PACER TRENDPILOT US BOND INDEXFor example, on 6/30/20, the S&P U.S. High Yield Corporate Bond Index (the High Yield Index) closed at 659.32 and the S&P U.S. Treasury Bond 7-10 Year

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

Data as of 12/31/20

PACER TRENDPILOT® US BOND INDEX

PACER TRENDPILOT® SERIES High Yield Bond Index/T-Bonds

S&P CREDIT RATING TREND DOWNGRADE as of 12/31/2020

Taking a look at fixed income

0

200

400

600

800

1000

1200

3/1/2010 3/1/2011 3/1/2012 3/1/2013 3/1/2014 3/1/2015 3/1/2016 3/1/2017 3/1/2018 3/1/2019 3/1/2020

U.S. CORPORATE DEBT AMOUNTS BY RATING CATEGORY DEBT AMOUNT (%) as of October 2020

0

10

20

30

40

50

0.8

5.4

24.3

40.8

13.1 12.2

3.4

AAAAA A BBB BBB CCC and LowerSource: S&P

Source: BBG

FOR INVESTMENT PROFESSIONAL USE ONLY. NOT FOR USE WITH THE INVESTING PUBLIC. 2


The graph to the left is the historical performance of the S&P U.S. High Yield Corporate Bond Total Return Index divided by the S&P U.S. Treasury Bond 7-10 Year Total Return Index (Risk Ratio) and the Risk Ratio's 100 day simple moving average. This illustration does not reflect any historical Trendpilot® Index or Pacer ETF performance. The Total Return Index includes the reinvestment of interest. In a low interest rate environment, further declines in treasury yields may be limited, possibly affecting the risk ratio’s responsiveness to market changes. YOU CANNOT INVEST DIRECTLY IN AN INDEX.

100 DAY SIMPLE MOVING AVERAGE COMPARED TO THE RISK RATIO 12/31/1995 – 12/31/2020

Risk Ratio100 Day Simple Moving Average

0.30

0.40

0.50

0.60

0.70

0.80

0.90

1.00

1.10

1.20

12/29/1995 12/29/1998 12/29/2001 12/29/2004 12/29/2007 12/29/2010 12/29/2013 12/29/2016 12/29/2019

S&P U.S. High Yield Corporate Bond Total Return Index

S&P U.S. Treasury Bond 7-10 Year Total Return Index= Risk Ratio

For example, on 12/31/20, the S&P U.S. High Yield Corporate Bond Index (the High Yield Index) closed at 731.3 and the S&P U.S. Treasury Bond 7-10 Year Index (the T-Bond Index) closed at 709.008, giving us a risk ratio of 1.03.

The risk ratio is designed to measure the relative total return strength of the S&P U.S. High Yield Corporate Bond Index to the S&P U.S. Treasury Bond 7-10 Year Index. When the risk ratio is increasing, high yield corporate bonds are outperforming Treasury bonds. When the risk ratio is decreasing, Treasury bonds are outperforming high yield corporate bonds. The risk ratio is compared to a 100D SMA in order to establish its trend.


The graphs illustrate the Pacer Trendpilot® methodology based on hypothetical movements of its risk ratio and its 100 day simple moving average. This does not demonstrate historical data, and is not an indication of how any Index or Pacer Trendpilot® methodology will perform in the future. If the conditions mentioned in the graph are not satisfied, the trend of the risk ratio will be the same as the trend of the risk ratio on the immediately preceding business day. (1)Any exposure change will become effective by the 6th business day.

HYPOTHETICAL ILLUSTRATION

High Yield Indicator: When the Risk Ratio closes above its 100 day simple moving average (100 Day SMA) for five consecutive business days, the exposure of the Index will be 100% to the S&P U.S. High Yield Corporate Bond Index.1 From the High Yield position, the Index will change to the 50/50 position or the T-Bond position depending on the 50/50 Indicator and the T-Bond Indicator.

100% S&P U.S. High Yield Corporate Bond Index

50/50 Indicator: When the Risk Ratio closes below its 100 Day SMA for five consecutive business days, the exposure of the Index will be 50% to the S&P U.S. High Yield Corporate Bond Index and 50% to the S&P U.S. Treasury Bond 7-10 Year Index.1 From the 50/50 position, the Index will return to the High Yield position or change to the T-Bond position depending on if those indicators are triggered.

50% S&P U.S. High Yield Corporate Bond Index, 50% S&P U.S. Treasury Bond 7-10 Year Index

T-Bond Indicator: When the Risk Ratio’s 100 Day SMA closes lower than its value from five business days earlier, the exposure of the Index will be 100% to the S&P U.S. Treasury Bond 7-10 Year Index.1 From this position, the Index will change to the S&P U.S. High Yield Corporate Bond Index position when the High Yield Indicator is triggered. The Index will not return to its 50/50 position unless the High Yield Indicator is first triggered.

100% S&P U.S. Treasury Bond 7-10 Year Index

Legend:

Risk Ratio 100 Day Simple Moving Average

Risk Ratio

S&P U.S. High Yield Corporate Bond Total Return Index

S&P U.S. Treasury Bond 7-10 Year Total Return Index


A strategy driven index that uses trend following to alternate exposure between a High Yield Corporate Bond Index and U.S. Treasury Bond Index.

HOW IT MOVESAfter an indicator is triggered, the index will move exposure over a 5 day period, trading at the close each business day.

100% old exposure

Signal triggered

100% new exposure

20%

80%

40%

60%

60%

40%

80%

20%

Day 1 Day 2 Day 3 Day 4 Day 5 Day 6


$0

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

$70,000

$80,000

$90,000

$100,000

12/29/1995 12/29/1998 12/29/2001 12/29/2004 12/29/2007 12/29/2010 12/29/2013 12/29/2016 12/29/2019


(1)All Indexes shown are Total Return Indexes. Source: S&P & Pacer Advisors. S&P has calculated the backtest gross of the ETF fees for the Trendpilot Index. Pacer Advisors is netting out the fees for this illustration. The hypothetical backtested index performance of the Pacer Trendpilot® US Bond Index is shown net of fees and reflects the reinvestment of dividends. The annual total expense is 0.60%. The Pacer Trendpilot® Index was released on 9/9/2019. All data shown here is hypothetical, retrospectively calculated, and based on rules-based criteria applied retroactively with the benefit of hindsight and knowledge of factors that may have positively affected its performance, and cannot account for all financial risk or market and economic factors that may affect the actual performance. The start date for this index was chosen based on data from S&P. The results shown are hypothetical and do not reflect actual returns. PAST PERFORMANCE (WHETHER RETROSPECTIVELY CALCULATED OR ACTUAL HISTORICAL) IS NOT INDICATIVE OF FUTURE RESULTS. YOU CANNOT INVEST DIRECTLY IN AN INDEX.

HYPOTHETICAL GROWTH OF $10,0001 12/29/1995 – 12/31/2020

HISTORICAL PERFORMANCE, VOLATILITY COMPARISON AND MAXIMUM DRAWDOWN (%)1 12/29/1995 – 12/31/2020

$90,523

$53,682

Pacer Trendpilot® US Bond Index S&P U.S. High Yield Corporate Bond Index S&P U.S. Treasury Bond 7-10 Year Index

Pacer Trendpilot® US

Bond Index

S&P U.S. High Yield Corporate

Bond Index

S&P U.S. Treasury Bond

7-10 Year Index

Maximum Return

39.22 (2009)

54.55 (2009)

18.13 (2008)

Minimum Return

-1.47 (1999)

-25.99 (2008)

-6.11 (2013)

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

Pacer Trendpilot® US

Bond Index

S&P U.S. High Yield Corporate

Bond Index

S&P U.S. Treasury Bond

7-10 Year Index

Annualized Average Return

9.20 6.95 5.65

Annualized Volatility

4.59 4.06 6.13

Maximum Drawdown

-8.10 -32.69 -10.21

MINIMUM AND MAXIMUM CALENDAR YEAR RETURNS (%)1

12/29/1995 – 12/31/2020$39,592

100% High Yield 50% High Yield/50% T-Bonds 100% Treasury Bonds


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

EXPECTED MOVEMENT PORTFOLIO COMPONENTS IN DIFFERENT MARKETS

Corporate Bond Index (Beta)

High Yield Index (Alpha)

Pacer Trednpilot Bond Index (Risk

Management)Total Portfolio

Value

Rising Markets Ç Equal Rise may be greaterEqual or rise may

be lessEqual or rise may be

greater

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

be less

60%Equity

30%Bonds

10% Beta10% Alternatives

10% Alpha

30%Bonds

10% PTBD

SAMPLE PORTFOLIO ALLOCATION

50% Pacer Trendpilot/

50% High Yield

-6.23%-25.99% 13.53%

100% Pacer Trendpilot

Index Returns

100% High Yield Returns

2008 CALENDAR-YEAR RETURNS

8.07%6.95% 9.20%

12/29/95-12/31/20 RETURNSThe charts to the right show different allocations to the High Yield Index and the Pacer Trendpilot US Bond Index over two separate time periods.

50% Pacer Trendpilot/

50% High Yield

100% Pacer Trendpilot

Index Returns

100% High Yield Returns

The Pacer Trendpilot Bond ETF is designed to complement an existing fixed income position. In using a risk management strategy alongside alpha and beta allocations, clients are better positioned for more downside risk management from the market.

COMPLEMENT AN EXISTING FIXED INCOME POSITION

Source: S&P & Pacer Advisors. S&P has calculated the backtest gross of the ETF fees for the Trendpilot Index. Pacer Advisors is netting out the fees for this illustration. The hypothetical backtested index performance of the Pacer Trendpilot® US Bond Index is shown net of fees and reflects the reinvestment of dividends. The annual total expense is 0.60%. The Pacer Trendpilot® Index was released on 9/9/2019. All data shown here is hypothetical, retrospectively calculated, and based on rules-based criteria applied retroactively with the benefit of hindsight and knowledge of factors that may have positively affected its performance, and cannot account for all financial risk or market and economic factors that may affect the actual performance. The start date for this index was chosen based on data from S&P. The results shown are hypothetical and do not reflect actual returns.PAST PERFORMANCE (WHETHER RETROSPECTIVELY CALCULATED OR ACTUAL HISTORICAL) IS NOT INDICATIVE OF FUTURE RESULTS. YOU CANNOT INVEST DIRECTLY IN AN INDEX.



Source: Morningstar

PAST PERFORMANCE (WHETHER RETROSPECTIVELY CALCULATED OR ACTUAL HISTORICAL) IS NOT INDICATIVE OF FUTURE RESULTS. YOU CANNOT INVEST DIRECTLY IN AN INDEX. The hypothetical backtested index performance of the Pacer Trendpilot US Bond Index (annual expense: 0.60%, index released 09/09/2019) is shown net of fees and reflects the reinvestment of dividends. Any data shown prior to this date is hypothetical, retrospectively calculated, and based on rules-based criteria applied retroactively with the benefit of hindsight and knowledge of factors that may have positively affected its performance, and cannot account for all financial risk or market and economic factors that may affect the actual performance. The actual performance of the Index may vary significantly from the backtested Index data.

HYPOTHETICAL HISTORICAL PERFORMANCE 12/29/1995 – 12/31/2020

Pacer Trendpilot US Bond Index Bloomberg Barclays US Aggregate Bond Total Return Index Equal Weight Pacer Trendpilot US Bond Index (Net of Fees), S&P U.S. High Yield Corporate Bond Index, S&P 7-10 Year U.S. Treasury Bond Index and Bloomberg Barclays US Bond Aggregate Index

$0

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

$70,000

$80,000

$90,000

$100,000

12/29/1995 12/29/1998 12/29/2001 12/29/2004 12/29/2007 12/29/2010 12/29/2013 12/29/2016 12/29/2019

$90,523

$55,090

$35,143




1 YEAR ROLLING (QUARTERLY) 12/29/1995 – 12/31/2020

Pacer Trendpilot US Bond Index (Net of Fees) S&P US Treasury Bond 7-10 Year Total Return Index S&P US High Yield Corporate Bond Total Return Index

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

50%

60%

12/3

1/19

96

6/30

/199

8

12/3

1/19

99

6/30

/200

1

12/3

1/20

02

6/30

/200

4

12/3

1/20

05

6/30

/200

7

12/3

1/20

08

6/30

/201

0

12/3

1/20

11

6/30

/201

3

12/3

1/20

14

6/30

/201

6

12/3

1/20

17

6/30

/201

9

12/3

1/20

20




10 YEAR ROLLING (QUARTERLY) 12/29/1995 – 12/31/2020

Pacer Trendpilot US Bond Index (Net of Fees) S&P US Treasury Bond 7-10 Year Total Return Index S&P US High Yield Corporate Bond Total Return Index

0%

2%

4%

6%

8%

10%

12%

14%

16%

12/3

1/20

05

3/31

/200

6

6/30

/200

6

9/30

/200

6

12/3

1/20

06

3/31

/200

7

6/30

/200

7

9/30

/200

7

12/3

1/20

07

3/31

/200

8

6/30

/200

8

9/30

/200

8

12/3

1/20

08

3/31

/200

9

6/30

/200

9

9/30

/200

9

12/3

1/20

09

3/31

/201

0

6/30

/201

0

9/30

/201

0

12/3

1/20

10

3/31

/201

1

6/30

/201

1

9/30

/201

1

12/3

1/20

11

3/31

/201

2

6/30

/201

2

9/30

/201

2

12/3

1/20

12

3/31

/201

3

6/30

/201

3

9/30

/201

3

12/3

1/20

13

3/31

/201

4

6/30

/201

4

9/30

/201

4

12/3

1/20

14

3/31

/201

5

6/30

/201

5

9/30

/201

5

12/3

1/20

15

3/31

/201

6

6/30

/201

6

9/30

/201

6

12/3

1/20

16

3/31

/201

7

6/30

/201

7

9/30

/201

7

12/3

1/20

17

3/31

/201

8

6/30

/201

8

9/30

/201

8

12/3

1/20

18

3/31

/201

9

6/30

/201

9

9/30

/201

9

12/3

1/20

19

3/31

/202

0

6/30

/202

0

9/30

/202

0

12/3

1/20

20


NOTES


NOTES


NOTES

PCR191021_PTBDPB 12/31/20

BEFORE INVESTING YOU SHOULD CAREFULLY CONSIDER THE FUNDS’ INVESTMENT OBJECTIVES, RISKS, CHARGES, AND EXPENSES. THIS AND OTHER INFORMATION IS IN THE PROSPECTUS. A COPY MAY BE OBTAINED BY VISITING WWW.PACERETFS.COM OR CALLING 1-877-337-0500. PLEASE READ THE PROSPECTUS CAREFULLY BEFORE INVESTING.

An investment in the Funds is subject to investment risk, including the possible loss of principal. Pacer ETF shares may be bought and sold on an exchange through a brokerage account. Brokerage commissions and ETF expenses will reduce investment returns. There can be no assurance that an active trading market for ETF shares will be developed or maintained. The risks associated with these funds are detailed in the prospectus and could include factors such as calculation methodology risk, ETF risks, limited operating history risk, fixed income risk, government obligations risk, high yield risk, management risk, passive investment risk, tracking risk, trend lag risk and other special risks of exchange traded funds. The Pacer Trendpilot® US Bond Index (the “Index”) is the property of Index Design Group, LLC which has contracted with S&P Opco, LLC (a subsidiary of S&P Dow Jones Indices LLC) to calculate and maintain the Index. The Index is not sponsored by S&P Dow Jones Indices or its affiliates or its third party licensors (collectively, “S&P Dow Jones Indices”). S&P Dow Jones Indices will not be liable for any errors or omissions in calculating the Index. “Calculated by S&P Dow Jones Indices” and the related stylized mark(s) are service marks of S&P Dow Jones Indices and have been licensed for use by Index Design Group, LLC. S&P® is a registered trademark of Standard & Poor’s Financial Services LLC (“SPFS”), and Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”). When investing in high yield, high risk securities, the Fund will generally hold a representative sample of the securities in the Index whose risk, return and other characteristics closely resemble, in the judgment of the Sub-Adviser, Vident Investment Advisory, those of the Index as a whole. While intended to allow the Fund to closely track the Index, use of this approach may cause the Fund’s performance to deviate from that of the Index. Pacer Advisors, Inc. is the fund advisor. Vident Investment Advisory is the fund sub-adviser. Vident Investment Advisory, LLC is registered as an investment advisor with the SEC and only conducts business in states where it is properly notice filed or is excluded from registration requirements. To learn more about the Index methodology, please visit www.indexdesigngroup.com or call 877-337-0500. DEFINITIONS OF CERTAIN DEFINED TERMS USED HEREIN: Annualized average return represents the calculated hypothetical rate of return that, if cumulatively applied to each relevant annual period during the time period indicated, would result in the actual cumulative rate of return for the entire period. Maximum return represents the highest calendar year return as measured during the period indicated.Minimum return represents the lowest calendar year return as measured during the period indicated.Annualized volatility is based on monthly returns from the most recent date indicated on the page and expressed as a standard deviation percentage. Standard deviation is a measure of volatility and illustrates the extent of variation (whether higher or lower) that exists from the average given set of results. A low standard deviation indicates that the results tend to be very close to the average result (a low degree of volatility). In contrast, a high standard deviation indicates that the results are spread out over a large range of outcomes (a high degree of volatility). Because the standard deviation is based on historical data, it may not predict variability in annualized performance of the Pacer ETFs in the future. Maximum drawdown represents the maximum percentage loss that the relevant index incurred from its peak level to its lowest level during the time period indicated.

Trendpilot® is a registered trademark of Index Design Group, LLC., an affiliate of Pacer Advisors, Inc.

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

877-337-0500 § www.paceretfs.com

Documents

PACER TRENDPILOT US BOND INDEXFor example, on 6/30/20, the S&P U.S. High Yield Corporate Bond Index (the High Yield Index) closed at 659.32 and the S&P U.S. Treasury Bond 7-10 Year