulted in part from a decrease from 500,014 outstanding Shares at June 30, 2011 to 450,014 outstanding Shares at September 30, 2011. The decrease in the Fund’s NAV resulted primarily from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of the Dow Jones-UBS Commodity Index. By comparison, during the three months ended September 30, 2010 the decrease in the Fund’s NAV resulted from a decrease from 550,014 outstanding Shares at June 30, 2010 to 350,014 outstanding Shares at September 30, 2010. The decrease in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of the Dow Jones-UBS Commodity Index.

For the three months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the daily performance of its benchmark. The Fund’s per share NAV decrease of 22.1% for the period ended September 30, 2011 as compared to the increase of 23.3% for the period ended September 30, 2010, was primarily due to a depreciation in the value of the assets of the Fund during the three months ended September 30, 2011.

During the three months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on July 26, 2011 at $36.90 per Share and reached its low for the period on September 30, 2011 at $26.02 per Share. By comparison, during the three months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on September 30, 2010 at $27.58 per Share and reached its low for the period on July 6, 2010 at $21.73 per Share.

The benchmark’s decline of 11.3% for the three months ended September 30, 2011, as compared to the benchmark’s rise of 11.6% for the three months ended September 30, 2010, can be attributed to a depreciation of the underlying components of the index, primarily Crude Oil, during the three months ended September 30, 2011.

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Net Income/Loss

The following table provides summary income information for the Fund for the three months ended September 30, 2011 and 2010:


	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
Net investment income (loss)	$	(36,061	)	$	(22,115	)
Management fee		37,054			27,744
Net realized gain (loss)		(1,050,593	)		2,113,613
Change in net unrealized appreciation/depreciation		(2,077,012	)		176,964
Net income (loss)	$	(3,163,666	)	$	2,268,462

The Fund’s net income decreased for the three months ended September 30, 2011, as compared to the three months ended September 30, 2010, primarily due to the performance of the Fund’s benchmark index during the three months ended September 30, 2011.

NAV of ProShares UltraShort DJ-UBS Commodity*

Fund Performance

The following table provides summary performance information for the Fund for the three months ended September 30, 2011 and 2010:


	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
NAV beginning of period	$	29,495,769		$	3,381,653
NAV end of period	$	12,378,058		$	1,334,848
Percentage change in NAV		(58.0	%)		(60.5	%)
Shares outstanding beginning of period		609,997			40,003
Shares outstanding end of period		209,997			20,003
Percentage change in shares outstanding		(65.6	%)		(50.0	%)
Shares created		—			—
Shares redeemed		400,000			20,000
Per share NAV beginning of period	$	48.35		$	84.54
Per share NAV end of period	$	58.94		$	66.73
Percentage change in per share NAV		21.9	%		(21.1	%)
Percentage change in benchmark		(11.3	%)		11.6	%
Benchmark annualized volatility		20.2	%		12.5	%

During the three months ended September 30, 2011, the decrease in the Fund’s NAV resulted from a decrease from 609,997 outstanding Shares at June 30, 2011 to 209,997 outstanding Shares at September 30, 2011. The decrease in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of the Dow Jones-UBS Commodity Index. By comparison, during the three months ended September 30, 2010, the decrease in the Fund’s NAV resulted primarily from a decrease from 40,003 outstanding Shares at June 30, 2010 to 20,003 outstanding Shares at September 30, 2010. The decrease in the Fund’s NAV also resulted in part from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of the Dow Jones-UBS Commodity Index.

For the three months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the inverse of the daily performance of its benchmark. The Fund’s per share NAV increase of 21.9% for the three months ended September 30, 2011, as compared to the decrease of 21.1% for the three months ended September 30, 2010, was primarily due to an appreciation in the value of the assets of the Fund during the three months ended September 30, 2011.

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During the three months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on September 30, 2011 at $58.94 per Share and reached its low for the period on July 26, 2011 at $43.39 per Share. By comparison, during the three months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on July 2, 2010 at $86.91 per Share and reached its low for the period on September 30, 2010 at $66.73 per Share.

Net Income/Loss

The following table provides summary income information for the Fund for the three months ended September 30, 2011 and 2010:

		000.000.000			000.000.000
	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
Net investment income (loss)	$	(31,685	)	$	(4,531	)
Management fee		32,416			5,480
Net realized gain (loss)		2,148,712			(806,062	)
Change in net unrealized appreciation/depreciation		(1,248,416	)		335,668
Net income (loss)	$	868,611		$	(474,925	)

The Fund’s net income increased for the three months ended September 30, 2011, as compared to the three months ended September 30, 2010, primarily due to the performance of the Fund’s benchmark index during the three months ended September 30, 2011.

*	See Note 1 of the Notes to Financial Statements in Item 1 of Part I regarding the reverse share split for the ProShares UltraShort DJ-UBS Commodity Fund.

NAV of ProShares Ultra DJ-UBS Crude Oil*

Fund Performance

The following table provides summary performance information for the Fund for the three months ended September 30, 2011 and 2010:

		000.000.000			000.000.000
	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
NAV beginning of period	$	426,397,237		$	501,252,171
NAV end of period	$	380,889,526		$	387,516,335
Percentage change in NAV		(10.7	%)		(22.7	%)
Shares outstanding beginning of period		9,999,170			13,012,504
Shares outstanding end of period		13,949,170			9,550,004
Percentage change in shares outstanding		39.5	%		(26.6	%)
Shares created		10,900,000			7,925,000
Shares redeemed		6,950,000			11,387,500
Per share NAV beginning of period	$	42.64		$	38.52
Per share NAV end of period	$	27.31		$	40.58
Percentage change in per share NAV		(36.0	%)		5.3	%
Percentage change in benchmark		(18.3	%)		3.6	%
Benchmark annualized volatility		38.5	%		25.5	%

During the three months ended September 30, 2011, the decrease in the Fund’s NAV resulted primarily from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of the Dow Jones-UBS Crude Oil Sub-Index. The decrease in the Fund’s NAV was offset by an increase from 9,999,170 outstanding Shares at June 30, 2011 to 13,949,170 outstanding Shares at September 30, 2011. By comparison, during the three months ended September 30,

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2010, the decrease in the Fund’s NAV resulted from a decrease from 13,012,504 outstanding Shares at June 30, 2010 to 9,550,004 outstanding Shares at September 30, 2010. The decrease in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of the Dow Jones-UBS Crude Oil Sub-Index.

For the three months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the daily performance of its benchmark. The Fund’s per share NAV decrease of 36.0% for the three months ended September 30, 2011, as compared to the increase of 5.3% for the three months ended September 30, 2010, was primarily due to a depreciation in the value of the assets of the Fund during the three months ended September 30, 2011.

During the three months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on July 22, 2011 at $45.99 per Share and reached its low for the period on September 30, 2011 at $27.31 per Share. By comparison, during the three months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on August 3, 2010 at $44.89 per Share and reached its low for the period on August 24, 2010 at $33.45 per Share.

The benchmark’s decline of 18.3% for the three months ended September 30, 2011, as compared to the benchmark’s rise of 3.6% for the three months ended September 30, 2010, can be attributed to a decrease in the price of WTI Crude Oil during the three months ended September 30, 2011.

Net Income/Loss

The following table provides summary income information for the Fund for the three months ended September 30, 2011 and 2010:


	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
Net investment income (loss)	$	(964,691	)	$	(892,150	)
Management fee		960,393			1,034,809
Brokerage commission		21,032			32,255
Net realized gain (loss)		(87,767,836	)		38,011,421
Change in net unrealized appreciation/depreciation		(45,561,944	)		22,157,832
Net income (loss)	$	(134,294,471	)	$	59,277,103

*	See Note 1 of the Notes to Financial Statements in Item 1 of Part I regarding the reverse share split for the ProShares Ultra DJ-UBS Crude Oil Fund.

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NAV of ProShares UltraShort DJ-UBS Crude Oil*

Fund Performance

The following table provides summary performance information for the Fund for the three months ended September 30, 2011 and 2010:


	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
NAV beginning of period	$	160,288,442		$	51,326,108
NAV end of period	$	72,357,831		$	40,018,686
Percentage change in NAV		(54.9	%)		(22.0	%)
Shares outstanding beginning of period		3,319,944			680,003
Shares outstanding end of period		1,119,944			600,003
Percentage change in shares outstanding		(66.3	%)		(11.8	%)
Shares created		950,000			1,300,000
Shares redeemed		3,150,000			1,380,000
Per share NAV beginning of period	$	48.28		$	75.48
Per share NAV end of period	$	64.61		$	66.70
Percentage change in per share NAV		33.8	%		(11.6	%)
Percentage change in benchmark		(18.3	%)		3.6	%
Benchmark annualized volatility		38.5	%		25.5	%

During the three months ended September 30, 2011, the decrease in the Fund’s NAV resulted from a decrease from 3,319,944 outstanding Shares at June 30, 2011 to 1,119,944 outstanding Shares at September 30, 2011. The decrease in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of the Dow Jones-UBS Crude Oil Sub-Index. By comparison, during the three months ended September 30, 2010, the decrease in the Fund’s NAV resulted primarily from a decrease from 680,003 outstanding Shares at June 30, 2010 to 600,003 outstanding Shares at September 30, 2010. The decrease in the Fund’s NAV also resulted in part by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of the Dow Jones-UBS Crude Oil Sub-Index.

For the three months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the inverse of the daily performance of its benchmark. The Fund’s per share NAV increase of 33.8% for the three months ended September 30, 2011, as compared to the decrease of 11.6% for the three months ended September 30, 2010, was primarily due to an appreciation in the value of the assets of the Fund during the three months ended September 30, 2011.

During the three months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on August 9, 2011 at $67.93 per Share and reached its low for the period on July 22, 2011 at $44.06 per Share. By comparison, during the three months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on August 24, 2010 at $83.07 per Share and reached its low for the period on August 3, 2010 at $62.77 per Share.

Net Income/Loss

The following table provides summary income information for the Fund for the three months ended September 30, 2011 and 2010:


	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
Net investment income (loss)	$	(239,496	)	$	(121,343	)
Management fee		236,646			132,890
Brokerage commission		8,341			9,886
Net realized gain (loss)		40,873,422			7,955,198
Change in net unrealized appreciation/depreciation		2,326,282			(3,546,545	)
Net income (loss)	$	42,960,208		$	4,287,310

*	See Note 1 of the Notes to Financial Statements in Item 1 of Part I regarding the reverse share split for the ProShares UltraShort DJ-UBS Crude Oil Fund.

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NAV of ProShares Ultra Gold

Fund Performance

The following table provides summary performance information for the Fund for the three months ended September 30, 2011 and 2010:


	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
NAV beginning of period	$	282,765,412		$	209,324,263
NAV end of period	$	374,010,221		$	203,705,598
Percentage change in NAV		32.3	%		(2.7	%)
Shares outstanding beginning of period		3,650,014			3,750,014
Shares outstanding end of period		4,300,014			3,350,014
Percentage change in shares outstanding		17.8	%		(10.7	%)
Shares created		900,000			250,000
Shares redeemed		250,000			650,000
Per share NAV beginning of period	$	77.47		$	55.82
Per share NAV end of period	$	86.98		$	60.81
Percentage change in per share NAV		12.3	%		8.9	%
Percentage change in benchmark		7.6	%		5.1	%
Benchmark annualized volatility		30.0	%		13.1	%

During the three months ended September 30, 2011, the increase in the Fund’s NAV resulted primarily from an increase from 3,650,014 outstanding Shares at June 30, 2011 to 4,300,014 outstanding Shares at September 30, 2011. The increase in the Fund’s NAV also resulted from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of gold bullion as measured by the U.S. Dollar p.m. fixing price for delivery in London. By comparison, during the three months ended September 30, 2010, the decrease in the Fund’s NAV resulted from a decrease from 3,750,014 outstanding Shares at June 30, 2010 to 3,350,014 outstanding Shares at September 30, 2010. The decrease in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of gold bullion as measured by the U.S. Dollar p.m. fixing price for delivery in London.

For the three months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the daily performance of its benchmark. The Fund’s per share NAV increase of 12.3% for the three months ended September 30, 2011, as compared to the increase of 8.9% for the three months ended September 30, 2010, was primarily due to a relatively higher appreciation in the value of the assets of the Fund during the three months ended September 30, 2011.

During the three months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on September 6, 2011 at $120.56 per Share and reached its low for the period on July 1, 2011 at $75.15 per Share. By comparison, during the three months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on September 29, 2010 at $60.85 per Share and reached its low for the period on July 28, 2010 at $48.05 per Share.

The benchmark’s rise of 7.6% for the three months ended September 30, 2011, as compared to the benchmark’s rise of 5.1% for the three months ended September 30, 2010, can be attributed to a relatively higher increase in the price of spot gold in U.S. Dollar terms during the three months ended September 30, 2011.

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Net Income/Loss

The following table provides summary income information for the Fund for the three months ended September 30, 2011 and 2010:


	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
Net investment income (loss)	$	(939,268	)	$	(381,515	)
Management fee		958,522			466,267
Brokerage commission		1,020			902
Net realized gain (loss)		4,796,540			7,178,453
Change in net unrealized appreciation/depreciation		23,303,771			9,263,007
Net income (loss)	$	27,161,043		$	16,059,945

The Fund’s net income increased for the three months ended September 30, 2011, as compared to the three months ended September 30, 2010, primarily due to the relative performance of the Fund’s benchmark during the three months ended September 30, 2011.

NAV of ProShares UltraShort Gold*

Fund Performance

The following table provides summary performance information for the Fund for the three months ended September 30, 2011 and 2010:


	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
NAV beginning of period	$	95,525,554		$	71,715,632
NAV end of period	$	178,039,495		$	75,659,755
Percentage change in NAV		86.4	%		5.5	%
Shares outstanding beginning of period		3,989,901			1,889,901
Shares outstanding end of period		9,239,901			2,239,901
Percentage change in shares outstanding		131.6	%		18.5	%
Shares created		6,900,000			450,000
Shares redeemed		1,650,000			100,000
Per share NAV beginning of period	$	23.94		$	37.95
Per share NAV end of period	$	19.27		$	33.78
Percentage change in per share NAV		(19.5	%)		(11.0	%)
Percentage change in benchmark		7.6	%		5.1	%
Benchmark annualized volatility		30.0	%		13.1	%

During the three months ended September 30, 2011, the increase in the Fund’s NAV resulted from an increase from 3,989,901 outstanding Shares at June 30, 2011 to 9,239,901 outstanding Shares at September 30, 2011. The increase in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of gold bullion as measured by the U.S. Dollar p.m. fixing price for delivery in London. By comparison, during the three months ended September 30, 2010, the increase in the Fund’s NAV resulted from an increase from 1,889,901 outstanding Shares at June 30, 2010 to 2,239,901 outstanding Shares at September 30, 2010. The increase in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of gold bullion as measured by the U.S. Dollar p.m. fixing price for delivery in London.

For the three months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the inverse of the daily performance of its benchmark. The Fund’s per share NAV decrease of 19.5% for the three months ended September 30, 2011, as compared to the decrease of 11.0% for the three months ended September 30, 2010, was primarily due to a relatively higher depreciation in the value of the assets of the Fund during the three months ended September 30, 2011.

During the three months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on July 1, 2011 at $24.65 per Share and reached its low for the period on September 6, 2011 at $14.52 per Share. By comparison, during the three months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on July 28, 2010 at $43.57 per Share and reached its low for the period on September 29, 2010 at $33.76 per Share.

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Net Income/Loss

The following table provides summary income information for the Fund for the three months ended September 30, 2011 and 2010:


	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
Net investment income (loss)	$	(293,684	)	$	(150,860	)
Management fee		299,227			183,450
Brokerage commission		613			513
Net realized gain (loss)		7,282,203			(5,235,802	)
Change in net unrealized appreciation/depreciation		(12,240,024	)		(3,101,016	)
Net income (loss)	$	(5,251,505	)	$	(8,487,678	)

*	See Note 1 of the Notes to Financial Statements in Item 1 of Part I regarding the reverse share split for the ProShares UltraShort Gold Fund.

NAV of ProShares Ultra Silver*

Fund Performance

The following table provides summary performance information for the Fund for the three months ended September 30, 2011 and 2010:


	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
NAV beginning of period	$	881,928,826		$	181,076,130
NAV end of period	$	705,943,332		$	200,971,964
Percentage change in NAV		(20.0	%)		11.0	%
Shares outstanding beginning of period		10,500,028			5,700,028
Shares outstanding end of period		12,900,028			4,700,028
Percentage change in shares outstanding		22.9	%		(17.5	%)
Shares created		4,800,000			100,000
Shares redeemed		2,400,000			1,100,000
Per share NAV beginning of period	$	83.99		$	31.77
Per share NAV end of period	$	54.72		$	42.76
Percentage change in per share NAV		(34.8	%)		34.6	%
Percentage change in benchmark		(13.1	%)		17.8	%
Benchmark annualized volatility		73.0	%		23.6	%

During the three months ended September 30, 2011, the decrease in the Fund’s NAV resulted from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of silver bullion as measured by the U.S. Dollar fixing price for delivery in London. The decrease in the Fund’s NAV was offset by an increase from 10,500,028 outstanding Shares at June 30, 2011 to 12,900,028 outstanding Shares at September 30, 2011. By comparison, during the three months ended September 30, 2010, the increase in the Fund’s NAV resulted from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of silver bullion as measured by the U.S. Dollar fixing price for delivery in London. The increase in the Fund’s NAV was offset by a decrease from 5,700,028 outstanding Shares at June 30, 2010 to 4,700,028 outstanding Shares at September 30, 2010.

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For the three months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the daily performance of its benchmark. The Fund’s per share NAV decrease of 34.8% for the three months ended September 30, 2011, as compared to the increase of 34.6% for the three months ended September 30, 2010, was primarily due to a depreciation in the value of the assets of the Fund during the three months ended September 30, 2011.

During the three months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on August 22, 2011 at $124.74 per Share and reached its low for the period on September 26, 2011 at $48.48 per Share. By comparison, during the three months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on September 30, 2010 at $42.76 per Share and reached its low for the period on July 20, 2010 at $27.68 per Share.

The benchmark’s decline of 13.1% for the three months ended September 30, 2011, as compared to the benchmark’s rise of 17.8% for the three months ended September 30, 2010, can be attributed to a decrease in the price of spot silver in U.S. Dollar terms during the three months ended September 30, 2011.

Net Income/Loss

The following table provides summary income information for the Fund for the three months ended September 30, 2011 and 2010:


	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
Net investment income (loss)	$	(2,371,209	)	$	(322,145	)
Management fee		2,423,377			399,644
Brokerage commission		2,126			1,147
Net realized gain (loss)		(350,312,420	)		35,416,828
Change in net unrealized appreciation/depreciation		84,424,890			17,444,906
Net income (loss)	$	(268,258,739	)	$	52,539,589

*	See Note 10 of the Notes to Financial Statements in Item 1 of Part I regarding the share split for the ProShares Ultra Silver Fund.

NAV of ProShares UltraShort Silver*

Fund Performance

The following table provides summary performance information for the Fund for the three months ended September 30, 2011 and 2010:


	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
NAV beginning of period	$	657,213,364		$	60,185,658
NAV end of period	$	533,394,247		$	60,913,712
Percentage change in NAV		(18.8	%)		1.2	%
Shares outstanding beginning of period		35,194,369			469,979
Shares outstanding end of period		32,694,369			694,979
Percentage change in shares outstanding		(7.1	%)		47.9	%
Shares created		17,200,000			312,500
Shares redeemed		19,700,000			87,500
Per share NAV beginning of period	$	18.67		$	128.06
Per share NAV end of period	$	16.31		$	87.65
Percentage change in per share NAV		(12.6	%)		(31.6	%)
Percentage change in benchmark		(13.1	%)		17.8	%
Benchmark annualized volatility		73.0	%		23.6	%

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During the three months ended September 30, 2011, the decrease in the Fund’s NAV resulted primarily from a decrease from 35,194,369 outstanding Shares at June 30, 2011 to 32,694,369 outstanding Shares at September 30, 2011. The decrease in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of silver bullion as measured by the U.S. Dollar fixing price for delivery in London. By comparison, during the three months ended September 30, 2010, the increase in the Fund’s NAV resulted primarily from an increase from 469,979 outstanding Shares at June 30, 2010 to 694,979 outstanding Shares at September 30, 2010. The increase in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of silver bullion as measured by the U.S. Dollar fixing price for delivery in London.

For the three months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the inverse of the daily performance of its benchmark. The Fund’s per share NAV decrease of 12.6% for the three months ended September 30, 2011, as compared to the decrease of 31.6% for the three months ended September 30, 2010 was primarily due to a relatively lower depreciation in the value of the assets of the Fund during the three months ended September 30, 2011.

During the three months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on September 26, 2011 at $22.09 per Share and reached its low for the period on August 22, 2011 at $10.93 per Share. By comparison, during the three months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on July 20, 2010 at $144.32 per Share and reached its low for the period on September 30, 2010 at $87.65 per Share.

Net Income/ Loss

The following table provides summary income information for the Fund for the three months ended September 30, 2011 and 2010:


	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
Net investment income (loss)	$	(1,293,605	)	$	(118,907	)
Management fee		1,328,783			146,320
Brokerage commission		1,431			789
Net realized gain (loss)		184,560,838			(17,827,197	)
Change in net unrealized appreciation/depreciation		(217,251,319	)		(5,514,318	)
Net income (loss)	$	(33,984,086	)	$	(23,460,422	)

The Fund’s net income decreased for the three months ended September 30, 2011, as compared to the three months ended September 30, 2010, primarily due to the performance of the Fund’s benchmark and the timing of capital share transactions during the three months ended September 30, 2011.

*	See Note 1 of the Notes to Financial Statements in Item 1 of Part I regarding the reverse share splits for the ProShares UltraShort Silver Fund.

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NAV of ProShares Ultra Euro

Fund Performance

The following table provides summary performance information for the Fund for the three months ended September 30, 2011 and 2010:


	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
NAV beginning of period	$	9,061,264		$	16,329,042
NAV end of period	$	7,715,933		$	12,106,899
Percentage change in NAV		(14.8	%)		(25.9	%)
Shares outstanding beginning of period		300,014			750,014
Shares outstanding end of period		300,014			450,014
Percentage change in shares outstanding		0.0	%		(40.0	%)
Shares created		—			—
Shares redeemed		—			300,000
Per share NAV beginning of period	$	30.20		$	21.77
Per share NAV end of period	$	25.72		$	26.90
Percentage change in per share NAV		(14.8	%)		23.6	%
Percentage change in benchmark		(7.6	%)		11.5	%
Benchmark annualized volatility		11.7	%		11.7	%

During the three months ended September 30, 2011, the decrease in the Fund’s NAV resulted from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of the spot price of the Euro versus the U.S. Dollar. There was no net change in the Fund’s outstanding Shares from June 30, 2011 to September 30, 2011. By comparison, during the three months ended September 30, 2010, the decrease in the Fund’s NAV resulted from a decrease from 750,014 outstanding Shares at June 30, 2010 to 450,014 outstanding Shares at September 30, 2010. The decrease in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of the spot price of the Euro versus the U.S. Dollar.

For the three months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the daily performance of its benchmark. The Fund’s per share NAV decrease of 14.8% for the three months ended September 30, 2011, as compared to the increase of 23.6% for the three months ended September 30, 2010 was primarily due to depreciation in the value of the assets of the Fund during the three months ended September 30, 2011.

During the three months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on July 1, 2011 at $30.31 per Share and reached its low for the period on September 30, 2011 at $25.72 per Share. By comparison, during the three months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on September 30, 2010 at $26.90 per Share and reached its low for the period on July 1, 2010 at $22.80 per Share.

The benchmark’s decline of 7.6% for the three months ended September 30, 2011, as compared to the benchmark’s rise of 11.5% for the three months ended September 30, 2010, can be attributed to a decrease in the value of the Euro versus the U.S. Dollar during the three months ended September 30, 2011.

Net Income/Loss

The following table provides summary income information for the Fund for the three months ended September 30, 2011 and 2010:


	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
Net investment income (loss)	$	(20,157	)	$	(30,018	)
Management fee		20,668			36,416
Net realized gain (loss)		(3,200	)		1,189,513
Change in net unrealized appreciation/depreciation		(1,321,974	)		1,996,030
Net income (loss)	$	(1,345,331	)	$	3,155,525

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NAV of ProShares UltraShort Euro

Fund Performance

The following table provides summary performance information for the Fund for the three months ended September 30, 2011 and 2010:


	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
NAV beginning of period	$	632,327,167		$	462,324,726
NAV end of period	$	936,941,013		$	277,619,839
Percentage change in NAV		48.2	%		(40.0	%)
Shares outstanding beginning of period		37,750,014			18,500,014
Shares outstanding end of period		48,600,014			14,000,014
Percentage change in shares outstanding		28.7	%		(24.3	%)
Shares created		17,550,000			1,300,000
Shares redeemed		6,700,000			5,800,000
Per share NAV beginning of period	$	16.75		$	24.99
Per share NAV end of period	$	19.28		$	19.83
Percentage change in per share NAV		15.1	%		(20.6	%)
Percentage change in benchmark		(7.6	%)		11.5	%
Benchmark annualized volatility		11.7	%		11.7	%

During the three months ended September 30, 2011, the increase in the Fund’s NAV resulted primarily from an increase from 37,750,014 outstanding Shares at June 30, 2011 to 48,600,014 outstanding Shares at September 30, 2011. The increase in the Fund’s NAV also resulted in part from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of the spot price of the Euro versus the U.S. Dollar. By comparison, during the three months ended September 30, 2010, the decrease in the Fund’s NAV resulted primarily from a decrease from 18,500,014 outstanding Shares at June 30, 2010 to 14,000,014 outstanding Shares at September 30, 2010. The decrease in the Fund’s NAV also resulted in part from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of the spot price of the Euro versus the U.S. Dollar.

For the three months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the inverse of the daily performance of its benchmark. The Fund’s per share NAV increase of 15.1% for the three months ended September 30, 2011, as compared to the decrease of 20.6% for the three months ended September 30, 2010 was primarily due to an appreciation in the value of the assets held by the Fund during the three months ended September 30, 2011.

During the three months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on September 30, 2011 at $19.28 per Share and reached its low for the period on August 29, 2011 at $16.54 per Share. By comparison, during the three months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on July 1, 2010 at $23.81 per Share and reached its low for the period on September 30, 2010 at $19.83 per Share.

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Net Income/Loss

The following table provides summary income information for the Fund for the three months ended September 30, 2011 and 2010:


	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
Net investment income (loss)	$	(1,691,141	)	$	(664,325	)
Management fee		1,728,002			846,458
Net realized gain (loss)		(11,049,248	)		(33,896,461	)
Change in net unrealized appreciation/depreciation		122,318,756			(49,936,224	)
Net income (loss)	$	109,578,367		$	(84,497,010	)

NAV of ProShares Ultra Yen

Fund Performance

The following table provides summary performance information for the Fund for the three months ended September 30, 2011 and 2010:


	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
NAV beginning of period	$	3,376,952		$	4,292,085
NAV end of period	$	5,485,629		$	6,371,767
Percentage change in NAV		62.4	%		48.5	%
Shares outstanding beginning of period		100,014			150,014
Shares outstanding end of period		150,014			200,014
Percentage change in shares outstanding		50.0	%		33.3	%
Shares created		50,000			50,000
Shares redeemed		—			—
Per share NAV beginning of period	$	33.76		$	28.61
Per share NAV end of period	$	36.57		$	31.86
Percentage change in per share NAV		8.3	%		11.3	%
Percentage change in benchmark		4.4	%		5.9	%
Benchmark annualized volatility		8.9	%		10.6	%

During the three months ended September 30, 2011, the increase in the Fund’s NAV resulted primarily from an increase from 100,014 outstanding Shares at June 30, 2011 to 150,014 outstanding Shares at September 30, 2011. The increase in the Fund’s NAV also resulted in part from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of the spot price of the Japanese Yen versus the U.S. Dollar. By comparison, during the three months ended September 30, 2010, the increase in the Fund’s NAV resulted primarily from an increase from 150,014 outstanding Shares at June 30, 2010 to 200,014 outstanding Shares at September 30, 2010. The increase in the Fund’s NAV also resulted in part from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of the spot price of the Japanese Yen versus the U.S. Dollar.

For the three months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the daily performance of its benchmark. The Fund’s per share NAV increase of 8.3% for the three months ended September 30, 2011, as compared to the increase of 11.3% for the three months ended September 30, 2010 was primarily due to a relatively lower appreciation in the value of the assets held by the Fund during the three months ended September 30, 2011.

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During the three months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on September 22, 2011 at $37.40 per Share and reached its low for the period on July 7, 2011 at $33.17 per Share. By comparison, during the three months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on September 14, 2010 at $32.21 per Share and reached its low for the period on July 9, 2010 at $28.43 per Share.

The benchmark’s rise of 4.4% for the three months ended September 30, 2011, as compared to the benchmark’s rise of 5.9% for the three months ended September 30, 2010, can be attributed to a relatively lower increase in the value of Japanese Yen versus the U.S. Dollar during the three months ended September 30, 2011.

Net Income/Loss

The following table provides summary income information for the Fund for the three months ended September 30, 2011 and 2010:


	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
Net investment income (loss)	$	(12,276	)	$	(11,174	)
Management fee		12,492			13,416
Net realized gain (loss)		496,377			849,525
Change in net unrealized appreciation/depreciation		(71,571	)		(217,358	)
Net income (loss)	$	412,530		$	620,993

The Fund’s net income decreased for the three months ended September 30, 2011, as compared to the three months ended September 30, 2010, primarily due to the relative performance of the Fund’s benchmark during the three months ended September 30, 2011.

NAV of ProShares UltraShort Yen*

Fund Performance

The following table provides summary performance information for the Fund for the three months ended September 30, 2011 and 2010:


	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
NAV beginning of period	$	356,417,645		$	145,332,808
NAV end of period	$	271,440,942		$	163,369,201
Percentage change in NAV		(23.8	%)		12.4	%
Shares outstanding beginning of period		7,850,004			2,566,671
Shares outstanding end of period		6,566,671			3,266,671
Percentage change in shares outstanding		(16.3	%)		27.3	%
Shares created		—			1,233,333
Shares redeemed		1,283,333			533,333
Per share NAV beginning of period	$	45.40		$	56.62
Per share NAV end of period	$	41.34		$	50.01
Percentage change in per share NAV		(9.0	%)		(11.7	%)
Percentage change in benchmark		4.4	%		5.9	%
Benchmark annualized volatility		8.9	%		10.6	%

During the three months ended September 30, 2011, the decrease in the Fund’s NAV resulted primarily from a decrease from 7,850,004 outstanding Shares at June 30, 2011 to 6,566,671 outstanding Shares at September 30, 2011. The decrease in the Fund’s NAV also resulted in part from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of the spot price of the Japanese Yen versus the U.S. Dollar. By comparison, during the three months ended June 30, 2010, the increase in the Fund’s NAV resulted from an increase from 2,566,671 outstanding Shares at June 30, 2010 to 3,266,671 outstanding Shares at September 30, 2010. The increase in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of the spot price of the Japanese Yen versus the U.S. Dollar.

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For the three months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the inverse of the daily performance of its benchmark. The Fund’s per share NAV decrease of 9.0% for the three months ended September 30, 2011, as compared to the decrease of 11.7% for the three months ended September 30, 2010 was primarily due to a relatively lower depreciation in the value of the assets held by the Fund during the three months ended September 30, 2011.

During the three months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on July 7, 2011 at $46.20 per Share and reached its low for the period on September 22, 2011 at $40.45 per Share. By comparison, during the three months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on July 9, 2010 at $56.89 per Share and reached its low for the period on September 14, 2010 at $49.71 per Share.

The benchmark’s rise of 4.4% for the three months ended September 30, 2011, as compared to the benchmark’s rise of 5.9% for the three months ended September 30, 2010, can be attributed to a relatively lower increase in the value of the Japanese Yen versus the U.S. Dollar during the three months ended September 30, 2011.

Net Income/Loss

The following table provides summary income information for the Fund for the three months ended September 30, 2011 and 2010:


	Three Months Ended September 30, 2011			Three Months Ended September 30, 2010
Net investment income (loss)	$	(701,439	)	$	(302,251	)
Management fee		725,344			376,573
Net realized gain (loss)		(34,105,281	)		(26,657,095	)
Change in net unrealized appreciation/depreciation		4,590,082			8,153,876
Net income (loss)	$	(30,216,638	)	$	(18,805,470	)

*	See Note 10 of the Notes to Financial Statements in Item 1 of Part I regarding the reverse share split for the ProShares UltraShort Yen Fund.

NAV of ProShares VIX Short-Term Futures ETF

Since the Fund commenced investment operations on January 3, 2011, a comparison of the Fund’s results of operations for the three months ended September 30, 2010 has not been provided.

Fund Performance

The following table provides summary performance information for the Fund for the three months ended September 30, 2011:


	Three Months Ended September 30, 2011
NAV beginning of period	$	46,602,361
NAV end of period	$	28,897,739
Percentage change in NAV		(38.0	%)
Shares outstanding beginning of period		1,025,005
Shares outstanding end of period		250,005
Percentage change in shares outstanding		(75.6	%)
Shares created		2,250,000
Shares redeemed		3,025,000
Per share NAV beginning of period	$	45.47
Per share NAV end of period	$	115.59
Percentage change in per share NAV		154.2	%
Percentage change in benchmark		157.3	%
Benchmark annualized volatility		97.2	%

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During the three months ended September 30, 2011, the decrease in the Fund’s NAV resulted from a decrease from 1,025,005 outstanding Shares at June 30, 2011 to 250,005 outstanding Shares at September 30, 2011. The decrease in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to the daily performance of the S&P 500 VIX Short-Term Futures Index.

For the three months ended September 30, 2011, the Fund’s daily performance had a statistical correlation over 0.99 of the daily performance of its benchmark.

During the three months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on September 30, 2011 at $115.59 per Share and reached its low for the period on July 7, 2011 at $43.15 per Share.

The benchmark’s rise of 157.3% for the three months ended September 30, 2011 can be attributed to a sharp rise in the front end of the VIX futures curve over the period.

Net Income/Loss

The following table provides summary income information for the Fund for the three months ended September 30, 2011:


	Three Months Ended September 30, 2011
Net investment income (loss)	$	(74,409	)
Management fee		26,672
Offering costs		49,621
Net realized gain (loss)		24,351,300
Change in net unrealized appreciation/depreciation		7,991,692
Net income (loss)	$	32,268,583

NAV of ProShares VIX Mid-Term Futures ETF

Since the Fund commenced investment operations on January 3, 2011, a comparison of the Fund’s results of operations for the three months ended September 30, 2010 has not been provided.

Fund Performance

The following table provides summary performance information for the Fund for the three months ended September 30, 2011:


	Three Months Ended September 30, 2011
NAV beginning of period	$	13,895,731
NAV end of period	$	13,436,216
Percentage change in NAV		(3.3	%)
Shares outstanding beginning of period		225,005
Shares outstanding end of period		150,005
Percentage change in shares outstanding		(33.3	%)
Shares created		50,000
Shares redeemed		125,000
Per share NAV beginning of period	$	61.76
Per share NAV end of period	$	89.57
Percentage change in per share NAV		45.0	%
Percentage change in benchmark		45.4	%
Benchmark annualized volatility		48.5	%

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During the three months ended September 30, 2011, the decrease in the Fund’s NAV resulted from a decrease from 225,005 outstanding Shares at June 30, 2011 to 150,005 outstanding Shares at September 30, 2011. The decrease in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to the daily performance of the S&P 500 VIX Mid-Term Futures Index.

For the three months ended September 30, 2011, the Fund’s daily performance had a statistical correlation over 0.99 of the daily performance of its benchmark.

During the three months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on September 30, 2011 at $89.57 per Share and reached its low for the period on July 7, 2011 at $57.37 per Share.

The benchmark’s rise of 45.4% for the three months ended September 30, 2011 can be attributed to a sharp rise in the VIX futures curve over the period.

Net Income/Loss

The following table provides summary income information for the Fund for the three months ended September 30, 2011:


	Three Months Ended September 30, 2011
Net investment income (loss)	$	(26,403	)
Offering costs		31,013
Limitation by Sponsor		(4,041	)
Net realized gain (loss)		2,364,369
Change in net unrealized appreciation/depreciation		2,243,166
Net income (loss)	$	4,581,132

Results of Operations for the Nine Months Ended September 30, 2011 Compared to the Nine Months Ended September 30, 2010

NAV of ProShares Ultra DJ-UBS Commodity

Fund Performance

The following table provides summary performance information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
NAV beginning of period	$	18,186,658		$	19,743,932
NAV end of period	$	11,710,948		$	9,651,779
Percentage change in NAV		(35.6	%)		(51.1	%)
Shares outstanding beginning of period		500,014			700,014
Shares outstanding end of period		450,014			350,014
Percentage change in shares outstanding		(10.0	%)		(50.0	%)
Shares created		50,000			250,000
Shares redeemed		100,000			600,000
Per share NAV beginning of period	$	36.37		$	28.21
Per share NAV end of period	$	26.02		$	27.58
Percentage change in per share NAV		(28.5	%)		(2.2	%)
Percentage change in benchmark		(13.6	%)		0.8	%
Benchmark annualized volatility		18.4	%		15.9	%

-137-

During the nine months ended September 30, 2011, the decrease in the Fund’s NAV resulted primarily from a decrease from 500,014 outstanding Shares at December 31, 2010 to 450,014 outstanding Shares at September 30, 2011. The decrease in the Fund’s NAV also resulted in part from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of the Dow Jones-UBS Commodity Index. By comparison, during the nine months ended September 30, 2010, the decrease in the Fund’s NAV resulted from a decrease from 700,014 outstanding Shares at December 31, 2009 to 350,014 outstanding Shares at September 30, 2010. The decrease in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of the Dow Jones-UBS Commodity Index.

For the nine months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the daily performance of its benchmark. The Fund’s per share NAV decrease of 28.5% for the period ended September 30, 2011 as compared to the decrease of 2.2% for the period ended September 30, 2010, was primarily due to a relatively higher depreciation in the value of the assets of the Fund during the nine months ended September 30, 2011.

During the nine months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on April 29, 2011 at $41.87 per Share and reached its low for the period on September 30, 2011 at $26.02 per Share. By comparison, during the nine months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on January 6, 2010 at $30.58 per Share and reached its low for the period on June 4, 2010 at $21.14 per Share.

The benchmark’s decline of 13.6% for the nine months ended September 30, 2011, as compared to the benchmark’s rise of 0.8% for the nine months ended September 30, 2010, can be attributed to a depreciation of the underlying components of the index, primarily Crude Oil, during the nine months ended September 30, 2011.

Net Income/Loss

The following table provides summary income information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
Net investment income (loss)	$	(121,339	)	$	(71,723	)
Management fee		131,603			88,670
Net realized gain (loss)		939,697			(623,565	)
Change in net unrealized appreciation/depreciation		(5,646,187	)		(457,054	)
Net income (loss)	$	(4,827,829	)	$	(1,152,342	)

The Fund’s net income decreased for the nine months ended September 30, 2011, as compared to the nine months ended September 30, 2010, primarily due to the performance of the Fund’s benchmark index during the nine months ended September 30, 2011.

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NAV of ProShares UltraShort DJ-UBS Commodity*

Fund Performance

The following table provides summary performance information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
NAV beginning of period	$	1,440,073		$	2,924,426
NAV end of period	$	12,378,058		$	1,334,848
Percentage change in NAV		759.5	%		(54.4	%)
Shares outstanding beginning of period		30,003			40,003
Shares outstanding end of period		209,997			20,003
Percentage change in shares outstanding		599.9	%		(50.0	%)
Shares created		1,780,000			40,000
Shares redeemed		1,600,006			60,000
Per share NAV beginning of period	$	48.00		$	73.11
Per share NAV end of period	$	58.94		$	66.73
Percentage change in per share NAV		22.8	%		(8.7	%)
Percentage change in benchmark		(13.6	%)		0.8	%
Benchmark annualized volatility		18.4	%		15.9	%

During the nine months ended September 30, 2011, the increase in the Fund’s NAV resulted primarily from an increase from 30,003 outstanding Shares at December 31, 2010 to 209,997 outstanding Shares at September 30, 2011. The increase in the Fund’s NAV also resulted in part from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of the Dow Jones-UBS Commodity Index. By comparison, during the nine months ended September 30, 2010, the decrease in the Fund’s NAV resulted primarily from a decrease from 40,003 outstanding Shares at December 31, 2009 to 20,003 outstanding Shares at September 30, 2010. The decrease in the Fund’s NAV also resulted in part from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of the Dow Jones-UBS Commodity Index.

For the nine months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the inverse of the daily performance of its benchmark. The Fund’s per share NAV increase of 22.8% for the nine months ended September 30, 2011, as compared to the decrease of 8.7% for the nine months ended September 30, 2010, was primarily due to an appreciation in the value of the assets of the Fund during the nine months ended September 30, 2011.

During the nine months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on September 30, 2011 at $58.94 per Share and reached its low for the period on April 29, 2011 at $39.91 per Share. By comparison, during the nine months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on June 4, 2010 at $90.42 per Share and reached its low for the period on September 30, 2010 at $66.73 per Share.

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Net Income/Loss

The following table provides summary income information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
Net investment income (loss)	$	(107,931	)	$	(21,704	)
Management fee		111,453			24,971
Net realized gain (loss)		(3,366,124	)		(254,724	)
Change in net unrealized appreciation/depreciation		1,168,483			115,152
Net income (loss)	$	(2,305,572	)	$	(161,276	)

*	See Note 1 of the Notes to Financial Statements in Item 1 of Part I regarding the reverse share split for the ProShares UltraShort DJ-UBS Commodity Fund.

NAV of ProShares Ultra DJ-UBS Crude Oil*

Fund Performance

The following table provides summary performance information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
NAV beginning of period	$	228,133,077		$	323,819,670
NAV end of period	$	380,889,526		$	387,516,335
Percentage change in NAV		67.0	%		19.7	%
Shares outstanding beginning of period		4,562,504			6,412,504
Shares outstanding end of period		13,949,170			9,550,004
Percentage change in shares outstanding		205.7	%		48.9	%
Shares created		28,375,000			25,087,500
Shares redeemed		18,988,334			21,950,000
Per share NAV beginning of period	$	50.00		$	50.50
Per share NAV end of period	$	27.31		$	40.58
Percentage change in per share NAV		(45.4	%)		(19.6	%)
Percentage change in benchmark		(22.3	%)		(7.4	%)
Benchmark annualized volatility		34.3	%		27.8	%

During the nine months ended September 30, 2011, the increase in the Fund’s NAV resulted from an increase from 4,562,504 outstanding Shares at December 31, 2010 to 13,949,170 outstanding Shares at September 30, 2011. The increase in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of the Dow Jones-UBS Crude Oil Sub-Index. By comparison, during the nine months ended September 30, 2010, the increase in the Fund’s NAV resulted from an increase from 6,412,504 outstanding Shares at December 31, 2009 to 9,550,004 outstanding Shares at September 30, 2010. The increase in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of the Dow Jones-UBS Crude Oil Sub-Index.

For the nine months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the daily performance of its benchmark. The Fund’s per share NAV decrease of 45.4% for the nine months ended September 30, 2011, as compared to the decrease of 19.6% for the nine months ended September 30, 2010, was primarily due to a relatively higher depreciation in the value of the assets of the Fund during the nine months ended September 30, 2011.

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During the nine months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on April 29, 2011 at $63.90 per Share and reached its low for the period on September 30, 2011 at $27.31 per Share. By comparison, during the nine months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on May 3, 2010 at $57.29 per Share and reached its low for the period on August 24, 2010 at $33.45 per Share.

The benchmark’s decline of 22.3% for the nine months ended September 30, 2011, as compared to the benchmark’s decline of 7.4% for the nine months ended September 30, 2010, can be attributed to a relatively greater decrease in the price of WTI Crude Oil during the nine months ended September 30, 2011.

Net Income/Loss

The following table provides summary income information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
Net investment income (loss)	$	(2,337,960	)	$	(2,243,523	)
Management fee		2,416,617			2,480,271
Brokerage commission		75,805			112,220
Net realized gain (loss)		(13,416,979	)		33,864,670
Change in net unrealized appreciation/depreciation		(74,873,291	)		8,155,123
Net income (loss)	$	(90,628,230	)	$	39,776,270

*	See Note 1 of the Notes to Financial Statements in Item 1 of Part I regarding the reverse share split for the ProShares Ultra DJ-UBS Crude Oil Fund.

NAV of ProShares UltraShort DJ-UBS Crude Oil*

Fund Performance

The following table provides summary performance information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
NAV beginning of period	$	132,214,257		$	76,656,626
NAV end of period	$	72,357,831		$	40,018,686
Percentage change in NAV		(45.3	%)		(47.8	%)
Shares outstanding beginning of period		2,600,003			1,120,003
Shares outstanding end of period		1,119,944			600,003
Percentage change in shares outstanding		(56.9	%)		(46.3	%)
Shares created		8,030,000			4,970,000
Shares redeemed		9,510,059			5,490,000
Per share NAV beginning of period	$	50.85		$	68.44
Per share NAV end of period	$	64.61		$	66.70
Percentage change in per share NAV		27.1	%		(2.6	%)
Percentage change in benchmark		(22.3	%)		(7.4	%)
Benchmark annualized volatility		34.3	%		27.8	%

During the nine months ended September 30, 2011, the decrease in the Fund’s NAV resulted from a decrease from 2,600,003 outstanding Shares at December 31, 2010 to 1,119,944 outstanding Shares at September 30, 2011. The decrease in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of the Dow Jones-UBS Crude Oil Sub-Index. By comparison, during the nine months ended

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September 30, 2010, the decrease in the Fund’s NAV resulted from a decrease from 1,120,003 outstanding Shares at December 31, 2009 to 600,003 outstanding Shares at September 30, 2010. The decrease in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of the Dow Jones-UBS Crude Oil Sub-Index.

For the nine months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the inverse of the daily performance of its benchmark. The Fund’s per share NAV increase of 27.1% for the nine months ended September 30, 2011, as compared to the decrease of 2.6% for the nine months ended September 30, 2010, was primarily due to an appreciation in the value of the assets of the Fund during the nine months ended September 30, 2011.

During the nine months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on August 9, 2011 at $67.93 per Share and reached its low for the period on April 29, 2011 at $36.11 per Share. By comparison, during the nine months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on May 25, 2010 at $90.21 per Share and reached its low for the period on May 3, 2010 at $55.10 per Share.

Net Income/Loss

The following table provides summary income information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
Net investment income (loss)	$	(908,915	)	$	(500,355	)
Management fee		936,197			539,674
Brokerage commission		40,643			37,608
Net realized gain (loss)		58,477,447			31,548,421
Change in net unrealized appreciation/depreciation		18,005,467			(290,950	)
Net income (loss)	$	75,573,999		$	30,757,116

The Fund’s net income increased for the nine months ended September 30, 2011, as compared to the nine months ended September 30, 2010, primarily due to the relative performance of the Fund’s benchmark index during the nine months ended September 30, 2011.

*	See Note 1 of the Notes to Financial Statements in Item 1 of Part I regarding the reverse share split for the ProShares UltraShort DJ-UBS Crude Oil Fund.

NAV of ProShares Ultra Gold

Fund Performance

The following table provides summary performance information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
NAV beginning of period	$	259,562,075		$	156,476,709
NAV end of period	$	374,010,221		$	203,705,598
Percentage change in NAV		44.1	%		30.2	%
Shares outstanding beginning of period		3,750,014			3,550,014
Shares outstanding end of period		4,300,014			3,350,014
Percentage change in shares outstanding		14.7	%		(5.6	%)
Shares created		1,250,000			1,400,000
Shares redeemed		700,000			1,600,000
Per share NAV beginning of period	$	69.22		$	44.08
Per share NAV end of period	$	86.98		$	60.81
Percentage change in per share NAV		25.7	%		38.0	%
Percentage change in benchmark		15.3	%		20.2	%
Benchmark annualized volatility		20.5	%		15.9	%

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During the nine months ended September 30, 2011, the increase in the Fund’s NAV resulted primarily from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of gold bullion as measured by the U.S. Dollar p.m. fixing price for delivery in London. The increase in the Fund’s NAV also resulted from an increase from 3,750,014 outstanding Shares at December 31, 2010 to 4,300,014 outstanding Shares at September 30, 2011. By comparison, during the nine months ended September 30, 2010, the increase in the Fund’s NAV resulted from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of gold bullion as measured by the U.S. Dollar p.m. fixing price for delivery in London. The increase in the Fund’s NAV was offset by a decrease from 3,550,014 outstanding Shares at December 31, 2009 to 3,350,014 outstanding Shares at September 30, 2010.

For the nine months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the daily performance of its benchmark. The Fund’s per share NAV increase of 25.7% for the nine months ended September 30, 2011, as compared to the increase of 38.0% for the nine months ended September 30, 2010, was primarily due to a relatively lower appreciation in the value of the assets of the Fund during the nine months ended September 30, 2011.

During the nine months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on September 6, 2011 at $120.56 per Share and reached its low for the period on January 28, 2011 at $60.68 per Share. By comparison, during the nine months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on September 29, 2010 at $60.85 per Share and reached its low for the period on February 5, 2010 at $41.35 per Share.

The benchmark’s rise of 15.3% for the nine months ended September 30, 2011, as compared to the benchmark’s rise of 20.2% for the nine months ended September 30, 2010, can be attributed to a relatively lower increase in the price of spot gold in U.S. Dollar terms during the nine months ended September 30, 2011.

Net Income/Loss

The following table provides summary income information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
Net investment income (loss)	$	(2,031,008	)	$	(1,111,843	)
Management fee		2,166,956			1,296,693
Brokerage commission		2,830			2,973
Net realized gain (loss)		55,429,164			50,897,147
Change in net unrealized appreciation/depreciation		(623,541	)		9,072,995
Net income (loss)	$	52,774,615		$	58,858,299

The Fund’s net income decreased for the nine months ended September 30, 2011, as compared to the nine months ended September 30, 2010, primarily due to the relative performance of the Fund’s benchmark during the nine months ended September 30, 2011.

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NAV of ProShares UltraShort Gold*

Fund Performance

The following table provides summary performance information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
NAV beginning of period	$	77,732,507		$	67,602,811
NAV end of period	$	178,039,495		$	75,659,755
Percentage change in NAV		129.0	%		11.9	%
Shares outstanding beginning of period		2,739,901			1,290,003
Shares outstanding end of period		9,239,901			2,239,901
Percentage change in shares outstanding		237.2	%		73.6	%
Shares created		8,900,000			1,600,000
Shares redeemed		2,400,000			650,102
Per share NAV beginning of period	$	28.37		$	52.41
Per share NAV end of period	$	19.27		$	33.78
Percentage change in per share NAV		(32.1	%)		(35.5	%)
Percentage change in benchmark		15.3	%		20.2	%
Benchmark annualized volatility		20.5	%		15.9	%

During the nine months ended September 30, 2011, the increase in the Fund’s NAV resulted from an increase from 2,739,901 outstanding Shares at December 31, 2010 to 9,239,901 outstanding Shares at September 30, 2011. The increase in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of gold bullion as measured by the U.S. Dollar p.m. fixing price for delivery in London. By comparison, during the nine months ended September 30, 2010, the increase in the Fund’s NAV resulted from an increase from 1,290,003 outstanding Shares at December 31, 2009 to 2,239,901 outstanding Shares at September 30, 2010. The increase in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of gold bullion as measured by the U.S. Dollar p.m. fixing price for delivery in London.

For the nine months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the inverse of the daily performance of its benchmark. The Fund’s per share NAV decrease of 32.1% for the nine months ended September 30, 2011, as compared to the decrease of 35.5% for the nine months ended September 30, 2010, was primarily due to a relatively lower depreciation in the value of the assets of the Fund during the nine months ended September 30, 2011.

During the nine months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on January 28, 2011 at $32.10 per Share and reached its low for the period on September 6, 2011 at $14.52 per Share. By comparison, during the nine months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on February 5, 2010 at $54.47 per Share and reached its low for the period on September 29, 2010 at $33.76 per Share.

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Net Income/Loss

The following table provides summary income information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
Net investment income (loss)	$	(682,151	)	$	(427,470	)
Management fee		729,868			497,988
Brokerage commission		2,466			2,338
Net realized gain (loss)		(16,106,587	)		(25,637,360	)
Change in net unrealized appreciation/depreciation		(4,468,775	)		(3,537,347	)
Net income (loss)	$	(21,257,513	)	$	(29,602,177	)

*	See Note 1 of the Notes to Financial Statements in Item 1 of Part I regarding the reverse share split for the ProShares UltraShort Gold Fund.

NAV of ProShares Ultra Silver*

Fund Performance

The following table provides summary performance information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
NAV beginning of period	$	547,003,919		$	145,416,382
NAV end of period	$	705,943,332		$	200,971,964
Percentage change in NAV		29.1	%		38.2	%
Shares outstanding beginning of period		7,000,028			5,100,028
Shares outstanding end of period		12,900,028			4,700,028
Percentage change in shares outstanding		84.3	%		(7.8	%)
Shares created		12,200,000			2,800,000
Shares redeemed		6,300,000			3,200,000
Per share NAV beginning of period	$	78.14		$	28.51
Per share NAV end of period	$	54.72		$	42.76
Percentage change in per share NAV		(30.0	%)		50.0	%
Percentage change in benchmark		(0.6	%)		29.9	%
Benchmark annualized volatility		63.8	%		30.9	%

During the nine months ended September 30, 2011, the increase in the Fund’s NAV resulted from an increase from 7,000,028 outstanding Shares at December 31, 2010 to 12,900,028 outstanding Shares at September 30, 2011. The increase in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of silver bullion as measured by the U.S. Dollar fixing price for delivery in London. By comparison, during the nine months ended September 30, 2010, the increase in the Fund’s NAV resulted from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of silver bullion as measured by the U.S. Dollar fixing price for delivery in London. The increase in the Fund’s NAV was offset by a decrease from 5,100,028 outstanding Shares at December 31, 2009 to 4,700,028 outstanding Shares at September 30, 2010.

For the nine months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the daily performance of its benchmark. The Fund’s per share NAV decrease of 30.0% for the nine months ended September 30, 2011, as compared to the increase of 50.0% for the nine months ended September 30, 2010, was primarily due to a depreciation in the value of the assets of the Fund during the nine months ended September 30, 2011.

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During the nine months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on April 28, 2011 at $184.61 per Share and reached its low for the period on September 26, 2011 at $48.48 per Share. By comparison, during the nine months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on September 30, 2010 at $42.76 per Share and reached its low for the period on February 8, 2010 at $22.20 per Share.

The benchmark’s decline of 0.6% for the nine months ended September 30, 2011, as compared to the benchmark’s rise of 29.9% for the nine months ended September 30, 2010, can be attributed to a decrease in the price of spot silver in U.S. Dollar terms during the nine months ended September 30, 2011.

Net Income/Loss

The following table provides summary income information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
Net investment income (loss)	$	(6,124,890	)	$	(1,000,101	)
Management fee		6,530,746			1,191,495
Brokerage commission		7,354			4,502
Net realized gain (loss)		(283,259,673	)		60,475,990
Change in net unrealized appreciation/depreciation		4,445,205			18,160,956
Net income (loss)	$	(284,939,358	)	$	77,636,845

*	See Note 10 of the Notes to Financial Statements in Item 1 of Part I regarding the share split for the ProShares Ultra Silver Fund.

NAV of ProShares UltraShort Silver*

Fund Performance

The following table provides summary performance information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
NAV beginning of period	$	99,032,781		$	64,516,145
NAV end of period	$	533,394,247		$	60,913,712
Percentage change in NAV		438.6	%		(5.6	%)
Shares outstanding beginning of period		2,482,479			342,500
Shares outstanding end of period		32,694,369			694,979
Percentage change in shares outstanding		1,217.0	%		102.9	%
Shares created		62,887,500			667,500
Shares redeemed		32,675,610			315,021
Per share NAV beginning of period	$	39.89		$	188.37
Per share NAV end of period	$	16.31		$	87.65
Percentage change in per share NAV		(59.1	%)		(53.5	%)
Percentage change in benchmark		(0.6	%)		29.9	%
Benchmark annualized volatility		63.8	%		30.9	%

During the nine months ended September 30, 2011, the increase in the Fund’s NAV resulted from an increase from 2,482,479 outstanding Shares at December 31, 2010 to 32,694,369 outstanding Shares at September 30, 2011. The increase in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of silver bullion as measured by the U.S. Dollar fixing price for delivery in

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London. By comparison, during the nine months ended September 30, 2010, the decrease in the Fund’s NAV resulted from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of silver bullion as measured by the U.S. Dollar fixing price for delivery in London. The decrease in the Fund’s NAV was offset by an increase from 342,500 outstanding Shares at December 31, 2009 to 694,979 outstanding Shares at September 30, 2010.

For the nine months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the inverse of the daily performance of its benchmark. The Fund’s per share NAV decrease of 59.1% for the nine months ended September 30, 2011, as compared to the decrease of 53.5% for the nine months ended September 30, 2010 was primarily due to a relatively higher depreciation in the value of the assets of the Fund during the nine months ended September 30, 2011.

During the nine months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on January 25, 2011 at $51.11 per Share and reached its low for the period on August 22, 2011 at $10.93 per Share. By comparison, during the nine months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on February 8, 2010 at $227.03 per Share and reached its low for the period on September 30, 2010 at $87.65 per Share.

Net Income/Loss

The following table provides summary income information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
Net investment income (loss)	$	(2,674,603	)	$	(378,626	)
Management fee		2,812,042			443,414
Brokerage commission		3,718			2,681
Net realized gain (loss)		132,218,978			(40,005,168	)
Change in net unrealized appreciation/depreciation		(190,241,523	)		(6,535,128	)
Net income (loss)	$	(60,697,148	)	$	(46,918,922	)

The Fund’s net income decreased for the nine months ended September 30, 2011, as compared to the nine months ended September 30, 2010, primarily due to the performance of the Fund’s benchmark and the timing of capital share transactions during the nine months ended September 30, 2011.

*	See Note 1 of the Notes to Financial Statements in Item 1 of Part I regarding the reverse share splits for the ProShares UltraShort Silver Fund.

NAV of ProShares Ultra Euro

Fund Performance

The following table provides summary performance information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
NAV beginning of period	$	7,729,684		$	7,531,857
NAV end of period	$	7,715,933		$	12,106,899
Percentage change in NAV		(0.2	%)		60.7	%
Shares outstanding beginning of period		300,014			250,014
Shares outstanding end of period		300,014			450,014
Percentage change in shares outstanding		0.0	%		80.0	%
Shares created		—			850,000
Shares redeemed		—			650,000
Per share NAV beginning of period	$	25.76		$	30.13
Per share NAV end of period	$	25.72		$	26.90
Percentage change in per share NAV		(0.2	%)		(10.7	%)
Percentage change in benchmark		0.2	%		(4.8	%)
Benchmark annualized volatility		11.2	%		11.4	%

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During the nine months ended September 30, 2011, the decrease in the Fund’s NAV resulted from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of the spot price of the Euro versus the U.S. Dollar. There was no net change in the Fund’s outstanding Shares from December 31, 2010 to September 30, 2011. By comparison, the increase in the Fund’s NAV resulted from an increase from 250,014 outstanding Shares at December 31, 2009 to 450,014 outstanding Shares at September 30, 2010. The increase in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of the spot price of the Euro versus the U.S. Dollar.

For the nine months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the daily performance of its benchmark. The Fund’s per share NAV decrease of 0.2% for the nine months ended September 30, 2011, as compared to the decrease of 10.7% for the nine months ended September 30, 2010 was primarily due to a relatively lower depreciation in the value of the assets of the Fund during the nine months ended September 30, 2011.

During the nine months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on May 3, 2011 at $31.63 per Share and reached its low for the period on January 7, 2011 at $24.01 per Share. By comparison, during the nine months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on January 11, 2010 at $30.98 per Share and reached its low for the period on June 7, 2010 at $20.70 per Share.

The benchmark’s rise of 0.2% for the nine months ended September 30, 2011, as compared to the benchmark’s decline of 4.8% for the nine months ended September 30, 2010, can be attributed to an increase in the value of the Euro versus the U.S. Dollar during the nine months ended September 30, 2011.

Net Income/Loss

The following table provides summary income information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
Net investment income (loss)	$	(56,375	)	$	(74,127	)
Management fee		60,728			86,347
Net realized gain (loss)		1,603,907			(1,755,348	)
Change in net unrealized appreciation/depreciation		(1,561,283	)		2,044,090
Net income (loss)	$	(13,751	)	$	214,615

The Fund’s net income decreased for the nine months ended September 30, 2011, as compared to the nine months ended September 30, 2010, primarily due to the performance of the Fund’s benchmark and the timing of capital share transactions during the nine months ended September 30, 2011.

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NAV of ProShares UltraShort Euro

Fund Performance

The following table provides summary performance information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
NAV beginning of period	$	444,412,995		$	100,847,786
NAV end of period	$	936,941,013		$	277,619,839
Percentage change in NAV		110.8	%		175.3	%
Shares outstanding beginning of period		21,900,014			5,400,014
Shares outstanding end of period		48,600,014			14,000,014
Percentage change in shares outstanding		121.9	%		159.3	%
Shares created		37,600,000			19,300,000
Shares redeemed		10,900,000			10,700,000
Per share NAV beginning of period	$	20.29		$	18.68
Per share NAV end of period	$	19.28		$	19.83
Percentage change in per share NAV		(5.0	%)		6.2	%
Percentage change in benchmark		0.2	%		(4.8	%)
Benchmark annualized volatility		11.2	%		11.4	%

During the nine months ended September 30, 2011, the increase in the Fund’s NAV resulted from an increase from 21,900,014 outstanding Shares at December 31, 2010 to 48,600,014 outstanding Shares at September 30, 2011. The increase in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of the spot price of the Euro versus the U.S. Dollar. By comparison, during the nine months ended September 30, 2010, the increase in the Fund’s NAV resulted primarily from an increase from 5,400,014 outstanding Shares at December 31, 2009 to 14,000,014 outstanding Shares at September 30, 2010. The increase in the Fund’s NAV also resulted from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of the spot price of the Euro versus the U.S. Dollar.

For the nine months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the inverse of the daily performance of its benchmark. The Fund’s per share NAV decrease of 5.0% for the nine months ended September 30, 2011, as compared to the increase of 6.2% for the nine months ended September 30, 2010 was primarily due to a depreciation in the value of the assets held by the Fund during the nine months ended September 30, 2011.

During the nine months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on January 7, 2011 at $21.74 per Share and reached its low for the period on May 3, 2011 at $16.22 per Share. By comparison, during the nine months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on June 7, 2010 at $26.39 per Share and reached its low for the period on January 11, 2010 at $18.14 per Share.

Net Income/Loss

The following table provides summary income information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
Net investment income (loss)	$	(3,593,051	)	$	(1,921,077	)
Management fee		3,848,679			2,336,429
Net realized gain (loss)		(112,480,023	)		54,597,147
Change in net unrealized appreciation/depreciation		132,937,415			(46,211,690	)
Net income (loss)	$	16,864,341		$	6,464,380

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The Fund’s net income increased for the nine months ended September 30, 2011, as compared to the nine months ended September 30, 2010, primarily due to the performance of the Fund’s benchmark and the timing of capital share transactions during the nine months ended September 30, 2011.

NAV of ProShares Ultra Yen

Fund Performance

The following table provides summary performance information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
NAV beginning of period	$	5,024,240		$	3,921,267
NAV end of period	$	5,485,629		$	6,371,767
Percentage change in NAV		9.2	%		62.5	%
Shares outstanding beginning of period		150,014			150,014
Shares outstanding end of period		150,014			200,014
Percentage change in shares outstanding		0.0	%		33.3	%
Shares created		50,000			50,000
Shares redeemed		50,000			—
Per share NAV beginning of period	$	33.49		$	26.14
Per share NAV end of period	$	36.57		$	31.86
Percentage change in per share NAV		9.2	%		21.9	%
Percentage change in benchmark		5.3	%		11.5	%
Benchmark annualized volatility		9.0	%		11.3	%

During the nine months ended September 30, 2011, the increase in the Fund’s NAV resulted from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of the spot price of the Japanese Yen versus the U.S. Dollar. There was no net change in the Fund’s outstanding Shares from December 31, 2010 to September 30, 2011. By comparison, during the nine months ended September 30, 2010, the increase in the Fund’s NAV resulted primarily from an increase from 150,014 outstanding Shares at December 31, 2009 to 200,014 outstanding Shares at September 30, 2010. The increase in the Fund’s NAV also resulted in part from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of the spot price of the Japanese Yen versus the U.S. Dollar.

For the nine months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the daily performance of its benchmark. The Fund’s per share NAV increase of 9.2% for the nine months ended September 30, 2011, as compared to the increase of 21.9% for the nine months ended September 30, 2010 was primarily due to a relatively lower appreciation in the value of the assets held by the Fund during the nine months ended September 30, 2011.

During the nine months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on September 22, 2011 at $37.40 per Share and reached its low for the period on April 6, 2011 at $30.09 per Share. By comparison, during the nine months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on September 14, 2010 at $32.21 per Share and reached its low for the period on May 3, 2010 at $25.14 per Share.

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The benchmark’s rise of 5.3% for the nine months ended September 30, 2011, as compared to the benchmark’s rise of 11.5% for the nine months ended September 30, 2010, can be attributed to a relatively lower increase in the value of the Japanese Yen versus the U.S. Dollar during the nine months ended September 30, 2011.

Net Income/Loss

The following table provides summary income information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
Net investment income (loss)	$	(26,698	)	$	(27,697	)
Management fee		28,409			32,485
Net realized gain (loss)		722,576			651,163
Change in net unrealized appreciation/depreciation		(337,047	)		368,345
Net income (loss)	$	358,831		$	991,811

NAV of ProShares UltraShort Yen*

Fund Performance

The following table provides summary performance information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
NAV beginning of period	$	207,685,813		$	67,487,917
NAV end of period	$	271,440,942		$	163,369,201
Percentage change in NAV		30.7	%		142.1	%
Shares outstanding beginning of period		4,416,671			1,050,005
Shares outstanding end of period		6,566,671			3,266,671
Percentage change in shares outstanding		48.7	%		211.1	%
Shares created		6,533,333			3,050,000
Shares redeemed		4,383,333			833,334
Per share NAV beginning of period	$	47.02		$	64.27
Per share NAV end of period	$	41.34		$	50.01
Percentage change in per share NAV		(12.1	%)		(22.2	%)
Percentage change in benchmark		5.3	%		11.5	%
Benchmark annualized volatility		9.0	%		11.3	%

During the nine months ended September 30, 2011, the increase in the Fund’s NAV resulted from an increase from 4,416,671 outstanding Shares at December 31, 2010 to 6,566,671 outstanding Shares at September 30, 2011. The increase in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of the spot price of the Japanese Yen versus the U.S. Dollar. By comparison, during the nine months ended September 30, 2010, the increase in the Fund’s NAV resulted from an increase from 1,050,005 outstanding Shares at December 31, 2009 to 3,266,671 outstanding Shares at September 30, 2010. The increase in the Fund’s NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of the spot price of the Japanese Yen versus the U.S. Dollar.

For the nine months ended September 30, 2011 and September 30, 2010, the Fund’s daily performance had a statistical correlation over 0.99 to 2x of the inverse of the daily performance of its benchmark. The Fund’s per share NAV decrease of 12.1% for the nine months ended September 30, 2011, as compared to the decrease of 22.2% for the nine months ended September 30, 2010 was primarily due to a relatively lower depreciation in the value of the assets held by the Fund during the nine months ended September 30, 2011.

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During the nine months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on April 6, 2011 at $51.44 per Share and reached its low for the period on September 22, 2011 at $40.45 per Share. By comparison, during the nine months ended September 30, 2010, the Fund’s per share NAV reached its high for the period on May 3, 2010 at $65.56 per Share and reached its low for the period on September 14, 2010 at $49.71 per Share.

Net Income/Loss

The following table provides summary income information for the Fund for the nine months ended September 30, 2011 and 2010:


	Nine Months Ended September 30, 2011			Nine Months Ended September 30, 2010
Net investment income (loss)	$	(2,077,237	)	$	(814,892	)
Management fee		2,253,245			975,343
Net realized gain (loss)		(55,830,491	)		(26,353,245	)
Change in net unrealized appreciation/depreciation		18,301,702			(6,588,677	)
Net income (loss)	$	(39,606,026	)	$	(33,756,814	)

*	See Note 10 of the Notes to Financial Statements in Item 1 of Part I regarding the reverse share split for the ProShares UltraShort Yen Fund.

NAV of ProShares VIX Short-Term Futures ETF

Since the Fund commenced investment operations on January 3, 2011, a comparison of the Fund’s results of operations for the nine months ended September 30, 2010 has not been provided.

Fund Performance

The following table provides summary performance information for the Fund for the nine months ended September 30, 2011:


	Nine Months Ended September 30, 2011
NAV beginning of period	$	400
NAV end of period	$	28,897,739
Percentage change in NAV		7,224,334.8	%
Shares outstanding beginning of period		5
Shares outstanding end of period		250,005
Percentage change in shares outstanding		5,000,000.0	%
Shares created		4,375,000
Shares redeemed		4,125,000
Per share NAV beginning of period	$	80.00
Per share NAV end of period	$	115.59
Percentage change in per share NAV		44.5	%
Percentage change in benchmark		47.1	%
Benchmark annualized volatility		72.6	%

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During the nine months ended September 30, 2011, the increase in the Fund’s NAV resulted primarily from an increase from 5 outstanding Shares at December 31, 2010 to 250,005 outstanding Shares at September 30, 2011. The increase in the Fund’s NAV also resulted in part from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to the daily performance of the S&P 500 VIX Short-Term Futures Index.

For the nine months ended September 30, 2011, the Fund’s daily performance had a statistical correlation over 0.99 of the daily performance of its benchmark.

During the nine months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on September 30, 2011 at $115.59 per Share and reached its low for the period on July 7, 2011 at $43.15 per Share.

The benchmark’s rise of 47.1% for the nine months ended September 30, 2011 can be attributed to the sharp rise in VIX short-term futures contracts over the period.

Net Income/Loss

The following table provides summary income information for the Fund for the nine months ended September 30, 2011:


	Nine Months Ended September 30, 2011
Net investment income (loss)	$	(198,888	)
Management fee		62,960
Offering costs		147,749
Net realized gain (loss)		11,559,160
Change in net unrealized appreciation/depreciation		3,539,675
Net income (loss)	$	14,899,947

NAV of ProShares VIX Mid-Term Futures ETF

Since the Fund commenced investment operations on January 3, 2011, a comparison of the Fund’s results of operations for the nine months ended September 30, 2010 has not been provided.

Fund Performance

The following table provides summary performance information for the Fund for the nine months ended September 30, 2011:


	Nine Months Ended September 30, 2011
NAV beginning of period	$	400
NAV end of period	$	13,436,216
Percentage change in NAV		3,358,954.0	%
Shares outstanding beginning of period		5
Shares outstanding end of period		150,005
Percentage change in shares outstanding		3,000,000.0	%
Shares created		525,000
Shares redeemed		375,000
Per share NAV beginning of period	$	80.00
Per share NAV end of period	$	89.57
Percentage change in per share NAV		12.0	%
Percentage change in benchmark		12.9	%
Benchmark annualized volatility		36.2	%

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During the nine months ended September 30, 2011, the increase in the Fund’s NAV resulted primarily from an increase from 5 outstanding Shares at December 31, 2010 to 150,005 outstanding Shares at September 30, 2011. The increase in the Fund’s NAV also resulted from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to the daily performance of the S&P 500 VIX Mid-Term Futures Index.

For the nine months ended September 30, 2011, the Fund’s daily performance had a statistical correlation over 0.99 of the daily performance of its benchmark.

During the nine months ended September 30, 2011, the Fund’s per share NAV reached its high for the period on September 30, 2011 at $89.57 per Share and reached its low for the period on July 7, 2011 at $57.37 per Share.

The benchmark’s rise of 12.9% for the nine months ended September 30, 2011 can be attributed to the sharp rise in VIX mid-term futures contracts over the period.

Net Income/Loss

The following table provides summary income information for the Fund for the nine months ended September 30, 2011:


	Nine Months Ended September 30, 2011
Net investment income (loss)	$	(58,166	)
Offering costs		92,343
Limitation by Sponsor		(30,593	)
Net realized gain (loss)		503,767
Change in net unrealized appreciation/depreciation		1,829,093
Net income (loss)	$	2,274,694

Off-Balance Sheet Arrangements and Contractual Obligations

As of November 9, 2011, the Funds have not used, nor do they expect to use in the future, special purpose entities to facilitate off-balance sheet financing arrangements and have no loan guarantee arrangements or off-balance sheet arrangements of any kind other than agreements entered into in the normal course of business, which may include indemnification provisions related to certain risks service providers undertake in performing services which are in the best interests of the Funds. While each Fund’s exposure under such indemnification provisions cannot be estimated, these general business indemnifications are not expected to have a material impact on a Fund’s financial position.

Management fee payments made to the Sponsor are calculated as a fixed percentage of each Fund’s NAV. As such, the Sponsor cannot anticipate the amount of payments that will be required under these arrangements for future periods as NAVs are not known until a future date. The agreement with the Sponsor may be terminated by either party upon 30 days written notice to the other party. One officer of the Trust also serves as an officer and owner of the Sponsor.

Market Risk

Trading in futures contracts involves each Fund entering into contractual commitments to purchase or sell a commodity underlying the Fund’s benchmark at a specified date and price, should it hold such futures contract into the deliverable period. Should a Fund enter into a contractual commitment to sell a physical commodity, it would be required to make delivery of that commodity at the contract price and then repurchase the contract at prevailing market prices or settle in cash. Since the repurchase price to which the value of a commodity can rise is unlimited, entering into commitments to sell commodities would expose a Fund to theoretically unlimited risk.

Each Fund’s exposure to market risk is influenced by a number of factors, including the liquidity of the markets in which the contracts are traded and the relationships among the contracts held. The inherent uncertainty of each Fund’s trading as well as the development of drastic market occurrences could ultimately lead to a loss of all or substantially all of investors’ capital.

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Credit Risk

When a Fund enters into swap agreements, futures contracts or forward contracts, the Fund is exposed to credit risk that the counterparty to the contract will not meet its obligations.

The counterparty for futures contracts traded on United States and most foreign futures exchanges is the clearing house associated with the particular exchange. In general, clearing houses are backed by their corporate members who may be required to share in the financial burden resulting from the nonperformance by one of their members and, as such, should significantly reduce this credit risk. In cases where the clearing house is not backed by the clearing members (i.e., some foreign exchanges, which may become applicable in the future), it may be backed by a consortium of banks or other financial institutions.

Swap and forward agreements are contracted for directly with counterparties. There can be no assurance that any counterparty, clearing member or clearing house will meet its obligations to a Fund.

Swap agreements do not generally involve the delivery of underlying assets either at the outset of a transaction or upon settlement. Accordingly, if the counterparty to a swap agreement defaults, the Fund’s risk of loss consists of the net amount of payments that the Fund is contractually entitled to receive, if any. Swap counterparty risk is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovery collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

Forward agreements do not involve the delivery of assets at the onset of a transaction, but may be settled physically in the underlying asset if such contracts are held to expiration, particularly in the case of currency forwards. Thus, prior to settlement, if the counterparty to a forward contract defaults, a Fund’s risk of loss consists of the net amount of payments that the Fund is contractually entitled to receive, if any. However, if physically settled forwards are held until expiration (presently, there is no plan to do this), at the time of settlement, a Fund may be at risk for the full notional value of the forward contracts depending on the type of settlement procedures used.

The Sponsor attempts to minimize certain of these market and credit risks by normally:

•

executing and clearing trades with creditworthy counterparties, as determined by the Sponsor;

•

limiting the outstanding amounts due from counterparties to the Funds;

•

not posting margin directly with a counterparty;

•

generally requiring that the counterparty posts collateral in amounts approximately equal to that owed to the Funds, as marked to market;

•

limiting the amount of margin or premium posted at a futures commission merchant (“FCM”); and

•

ensuring that deliverable contracts are not held to such a date when delivery of the underlying asset could be called for.

The FCM for each Fund, in accepting orders for the purchase or sale of domestic futures contracts, is required by CFTC regulations to separately account for and segregate as belonging to the Fund, all assets of the Fund relating to domestic futures trading, and the FCM is not allowed to commingle such assets with other assets of the FCM. In addition, CFTC regulations also require the FCM to hold in a secure account assets of each Fund related to foreign futures trading.

The Funds could lose money if the issuer of a debt security is unable to meet its financial obligations or goes bankrupt. The Funds could also lose money if the issuer of a debt security in which it has a short position is upgraded or generally improves its standing. Changes in an issuer’s financial strength or in an issuer’s or debt security’s credit rating also may affect a security’s value and thus have an impact on a Fund’s performance. Credit risk usually applies to most debt securities, but generally is not a factor for U.S. government obligations.

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Critical Accounting Policies

The Trust’s and the Funds’ critical accounting policies are as follows:

Preparation of the financial statements and related disclosures in compliance with accounting principles generally accepted in the United States of America requires the application of appropriate accounting rules and guidance, as well as the use of estimates. The Trust’s and the Funds’ application of these policies involves judgments and actual results may differ from the estimates used.

Each Fund has significant exposure to Financial Instruments. The Funds hold a significant portion of their assets in swaps, futures or forward contracts, all of which are recorded on a trade date basis and at fair value in the financial statements, with changes in fair value reported in the Statements of Operations.

The use of fair value to measure Financial Instruments, with related unrealized gains or losses recognized in earnings in each period, is fundamental to the Trust’s and the Funds’ financial statements. The fair value of a Financial Instrument is the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (the exit price).

For financial reporting purposes, the Leveraged Funds and the VIX Funds value transactions based upon the final closing price in their primary markets. Accordingly, the investment valuations in these financial statements differ from those used in the calculation of some Leveraged Funds’ and VIX Funds’ final creation/redemption NAV for the three and nine months ended September 30, 2011.

Short-term investments are valued at market price. Treasury securities having a maturity of greater than sixty days are valued at market price.

Derivatives (e.g., futures, swaps and forward agreements) are generally valued using independent sources and/or agreements with counterparties or other procedures as determined by the Sponsor. Futures contracts, except for those entered into by the Gold and Silver Funds, are generally valued at the last settled price on the applicable exchange on which that future trades. Futures contracts entered into by the Gold and Silver Funds are valued at the last sales price prior to the time at which the NAV per Share of a Fund is determined. If there was no sale on that day, and for non-exchange-traded derivatives, the Sponsor may in its sole discretion choose to determine a fair value price as the basis for determining the market value of such position for such day. Such fair value prices would be generally determined based on available inputs about the current value of the underlying financial instrument or commodity and would be based on principles that the Sponsor deems fair and equitable so long as such principles are consistent with normal industry standards. When market closing prices are not available, the Sponsor may value an asset of a Fund pursuant to the policies the Sponsor has adopted, which are consistent with normal industry standards.

Fair value pricing may require subjective determinations about the value of an investment. While each Leveraged and VIX Fund’s policy is intended to result in a calculation of the Leveraged or the VIX Fund’s NAV that fairly reflects investment values as of the time of pricing, the Leveraged and the VIX Funds cannot ensure that fair values determined by the Sponsor or persons acting at their direction would accurately reflect the price that the Leveraged or the VIX Fund could obtain for an investment if it were to dispose of that investment as of the time of pricing (for instance, in a forced or distressed sale). The prices used by the Leveraged or the VIX Fund may differ from the value that would be realized if the investments were sold and the differences could be material to the financial statements.

The Funds disclose the fair value of their investments in a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. See Note 2 in Item 1 of this Quarterly Report on Form 10-Q for further information.

Discounts on short-term securities purchased are amortized and reflected as Interest Income in the Statements of Operations.

Realized gains (losses) and changes in unrealized gain (loss) on open positions are determined on a specific identification basis and recognized in the Statements of Operations in the period in which the contract is closed or the changes occur, respectively.

Each Geared Fund pays its respective brokerage commissions, including applicable exchange fees, NFA fees, give-up fees, pit brokerage fees and other transaction related fees and expenses charged in connection with trading activities for each Fund’s investment in U.S. Commodity Futures Trading Commission regulated investments. Brokerage commissions on futures contracts are recognized on a half-turn basis.

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Item 3.

Quantitative and Qualitative Disclosures About Market Risk.

Quantitative Disclosure

Commodity Price Sensitivity

Each of the Commodity Funds and the Commodity Index Funds is exposed to commodity price risk through its holdings of Financial Instruments. The following tables provide information about each of the Commodity Funds’ and the Commodity Index Funds’ Financial Instruments, which were sensitive to commodity price risk. As of September 30, 2011 and September 30, 2010, each of the Commodity Funds and the Commodity Index Funds’ positions were as follows:

ProShares Ultra DJ-UBS Commodity:

As of September 30, 2011, the ProShares Ultra DJ-UBS Commodity Fund was exposed to commodity price risk through its holding of swap agreements linked to the Dow Jones-UBS Commodity Index. The following table provides information about the Fund’s swap positions as of September 30, 2011, which were sensitive to commodity price risk.

Swap Agreements

Reference Index

Counterparty

Long or
Short

Index Close

Notional Amount
at Value

Dow Jones-UBS Commodity Index

Goldman Sachs International

Long

140.1750

6,650,383

Dow Jones-UBS Commodity Index

UBS AG

Long

140.1750

16,811,409

The September 30, 2011 swap notional amount is calculated by multiplying units times the closing level of the Index. The notional amount will increase (decrease) proportionally with increases (decreases) in the level of the Index. Additional gains (losses) associated with these contracts will be equal to any such subsequent increases (decreases) in notional amount, before accounting for spreads or financing costs associated with the swaps. The Fund will generally attempt to adjust its positions in Financial Instruments each day to have $2.00 of exposure to the Index for every $1.00 of net assets. While the above information properly represents the then current commodity price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the return of the Index and multiplying by two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Swap counterparty risk is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

As of September 30, 2010, the ProShares Ultra DJ-UBS Commodity Fund was exposed to commodity price risk through its holding of swap agreements linked to the Dow Jones-UBS Commodity Index. The following table provides information about the Fund’s swap positions as of September 30, 2010, which were sensitive to commodity price risk.

Swap Agreements

Reference Index

Counterparty

Long or
Short

Index Close

Notional Amount
at Value

Dow Jones-UBS Commodity Index

Goldman Sachs International

Long

140.2939

4,659,257

Dow Jones-UBS Commodity Index

UBS AG

Long

140.2939

14,627,126

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The September 30, 2010 swap notional amount is calculated by multiplying units times the closing level of the Index. The notional amount will increase (decrease) proportionally with increases (decreases) in the level of the Index. Additional gains (losses) associated with these contracts will be equal to any such subsequent increases (decreases) in notional amount, before accounting for spreads or financing costs associated with the swaps. The Fund will generally attempt to adjust its positions in Financial Instruments each day to have $2.00 of exposure to the Index for every $1.00 of net assets. While the above information properly represents the then current commodity price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the return of the Index and multiplying by two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Swap counterparty risk is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

ProShares UltraShort DJ-UBS Commodity:

As of September 30, 2011, the ProShares UltraShort DJ-UBS Commodity Fund was exposed to inverse commodity price risk through its holding of swap agreements linked to the Dow Jones-UBS Commodity Index. The following table provides information about the Fund’s short swap positions as of September 30, 2011, which were sensitive to commodity price risk.

Swap Agreements


Reference Index	Counterparty		Long or Short	Index Close		Notional Amount at Value
Dow Jones-UBS Commodity Index		Goldman Sachs International	Short	$	140.1750	$	(4,499,693	)
Dow Jones-UBS Commodity Index		UBS AG	Short		140.1750		(20,136,530	)

The September 30, 2011 short swap notional amount is calculated by multiplying units times the closing level of the Index. The short notional amount will increase (decrease) proportionally with increases (decreases) in the level of the Index. Additional losses (gains) associated with these contracts will be equal to any such subsequent increases (decreases) in short notional amount, before accounting for any spreads or financing costs associated with the swaps. The Fund will generally attempt to adjust its positions in Financial Instruments each day to have negative $2.00 of exposure to the Index for every $1.00 of net assets. While the above information properly represents the then current commodity price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the return of the Index and multiplying by negative two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Swap counterparty risk is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

As of September 30, 2010, the ProShares UltraShort DJ-UBS Commodity Fund was exposed to inverse commodity price risk through its holding of swap agreements linked to the Dow Jones-UBS Commodity Index. The following table provides information about the Fund’s short swap positions as of September 30, 2010, which were sensitive to commodity price risk.

Swap Agreements


Reference Index	Counterparty		Long or Short	Index Close		Notional Amount at Value
Dow Jones-UBS Commodity Index		Goldman Sachs International	Short	$	140.2939	$	(688,504	)
Dow Jones-UBS Commodity Index		UBS AG	Short		140.2939		(1,993,193	)

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The September 30, 2010 short swap notional amount is calculated by multiplying units times the closing level of the Index. The short notional amount will increase (decrease) proportionally with increases (decreases) in the level of the Index. Additional losses (gains) associated with these contracts will be equal to any such subsequent increases (decreases) in short notional amount, before accounting for any spreads or financing costs associated with the swaps. The Fund will generally attempt to adjust its positions in Financial Instruments each day to have negative $2.00 of exposure to the Index for every $1.00 of net assets. While the above information properly represents the then current commodity price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the return of the Index and multiplying by negative two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Swap counterparty risk is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

ProShares Ultra DJ-UBS Crude Oil:

As of September 30, 2011, the ProShares Ultra DJ-UBS Crude Oil Fund was exposed to commodity price risk through its holding of Crude Oil futures contracts and its holding of swap agreements linked to the Dow Jones-UBS Crude Oil Sub-Index. The following tables provide information about the Fund’s positions in these Financial Instruments as of September 30, 2011, which were sensitive to commodity price risk.

Futures Positions

Contract

Long or
Short

Expiration

Contracts

Valuation
Price

Contract
Multiplier

Notional Amount
at Value

Crude Oil (NYMEX)

Long

November 2011

3,935

79.20

1,000

311,652,000

Swap Agreements

Reference Index

Counterparty

Long or
Short

Index Close

Notional Amount
at Value

Dow Jones-UBS Crude Oil Sub-Index

Goldman Sachs International

Long

209.3412

188,482,103

Dow Jones-UBS Crude Oil Sub-Index

UBS AG

Long

209.3412

261,660,350

The September 30, 2011 futures notional amount is calculated by multiplying the number of contracts held times the valuation price times the contract multiplier. The September 30, 2011 swap notional amount is calculated by multiplying the number of units times the closing level of the Index. These notional amounts will increase (decrease) proportionally with increases (decreases) in the price of the futures contract or the level of the Index, as applicable. Additional gains (losses) associated with these contracts will be equal to any such subsequent increases (decreases) in notional amount, before accounting for spreads or transaction or financing costs. The Fund will generally attempt to adjust its positions in Financial Instruments each day to have $2.00 of exposure to the Index for every $1.00 of net assets. While the above information properly represents the then current commodity price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the return of the Index and multiplying by two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Swap counterparty risk is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

As of September 30, 2010, the ProShares Ultra DJ-UBS Crude Oil Fund was exposed to commodity price risk through its holding of Crude Oil futures contracts and its holding of swap agreements linked to the Dow Jones-UBS Crude Oil Sub-Index. The following tables provide information about the Fund’s positions in these Financial Instruments as of September 30, 2010, which were sensitive to commodity price risk.

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Futures Positions

Contract

Long or
Short

Expiration

Contracts

Valuation
Price

Contract
Multiplier

Notional Amount
at Value

Crude Oil (NYMEX)

Long

November 2010

4,133

79.97

1,000

330,516,010

Swap Agreements

Reference Index

Counterparty

Long or
Short

Index Close

Notional Amount
at Value

Dow Jones-UBS Crude Oil Sub-Index

Goldman Sachs International

Long

240.8953

190,360,794

Dow Jones-UBS Crude Oil Sub-Index

UBS AG

Long

240.8953

254,055,319

The September 30, 2010 futures notional amount is calculated by multiplying the number of contracts held times the valuation price times the contract multiplier. The September 30, 2010 swap notional amount is calculated by multiplying the number of units times the closing level of the Index. These notional amounts will increase (decrease) proportionally with increases (decreases) in the price of the futures contract or the level of the Index, as applicable. Additional gains (losses) associated with these contracts will be equal to any such subsequent increases (decreases) in notional amount, before accounting for spreads or transaction or financing costs. The Fund will generally attempt to adjust its positions in Financial Instruments each day to have $2.00 of exposure to the Index for every $1.00 of net assets. While the above information properly represents the then current commodity price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the return of the Index and multiplying by two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Swap counterparty risk is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

ProShares UltraShort DJ-UBS Crude Oil:

As of September 30, 2011, the ProShares UltraShort DJ-UBS Crude Oil Fund was exposed to inverse commodity price risk through its holding of Crude Oil futures contracts and its holding of swap agreements linked to the Dow Jones-UBS Crude Oil Sub-Index. The following tables provide information about the Fund’s positions in these Financial Instruments as of September 30, 2011, which were sensitive to commodity price risk.

Futures Positions


Contract	Long or Short		Expiration		Contracts		Valuation Price		Contract Multiplier		Notional Amount at Value
Crude Oil (NYMEX)		Short		November 2011		667	$	79.20		1,000	$	(52,826,400	)

Swap Agreements


Reference Index	Counterparty		Long or Short		Index Close		Notional Amount at Value
Dow Jones-UBS Crude Oil Sub-Index		Goldman Sachs International		Short	$	209.3412	$	(35,501,505	)
Dow Jones-UBS Crude Oil Sub-Index		UBS AG		Short		209.3412		(56,394,476	)

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The September 30, 2011 short futures notional amount is calculated by multiplying the number of contracts held times the valuation price times the contract multiplier. The September 30, 2011 short swap notional amount is calculated by multiplying the number of units times the closing level of the Index. These short notional amounts will increase (decrease) proportionally with increases (decreases) in the price of the futures contract or the level of the Index, as applicable. Additional losses (gains) associated with these contracts will be equal to any such subsequent increases (decreases) in short notional amount, before accounting for spreads or transaction or financing costs. The Fund will generally attempt to adjust its positions in Financial Instruments each day to have negative $2.00 of exposure to the Index for every $1.00 of net assets. While the above information properly represents the then current commodity price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the return of the Index and multiplying by negative two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Swap counterparty risk is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

As of September 30, 2010, the ProShares UltraShort DJ-UBS Crude Oil Fund was exposed to inverse commodity price risk through its holding of Crude Oil futures contracts and its holding of swap agreements linked to the Dow Jones-UBS Crude Oil Sub-Index. The following tables provide information about the Fund’s positions in these Financial Instruments as of September 30, 2010, which were sensitive to commodity price risk.

Futures Positions


Contract	Long or Short		Expiration		Contracts		Valuation Price		Contract Multiplier		Notional Amount at Value
Crude Oil (NYMEX)		Short		November 2010		400	$	79.97		1,000	$	(31,988,000	)

Swap Agreements


Reference Index	Counterparty	Long or Short		Index Close		Notional Amount at Value
Dow Jones-UBS Crude Oil Sub-Index	Goldman Sachs International		Short	$	240.8953	$	(19,406,494	)
Dow Jones-UBS Crude Oil Sub-Index	UBS AG		Short		240.8953		(28,626,377	)

The September 30, 2010 short futures notional amount is calculated by multiplying the number of contracts held times the valuation price times the contract multiplier. The September 30, 2010 short swap notional amount is calculated by multiplying the number of units times the closing level of the Index. These short notional amounts will increase (decrease) proportionally with increases (decreases) in the price of the futures contract or the level of the Index, as applicable. Additional losses (gains) associated with these contracts will be equal to any such subsequent increases (decreases) in short notional amount, before accounting for spreads or transaction or financing costs. The Fund will generally attempt to adjust its positions in Financial Instruments each day to have negative $2.00 of exposure to the Index for every $1.00 of net assets. While the above information properly represents the then current commodity price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the return of the Index and multiplying by negative two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Swap counterparty risk is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

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ProShares Ultra Gold:

As of September 30, 2011, the ProShares Ultra Gold Fund was exposed to commodity price risk through its holding of Gold futures contracts and Gold forward agreements. The following tables provide information about the Fund’s positions in these Financial Instruments as of September 30, 2011, which were sensitive to commodity price risk.

Futures Positions

Contract

Long or
Short

Expiration

Contracts

Valuation
Price

Contract
Multiplier

Notional Amount
at Value

Gold Futures (COMEX)

Long

December 2011

1,622.30

100

4,055,750

Forward Agreements

Reference Index

Counterparty

Long or
Short

Valuation
Price

Notional Amount
at Value

0.995 Fine Troy Ounce Gold

Goldman Sachs International

Long

1,620.23

183,928,510

0.995 Fine Troy Ounce Gold

UBS AG

Long

1,620.23

560,113,511

The September 30, 2011 futures notional amount is calculated by multiplying the number of contracts held times the valuation price times the contract multiplier. The September 30, 2011 forward notional amount equals units multiplied by the forward price. These notional amounts will increase (decrease) proportionally with increases (decreases) in the price of the futures contract or forward price, as applicable. Additional gains (losses) associated with these contracts will be equal to any such subsequent increases (decreases) in notional amount, before accounting for spreads or transaction or financing costs. The Fund will generally attempt to adjust its positions in Financial Instruments each day to have $2.00 of exposure to the Index for every $1.00 of net assets. While the above information properly represents the then current commodity price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the return of the Index and multiplying by two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Counterparty risk related to the forward agreements is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

As of September 30, 2010, the ProShares Ultra Gold Fund was exposed to commodity price risk through its holding of Gold futures contracts and Gold forward agreements. The following tables provide information about the Fund’s positions in these Financial Instruments as of September 30, 2010, which were sensitive to commodity price risk.

Futures Positions

Contract

Long or
Short

Expiration

Contracts

Valuation
Price

Contract
Multiplier

Notional Amount
at Value

Gold Futures (COMEX)

Long

December 2010

1,309.60

100

9,429,120

Forward Agreements

Reference Index

Counterparty

Long or
Short

Valuation
Price

Notional Amount
at Value

0.995 Fine Troy Ounce Gold

Goldman Sachs International

Long

1,307.16

47,998,915

0.995 Fine Troy Ounce Gold

UBS AG

Long

1,307.16

350,188,164

The September 30, 2010 futures notional amount is calculated by multiplying the number of contracts held times the valuation price times the contract multiplier. The September 30, 2010 forward notional amount equals units multiplied by the forward price. These notional amounts will increase (decrease) proportionally with increases (decreases) in the price of the futures contract or forward price, as applicable. Additional gains (losses) associated with these contracts will be equal to any such subsequent increases (decreases) in notional amount, before accounting for spreads or transaction or financing costs. The Fund will generally attempt to

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adjust its positions in Financial Instruments each day to have $2.00 of exposure to the Index for every $1.00 of net assets. While the above information properly represents the then current commodity price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the return of the Index and multiplying by two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Counterparty risk related to the forward agreements is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

ProShares UltraShort Gold:

As of September 30, 2011, the ProShares UltraShort Gold Fund was exposed to inverse commodity price risk through its holding of Gold futures contracts and Gold forward agreements. The following tables provide information about the Fund’s positions in these Financial Instruments as of September 30, 2011, which were sensitive to commodity price risk.

Futures Positions


Contract	Long or Short		Expiration		Contracts		Valuation Price		Contract Multiplier		Notional Amount at Value
Gold Futures (COMEX)		Short		December 2011		12	$	1,622.30		100	$	(1,946,760	)

Forward Agreements


Reference Index	Counterparty	Long or Short		Valuation Price		Notional Amount at Value
0.995 Fine Troy Ounce Gold	Goldman Sachs International		Short	$	1,620.23	$	(85,058,835	)
0.995 Fine Troy Ounce Gold	UBS AG		Short		1,620.23		(269,120,203	)

The September 30, 2011 short futures notional amount is calculated by multiplying the number of contracts held times the valuation price times the contract multiplier. The September 30, 2011 short forward notional amount equals units multiplied by the forward price. These short notional amounts will increase (decrease) proportionally with increases (decreases) in the price of the futures contract or forward price, as applicable. Additional losses (gains) associated with these contracts will be equal to any such subsequent increases (decreases) in short notional amount, before accounting for spreads or transaction or financing costs. The Fund will generally attempt to adjust its positions in Financial Instruments each day to have negative $2.00 of short exposure to the Index for every $1.00 of net assets. While the above information properly represents the then current commodity price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the return of the Index and multiplying by negative two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Counterparty risk related to the forward agreements is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

As of September 30, 2010, the ProShares UltraShort Gold Fund was exposed to inverse commodity price risk through its holding of Gold futures contracts and Gold forward agreements. The following tables provide information about the Fund’s positions in these Financial Instruments as of September 30, 2010, which were sensitive to commodity price risk.

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Futures Positions


Contract	Long or Short		Expiration		Contracts		Valuation Price		Contract Multiplier		Notional Amount at Value
Gold Futures (COMEX)		Short		December 2010		36	$	1,309.60		100	$	(4,714,560	)

Forward Agreements


Reference Index	Counterparty	Long or Short		Valuation Price		Notional Amount at Value
0.995 Fine Troy Ounce Gold	Goldman Sachs International		Short	$	1,307.16	$	(20,781,230	)
0.995 Fine Troy Ounce Gold	UBS AG		Short		1,307.16		(125,618,076	)

The September 30, 2010 short futures notional amount is calculated by multiplying the number of contracts held times the valuation price times the contract multiplier. The September 30, 2010 short forward notional amount equals units multiplied by the forward price. These short notional amounts will increase (decrease) proportionally with increases (decreases) in the price of the futures contract or forward price, as applicable. Additional losses (gains) associated with these contracts will be equal to any such subsequent increases (decreases) in short notional amount, before accounting for spreads or transaction or financing costs. The Fund will generally attempt to adjust its positions in Financial Instruments each day to have negative $2.00 of short exposure to the Index for every $1.00 of net assets. While the above information properly represents the then current commodity price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the return of the Index and multiplying by negative two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Counterparty risk related to the forward agreements is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

ProShares Ultra Silver:

As of September 30, 2011, the ProShares Ultra Silver Fund was exposed to commodity price risk through its holding of Silver futures contracts and Silver forward agreements. The following tables provide information about the Fund’s positions in these Financial Instruments as of September 30, 2011, which were sensitive to commodity price risk.

Futures Positions

Contract

Long or
Short

Expiration

Contracts

Valuation
Price

Contract
Multiplier

Notional Amount
at Value

Silver Futures (COMEX)

Long

December 2011

30.083

5,000

11,130,710

Forward Agreements

Reference Index

Counterparty

Long or
Short

Valuation
Price

Notional Amount
at Value

0.999 Fine Troy Ounce Silver

Goldman Sachs International

Long

30.4532

367,899,019

0.999 Fine Troy Ounce Silver

UBS AG

Long

30.4532

1,033,094,357

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notional amounts will increase (decrease) proportionally with increases (decreases) in the price of the futures contract or forward price, as applicable. Additional gains (losses) associated with these contracts will be equal to any such subsequent increases (decreases) in notional amount, before accounting for spreads or transaction or financing costs. The Fund will generally attempt to adjust its positions in Financial Instruments each day to have $2.00 of exposure to the Index for every $1.00 of net assets. While the above information properly represents the then current commodity price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the return of the Index and multiplying by two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Counterparty risk related to the forward agreements is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

As of September 30, 2010, the ProShares Ultra Silver Fund was exposed to commodity price risk through its holding of Silver futures contracts and Silver forward agreements. The following tables provide information about the Fund’s positions in these Financial Instruments as of September 30, 2010, which were sensitive to commodity price risk.

Futures Positions

Contract

Long or
Short

Expiration

Contracts

Valuation
Price

Contract
Multiplier

Notional Amount
at Value

Silver Futures (COMEX)

Long

December 2010

105

21.821

5,000

11,456,025

Forward Agreements

Reference Index

Counterparty

Long or
Short

Valuation
Price

Notional Amount
at Value

0.999 Fine Troy Ounce Silver

Goldman Sachs International

Long

22.0741

96,702,217

0.999 Fine Troy Ounce Silver

UBS AG

Long

22.0741

293,894,568

The September 30, 2010 futures notional amount is calculated by multiplying the number of contracts held times the valuation price times the contract multiplier. The September 30, 2010 forward notional amount equals units multiplied by the forward price. These notional amounts will increase (decrease) proportionally with increases (decreases) in the price of the futures contract or forward price, as applicable. Additional gains (losses) associated with these contracts will be equal to any such subsequent increases (decreases) in notional amount, before accounting for spreads or transaction or financing costs. The Fund will generally attempt to adjust its positions in Financial Instruments each day to have $2.00 of exposure to the Index for every $1.00 of net assets. While the above information properly represents the then current commodity price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the return of the Index and multiplying by two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Counterparty risk related to the forward agreements is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

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ProShares UltraShort Silver:

As of September 30, 2011, the ProShares UltraShort Silver Fund was exposed to inverse commodity price risk through its holding of Silver futures contracts and Silver forward agreements. The following tables provide information about the Fund’s positions in these Financial Instruments as of September 30, 2011, which were sensitive to commodity price risk.

Futures Positions


Contract	Long or Short		Expiration		Contracts		Valuation Price		Contract Multiplier		Notional Amount at Value
Silver Futures (COMEX)		Short		December 2011		30	$	30.083		5,000	$	(4,512,450	)

Forward Agreements


Reference Index	Counterparty	Long or Short		Valuation Price		Notional Amount at Value
0.999 Fine Troy Ounce Silver	Goldman Sachs International		Short	$	30.4532	$	(231,520,453	)
0.999 Fine Troy Ounce Silver	UBS AG		Short		30.4532		(830,550,124	)

The September 30, 2011 short futures notional amount is calculated by multiplying the number of contracts held times the valuation price times the contract multiplier. The September 30, 2011 short forward notional amount equals units multiplied by the forward price. These short notional amounts will increase (decrease) proportionally with increases (decreases) in the price of the futures contract or forward price, as applicable. Additional losses (gains) associated with these contracts will be equal to any such subsequent increases (decreases) in short notional amount, before accounting for spreads or transaction or financing costs. The Fund will generally attempt to adjust its positions in Financial Instruments each day to have negative $2.00 of short exposure to the Index for every $1.00 of net assets. While the above information properly represents the then current commodity price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the return of the Index and multiplying by negative two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Counterparty risk related to the forward agreements is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

As of September 30, 2010, the ProShares UltraShort Silver Fund was exposed to inverse commodity price risk through its holding of Silver futures contracts and Silver forward agreements. The following tables provide information about the Fund’s positions in these Financial Instruments as of September 30, 2010, which were sensitive to commodity price risk.

Futures Positions


Contract	Long or Short		Expiration		Contracts		Valuation Price		Contract Multiplier		Notional Amount at Value
Silver Futures (COMEX)		Short		December 2010		24	$	21.821		5,000	$	(2,618,520	)

Forward Agreements


Reference Index	Counterparty	Long or Short		Valuation Price		Notional Amount at Value
0.999 Fine Troy Ounce Silver	Goldman Sachs International		Short	$	22.0741	$	(31,179,666	)
0.999 Fine Troy Ounce Silver	UBS AG		Short		22.0741		(87,921,140	)

The September 30, 2010 short futures notional amount is calculated by multiplying the number of contracts held times the valuation price times the contract multiplier. The September 30, 2010 short forward notional amount equals units multiplied by the forward price. These short notional amounts will increase (decrease) proportionally with increases (decreases) in the price of the futures contract or forward price, as applicable. Additional losses (gains) associated with these contracts will be equal to any such subsequent increases (decreases) in short notional amount, before accounting for spreads or transaction or financing costs. The Fund will

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generally attempt to adjust its positions in Financial Instruments each day to have negative $2.00 of short exposure to the Index for every $1.00 of net assets. While the above information properly represents the then current commodity price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the return of the Index and multiplying by negative two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Counterparty risk related to the forward agreements is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

Exchange Rate Sensitivity

Each of the Currency Funds is exposed to exchange rate risk through its holdings of Financial Instruments. The following tables provide information about each of the Currency Funds’ Financial Instruments, which are sensitive to changes in exchange rates. As of September 30, 2011, each of the Currency Funds’ positions were as follows:

ProShares Ultra Euro:

As of September 30, 2011, the ProShares Ultra Euro Fund was exposed to exchange rate price risk through its holdings of Euro/USD foreign currency forward contracts. The following table provides information about the Fund’s positions in these Financial Instruments as of September 30, 2011, which were sensitive to exchange rate price risk.

Foreign Currency Forward Contracts


Reference Currency	Counterparty	Long or Short		Settlement Date		Euro			Forward Rate		Market Value USD
Euro	Goldman Sachs International		Long		10/07/11		6,232,725			1 .3396	$	8,349,073
Euro	UBS AG		Long		10/07/11		6,659,500			1 .3396		8,920,761
Euro	Goldman Sachs International		Short		10/07/11		(721,200	)		1 .3396		(966,087	)
Euro	UBS AG		Short		10/07/11		(646,900	)		1 .3396		(866,558	)

The September 30, 2011 USD market value equals the number of Euros multiplied by the forward rate. These notional amounts will increase (decrease) proportionally with increases (decreases) in the forward price. The Fund will generally attempt to adjust its positions in Financial Instruments each day to have $2.00 of exposure to the Euro for every $1.00 of net assets. While the above information properly represents the then current exchange rate price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the appreciation or depreciation of the Euro and multiplying by two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Counterparty risk related to foreign currency forward contracts is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

As of September 30, 2010, the ProShares Ultra Euro Fund was exposed to exchange rate price risk through its holdings of Euro/USD foreign currency forward contracts. The following table provides information about the Fund’s positions in these Financial Instruments as of September 30, 2010, which were sensitive to exchange rate price risk.

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Foreign Currency Forward Contracts


Reference Currency	Counterparty	Long or Short		Settlement Date		Euro			Forward Rate		Market Value USD
Euro	Goldman Sachs International		Long		10/08/10		9,088,625			1.3631	$	12,388,382
Euro	UBS AG		Long		10/08/10		12,716,100			1.3631		17,332,864
Euro	Goldman Sachs International		Short		10/08/10		(64,600	)		1.3631		(88,054	)
Euro	UBS AG		Short		10/08/10		(3,978,300	)		1.3631		(5,422,679	)

The September 30, 2010 USD market value equals the number of Euros multiplied by the forward rate. These notional amounts will increase (decrease) proportionally with increases (decreases) in the forward price. The Fund will generally attempt to adjust its positions in Financial Instruments each day to have $2.00 of exposure to the Euro for every $1.00 of net assets. While the above information properly represents the then current exchange rate price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the appreciation or depreciation of the Euro and multiplying by two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Counterparty risk related to foreign currency forward contracts is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

ProShares UltraShort Euro:

As of September 30, 2011, the ProShares UltraShort Euro Fund was exposed to inverse exchange rate price risk through its holdings of Euro/USD foreign currency forward contracts. The following table provides information about the Fund’s positions in these Financial Instruments as of September 30, 2011, which were sensitive to exchange rate price risk.

Foreign Currency Forward Contracts


Reference Currency	Counterparty	Long or Short		Settlement Date		Euro			Forward Rate		Market Value USD
Euro	Goldman Sachs International		Long		10/07/11		63,408,700			1 .3396	$	84,939,392
Euro	UBS AG		Long		10/07/11		86,950,300			1 .3396		116,474,642
Euro	Goldman Sachs International		Short		10/07/11		(731,587,225	)		1 .3396		(980,000,757	)
Euro	UBS AG		Short		10/07/11		(816,704,400	)		1 .3396		(1,094,019,828	)

The September 30, 2011 USD market value equals the number of Euros multiplied by the forward rate. These notional amounts will increase (decrease) proportionally with increases (decreases) in the forward price. The Fund will generally attempt to adjust its positions in Financial Instruments each day to have negative $2.00 of short exposure to the Euro for every $1.00 of net assets. While the above information properly represents the then current exchange rate price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the appreciation or depreciation of the Euro and multiplying by negative two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Counterparty risk related to foreign currency forward contracts is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

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As of September 30, 2010, the ProShares UltraShort Euro Fund was exposed to inverse exchange rate price risk through its holdings of Euro/USD foreign currency forward contracts. The following table provides information about the Fund’s positions in these Financial Instruments as of September 30, 2010, which were sensitive to exchange rate price risk.

Foreign Currency Forward Contracts


Reference Currency	Counterparty	Long or Short		Settlement Date		Euro			Forward Rate		Market Value USD
Euro	Goldman Sachs International		Long		10/08/10		83,196,500			1.3631	$	113,402,195
Euro	UBS AG		Long		10/08/10		71,122,800			1.3631		96,944,964
Euro	Goldman Sachs International		Short		10/08/10		(275,824,625	)		1.3631		(375,966,753	)
Euro	UBS AG		Short		10/08/10		(285,937,800	)		1.3631		(389,751,663	)

The September 30, 2010 USD market value equals the number of Euros multiplied by the forward rate. These notional amounts will increase (decrease) proportionally with increases (decreases) in the forward price. The Fund will generally attempt to adjust its positions in Financial Instruments each day to have negative $2.00 of short exposure to the Euro for every $1.00 of net assets. While the above information properly represents the then current exchange rate price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the appreciation or depreciation of the Euro and multiplying by negative two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Counterparty risk related to foreign currency forward contracts is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

ProShares Ultra Yen:

As of September 30, 2011, the ProShares Ultra Yen Fund was exposed to exchange rate price risk through its holdings of Yen/USD foreign currency forward contracts. The following table provides information about the Fund’s positions in these Financial Instruments as of September 30, 2011, which were sensitive to exchange rate price risk.

Foreign Currency Forward Contracts


Reference Currency	Counterparty	Long or Short		Settlement Date		Yen			Forward Rate		Market Value USD
Yen	Goldman Sachs International		Long		10/07/11		355,590,000			0 .012963	$	4,609,665
Yen	UBS AG		Long		10/07/11		516,060,000			0 .012963		6,689,905
Yen	Goldman Sachs International		Short		10/07/11		(19,800,000	)		0 .012963		(256,676	)
Yen	UBS AG		Short		10/07/11		(5,630,000	)		0 .012963		(72,984	)

The September 30, 2011 USD market value equals the number of Yen multiplied by the forward rate. These notional amounts will increase (decrease) proportionally with increases (decreases) in the forward price. The Fund will generally attempt to adjust its positions in Financial Instruments each day to have $2.00 of exposure to the Yen for every $1.00 of net assets. While the above information properly represents the then current exchange rate price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the appreciation or depreciation of the Yen and multiplying by two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Counterparty risk related to foreign currency forward contracts is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

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As of September 30, 2010, the ProShares Ultra Yen Fund was exposed to exchange rate price risk through its holdings of Yen/USD foreign currency forward contracts. The following table provides information about the Fund’s positions in these Financial Instruments as of September 30, 2010, which were sensitive to exchange rate price risk.

Foreign Currency Forward Contracts


Reference Currency	Counterparty	Long or Short		Settlement Date		Yen			Forward Rate		Market Value USD
Yen	Goldman Sachs International		Long		10/08/10		421,140,000			0.011974	$	5,042,857
Yen	UBS AG		Long		10/08/10		682,610,000			0.011974		8,173,777
Yen	Goldman Sachs International		Short		10/08/10		(38,640,000	)		0.011974		(462,687	)
Yen	UBS AG		Short		10/08/10		(2,800,000	)		0.011974		(33,528	)

The September 30, 2010 USD market value equals the number of Yen multiplied by the forward rate. These notional amounts will increase (decrease) proportionally with increases (decreases) in the forward price. The Fund will generally attempt to adjust its positions in Financial Instruments each day to have $2.00 of exposure to the Yen for every $1.00 of net assets. While the above information properly represents the then current exchange rate price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the appreciation or depreciation of the Yen and multiplying by two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Counterparty risk related to foreign currency forward contracts is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

ProShares UltraShort Yen:

As of September 30, 2011, the ProShares UltraShort Yen Fund was exposed to inverse exchange rate price risk through its holdings of Yen/USD foreign currency forward contracts. The following table provides information about the Fund’s positions in these Financial Instruments as of September 30, 2011, which were sensitive to exchange rate price risk.

Foreign Currency Forward Contracts


Reference Currency	Counterparty	Long or Short		Settlement Date		Yen			Forward Rate		Market Value USD
Yen	Goldman Sachs International		Long		10/07/11		3,203,440,000			0 .012963	$	41,527,556
Yen	UBS AG		Long		10/07/11		1,423,900,000			0 .012963		18,458,622
Yen	Goldman Sachs International		Short		10/07/11		(23,267,420,000	)		0 .012963		(301,625,468	)
Yen	UBS AG		Short		10/07/11		(23,259,690,000	)		0 .012963		(301,525,261	)

The September 30, 2011 USD market value equals the number of Yen multiplied by the forward rate. These notional amounts will increase (decrease) proportionally with increases (decreases) in the forward price. The Fund will generally attempt to adjust its positions in Financial Instruments each day to have negative $2.00 of short exposure to the Yen for every $1.00 of net assets. While the above information properly represents the then current exchange rate price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the appreciation or depreciation of the Yen and multiplying by negative two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Counterparty risk related to foreign currency forward contracts is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

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As of September 30, 2010, the ProShares UltraShort Yen Fund was exposed to inverse exchange rate price risk through its holdings of Yen/USD foreign currency forward contracts. The following table provides information about the Fund’s positions in these Financial Instruments as of September 30, 2010, which were sensitive to exchange rate price risk.

Foreign Currency Forward Contracts


Reference Currency	Counterparty	Long or Short		Settlement Date		Yen			Forward Rate		Market Value USD
Yen	Goldman Sachs International		Long		10/08/10		3,369,670,000			0.011974	$	40,349,439
Yen	UBS AG		Long		10/08/10		1,717,910,000			0.011974		20,570,770
Yen	Goldman Sachs International		Short		10/08/10		(15,769,330,000	)		0.011974		(188,826,687	)
Yen	UBS AG		Short		10/08/10		(16,586,520,000	)		0.011974		(198,611,965	)

The September 30, 2010 USD market value equals the number of Yen multiplied by the forward rate. These notional amounts will increase (decrease) proportionally with increases (decreases) in the forward price. The Fund will generally attempt to adjust its positions in Financial Instruments each day to have negative $2.00 of short exposure to the Yen for every $1.00 of net assets. While the above information properly represents the then current exchange rate price risk and is adequate for estimating the following day’s gains or losses, estimates of future values over longer periods should take the Fund’s daily rebalancing efforts into account. Future period returns, before fees and expenses, cannot be estimated simply by estimating the appreciation or depreciation of the Yen and multiplying by negative two. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day. Counterparty risk related to foreign currency forward contracts is generally limited to the amount of any unrealized gains, although in the event of a counterparty bankruptcy, there could be delays and costs associated with recovering collateral posted in segregated tri-party accounts at the Fund’s custodian bank.

Equity Market Volatility Sensitivity

ProShares VIX Short-Term Futures ETF

As of September 30, 2011, the ProShares VIX Short-Term Futures ETF Fund was exposed to equity market volatility risk through its holding of VIX futures contracts. The following table provides information about the Fund’s positions in VIX futures contracts as of September 30, 2011, which were sensitive to equity market volatility risk.

Futures Positions


Contract	Long or Short		Expiration		Contracts		Valuation Price		Contract Multiplier		Notional Amount at Value
VIX (CBOE)		Long		October 2011		429	$	42 .15		1,000	$	18,082,350
VIX (CBOE)		Long		November 2011		286		37 .75		1,000		10,796,500

ProShares VIX Mid-Term Futures ETF

As of September 30, 2011, the ProShares VIX Mid-Term Futures ETF Fund was exposed to equity market volatility risk through its holding of VIX futures contracts. The following table provides information about the Fund’s positions in VIX futures contracts as of September 30, 2011, which were sensitive to equity market volatility risk.

Futures Positions


Contract	Long or Short		Expiration		Contracts		Valuation Price		Contract Multiplier		Notional Amount at Value
VIX (CBOE)		Long		January 2012		78	$	35 .50		1,000	$	2,769,000
VIX (CBOE)		Long		February 2012		129		34 .70		1,000		4,476,300
VIX (CBOE)		Long		March 2012		129		34 .25		1,000		4,418,250
VIX (CBOE)		Long		April 2012		52		34 .35		1,000		1,786,200

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Qualitative Disclosure

As described above in Item 2 of this Quarterly Report on Form 10-Q, it is the investment objective of each Leveraged Fund to seek daily investment results, before fees and expenses, which match twice (2x) the daily performance, whether positive or negative, of its corresponding benchmark. Each Ultra Fund seeks daily investment results (before fees and expenses) that match twice (2x) the daily performance of its corresponding benchmark. Each Short Fund will seek daily investment results (before fees and expenses) that match the inverse (-1x) of the daily performance of its corresponding benchmark. Each UltraShort Fund seeks daily investment results (before fees and expenses) that match twice the inverse (-2x) of the daily performance of its corresponding benchmark. Each VIX Fund seeks investment results (before fees and expenses) that match the performance of a benchmark. Daily performance is measured from the calculation of one NAV to the next. The Geared Funds do not seek to achieve these stated investment objectives over a period of time greater than one day because mathematical compounding prevents the Geared Funds from achieving such results. Performance over longer periods of time will be influenced not only by the cumulative period performance of the corresponding benchmark but equally by the intervening volatility of the benchmark as well as fees and expenses, including costs associated with the use of Financial Instruments such as financing costs and trading spreads. Future period returns, before fees and expenses, cannot be estimated simply by estimating the percent change in the corresponding benchmark and multiplying by two or negative two. Investors should monitor their ProShares holdings consistent with their strategies, as frequently as daily. See “Item 1A. Risk Factors” in this Form 10-Q for additional information regarding performance for periods longer than one day.

Primary Market Risk Exposure

Each Fund’s investment objective and corresponding benchmark defines the primary market risks that the Funds are exposed to. For example, the primary market risk that the ProShares Ultra DJ-UBS Crude Oil and the ProShares UltraShort DJ-UBS Crude Oil Funds are exposed to are direct and inverse exposure, respectively, to the price of crude oil as measured by the return of holding and periodically rolling crude oil futures contracts (the Dow Jones-UBS Commodity Index and its sub-indexes are based on the price of rolling futures positions, rather than on the cash price for immediate delivery of the corresponding commodity).

Each Fund’s exposure to market risk is further influenced by a number of factors, including the liquidity of the markets in which the contracts are traded and the relationships among the contracts held. The inherent uncertainty of each Fund’s trading as well as the development of drastic market occurrences could ultimately lead to a loss of all or substantially all of investors’ capital.

As described above in Item 2 of this Quarterly Report on Form 10-Q, trading in certain futures contracts or forward agreements involves each Fund entering into contractual commitments to purchase or sell a commodity underlying a Fund’s benchmark at a specified date and price, should it hold such futures contracts or forward agreements into the deliverable period. Should a Fund enter into a contractual commitment to sell a physical commodity, it is required to make delivery of that commodity at the contract price and then repurchase the contract at prevailing market prices or settle in cash. Since the repurchase price to which the value of a commodity can rise is unlimited, entering into commitments to sell commodities would expose a Fund to theoretically unlimited risk.

Commodity Price Sensitivity

As further described in “Item 1A. Risk Factors” in this Form 10-Q, the value of the Shares of each Fund relates directly to the value of, and realized profit or loss from, the Financial Instruments and other assets held by the Fund and fluctuations in the price of these assets could materially adversely affect an investment in the Shares. With regard to the Commodity Index Funds or the Commodity Funds, several factors may affect the price of a commodity underlying a Commodity Index Fund or a Commodity Fund, and in turn, the Financial Instruments and other assets, if any, owned by such a Fund. The impact of changes in the price of a physical commodity or of a commodity index (comprised of commodity futures contracts) will affect investors differently depending upon the Fund in which investors invest. Daily increases in the price of an underlying commodity or commodity index will negatively impact the daily performance of Shares of an UltraShort Fund and daily decreases in the price of an underlying commodity or commodity index will negatively impact the daily performance of Shares of an Ultra Fund.

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Additionally, performance over time is a cumulative effect of geometrically linking each day’s leveraged or inverse leveraged returns. For instance, if a corresponding benchmark was up 10% and then down 10%, which would result in a (1.1*0.9)-1 = -1% period benchmark return, the two-day period return for a theoretical two-times fund would be equal to a (1.2 *0.8)-1 = -4% period Fund return (rather than simply two times the period return of the benchmark).

Exchange Rate Sensitivity

As further described in “Item 1A. Risk Factors” in this Form 10-Q, the value of the Shares of each Fund relates directly to the value of, and realized profit or loss from, the Financial Instruments and other assets held by the Fund and fluctuations in the price of these assets could materially adversely affect an investment in the Shares. With regard to the Currency Funds, several factors may affect the value of the foreign currencies or the U.S. Dollar, and, in turn, the Financial Instruments and other assets, if any, owned by a Fund. The impact of changes in the price of a currency will affect investors differently depending upon the Fund in which investors invest. Daily increases in the price of a currency will negatively impact the daily performance of Shares of an UltraShort Fund and daily decreases in the price of a currency will negatively impact the daily performance of Shares of an Ultra Fund.

Equity Market Volatility Sensitivity

As further described in “Item 1A. Risk Factors” in this Form 10-Q, the value of the Shares of each VIX Fund relates directly to the value of, and realized profit or loss from, the Financial Instruments and other assets held by the Fund and fluctuations in the price of these assets could materially adversely affect an investment in the Shares. Several factors may affect the price and/or liquidity of VIX futures contracts and other assets, if any, owned by a VIX Fund. The impact of changes in the price of these assets will affect investors differently depending upon the Fund in which investors invest.

Managing Market Risks

Each Fund seeks to remain fully exposed to the corresponding benchmark at the levels implied by the relevant investment objective (1x, 2x, -1x or -2x), regardless of market direction or sentiment. At the close of the relevant markets each trading day (see NAV calculation times), each Fund will seek to position its portfolio so that its exposure to its benchmark is consistent with its investment objective. As described above in Item 2 of this Quarterly Report on Form 10-Q, these adjustments are done through the use of various Financial Instruments. No attempt is made to adjust market exposure in order to avoid changes to the benchmark that would cause the Funds to lose value. Factors common to all Funds that may require portfolio re-positioning are create/redeem activity and index rebalances.

For Geared Funds, the impact of the Index’s movements during the day also affects whether the Fund’s portfolio needs to be re-positioned. For example, if the Index for an Ultra Fund has risen on a given day, net assets of the Fund should rise, meaning that the Fund’s long exposure will need to be increased to the extent there are not offsetting factors such as redemption activity. Conversely, if the Index has fallen on a given day, net assets of an Ultra Fund should fall, meaning the Fund’s long exposure will generally need to be decreased. Net assets for Short Funds will generally decrease when the Index rises on a given day, meaning the Fund’s short exposure may need to be decreased. Conversely if the Index has fallen on a given day, a Short Fund’s assets should rise, meaning its short exposure may need to be increased.

The use of certain Financial Instruments introduces counterparty risk. A Fund will be subject to credit risk with respect to the amount it expects to receive from counterparties to Financial Instruments entered into by the Fund. A Fund may be negatively impacted if a

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counterparty becomes bankrupt or otherwise fails to perform its obligations due to financial difficulties. Each Fund intends to enter into swap and forward agreements only with large, established and well capitalized financial institutions that meet certain credit quality standards and monitoring policies. Each Fund may use various techniques to minimize credit risk including early termination or reset and payment, limiting the net amount due from any individual counterparty, and generally requiring that the counterparty post collateral with respect to amounts owed to the Funds, marked to market daily.

Most Financial Instruments held by the Funds are “unfunded” meaning that the Fund will obtain exposure to the corresponding benchmark while still being in possession of its original cash assets. The cash positions that result from use of such Financial Instruments are held in a manner to minimize both interest rate and credit risk. During the reporting period, cash positions were maintained in a non-interest bearing demand deposit account. The Funds also invest a portion of this cash in cash equivalents (such as shares of money market funds, bank deposits, bank money market accounts, certain variable rate-demand notes and repurchase agreements collateralized by government securities).

Item 4.

Controls and Procedures.

Disclosure Controls and Procedures

Under the supervision and with the participation of the principal executive officer and principal financial officer of the Trust, Trust management has evaluated the effectiveness of the Trust’s and the Funds’ disclosure controls and procedures, and have concluded that the disclosure controls and procedures of the Trust and the Funds (as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “1934 Act”)) were effective, as of September 30, 2011, to provide reasonable assurance that information required to be disclosed in the reports that the Trust files or submits under the 1934 Act on behalf of the Trust and the Funds is recorded, processed, summarized and reported, within the time periods specified in the applicable rules and forms, and that it is accumulated and communicated to the duly authorized officers of the Trust as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control over Financial Reporting

There were no changes in the Trust’s or the Funds’ internal control over financial reporting that occurred during the quarter ended September 30, 2011 that have materially affected, or are reasonably likely to materially affect, the Trust’s or the Funds’ internal control over financial reporting.

Certifications

The certifications by the Principal Executive Officer and Principal Financial Officer of the Trust required by Section 302 and Section 906 of the Sarbanes-Oxley Act of 2002, which are filed or furnished as exhibits to this Quarterly Report on Form 10-Q, apply both to the Trust taken as a whole and each Fund, and the Principal Executive Officer and Principal Financial Officer of the Trust are certifying both as to the Trust taken as a whole and each Fund.

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Part II. OTHER INFORMATION

Item 1.

Legal Proceedings.

Item 1A.

Risk Factors.

These risk factors should be read in connection with other information included in this Quarterly Report on Form 10-Q, including Management’s Discussion and Analysis of Financial Condition and Results of Operations and the Funds’ Financial Statements and the related Notes to the Funds’ Financial Statements. For purposes of this section:

•

The term “Geared Natural Gas Fund” refers to ProShares Ultra DJ-UBS Natural Gas, ProShares Short DJ-UBS Natural Gas and ProShares UltraShort DJ-UBS Natural Gas;

•

The term “Geared VIX Fund” refers to ProShares Ultra VIX Short-Term Futures ETF, ProShares Short VIX Short-Term Futures ETF, ProShares UltraShort VIX Short-Term Futures ETF, ProShares Ultra VIX Mid-Term Futures ETF, ProShares Short VIX Mid-Term Futures ETF and ProShares UltraShort VIX Mid-Term Futures ETF;

•

The term “Geared Fund” refers to ProShares Ultra DJ-UBS Commodity, ProShares UltraShort DJ-UBS Commodity, ProShares Ultra DJ-UBS Crude Oil, ProShares UltraShort DJ-UBS Crude Oil, ProShares Ultra Gold, ProShares Short Gold, ProShares UltraShort Gold, ProShares Ultra Silver, ProShares UltraShort Silver, ProShares Ultra Euro, ProShares UltraShort Euro, ProShares Ultra Yen, ProShares UltraShort Yen, each Geared Natural Gas Fund and each Geared VIX Fund;

•

The term “Commodity Index Fund” refers to ProShares Ultra DJ-UBS Commodity, ProShares UltraShort DJ-UBS Commodity; ProShares Ultra DJ-UBS Crude Oil; ProShares UltraShort DJ-UBS Crude Oil; ProShares Ultra DJ-UBS Natural Gas; ProShares Short DJ-UBS Natural Gas and ProShares UltraShort DJ-UBS Natural Gas;

•

The term “Commodity Fund” refers to ProShares Ultra Gold; ProShares Short Gold; ProShares UltraShort Gold; ProShares Ultra Silver and ProShares UltraShort Silver;

•

The term “Currency Fund” refers to ProShares Ultra Euro; ProShares UltraShort Euro; ProShares Ultra Yen and ProShares UltraShort Yen;

•

The term “Matching VIX Fund” refers to ProShares VIX Short-Term Futures ETF and ProShares VIX Mid-Term Futures ETF; and

•

The term “VIX Fund” refers to each Geared VIX Fund and each Matching VIX Fund.

Risks Specific to the Geared Funds

In addition to the risks described elsewhere in this “Risk Factors” section, the following risks apply to the Geared Funds.

Due to the compounding of daily returns, the Geared Funds’ returns over periods longer than one day will likely differ in amount and possibly even direction from the Fund multiple times the benchmark return for the period.

Each of the Geared Funds are “geared” funds in the sense that each has an investment objective to match a multiple (e.g., 2x), the inverse (e.g., -1x) or an inverse multiple (e.g., -2x) of the performance of a benchmark on a given day. Each Geared Fund seeks investment results for a single day only, as measured from its net asset value (“NAV”) calculation time to its next NAV calculation time, and not for any other period. The return of a Geared Fund for a period longer than a day is the result of its return for each day compounded over the period and usually will differ from the Geared Fund’s multiple times the return of the Geared Fund’s benchmark for the period. Longer holding periods, higher benchmark volatility, inverse multiples and greater leverage each affect the impact of compounding on a Fund’s returns. Daily compounding of a Geared Fund’s investment returns can dramatically and adversely affect its longer-term performance during periods of high volatility. Volatility may be at least as important to a Geared Fund’s return for a period as the return of the fund’s underlying benchmark.

Each Ultra or UltraShort Fund uses leverage and should produce daily returns that are more volatile than that of its benchmark. For example, the daily return of an Ultra Fund with a 2x multiple should be approximately twice as volatile on a daily basis as is the return of a fund with an objective of matching the same benchmark. The daily returns of Short and UltraShort Funds are designed to be the inverse of, or twice the inverse of, the return that would be expected of a fund with an objective of matching the same benchmark. The Geared Funds

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are not appropriate for all investors and present different risks than other funds. The Geared Funds that use leverage are riskier than similarly benchmarked exchange-traded funds that do not use leverage. An investor should only consider an investment in a Geared Fund if he or she understands the consequences of seeking daily leveraged, daily inverse or daily inverse leveraged investment results. Daily objective geared funds, if used properly and in conjunction with the investor’s view on the future direction and volatility of the markets, can be useful tools for investors who want to manage their exposure to various markets and market segments and who are willing to monitor and/or periodically rebalance their portfolios. Shareholders who invest in the Geared Funds should actively manage and monitor their investments, as frequently as daily.

The hypothetical example below illustrates how daily geared fund returns can behave for periods longer than one day. Take a hypothetical fund XYZ that seeks to double the daily performance of benchmark XYZ. On each day, fund XYZ performs in line with its objective (2x the benchmark’s daily performance before fees and expenses). Notice that over the entire five-day period, the fund’s total return is considerably less than double that of the period return of the benchmark. For the five-day period, benchmark XYZ gained 5.1% while fund XYZ gained 9.8% (versus 10.2% or 2x 5.1%). In other scenarios, the return of a daily rebalanced fund could be greater than double the benchmark’s return.


	Benchmark XYZ					Fund XYZ
	Level		Daily Performance			Daily Performance			Net Asset Value
Start		100.0							$	100.00
Day 1		103.0		3.0	%		6.0	%	$	106.00
Day 2		99.9		-3.0	%		-6.0	%	$	99.64
Day 3		103.9		4.0	%		8.0	%	$	107.61
Day 4		101.3		-2.5	%		-5.0	%	$	102.23
Day 5		105.1		3.7	%		7.4	%	$	109.80
Total Return				5.1	%		9.8	%

This effect is caused by compounding, which exists in all investments, but has a more significant impact in geared funds. In general, during periods of higher benchmark volatility, compounding will cause longer term results to be less than two times the return of the benchmark (or less than the inverse (-1x) or twice the inverse (-2x) times the return of the benchmarks for the Short Funds and the UltraShort Funds, respectively). This effect becomes more pronounced as volatility increases. Conversely, in periods of lower benchmark volatility (particularly when combined with higher benchmark returns), fund returns over longer periods can be higher than two times the return of the benchmark. Actual results for a particular period, before fees and expenses, are also dependent on the magnitude of the benchmark return in addition to the benchmark volatility. Similar effects exist for Short Funds and the UltraShort Funds, and the significance of this effect is even greater with inverse or inverse leveraged funds.

The graphs that follow illustrate this point. Each of the graphs shows a simulated hypothetical one year performance of a benchmark compared with the performance of a fund that perfectly achieves its geared daily investment objective. The graphs demonstrate that, for periods greater than one day, a geared fund is likely to underperform or over-perform (but not match) the benchmark performance (or the inverse of the benchmark performance) times the multiple stated as the daily fund objective. Investors should understand the consequences of holding daily rebalanced funds for periods longer than a single day and should actively manage and monitor their investments, as frequently as daily. A one-year period is used solely for illustrative purposes. Deviations from the benchmark return times the fund multiple can occur over periods as short as two days (each day as measured from NAV to NAV) and may also occur in periods shorter than one day (when measured intraday as opposed to NAV to NAV). See “Intraday Price Performance Risk” below for additional details. To isolate the impact of leverage, these graphs assume: a) no fund expenses or transaction costs; b) borrowing/lending rates (to obtain required leverage) and cash reinvestment rates of zero percent; and c) the fund consistently maintaining perfect exposure (2x, -1x or -2x) as of the fund’s NAV time each day. If these assumptions were different, the fund’s performance would be different than that shown. Each of the graphs also assumes a volatility rate of 60%, which is an approximate average of the five-year historical volatility rate of the most volatile benchmark referenced herein (the S&P 500 VIX Short-Term Futures Index). A benchmark’s volatility rate is a statistical measure of the magnitude of fluctuations in its returns.

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LOGO

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LOGO

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LOGO

The historical five year average volatility of the benchmarks utilized by the Funds ranges from 10.68 to 57.8, as set forth in the table below.


Benchmark	Historical Five-Year Average Volatility Rate as of December 31, 2010
Dow Jones—UBS Commodity Index^SM		21.36	%
Dow Jones—UBS Crude Oil Subindex^SM		38.64	%
Dow Jones—UBS Natural Gas Subindex^SM		48.00	%
The daily performance of gold bullion as measured by the U.S. dollar p.m. fixing price for delivery in London		22.54	%
The daily performance of silver bullion as measured by the U.S. dollar fixing price for delivery in London		39.86	%
The U.S. dollar price of the Euro		10.68	%
The U.S. dollar price of the Japanese yen		11.73	%
S&P 500 VIX Short-Term Futures Index		57.8	%
S&P 500 VIX Mid-Term Futures Index		31.1	%

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The tables below illustrate the impact of two factors impacting a fund’s performance, benchmark volatility and benchmark return. Benchmark volatility is a statistical measure of the magnitude of fluctuations in the returns of a benchmark and is calculated as the standard deviation of the natural logarithms of one plus the benchmark return (calculated daily), multiplied by the square root of the number of trading days per year (assumed to be 252). The tables show estimated fund returns for a number of combinations of benchmark return and benchmark volatility over a one-year period. To isolate the impact of leverage, these graphs assume: a) no fund expenses or transaction costs; b) borrowing/lending rates of zero percent (to obtain required leveraged, inverse or inverse leveraged exposure) and cash reinvestment rates of zero percent; and c) the fund consistently maintaining perfect exposure (2x, -1x or -2x) as of the fund’s NAV time each day. If these assumptions were different, the fund’s performance would be different than that shown. If fund expenses, transaction costs and financing expenses were included, the fund’s performance would be lower than shown. The first table below shows an example in which a geared fund has an investment objective to correspond to twice (2x) the daily performance of a benchmark. The geared fund could incorrectly be expected to achieve a 20% return on a yearly basis if the benchmark return was 10%, absent the effects of compounding. However, as the table shows, with a benchmark volatility of 40%, such a fund would return 3.1. In the charts below, shaded areas represent those scenarios where a geared fund with the investment objective described will outperform (i.e., return more than) the benchmark performance times the stated multiple in the fund’s investment objective; conversely areas not shaded represent those scenarios where the fund will underperform (i.e., return less than) the benchmark performance times the multiple stated as the daily fund objective.

Estimated Fund Return Over One Year When the Fund Objective is to Seek Daily Investment Results, Before Fees and Expenses, that Correspond to Twice (2x) the Daily Performance of a Benchmark.


One Year Benchmark Performance			200% One Year Benchmark Performance			Benchmark Volatility
One Year Benchmark Performance			200% One Year Benchmark Performance			0%			5%			10%			15%			20%			25%			30%			35%			40%			45%			50%			55%			60%
	-60	%		-120	%		-84.0	%		-84.0	%		-84.2	%		-84.4	%		-84.6	%		-85.0	%		-85.4	%		-85.8	%		-86.4	%		-86.9	%		-87.5	%		-88.2	%		-88.8	%
	-55	%		-110	%		-79.8	%		-79.8	%		-80.0	%		-80.2	%		-80.5	%		-81.0	%		-81.5	%		-82.1	%		-82.7	%		-83.5	%		-84.2	%		-85.0	%		-85.9	%
	-50	%		-100	%		-75.0	%		-75.1	%		-75.2	%		-75.6	%		-76.0	%		-76.5	%		-77.2	%		-77.9	%		-78.7	%		-79.6	%		-80.5	%		-81.5	%		-82.6	%
	-45	%		-90	%		-69.8	%		-69.8	%		-70.1	%		-70.4	%		-70.9	%		-71.6	%		-72.4	%		-73.2	%		-74.2	%		-75.3	%		-76.4	%		-77.6	%		-78.9	%
	-40	%		-80	%		-64.0	%		-64.1	%		-64.4	%		-64.8	%		-65.4	%		-66.2	%		-67.1	%		-68.2	%		-69.3	%		-70.6	%		-72.0	%		-73.4	%		-74.9	%
	-35	%		-70	%		-57.8	%		-57.9	%		-58.2	%		-58.7	%		-59.4	%		-60.3	%		-61.4	%		-62.6	%		-64.0	%		-65.5	%		-67.1	%		-68.8	%		-70.5	%
	-30	%		-60	%		-51.0	%		-51.1	%		-51.5	%		-52.1	%		-52.9	%		-54.0	%		-55.2	%		-56.6	%		-58.2	%		-60.0	%		-61.8	%		-63.8	%		-65.8	%
	-25	%		-50	%		-43.8	%		-43.9	%		-44.3	%		-45.0	%		-46.0	%		-47.2	%		-48.6	%		-50.2	%		-52.1	%		-54.1	%		-56.2	%		-58.4	%		-60.8	%
	-20	%		-40	%		-36.0	%		-36.2	%		-36.6	%		-37.4	%		-38.5	%		-39.9	%		-41.5	%		-43.4	%		-45.5	%		-47.7	%		-50.2	%		-52.7	%		-55.3	%
	-15	%		-30	%		-27.8	%		-27.9	%		-28.5	%		-29.4	%		-30.6	%		-32.1	%		-34.0	%		-36.1	%		-38.4	%		-41.0	%		-43.7	%		-46.6	%		-49.6	%
	-10	%		-20	%		-19.0	%		-19.2	%		-19.8	%		-20.8	%		-22.2	%		-23.9	%		-26.0	%		-28.3	%		-31.0	%		-33.8	%		-36.9	%		-40.1	%		-43.5	%
	-5	%		-10	%		-9.8	%		-10.0	%		-10.6	%		-11.8	%		-13.3	%		-15.2	%		-17.5	%		-20.2	%		-23.1	%		-26.3	%		-29.7	%		-33.3	%		-37.0	%
	0	%		0	%		0.0	%		-0.2	%		-1.0	%		-2.2	%		-3.9	%		-6.1	%		-8.6	%		-11.5	%		-14.8	%		-18.3	%		-22.1	%		-26.1	%		-30.2	%
	5	%		10	%		10.3	%		10.0	%		9.2	%		7.8	%		5.9	%		3.6	%		0.8	%		-2.5	%		-6.1	%		-10.0	%		-14.1	%		-18.5	%		-23.1	%
	10	%		20	%		21.0	%		20.7	%		19.8	%		18.3	%		16.3	%		13.7	%		10.6	%		7.0	%		3.1	%		-1.2	%		-5.8	%		-10.6	%		-15.6	%
	15	%		30	%		32.3	%		31.9	%		30.9	%		29.3	%		27.1	%		24.2	%		20.9	%		17.0	%		12.7	%		8.0	%		3.0	%		-2.3	%		-7.7	%

-180-


One Year Benchmark Performance			200% One Year Benchmark Performance			Benchmark Volatility
One Year Benchmark Performance			200% One Year Benchmark Performance			0%			5%			10%			15%			20%			25%			30%			35%			40%			45%			50%			55%			60%
	20	%		40	%		44.0	%		43.6	%		42.6	%		40.8	%		38.4	%		35.3	%		31.6	%		27.4	%		22.7	%		17.6	%		12.1	%		6.4	%		0.5	%
	25	%		50	%		56.3	%		55.9	%		54.7	%		52.8	%		50.1	%		46.8	%		42.8	%		38.2	%		33.1	%		27.6	%		21.7	%		15.5	%		9.0	%
	30	%		60	%		69.0	%		68.6	%		67.3	%		65.2	%		62.4	%		58.8	%		54.5	%		49.5	%		44.0	%		38.0	%		31.6	%		24.9	%		17.9	%
	35	%		70	%		82.3	%		81.8	%		80.4	%		78.2	%		75.1	%		71.2	%		66.6	%		61.2	%		55.3	%		48.8	%		41.9	%		34.7	%		27.2	%
	40	%		80	%		96.0	%		95.5	%		94.0	%		91.6	%		88.3	%		84.1	%		79.1	%		73.4	%		67.0	%		60.1	%		52.6	%		44.8	%		36.7	%
	45	%		90	%		110.3	%		109.7	%		108.2	%		105.6	%		102.0	%		97.5	%		92.2	%		86.0	%		79.2	%		71.7	%		63.7	%		55.4	%		46.7	%
	50	%		100	%		125.0	%		124.4	%		122.8	%		120.0	%		116.2	%		111.4	%		105.6	%		99.1	%		91.7	%		83.8	%		75.2	%		66.3	%		57.0	%
	55	%		110	%		140.3	%		139.7	%		137.9	%		134.9	%		130.8	%		125.7	%		119.6	%		112.6	%		104.7	%		96.2	%		87.1	%		77.5	%		67.6	%
	60	%		120	%		156.0	%		155.4	%		153.5	%		150.3	%		146.0	%		140.5	%		134.0	%		126.5	%		118.1	%		109.1	%		99.4	%		89.2	%		78.6	%

Estimated Fund Return Over One Year When the Fund Objective is to Seek Daily Investment Results, Before Fees and Expenses, that Correspond to the Inverse (-1x) of the Daily Performance of a Benchmark.


One Year Benchmark Performance			Inverse of One Year Benchmark Performance			Benchmark Volatility
One Year Benchmark Performance			Inverse of One Year Benchmark Performance			0%			5%			10%			15%			20%			25%			30%			35%			40%			45%			50%			55%			60%
	-60	%		60	%		150.0	%		149.4	%		147.5	%		144.4	%		140.2	%		134.9	%		128.5	%		121.2	%		113.0	%		104.2	%		94.7	%		84.7	%		74.4	%
	-55	%		55	%		122.2	%		121.7	%		120.0	%		117.3	%		113.5	%		108.8	%		103.1	%		96.6	%		89.4	%		81.5	%		73.1	%		64.2	%		55.0	%
	-50	%		50	%		100.0	%		99.5	%		98.0	%		95.6	%		92.2	%		87.9	%		82.8	%		76.9	%		70.4	%		63.3	%		55.8	%		47.8	%		39.5	%
	-45	%		45	%		81.8	%		81.4	%		80.0	%		77.8	%		74.7	%		70.8	%		66.2	%		60.9	%		54.9	%		48.5	%		41.6	%		34.4	%		26.9	%
	-40	%		40	%		66.7	%		66.3	%		65.0	%		63.0	%		60.1	%		56.6	%		52.3	%		47.5	%		42.0	%		36.1	%		29.8	%		23.2	%		16.3	%
	-35	%		35	%		53.8	%		53.5	%		52.3	%		50.4	%		47.8	%		44.5	%		40.6	%		36.1	%		31.1	%		25.6	%		19.8	%		13.7	%		7.3	%
	-30	%		30	%		42.9	%		42.5	%		41.4	%		39.7	%		37.3	%		34.2	%		30.6	%		26.4	%		21.7	%		16.7	%		11.3	%		5.6	%		-0.3	%
	-25	%		25	%		33.3	%		33.0	%		32.0	%		30.4	%		28.1	%		25.3	%		21.9	%		18.0	%		13.6	%		8.9	%		3.8	%		-1.5	%		-7.0	%
	-20	%		20	%		25.0	%		24.7	%		23.8	%		22.2	%		20.1	%		17.4	%		14.2	%		10.6	%		6.5	%		2.1	%		-2.6	%		-7.6	%		-12.8	%
	-15	%		15	%		17.6	%		17.4	%		16.5	%		15.0	%		13.0	%		10.5	%		7.5	%		4.1	%		0.3	%		-3.9	%		-8.4	%		-13.1	%		-17.9	%
	-10	%		10	%		11.1	%		10.8	%		10.0	%		8.6	%		6.8	%		4.4	%		1.5	%		-1.7	%		-5.3	%		-9.3	%		-13.5	%		-17.9	%		-22.5	%
	-5	%		5	%		5.3	%		5.0	%		4.2	%		2.9	%		1.1	%		-1.1	%		-3.8	%		-6.9	%		-10.3	%		-14.0	%		-18.0	%		-22.2	%		-26.6	%
	0	%		0	%		0.0	%		-0.2	%		-1.0	%		-2.2	%		-3.9	%		-6.1	%		-8.6	%		-11.5	%		-14.8	%		-18.3	%		-22.1	%		-26.1	%		-30.2	%
	5	%		-5	%		-4.8	%		-5.0	%		-5.7	%		-6.9	%		-8.5	%		-10.5	%		-13.0	%		-15.7	%		-18.8	%		-22.2	%		-25.8	%		-29.6	%		-33.6	%
	10	%		-10	%		-9.1	%		-9.3	%		-10.0	%		-11.1	%		-12.7	%		-14.6	%		-16.9	%		-19.6	%		-22.5	%		-25.8	%		-29.2	%		-32.8	%		-36.6	%
	15	%		-15	%		-13.0	%		-13.3	%		-13.9	%		-15.0	%		-16.5	%		-18.3	%		-20.5	%		-23.1	%		-25.9	%		-29.0	%		-32.3	%		-35.7	%		-39.3	%
	20	%		-20	%		-16.7	%		-16.9	%		-17.5	%		-18.5	%		-19.9	%		-21.7	%		-23.8	%		-26.3	%		-29.0	%		-31.9	%		-35.1	%		-38.4	%		-41.9	%
	25	%		-25	%		-20.0	%		-20.2	%		-20.8	%		-21.8	%		-23.1	%		-24.8	%		-26.9	%		-29.2	%		-31.8	%		-34.7	%		-37.7	%		-40.9	%		-44.2	%
	30	%		-30	%		-23.1	%		-23.3	%		-23.8	%		-24.8	%		-26.1	%		-27.7	%		-29.7	%		-31.9	%		-34.5	%		-37.2	%		-40.1	%		-43.2	%		-46.3	%

-181-


One Year Benchmark Performance			Inverse of One Year Benchmark Performance			Benchmark Volatility
One Year Benchmark Performance			Inverse of One Year Benchmark Performance			0%			5%			10%			15%			20%			25%			30%			35%			40%			45%			50%			55%			60%
	35	%		-35	%		-25.9	%		-26.1	%		-26.7	%		-27.6	%		-28.8	%		-30.4	%		-32.3	%		-34.5	%		-36.9	%		-39.5	%		-42.3	%		-45.3	%		-48.3	%
	40	%		-40	%		-28.6	%		-28.7	%		-29.3	%		-30.2	%		-31.4	%		-32.9	%		-34.7	%		-36.8	%		-39.1	%		-41.7	%		-44.4	%		-47.2	%		-50.2	%
	45	%		-45	%		-31.0	%		-31.2	%		-31.7	%		-32.6	%		-33.7	%		-35.2	%		-37.0	%		-39.0	%		-41.2	%		-43.7	%		-46.3	%		-49.0	%		-51.9	%
	50	%		-50	%		-33.3	%		-33.5	%		-34.0	%		-34.8	%		-35.9	%		-37.4	%		-39.1	%		-41.0	%		-43.2	%		-45.6	%		-48.1	%		-50.7	%		-53.5	%
	55	%		-55	%		-35.5	%		-35.6	%		-36.1	%		-36.9	%		-38.0	%		-39.4	%		-41.0	%		-42.9	%		-45.0	%		-47.3	%		-49.8	%		-52.3	%		-55.0	%
	60	%		-60	%		-37.5	%		-37.7	%		-38.1	%		-38.9	%		-40.0	%		-41.3	%		-42.9	%		-44.7	%		-46.7	%		-49.0	%		-51.3	%		-53.8	%		-56.4	%

Estimated Fund Return Over One Year When the Fund Objective is to Seek Daily Investment Results, Before Fees and Expenses, that Correspond to Twice the Inverse (-2x) of the Daily Performance of a Benchmark.


One Year Benchmark Performance			200% Inverse of One Year Benchmark Performance			Benchmark Volatility
One Year Benchmark Performance			200% Inverse of One Year Benchmark Performance			0%			5%			10%			15%			20%			25%			30%			35%			40%			45%			50%			55%			60%
	-60	%		120	%		525.0	%		520.3	%		506.5	%		484.2	%		454.3	%		418.1	%		377.1	%		332.8	%		286.7	%		240.4	%		195.2	%		152.2	%		112.2	%
	-55	%		110	%		393.8	%		390.1	%		379.2	%		361.6	%		338.0	%		309.4	%		277.0	%		242.0	%		205.6	%		169.0	%		133.3	%		99.3	%		67.7	%
	-50	%		100	%		300.0	%		297.0	%		288.2	%		273.9	%		254.8	%		231.6	%		205.4	%		177.0	%		147.5	%		117.9	%		88.9	%		61.4	%		35.8	%
	-45	%		90	%		230.6	%		228.1	%		220.8	%		209.0	%		193.2	%		174.1	%		152.4	%		128.9	%		104.6	%		80.1	%		56.2	%		33.4	%		12.3	%
	-40	%		80	%		177.8	%		175.7	%		169.6	%		159.6	%		146.4	%		130.3	%		112.0	%		92.4	%		71.9	%		51.3	%		31.2	%		12.1	%		-5.7	%
	-35	%		70	%		136.7	%		134.9	%		129.7	%		121.2	%		109.9	%		96.2	%		80.7	%		63.9	%		46.5	%		28.9	%		11.8	%		-4.5	%		-19.6	%
	-30	%		60	%		104.1	%		102.6	%		98.1	%		90.8	%		81.0	%		69.2	%		55.8	%		41.3	%		26.3	%		11.2	%		-3.6	%		-17.6	%		-30.7	%
	-25	%		50	%		77.8	%		76.4	%		72.5	%		66.2	%		57.7	%		47.4	%		35.7	%		23.1	%		10.0	%		-3.2	%		-16.0	%		-28.3	%		-39.6	%
	-20	%		40	%		56.3	%		55.1	%		51.6	%		46.1	%		38.6	%		29.5	%		19.3	%		8.2	%		-3.3	%		-14.9	%		-26.2	%		-36.9	%		-46.9	%
	-15	%		30	%		38.4	%		37.4	%		34.3	%		29.4	%		22.8	%		14.7	%		5.7	%		-4.2	%		-14.4	%		-24.6	%		-34.6	%		-44.1	%		-53.0	%
	-10	%		20	%		23.5	%		22.5	%		19.8	%		15.4	%		9.5	%		2.3	%		-5.8	%		-14.5	%		-23.6	%		-32.8	%		-41.7	%		-50.2	%		-58.1	%
	-5	%		10	%		10.8	%		10.0	%		7.5	%		3.6	%		-1.7	%		-8.1	%		-15.4	%		-23.3	%		-31.4	%		-39.6	%		-47.7	%		-55.3	%		-62.4	%
	0	%		0	%		0.0	%		-0.7	%		-3.0	%		-6.5	%		-11.3	%		-17.1	%		-23.7	%		-30.8	%		-38.1	%		-45.5	%		-52.8	%		-59.6	%		-66.0	%
	5	%		-10	%		-9.3	%		-10.0	%		-12.0	%		-15.2	%		-19.6	%		-24.8	%		-30.8	%		-37.2	%		-43.9	%		-50.6	%		-57.2	%		-63.4	%		-69.2	%
	10	%		-20	%		-17.4	%		-18.0	%		-19.8	%		-22.7	%		-26.7	%		-31.5	%		-36.9	%		-42.8	%		-48.9	%		-55.0	%		-61.0	%		-66.7	%		-71.9	%
	15	%		-30	%		-24.4	%		-25.0	%		-26.6	%		-29.3	%		-32.9	%		-37.3	%		-42.3	%		-47.6	%		-53.2	%		-58.8	%		-64.3	%		-69.5	%		-74.3	%
	20	%		-40	%		-30.6	%		-31.1	%		-32.6	%		-35.1	%		-38.4	%		-42.4	%		-47.0	%		-51.9	%		-57.0	%		-62.2	%		-67.2	%		-72.0	%		-76.4	%
	25	%		-50	%		-36.0	%		-36.5	%		-37.9	%		-40.2	%		-43.2	%		-46.9	%		-51.1	%		-55.7	%		-60.4	%		-65.1	%		-69.8	%		-74.2	%		-78.3	%
	30	%		-60	%		-40.8	%		-41.3	%		-42.6	%		-44.7	%		-47.5	%		-50.9	%		-54.8	%		-59.0	%		-63.4	%		-67.8	%		-72.0	%		-76.1	%		-79.9	%
	35	%		-70	%		-45.1	%		-45.5	%		-46.8	%		-48.7	%		-51.3	%		-54.5	%		-58.1	%		-62.0	%		-66.0	%		-70.1	%		-74.1	%		-77.9	%		-81.4	%
	40	%		-80	%		-49.0	%		-49.4	%		-50.5	%		-52.3	%		-54.7	%		-57.7	%		-61.1	%		-64.7	%		-68.4	%		-72.2	%		-75.9	%		-79.4	%		-82.7	%
	45	%		-90	%		-52.4	%		-52.8	%		-53.8	%		-55.5	%		-57.8	%		-60.6	%		-63.7	%		-67.1	%		-70.6	%		-74.1	%		-77.5	%		-80.8	%		-83.8	%

-182-


One Year Benchmark Performance			200% Inverse of One Year Benchmark Performance			Benchmark Volatility
One Year Benchmark Performance			200% Inverse of One Year Benchmark Performance			0%			5%			10%			15%			20%			25%			30%			35%			40%			45%			50%			55%			60%
	50	%		-100	%		-55.6	%		-55.9	%		-56.9	%		-58.5	%		-60.6	%		-63.2	%		-66.1	%		-69.2	%		-72.5	%		-75.8	%		-79.0	%		-82.1	%		-84.9	%
	55	%		-110	%		-58.4	%		-58.7	%		-59.6	%		-61.1	%		-63.1	%		-65.5	%		-68.2	%		-71.2	%		-74.2	%		-77.3	%		-80.3	%		-83.2	%		-85.9	%
	60	%		-120	%		-60.9	%		-61.2	%		-62.1	%		-63.5	%		-65.4	%		-67.6	%		-70.2	%		-73.0	%		-75.8	%		-78.7	%		-81.5	%		-84.2	%		-86.7	%

The foregoing tables are intended to isolate the effect of benchmark volatility and benchmark performance on the return of leveraged, inverse or inverse leveraged funds. The Geared Funds’ actual returns may be significantly greater or less than the returns shown above as a result of any of the factors discussed above or under the below risk factor describing correlation risks.

Correlation Risks Specific to the Geared Funds.

In order to achieve a high degree of correlation with their applicable underlying benchmarks, the Geared Funds seek to rebalance their portfolios daily to keep exposure consistent with their investment objectives. Being materially over- or under-exposed to the benchmarks may prevent such Funds from achieving a high degree of correlation with their applicable underlying benchmarks. Market disruptions or closure, regulatory restrictions or extreme market volatility will adversely affect such Funds’ ability to adjust exposure to requisite levels. The target amount of portfolio exposure is impacted dynamically by the benchmarks’ movements during each day. Because of this, it is unlikely that the Geared Funds will be perfectly exposed (i.e., 2x, -1x, or -2x, as applicable) at the end of each day, and the likelihood of being materially under- or over-exposed is higher on days when the benchmark levels are volatile near the close of the trading day.

For general correlation risks of the Funds, please see “While close tracking of any Fund to its benchmark may be achieved, several factors may affect a Fund’s ability to consistently achieve this correlation.” below.

Intraday Price Performance Risk.

Each Geared Fund is rebalanced at or about the time of its NAV calculation time (which in many cases is other than at the close of the U.S. equity markets). As such, the intraday leveraging of a Fund as reflected in its secondary market price will generally be different from the Fund’s stated daily investment objective (e.g., 2x, -1x or -2x). When shares of a Fund (“Shares”) are bought intraday, the performance of a Geared Fund’s Shares until the Fund’s next NAV calculation will generally be greater than or less than the Fund’s stated daily multiple.

The use of leveraged, inverse and/or inverse leveraged positions could result in the total loss of an investor’s investment.

The Geared Funds that utilize leveraged or inverse leveraged techniques in seeking to achieve their respective investment objectives will lose more money in market environments adverse to their respective daily investment objectives than Funds that do not employ leveraged or inverse leveraged techniques, which could result in the total loss of an investor’s investment.

For example, because the Ultra and UltraShort Funds offered hereby include a two times (2x) or a two times the inverse (-2x) multiplier, a single day price movement approaching 50% at any point in the day in the relevant benchmark could result in the total loss or almost total loss of an investor’s investment if that price movement is contrary to the investment objective of the Fund in which an investor has invested, even if such Fund’s benchmark subsequently moves in an opposite direction, eliminating all or part of the price movement. This would be the case with downward one-day or intraday price movements in the benchmark of an Ultra Fund or upward one-day or intraday price movements in the benchmark of an UltraShort Fund, even though the benchmark (and the reference assets comprising that benchmark) maintains a level greater than zero at all times.

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Inverse positions can result in unlimited losses as the benchmark rises. As such, for Short Funds, a single day or intraday price increase approaching 100% in the relevant benchmark could result in the total loss or almost total loss of an investor’s investment even if such Fund’s benchmark subsequently moves lower. This risk exists for all of the Short Funds, and, based on historical intraday volatility measures, may be particularly acute for ProShares Short VIX Futures ETF.

Risks Specific to the VIX Funds

In addition to the risks described elsewhere in this “Risk Factors” section, the following risks apply to the VIX Funds.

The VIX Funds are benchmarked to either the S&P 500 VIX Short-Term Futures Index or the S&P 500 VIX Mid-Term Futures Index (each, a “VIX Futures Index”). They are not benchmarked to the VIX or actual realized volatility of the S&P 500 Index.

The level of each VIX Futures Index is based on the value of the relevant futures contracts (“VIX futures contracts”) based on the Chicago Board Options Exchange Volatility Index (the “VIX”) comprising the applicable VIX Futures Index. Each VIX Fund is benchmarked to its respective VIX Futures Index and the VIX Funds are not linked to the VIX (which is a measure of implied volatility of the S&P 500 Index over the next 30 days derived from option prices), to realized volatility of the S&P 500 Index or to the options that underlie the VIX calculation. Each VIX Fund should be expected to perform very differently from the VIX over all periods of time. In many cases the VIX Futures Indexes will significantly underperform the VIX. Furthermore, because each VIX Fund may invest in VIX futures contracts other than the VIX futures contracts comprising the Fund’s VIX Futures Index, the VIX Funds may perform differently than their respective VIX Futures Indexes.

VIX futures contracts are not directly based on a tradable underlying asset.

The VIX is not directly investable. The settlement price at maturity of VIX futures contracts are based on the calculation that determines the level of the VIX. As a result, the behavior of the VIX futures contracts may be different from traditional futures contracts whose settlement price is based on a specific tradable asset.

The VIX Futures Indexes and VIX futures have limited historical information.

The VIX Futures Indexes were created in December 2008 and Standard & Poor’s has published limited information about how the VIX Futures Indexes would have performed had they been calculated prior to their creation. In addition, VIX futures contracts have traded freely only since March 26, 2004, and not all futures of all relevant maturities have traded at all times since that date. Because the VIX Futures Indexes and the VIX futures contracts that underlie them are of recent origin and limited historical performance data exists with respect to them, your investment in the Fund may involve a greater risk than investing in alternate instruments linked to one or more indexes with a more established record of performance. A longer history of actual performance may have been helpful in providing more reliable information on which to assess the validity of the proprietary methodology that the VIX Futures Indexes make use of as the basis for an investment decision.

The level of the VIX has historically reverted to a long-term mean level and is subject to the risk associated with reversion to its mean. Accordingly, investors should not expect the VIX Funds to retain any appreciation in value over extended periods of time.

In the past, the level of the VIX has typically reverted over the longer term to a historical mean, and its absolute level has been constrained within a band. It is likely that the spot level of the VIX will continue to be constrained in the future. This means that the level of VIX futures and the VIX Futures Indexes also likely will be constrained within a band and mean reverting over time. Unlike conventional stock-based indexes and funds, it is not expected that the VIX Futures Indexes or the VIX Funds will generally rise over time. Rather the VIX Futures Indexes, the VIX Ultra Funds and the Matching VIX Funds will rise and fall (or fall and rise) and the VIX Short Funds and the VIX UltraShort Funds will fall and rise (or rise and fall) as volatility increases and decreases (or decreases and increases). For most investors this likely implies that the VIX Funds should only be used as a short-term tactical tool or for diversification purposes rather than an investment in anticipation of long-term gains.

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When economic uncertainty increases and there is an associated increase in expected volatility, the value of VIX futures contracts will likely also increase and the potential upside of an investment in a VIX Short Fund or VIX UltraShort Fund will correspondingly be limited as a result. Similarly, when economic uncertainty recedes, and there is an associated decrease in expected volatility, the value of VIX futures contracts will likely also decrease and the potential upside of an investment in a VIX Ultra Fund or a Matching VIX Fund will correspondingly be limited as a result.

Risks Related to All Funds

While close tracking of any Fund to its benchmark may be achieved, several factors may affect a Fund’s ability to consistently achieve this correlation.

While the Funds expect to meet their investment objectives, there is no guarantee they will do so. Factors that may affect a Fund’s ability to meet its investment objective include: (1) the ability of ProShare Capital Management LLC (the “Sponsor”) to purchase and sell Financial Instruments (i.e., commodity-based, currency-based or equity market volatility-based instruments whose value is derived from the value of an underlying asset, rate or index, including futures contracts and options on futures contracts, swap agreements, forward contracts and other commodity-based or currency-based options contracts as a substitute for investing directly in commodities, currencies or equity market volatility products in order to gain exposure to the commodity index, currency benchmark, commodity, currency or to an equity market volatility index) in a manner that correlates to a Fund’s objective; (2) an imperfect correlation between the performance of the instruments held by a Fund, such as swaps, futures contracts and/or forward contracts, and the performance of the applicable benchmark; (3) bid-ask spreads on such instruments; (4) commission costs; (5) holding instruments traded in a market that has become illiquid or disrupted; (6) a Fund’s Share prices being rounded to the nearest cent; (7) changes to a benchmark that are not disseminated in advance; (8) the need to conform a Fund’s portfolio holdings to comply with investment restrictions or policies or regulatory or tax law requirements; and (9) early and unanticipated closings of the markets on which the holdings of a Fund trade, resulting in the inability of the Fund to execute intended portfolio transactions; and (10) accounting standards.

Each Fund seeks to provide investment results (before fees and expenses) that correspond to the daily performance (or, in the case of the Geared Funds, correspond to a multiple, the inverse or an inverse multiple of the daily performance) of a benchmark at all times, even during periods when the applicable benchmark is flat as well as when the benchmark is moving in a manner which causes a Fund’s NAV to decline, thereby causing losses to such Fund.

The Funds are not actively managed by traditional methods, which typically involve effecting changes in the composition of a portfolio on the basis of judgments relating to economic, financial and market considerations with a view toward obtaining positive results under all market conditions. Rather, the Sponsor seeks to cause the NAV to track the daily performance of a benchmark in accordance with each Fund’s investment objective, even during periods in which the benchmark is flat or moving in a manner which causes the NAV of a Fund to decline. It is possible to lose money over time when an underlying benchmark is up for the corresponding Ultra Fund, or down for the corresponding Short or UltraShort Fund, due to the effects of daily rebalancing, volatility and compounding (see “Risks Specific to the Geared Funds” for additional details).

The value of the Shares of each Fund relates directly to the value of, and realized profit or loss from, the Financial Instruments and other assets held by that Fund. Fluctuations in the price of these Financial Instruments or assets could materially adversely affect an investment in the Shares.

With regard to the Commodity Funds and the Commodity Index Funds, several factors may affect the price of an underlying reference asset, and in turn, the Financial Instruments and other assets, if any, owned by such a Fund, including, but not limited to:

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•

The recent proliferation of commodity linked exchange-traded products and their unknown effect on the commodity markets.

•

Large purchases or sales of physical commodities by the official sector. Governments and large institutions have large commodities holdings or may establish major commodities positions. For example, a significant portion of the aggregate world gold holdings is owned by governments, central banks and related institutions. Similarly, nations with centralized or nationalized oil production and organizations such as the Organization of Petroleum Exporting Countries control large physical quantities of crude oil. If one or more of these institutions decides to buy or sell any commodity in amounts large enough to cause a change in world prices, the price of Shares based upon a benchmark related to that commodity will be affected.

•

Other political factors. In addition to the organized political and institutional trading-related activities described above, peaceful political activity such as imposition of regulations or entry into trade treaties, as well as political disruptions caused by societal breakdown, insurrection and/or war may greatly influence commodities prices.

•

Significant increases or decreases in the available supply of a physical commodity due to natural or technological factors. Natural factors would include depletion of known cost-effective sources for a commodity or the impact of severe weather on the ability to produce or distribute the commodity. Technological factors, such as increases in availability created by new or improved extraction, refining and processing equipment and methods or decreases caused by failure or unavailability of major refining and processing equipment (for example, shutting down or constructing oil refineries), also materially influence the supply of commodities.

•

Significant increases or decreases in the demand for a physical commodity due to natural or technological factors. Natural factors would include such events as unusual climatological conditions impacting the demand for energy commodities. Technological factors may include such developments as substitutes for energy or other industrial commodities.

•

A significant increase or decrease in commodity hedging activity by commodity producers. Should there be an increase or decrease in the level of hedge activity of commodity producing companies, countries and/or organizations, it could cause a change in world prices of any given commodity, causing the price of Shares based upon a benchmark related to that commodity to be affected.

•

A significant change in the attitude of speculators and investors towards a commodity. Should the speculative community take a negative or positive view towards any given commodity, it could cause a change in world prices of any given commodity and the price of Shares based upon a benchmark related to that commodity will be affected.

With regard to the Currency Funds, several factors may affect the value of foreign currencies or the U.S. dollar, and in turn, Financial Instruments and other assets, if any, owned by a Fund, including, but not limited to:

•

Debt level and trade deficit of the relevant foreign countries;

•

Inflation rates of the United States and the relevant foreign countries and investors’ expectations concerning inflation rates;

•

Interest rates of the United States and the relevant foreign countries and investors’ expectations concerning interest rates;

•

Investment and trading activities of mutual funds, hedge funds and currency funds;

•

Global or regional political, economic or financial events and situations; and

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•

Sovereign action to set or restrict currency conversion.

With regard to the VIX Funds, several factors may affect the price and/or liquidity of VIX futures contracts and other assets, if any, owned by a Fund, including, but not limited to:

•

Prevailing market prices and forward volatility levels of the U.S. stock markets, the S&P 500 Index, the equity securities included in the S&P 500 Index and prevailing market prices of options on the S&P 500 Index, the VIX, options on the VIX, the relevant VIX futures contracts, or any other financial instruments related to the S&P 500 Index and the VIX or VIX futures;

•

Interest rates;

•

Economic, financial, political, regulatory, geographical, biological or judicial events that affect the level of a VIX Futures Index or the market price or forward volatility of the U.S. stock markets, the equity securities included in the S&P 500 Index, the S&P 500 Index, the VIX or the relevant futures or option contracts on the VIX;

•

Supply and demand as well as hedging activities in the listed and over-the-counter (“OTC”) equity derivative markets; and

•

Disruptions in trading of the S&P 500 Index, futures contracts on the S&P 500 Index or options on the S&P 500 Index.

These factors interrelate in complex ways, and the effect of one factor on the market value of a Fund may offset or enhance the effect of another factor.

Financial Instruments linked to commodities, currencies and/or equity market volatility benchmarks can be highly volatile and the Funds may experience large losses when buying, selling or holding such instruments.

Financial Instruments linked to commodities, currencies and/or equity market volatility benchmarks can be highly volatile and may experience large losses. In particular, trading in VIX futures contracts and natural gas futures contracts (or other Financial Instruments linked to equity market volatility or natural gas) has been very volatile and can be expected to be very volatile in the future. High volatility may have an adverse impact on the Funds, especially the Geared Funds.

Potential negative impact from rolling futures positions.

Certain of the Funds invest in or have exposure to futures contracts and are subject to risks related to rolling. The contractual obligations of a buyer or seller holding to expiration may generally be satisfied by taking or making physical delivery of the underlying reference asset or settling in cash as designated in the contract specifications. Alternatively, futures contracts may be closed out prior to expiration by making an offsetting sale or purchase of an identical futures contract on the same or linked exchange before the designated date of delivery. Once this date is reached, the futures contract “expires.” As the futures contracts held by a Fund near expiration, they are generally closed out and replaced by contracts with a later expiration. This process is referred to as “rolling.”

When the market for these contracts is such that the prices are higher in the more distant delivery months than in the nearer delivery months, the sale during the course of the “rolling process” of the more nearby contract would take place at a price that is lower than the price of the more distant contract. This pattern of higher futures prices for longer expiration futures contracts is often referred to as “contango.” Alternatively, when the market for these contracts is such that the prices are higher in the nearer months than in the more distant months, the sale during the course of the “rolling process” of the more nearby contract would take place at a price that is higher than the price of the more distant contract. This pattern of higher futures prices of shorter expiration futures contracts is referred to as “backwardation.”

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There have been extended periods in which contango or backwardation has existed in the futures contract markets for various types of futures contracts, and such periods can be expected to occur in the future. The presence of contango in certain futures contracts at the time of rolling would be expected to adversely affect the Ultra Funds and Matching VIX Funds, and positively affect the Short Funds and UltraShort Funds. Similarly, the presence of backwardation in certain futures contracts at the time of rolling such contracts would be expected to adversely affect the Short Funds and UltraShort Funds and positively affect the Ultra Funds and Matching VIX Funds.

Funds that are designed to track a multiple, the inverse or an inverse multiple of the daily performance of gold or silver bullion (ProShares Ultra Gold, ProShares Short Gold, ProShares UltraShort Gold, ProShares Ultra Silver and ProShares UltraShort Silver) do not invest in bullion itself as certain other exchange-traded products do. Rather such Funds use Financial Instruments to gain exposure to these precious metals. Not investing directly in bullion may introduce additional tracking error and these Funds are subject to the effects of contango and backwardation described above.

Using Financial Instruments such as forwards and futures in an effort to replicate the performance of gold and silver bullion may introduce tracking error to the performance of such Funds. The primary cause of tracking error resulting from not investing directly in bullion is expected to be caused by the need to roll futures or forward contracts as described above and the resulting possibility that contango or backwardation can occur. Gold and silver historically exhibit contango markets during most periods. The existence of historically prevalent contango markets would be expected to adversely affect the Ultra Funds. Alternatively, the existence of backwardated markets in either silver or gold would have an adverse impact on the Short and UltraShort Funds.

Possible illiquid markets may exacerbate losses.

Financial Instruments cannot always be liquidated at the desired price. It is difficult to execute a trade at a specific price when there is a relatively small volume of buy and sell orders in a market. A market disruption can also make it difficult to liquidate a position or find a swap or forward contract counterparty at a reasonable cost.

There can be no assurance that market illiquidity will not cause losses for the Funds. The large size of the positions which the Funds may acquire increases the risk of illiquidity by both making their positions more difficult to liquidate and increasing the losses incurred while trying to do so. Any type of disruption or illiquidity will potentially be exacerbated due to the fact that the Funds will typically invest in Financial Instruments related to one benchmark, which in many cases is highly concentrated.

It may not be possible to gain exposure to the benchmarks using exchange-traded Financial Instruments in the future.

The Funds may utilize exchange-traded Financial Instruments. It may not be possible to gain exposure to the benchmarks with these Financial Instruments in the future. If these Financial Instruments cease to be traded on regulated exchanges, they may be replaced with Financial Instruments traded on trading facilities that are subject to lesser degrees of regulation or, in some cases, no substantive regulation. As a result, trading in such Financial Instruments, and the manner in which prices and volumes are reported by the relevant trading facilities, may not be subject to the provisions of, and the protections afforded by, the U.S. Commodity Exchange Act of 1936 (the “CEA”), or other applicable statutes and related regulations, that govern trading on regulated U.S. futures exchanges, or similar statutes and regulations that govern trading on regulated U.K. futures exchanges. In addition, many electronic trading facilities have only recently initiated trading and do not have significant trading histories. As a result, the trading of contracts on such facilities, and the inclusion of such contracts in a benchmark index, may be subject to certain risks not presented by U.S. or U.K. exchange-traded futures contracts, including risks related to the liquidity and price histories of the relevant contracts.

Fees are charged regardless of a Fund’s returns and may result in depletion of assets.

The Funds are subject to the fees and expenses described herein which are payable irrespective of a Fund’s returns. Such fees and expenses include asset-based fees of 0.95% per annum of each Geared Fund’s average daily NAV and 0.85% per annum of each Matching VIX Fund’s average daily NAV, as well as the effects of commissions, trading spreads, and embedded financing, borrow costs and fees associated with swaps, forwards, futures contracts, and costs relating to the purchase of U.S. Treasury securities or similar high credit quality short-term fixed-income or similar securities. Additional charges may include other fees as applicable.

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To the extent that a Fund benchmark is an index, changes implemented by the index provider that affect the composition and valuation of the index could adversely affect the value of an investment in a Fund’s Shares.

Certain Fund benchmarks are indexes maintained by index providers that are unaffiliated with the Funds or the Sponsor. The policies implemented by index providers concerning the calculation of the level of an index or the composition of an index could affect the level of the index and, therefore, the value of Shares. The index providers may change the composition of its indexes, or make other methodological changes that could change the level of an index. Additionally, the index providers may alter, discontinue or suspend calculation or dissemination an index. Any of these actions could adversely affect the value of Shares of a Fund using that index as a benchmark. Index providers have no obligation to consider Fund shareholder interests in calculating or revising an index. Any of these actions could adversely affect the value of Fund Shares. Calculation of an index may not be possible or feasible under certain events or circumstances that are beyond the reasonable control of the Sponsor, which in turn may adversely impact both the index and/or the Shares, as applicable. Additionally, index calculations may be disrupted by rollover disruptions, rebalancing disruptions and/or market emergencies, which may have an adverse effect on the value of the Shares.

The Funds are subject to counterparty risks, credit risks and other risks associated with swap agreements and forward contracts, which could result in significant losses to such Funds.

Certain of the Funds may use swap agreements and/or forward contracts as a means to achieve their respective investment objectives. These Financial Instruments are traded over the counter and are essentially unregulated by the Commodity Futures Trading Commission (“CFTC”). Investors, therefore, do not receive the protection of CFTC regulation or the statutory scheme of the CEA in connection with each Fund’s swap agreements or forward contracts. The lack of regulation in these markets could expose investors to significant losses under certain circumstances including in the event of trading abuses or financial failure by participants.

Unlike in futures contracts, the counterparty to swap agreements or forward contracts is generally a single bank or other financial institution, rather than a clearing organization backed by a group of financial institutions. As a result, a Fund is subject to credit risk with respect to the amount it expects to receive from counterparties to swaps and forward contracts entered into as part of that Fund’s principal investment strategy. If a counterparty becomes bankrupt or otherwise fails to perform its obligations, a Fund could suffer significant losses on these contracts and the value of an investor’s investment in a Fund may decline.

The Funds have sought to mitigate these risks by generally requiring that the counterparties for each Fund agree to post collateral for the benefit of the Fund, marked to market daily, in an amount approximately equal to what the counterparty owes the Fund. In the event of the bankruptcy of a counterparty, the Fund will have direct access to the collateral received from the counterparty. To the extent any such collateral is otherwise insufficient, the Funds will be exposed to counterparty risk as described above, including possible delays in recovering amounts as a result of bankruptcy proceedings. The Funds typically enter into transactions only with large, well-capitalized and well established financial institutions.

Swaps or forward contracts have terms that make them less marketable than futures contracts. Swaps or forward contracts are less marketable because they are not traded on an exchange, do not have uniform terms and conditions, and are entered into based upon the creditworthiness of the parties and the availability of credit support, such as collateral, and in general, are not transferable without the consent of the counterparty. Swap agreements and forward contracts may entail breakage costs if terminated prior to the final maturity date.

If the value of the Fund’s benchmark has a dramatic intraday move in value that would cause a material decline in the Fund’s NAV, the terms of the swap may permit the counterparty to immediately close out the transaction with the Fund. In that event, it may not be possible for the Fund to enter into another swap agreement or to invest in other Financial Instruments necessary to achieve the desired exposure consistent with the Fund’s objective. This, in turn, may prevent the fund from achieving its investment objective, even if the value of the Fund’s benchmark reverses all or part of its intraday move by the end of the day.

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Historical correlation trends between Fund benchmarks and other asset classes may not continue or may reverse, limiting or eliminating any potential diversification or other benefit from owning a Fund.

To the extent that an investor purchases a Fund seeking diversification benefits based on the historic correlation (whether positive or negative) between the returns of the commodity, equity market volatility or currency markets and other asset classes, such historic correlation may not continue or may reverse itself. In this circumstance, the diversification or other benefits sought may be limited or nonexistent.

The Funds have limited or no operating history, and, as a result, investors have only a limited performance history, if any, to serve as a factor for evaluating an investment in the Funds.

The Funds have limited or no performance history upon which to evaluate an investor’s investment in the Funds. Although past performance is not necessarily indicative of future results, if the Funds had longer performance histories, or any performance history in the case of ProShares Short DJ-UBS Natural Gas, ProShares Short Gold Fund, ProShares UltraShort VIX Short-Term Futures ETF, ProShares UltraVIX Mid-Term Futures ETF, ProShares Short VIX Mid-Term Futures ETF or ProShares UltraShort VIX Mid-Term Futures ETF, such performance histories might (or might not) provide investors with more information on which to evaluate an investment in the Funds. Likewise, certain benchmarks have a limited history which might (or might not) provide investors with more information on which to evaluate an investment in the Funds.

Investors cannot be assured of the Sponsor’s continued services, the discontinuance of which may be detrimental to the Funds.

Investors cannot be assured that the Sponsor will be able to continue to service the Funds for any length of time. If the Sponsor discontinues its activities on behalf of the Funds, the Funds may be adversely affected, as there may be no entity servicing the Funds for a period of time. If the Sponsor’s registrations with the CFTC or memberships in the National Futures Association were revoked or suspended, the Sponsor would no longer be able to provide services and/or to render trading advice to the Funds. As the Funds themselves are not registered with the CFTC in any capacity, if the Sponsor were unable to provide services and/or trading advice to the Funds, the Funds would be unable to pursue their investment objectives unless and until the Sponsor’s ability to provide services and trading advice to the Funds was reinstated or a replacement for the Sponsor as commodity pool operator and/or commodity trading advisor could be found. Such an event could result in termination of the Funds.

The lack of active trading markets for the Shares of the Funds may result in losses on investors’ investments at the time of disposition of Shares.

Although the Shares of the Funds are or will be listed and traded on the NYSE Arca, there can be no guarantee that an active trading market for the Shares of the Funds will develop or be maintained. If investors need to sell their Shares at a time when no active market for them exists, the price investors receive for their Shares, assuming that investors are able to sell them, likely will be lower than the price that investors would receive if an active market did exist.

Investors may be adversely affected by redemption or creation orders that are subject to postponement, suspension or rejection under certain circumstances.

A Fund may, in its discretion, suspend the right of creation or redemption or may postpone the redemption or purchase settlement date, for (1) any period during which the NYSE Arca, New York Stock Exchange or any other exchange, marketplace or trading center, deemed to affect the normal operations of the Funds, is closed, or when trading is restricted or suspended or restricted on such exchanges in any of the Funds’ futures contracts, (2) any period during which an emergency exists as a result of which the fulfillment of a purchase order or the redemption distribution is not reasonably practicable, or (3) such other period as the Sponsor determines to be necessary for the protection of the shareholders of the Funds. In addition, a Fund will reject a redemption order if the order is not in proper form as described in the Authorized Participant Agreement or if the fulfillment of the order might be unlawful.

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Any such postponement, suspension or rejection could adversely affect a redeeming Authorized Participant. For example, the resulting delay may adversely affect the value of the Authorized Participant’s redemption proceeds if the NAV of the Funds decline during the period of delay. The Funds disclaim any liability for any loss or damage that may result from any such suspension or postponement. Suspension of creation privileges may adversely impact how the Shares are traded and arbitraged on the Exchange, which could cause them to trade at levels materially different (premiums and discounts) from the fair value of their underlying holdings.

The NAV may not always correspond to market price and, as a result, investors may be adversely affected by the creation or redemption of Creation Units at a value that differs from the market price of the Shares.

The NAV per Share of a Fund changes as fluctuations occur in the market value of a Fund’s portfolio. Investors should be aware that the public trading price of a number of Shares of a Fund otherwise amounting to a Creation Unit may be different from the NAV of an actual Creation Unit (i.e., 50,000 individual Shares may trade at a premium over, or a discount to, NAV of a Creation Unit of Shares of a Geared Fund or 25,000 individual Shares may trade at a premium over, or a discount to, NAV of a Creation Unit of Shares of a Matching VIX Fund) and similarly the public trading price per Share of a Fund may be different from the NAV per Share of the Fund. Consequently, an Authorized Participant may be able to create or redeem a Creation Unit of Shares of a Fund at a discount or a premium to the public trading price per Share of that Fund. This price difference may be due, in large part, to the fact that supply and demand forces at work in the secondary trading market for Shares of a Fund are closely related, but not identical, to the same forces influencing the price of an underlying reference asset at any point in time.

Authorized Participants or their clients or customers may have an opportunity to realize a profit if they can purchase a Creation Unit at a discount to the public trading price of the Shares of a Fund or can redeem a Creation Unit at a premium over the public trading price of the Shares of a Fund. The Sponsor expects that the exploitation of such arbitrage opportunities by Authorized Participants and their clients and customers will tend to cause the public trading price to track NAV per Share of the Funds closely over time.

The value of a Share of a Fund may be influenced by non-concurrent trading hours between the NYSE Arca and the market in which the Financial Instruments (or related reference assets) held by a Fund are traded. The Shares of each Fund trade, or will trade, on the NYSE Arca from 9:30 a.m. to 4:00 p.m. (Eastern Time). The Financial Instruments (and/or the reference assets) held by a particular Fund, however, may have different fixing or settlement times. Consequently, liquidity in the Financial Instruments underlying the applicable benchmark may be reduced after the close of trading on the applicable exchange. As a result, during the time when the NYSE Arca is open and the exchange on which the Financial Instruments underlying the applicable benchmark are traded is closed, trading spreads and the resulting premium or discount on the Shares of a Fund may widen, and, therefore, increase the difference between the price of the Shares of a Fund and the NAV of such Shares.

The number of underlying components included in a Fund’s benchmark may impact volatility, which could adversely affect an investment in the Shares.

Each of the indices for the Commodity Index Funds is concentrated in terms of the number and type of commodities represented, and some of the sub-indices are solely concentrated in a single commodity. The benchmarks for the Commodity Funds, the VIX Funds and the Currency Funds are concentrated solely on a reference asset. Investors should be aware that other commodity, volatility and currency benchmarks may be more diversified in terms of both the number and variety of commodities and currencies included or in terms of the volatility exposure offered. Concentration in fewer underlying reference assets may result in a greater degree of volatility in a benchmark and the NAV of the Fund which tracks that benchmark under specific market conditions and over time.

Trading on exchanges outside the United States is not subject to U.S. regulation and may result in different or diminished investor protections.

Some of the Funds’ trading may be conducted on exchanges outside the United States. Trading on such exchanges is not regulated by any U.S. governmental agency and may involve certain risks not applicable to trading on U.S. exchanges, including different or diminished investor protections. In trading contracts denominated in currencies other than U.S. dollars, the Shares are subject to the risk of adverse exchange rate movements between the dollar and the functional currencies of such contracts. Investors could incur substantial losses from trading on foreign exchanges which such investors would not have otherwise been subject had the Funds’ trading been limited to U.S. markets.

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Competing claims of intellectual property rights may adversely affect the Funds and an investment in the Shares.

Although the Sponsor does not anticipate that such claims will adversely impact the Funds, it is impossible to provide definite assurances that no such negative impact will occur. The Sponsor believes that it has properly licensed or obtained the appropriate consent of all necessary parties with respect to intellectual property rights. However, other third parties could allege ownership as to such rights and may bring an action in asserting their claims. To the extent any action is brought by a third party asserting such rights, the expenses in litigating, negotiating, cross-licensing or otherwise settling such claims may adversely affect the Funds.

Investors may be adversely affected by an overstatement or understatement of the NAV calculation of the Funds due to the valuation method employed on the date of NAV calculation.

Calculating the NAV of the Funds includes, in part, any unrealized profits or losses on open Financial Instrument positions. Under normal circumstances, the NAV of a Fund reflects the value of the Financial Instruments held by a Fund, as of the time the NAV is being calculated. However, if any of the Financial Instruments held by a Fund could not be purchased or sold on a day when a Fund is accepting creation and redemption orders (due to the operation of daily limits or other rules of the exchange or otherwise), a Fund may be improperly exposed which could cause it to fail to meet its stated investment objective. Alternatively, a Fund may attempt to calculate the fair value of such Financial Instruments. In such a situation, there is a risk that the calculation of the relevant benchmark, and therefore, the NAV of the applicable Fund on such day, may not accurately reflect the realizable market value of the Financial Instruments underlying such benchmark.

The liquidity of the Shares may also be affected by the withdrawal from participation of Authorized Participants, which could adversely affect the market price of the Shares.

In the event that one or more Authorized Participants which have substantial interests in the Shares withdraw from participation, the liquidity of the Shares will likely decrease, which could adversely affect the market price of the Shares and result in investors incurring a loss on their investment.

Shareholders that are not Authorized Participants may only purchase or sell their Shares in secondary trading markets, and the conditions associated with trading in secondary markets may adversely affect investors’ investment in the Shares.

Only Authorized Participants may create or redeem Creation Units. All other investors that desire to purchase or sell Shares must do so through the NYSE Arca or in other markets, if any, in which the Shares may be traded.

NYSE Arca may halt trading in the Shares of a Fund which would adversely impact investors’ ability to sell Shares.

Trading in Shares of a Fund may be halted due to market conditions or, in light of NYSE Arca rules and procedures, for reasons that, in the view of the NYSE Arca, make trading in Shares of a Fund inadvisable. In addition, trading is subject to trading halts caused by extraordinary market volatility pursuant to “circuit breaker” rules that require trading to be halted for a specified period based on a specified decline or rise in a market index (e.g., Dow Jones Industrial Average) or in the price of a Fund’s Shares. Additionally the ability to short sell a Fund’s Shares may be restricted when there is a 10% or greater change from the previous day’s official closing price. There can be no assurance that the requirements necessary to maintain the listing of the Shares of a Fund will continue to be met or will remain unchanged.

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Shareholders do not have the protections associated with ownership of shares in an investment company registered under the Investment Company Act of 1940 Act (the “1940 Act”).

None of the Funds are subject to registration or regulation under the 1940 Act. Consequently, shareholders do not have the regulatory protections provided to investors in investment companies.

Shareholders do not have the rights enjoyed by investors in certain other vehicles and may be adversely affected by a lack of statutory rights and by limited voting and distribution rights.

The Shares have limited voting and distribution rights. For example, shareholders do not have the right to elect directors, the Funds may enact splits or reverse splits without shareholder approval and the Funds are not required to pay regular distributions, although the Funds may pay distributions at the discretion of the Sponsor.

The value of the Shares will be adversely affected if the Funds are required to indemnify the Trustee.

Under the Amended and Restated Trust Agreement of the Trust, as may be further amended and restated from time to time (the “Trust Agreement”), the Trustee has the right to be indemnified for any liability or expense incurred without gross negligence or willful misconduct. That means the Sponsor may require the assets of a Fund to be sold in order to cover losses or liability suffered by it or by the Trustee. Any sale of that kind would reduce the NAV of one or more of the Funds.

Although the Shares of the Funds are limited liability investments, certain circumstances such as bankruptcy of a Fund will increase a shareholder’s liability.

The Shares of the Funds are limited liability investments; investors may not lose more than the amount that they invest plus any profits recognized on their investment. However, shareholders could be required, as a matter of bankruptcy law, to return to the estate of a Fund any distribution they received at a time when such Fund was in fact insolvent or in violation of the Trust Agreement.

Failure of the Futures Commission Merchants (each, an “FCM”) to segregate assets may increase losses in the Funds.

The CEA requires a clearing broker to segregate all funds received from customers from such broker’s proprietary assets. There is a risk that assets deposited by the Sponsor on behalf of the Funds as margin with the FCMs may, in certain circumstances, be used to satisfy losses of other clients of the FCMs. If an FCM fails to segregate the funds received from the Sponsor, the assets of the Funds might not be fully protected in the event of the FCM’s bankruptcy. Furthermore, in the event of an FCM’s bankruptcy, Fund Shares could be limited to recovering only a pro rata share of all available funds segregated on behalf of the FCM’s combined customer accounts, even though certain property specifically traceable to a particular Fund was held by the FCM. Each FCM may, from time to time, have been the subject of certain regulatory and private causes of action.

In the event of a bankruptcy or insolvency of any exchange or a clearing house, a Fund could experience a loss of the funds deposited through its FCM as margin with the exchange or clearing house, a loss of any profits on its open positions on the exchange, and the loss of unrealized profits on its closed positions on the exchange.

A court could potentially conclude that the assets and liabilities of one Fund are not segregated from those of another Fund and thereby potentially exposing assets in one Fund to the liabilities of another Fund.

Each Fund is a separate series of a Delaware statutory trust and not itself a separate legal entity. Section 3804(a) of the Delaware Statutory Trust Act (the “DSTA”) provides that if certain provisions are in the formation and governing documents of a statutory trust organized in series, and if separate and distinct records are maintained for any series and the assets associated with that series are held in separate and distinct records (directly or indirectly, including through a nominee or otherwise) and accounted for in such separate and distinct records separately from the other assets of the statutory trust, or any series thereof, then the debts, liabilities, obligations and expenses incurred, contracted for or otherwise existing with respect to a particular series are enforceable against the assets of

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such series only, and not against the assets of the statutory trust generally or any other series thereof, and none of the debts, liabilities, obligations and expenses incurred, contracted for or otherwise existing with respect to the statutory trust generally or any other series thereof shall be enforceable against the assets of such series. The Sponsor is not aware of any court case that has interpreted Section 3804(a) of the DSTA or provided any guidance as to what is required for compliance. The Sponsor maintains separate and distinct records for each Fund and accounts for them separately, but it is possible a court could conclude that the methods used did not satisfy Section 3804(a) of the DSTA and thus potentially expose assets in one Fund to the liabilities of another Fund.

Shareholders’ tax liability will exceed cash distributions on the Shares.

Shareholders of each Fund are subject to U.S. federal income taxation and, in some cases, state, local, or foreign income taxation on their share of the Fund’s taxable income, whether or not they receive cash distributions from the Fund. Each Fund does not currently expect to make distributions with respect to capital gains or ordinary income. Accordingly, shareholders of a Fund will not receive cash distributions equal to their share of the Fund’s taxable income or the tax liability that results from such income. A Fund’s income, gains, losses and deductions are allocated to shareholders on a monthly basis. If you own Shares in a Fund at the beginning of a month and sell them during the month, you are generally still considered a shareholder through the end of that month.

The U.S. Internal Revenue Service (“IRS”) could adjust or reallocate items of income, gain, deduction, loss and credit with respect to the Shares if the IRS does not accept the assumptions or conventions utilized by the Fund.

U.S. federal income tax rules applicable to partnerships are complex and their application is not always clear. Moreover, the rules generally were not written for, and in some respects are difficult to apply to, publicly traded interests in partnerships. The Funds apply certain assumptions and conventions intended to comply with the intent of the rules and to report income, gain, deduction, loss and credit to shareholders in a manner that reflects the shareholders’ economic gains and losses, but these assumptions and conventions may not comply with all aspects of the applicable regulations. It is possible therefore that the IRS will successfully assert that these assumptions or conventions do not satisfy the technical requirements of the Internal Revenue Code of 1986, as amended or the Treasury regulations promulgated thereunder and will require that items of income, gain, deduction, loss and credit be adjusted or reallocated in a manner that could be adverse to investors.

Shareholders of each Fund may recognize significant amounts of ordinary income and short-term capital gain.

Due to the investment strategy of the Funds, the Funds may realize and pass-through to Shareholders significant amounts of ordinary income and short-term capital gains as opposed to long-term capital gains, which generally are taxed at a preferential rate. A Fund’s income, gains, losses and deductions are allocated to shareholders on a monthly basis. If you own shares in a Fund at the beginning of a month and sell them during the month, you are generally still considered a shareholder through the end of that month.

INVESTORS ARE STRONGLY URGED TO CONSULT THEIR OWN TAX ADVISERS AND COUNSEL WITH RESPECT TO THE POSSIBLE TAX CONSEQUENCES TO THEM OF AN INVESTMENT IN THE SHARES OF A FUND; SUCH TAX CONSEQUENCES MAY DIFFER IN RESPECT OF DIFFERENT INVESTORS.

Regulatory changes or actions, including the implementation of new legislation, may alter the operations and profitability of the Funds.

Considerable regulatory attention has been focused on non-traditional investment pools which are publicly distributed in the United States. There is a possibility of future regulatory changes altering, perhaps to a material extent, the nature of an investment in the Funds or the ability of the Funds to continue to implement their investment strategies.

The futures markets are subject to comprehensive statutes, regulations, and margin requirements. In addition, the Securities and Exchange Commission (“SEC”), CFTC and the exchanges are authorized to take extraordinary actions in the event of a market emergency, including, for example, the retroactive implementation of speculative position limits or higher margin requirements, the establishment of daily price limits and the suspension of trading. The regulation of swaps and futures transactions in the United States is a rapidly changing area of law and is subject to modification by government and judicial action. The effect of any future regulatory change on the Funds is impossible to predict, but could be substantial and adverse.

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In particular, the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) was signed into law on July 21, 2010. The Act will make sweeping changes to the way in which the U.S. financial system is supervised and regulated. Title VII of the Dodd-Frank Act sets forth a new legislative framework for OTC derivatives, including Financial Instruments, such as swaps, in which certain of the Funds may invest. Title VII of the Dodd-Frank Act makes broad changes to the OTC derivatives market, grants significant new authority to the SEC and the CFTC to regulate OTC derivatives and market participants, and will require clearing and exchange trading of many OTC derivatives transactions.

Provisions in the Dodd-Frank Act include the requirement that position limits on commodity futures contracts be established; new registration, recordkeeping, capital and margin requirements for “swap dealers” and “major swap participants” as determined by the Dodd-Frank Act and applicable regulations; and the forced use of clearinghouse mechanisms for many OTC derivative transactions. Additionally, the new law requires the aggregation, for purposes of position limits, of all positions in futures held by a single entity and its affiliates, whether such positions exist on U.S. futures exchanges, non-U.S. futures exchanges, or in OTC contracts.

The CFTC, SEC and other federal regulators have been tasked with developing the rules and regulations enacting the provisions of the Dodd-Frank Act. It is not possible at this time to gauge the exact nature and scope of the impact of the Dodd-Frank Act on any of the Funds. The new law and the rules to be promulgated may negatively impact a Fund’s ability to meet its investment objective either through limits or requirements imposed on it or upon its counterparties. In particular, new position limits imposed on a Fund or its counterparties may impact that Fund’s ability to invest in a manner that efficiently meets its investment objective, and new requirements, including capital and mandatory clearing, may increase the cost of a Fund’s investments and cost of doing business, which could adversely affect investors.

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Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds.

(a)

None.

(b)

The Trust initially registered Shares on Form S-1 (No. 333-146801), which was declared effective on November 21, 2008, and registered additional Shares on its Registration Statement on Form S-1 (No. 333-156888), which was declared effective on February 13, 2009. The Trust terminated these two offerings before the sale of all Shares registered and re-allocated the remaining amount of the Shares registered among the Funds pursuant to its Registration Statement on Form S-3 (No. 333-163511), which became effective on December 4, 2009, and registered additional Shares and Funds pursuant to Post-Effective Amendments to that Registration Statement, which became effective on May 28, 2010 and December 23, 2010. Additional amounts were registered pursuant to subsequent Prospectus Supplements, which aggregate total amounts are reflected in the “Amount Registered” column below. Substantially all of the proceeds received by each Fund from the issuance and sale of Shares to Authorized Participants are used by each Fund to enter into Financial Instruments relating to that Fund’s benchmark in combination with cash or cash equivalents and/or U.S. Treasury Securities or other high credit quality short-term fixed-income or similar securities (such as shares of money market funds, bank deposits, bank money market accounts, certain variable rate-demand notes and repurchase agreements collateralized by government securities, whether denominated in U.S. or the applicable foreign currency with respect to a Currency Fund) that may be used to collateralize swap agreements or forward contracts or deposited with FCMs as margin in connection with any futures transactions. Each Leveraged Fund continuously offers and redeems its Shares in blocks of 50,000 Shares. Each VIX Fund continuously offers and redeems its Shares in blocks of 25,000 Shares.


Title of Securities Registered	Amount Registered		Shares Sold for the three months ended September 30, 2011		Sale Price of Shares Sold for the three months ended September 30, 2011
ProShares Ultra DJ-UBS Commodity Common Units of Beneficial Interest	$	300,000,000		—	$	—
ProShares UltraShort DJ-UBS Commodity Common Units of Beneficial Interest	$	500,000,000		—	$	—
ProShares Ultra DJ-UBS Crude Oil Common Units of Beneficial Interest	$	3,000,000,000		10,900,000	$	352,846,722
ProShares UltraShort DJ-UBS Crude Oil Common Units of Beneficial Interest	$	1,500,000,000		950,000	$	48,259,456
ProShares Ultra DJ-UBS Natural Gas Common Units of Beneficial Interest	$	500,000,000		—	$	—
ProShares Short DJ-UBS Natural Gas Common Units of Beneficial Interest	$	500,000,000		—	$	—
ProShares UltraShort DJ-UBS Natural Gas Common Units of Beneficial Interest	$	500,000,000		—	$	—
ProShares Ultra Gold Common Units of Beneficial Interest	$	1,000,000,000		900,000	$	92,734,651
ProShares Short Gold Common Units of Beneficial Interest	$	500,000,000		—	$	—
ProShares UltraShort Gold Common Units of Beneficial Interest	$	1,000,000,000		6,900,000	$	118,038,645
ProShares Ultra Silver Common Units of Beneficial Interest	$	2,000,000,000		4,800,000	$	337,790,511
ProShares UltraShort Silver Common Units of Beneficial Interest	$	2,100,000,000		17,200,000	$	223,296,405
ProShares Ultra Euro Common Units of Beneficial Interest	$	500,000,000		—	$	—
ProShares UltraShort Euro Common Units of Beneficial Interest	$	2,103,506,872		17,550,000	$	314,609,537
ProShares Ultra Yen Common Units of Beneficial Interest	$	500,000,000		50,000	$	1,696,147
ProShares UltraShort Yen Common Units of Beneficial Interest	$	1,300,000,000		—	$	—
ProShares VIX Short-Term Futures ETF Common Units of Beneficial Interest	$	800,000,000		2,250,000	$	139,655,248
ProShares VIX Mid-Term Futures ETF Common Units of Beneficial Interest	$	500,000,000		50,000	$	4,347,490
ProShares Short VIX Short-Term Futures ETF Common Units of Beneficial Interest	$	500,000,000		—	$	—
ProShares Ultra VIX Short-Term Futures ETF Common Units of Beneficial Interest	$	500,000,000		—	$	—
Total:	$	20,103,506,872		61,550,000	$	1,633,274,812

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(c)	From July 1, 2011 through September 30, 2011, the number of Shares redeemed and average price per Share for each Fund were as follows:


Fund	Total Number of Shares Redeemed		Average Price Per Share
ProShares Ultra DJ-UBS Commodity
07/01/11 to 07/31/11		50,000	$	36.41
08/01/11 to 08/31/11		—		—
09/01/11 to 09/30/11		—		—
ProShares UltraShort DJ-UBS Commodity
07/01/11 to 07/31/11		350,000		44.55
08/01/11 to 08/31/11		50,000		47.91
09/01/11 to 09/30/11		—		—
ProShares Ultra DJ-UBS Crude Oil
07/01/11 to 07/31/11		2,750,000		44.42
08/01/11 to 08/31/11		1,850,000		34.39
09/01/11 to 09/30/11		2,350,000		33.31
ProShares UltraShort DJ-UBS Crude Oil
07/01/11 to 07/31/11		700,000		47.41
08/01/11 to 08/31/11		2,300,000		59.25
09/01/11 to 09/30/11		150,000		64.66
ProShares Ultra Gold
07/01/11 to 07/31/11		—		—
08/01/11 to 08/31/11		50,000		100.70
09/01/11 to 09/30/11		200,000		118.08
ProShares UltraShort Gold
07/01/11 to 07/31/11		—		—
08/01/11 to 08/31/11		—		—
09/01/11 to 09/30/11		1,650,000		18.35
ProShares Ultra Silver
07/01/11 to 07/31/11		500,000		104.01
08/01/11 to 08/31/11		1,300,000		105.63
09/01/11 to 09/30/11		600,000		93.66
ProShares UltraShort Silver
07/01/11 to 07/31/11		—		—
08/01/11 to 08/31/11		7,750,000		13.09
09/01/11 to 09/30/11		11,950,000		17.71
ProShares Ultra Euro
07/01/11 to 07/31/11		—		—
08/01/11 to 08/31/11		—		—
09/01/11 to 09/30/11		—		—
ProShares UltraShort Euro
07/01/11 to 07/31/11		2,900,000		17.28
08/01/11 to 08/31/11		1,700,000		17.34
09/01/11 to 09/30/11		2,100,000		19.04
ProShares Ultra Yen
07/01/11 to 07/31/11		—		—
08/01/11 to 08/31/11		—		—
09/01/11 to 09/30/11		—		—
ProShares UltraShort Yen
07/01/11 to 07/31/11		83,333		43.72
08/01/11 to 08/31/11		1,033,333		42.83
09/01/11 to 09/30/11		166,667		41.15
ProShares VIX Short-Term Futures ETF
07/01/11 to 07/31/11		1,250,000		48.96
08/01/11 to 08/31/11		1,625,000		69.33
09/01/11 to 09/30/11		150,000		105.06
ProShares VIX Mid-Term Futures ETF
07/01/11 to 07/31/11		50,000		58.89
08/01/11 to 08/31/11		—		—
09/01/11 to 09/30/11		75,000		85.92
Total:		45,683,333		31.83

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Item 3.

Defaults Upon Senior Securities.

None.

Item 4.

(Removed and Reserved).

Item 5.

Other Information.

None.

Item 6.

Exhibits.


Exhibit No.		Description of Document
31.1		Certification by Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002(1)
31.2		Certification by Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002(1)
32.1		Certification by Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002(2)
32.2		Certification by Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002(2)
101.INS		XBRL Instance Document(3)
101.SCH		XBRL Taxonomy Extension Schema(3)
101.CAL		XBRL Taxonomy Extension Calculation Linkbase(3)
101.DEF		XBRL Taxonomy Extension Definition Linkbase(3)
101.LAB		XBRL Taxonomy Extension Label Linkbase(3)
101.PRE		XBRL Taxonomy Extension Presentation Linkbase(3)

(1)	Filed herewith.

(2)	Furnished herewith.

(3)

In accordance with Rule 406T of Regulation S-T, the information in these exhibits is furnished and deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 and 12 of the Securities Act of 1933, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

PROSHARES TRUST II

/s/ Louis Mayberg

By: Louis Mayberg

Principal Executive Officer

Date: November 9, 2011

/s/ Edward Karpowicz

By: Edward Karpowicz

Principal Financial Officer

Date: November 9, 2011