As filed with the Securities and Exchange Commission on January 25, 2008

Registration No. 333-147948

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

AMENDMENT NO. 1

ON

FORM S-1

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

MACRO INFLATION DEPOSITOR, LLC

(Depositor)

(Exact name of registrant as specified in its charter)

MacroShares Medical Inflation Up Trust Series 2008-1

(Issuer with respect to the Offered Securities)

New York (State or other jurisdiction of incorporation or organization) 26-1501411 (I.R.S. Employer Identification No.)

73 Green Tree Drive #9

Dover, DE 19904

(888) MACROS1

(Address, including zip code, and telephone number, including area code, of registrant's principal executive offices)

Mr. Samuel Masucci, III

President

MACRO Inflation Depositor, LLC

73 Green Tree Drive #9

Dover, DE 19904

(888) MACROS1

(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to:

Richard F. Kadlick, Esq.

Skadden, Arps, Slate, Meagher & Flom LLP

Four Times Square

New York, New York 10036

(212) 735-3000

(212) 735-2000 (facsimile)

Approximate date of commencement of proposed sale to the public: As soon as practicable after this registration statement becomes effective.

If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. x

If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨

If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨

If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨

If delivery of the prospectus is expected to be made pursuant to Rule 434, check the following box. ¨

CALCULATION OF REGISTRATION FEE

Title of Each Class of Securities to be Registered(1)	Amount to be Registered		Proposed Maximum Offering Price Per Share(2)			Proposed Maximum Aggregate Offering Price(2)		Amount of Registration Fee		Date Due
Up MacroShares	$	1,000,000	$	[20	]	$	1,000,000	$	30.70		[      ], 2018

(1) We are also registering the income distribution agreement and the settlement contracts pursuant to this registration statement. No separate consideration is received for either the income distribution agreement or the settlement contracts, and, therefore, no additional fee is required pursuant to Rule 457(n) under the Securities Act of 1933, as amended.

(2) Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(d) under the Securities Act of 1933, as amended.

The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

PRELIMINARY, SUBJECT TO COMPLETION, DATED JANUARY 25, 2008

Prospectus

$[                ]

MacroShares Medical Inflation Up Shares Series 2008-1

Issued by

MacroShares Medical Inflation Up Trust Series 2008-1

MACRO Inflation Depositor, LLC,

as Depositor 

The MacroShares Medical Inflation Up Trust Series 2008-1, referred to as the "Up Trust," intends to issue MacroShares Medical Inflation Up Shares Series 2008-1, referred to as the "Up MacroShares," on a continuous basis at the direction of authorized participants.

The assets of the Up Trust will consist of an income distribution agreement and settlement contracts entered into with the Down Trust. The Up Trust will also hold U.S. Treasuries and repurchase agreements on U.S. Treasuries to secure its obligations under the income distribution agreement and the settlement contracts. The Up Trust will make quarterly distributions of income on the treasuries and a final distribution of all assets it holds on deposit on the final scheduled termination date, an early termination date or a redemption date. Each quarterly and final distribution will be based on the value for the medical care component of the Consumer Price Index for All Urban Consumers ("CPI-U"), as calculated and published by the Bureau of Labor Statistics ("BLS"). The medical care component of the CPI-U reflects inflation in the cost of medical goods and services. The "Applicable Reference Value of Medical Inflation" is a daily linear interpolation based on the monthly values of the medical care component of the CPI-U for the preceding two months and is the reference value on the basis of which quarterly and final distributions on the Up MacroShares are calculated. The hurdle rate has been designated as [4.00%] and the leverage factor as 2. If the ratio of the Applicable Reference Value of Medical Inflation on any day to the Applicable Reference Value of Medical Inflation on the closing date (as defined below) exceeds the hurdle rate, compounded for the period from the closing date to the day of measurement, the underlying value of the Up Trust on the next business day will include all of its assets plus a portion of the assets of the paired Down Trust. This portion of assets due from the Down Trust will be doubled by the leverage factor. Conversely, if this ratio is less than the compounded hurdle rate, the Up Trust's underlying value will decrease, because a portion of its assets will be included in the underlying value of its paired Down Trust. This portion of assets due to the Down Trust will be doubled by the leverage factor. The Up MacroShares must be redeemed together with Down MacroShares by any holder who is an authorized participant on any business day in MacroShares Units consisting of a minimum of 50,000 Up MacroShares and 50,000 Down MacroShares, at the respective per share underlying values of those shares, as measured on the applicable redemption date. Unless earlier redeemed on a redemption date or an early termination date, a final distribution will be made on the Up MacroShares on the Distribution Date occurring in [           ] of 2018.

The Up MacroShares will trade on the New York Stock Exchange under the symbol "[           ]." The Up MacroShares are not insured or guaranteed by the United States government or any government agency or instrumentality and are not an investment in a money-market type fund.

AN INVESTMENT IN THE UP MACROSHARES INVOLVES SIGNIFICANT RISKS, INCLUDING THE RISK OF LOSS OF ALL OF YOUR INVESTMENT. YOU SHOULD REVIEW THE RISK FACTORS BEGINNING ON PAGE [26] OF THIS PROSPECTUS PRIOR TO INVESTING IN THE UP MACROSHARES. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

THE UP TRUST DOES NOT HOLD OR TRADE IN COMMODITY FUTURES CONTRACTS OR OTHER INSTRUMENTS REGULATED BY THE COMMODITY FUTURES TRADING COMMISSION. NEITHER THE ADMINISTRATIVE AGENT NOR THE TRUSTEE, AS THE OPERATOR OF THE UP TRUST IS REGISTERED AS A COMMODITY POOL OPERATOR AND NONE OF THE TRUSTEE, THE ADMINISTRATIVE AGENT OR WE, AS DEPOSITOR, ARE SUBJECT TO REGULATION BY THE COMMODITY FUTURES TRADING COMMISSION AS A COMMODITY POOL OPERATOR OR A COMMODITY TRADING ADVISOR.

Title of Each Class of Securities to be Purchased	Offering Price Per Share	Offering Price Per Unit
Up MacroShares	$[20]	$[1,000,000]

The Initial Purchasers, subject to conditions, have agreed to purchase [            ] Up MacroShares and [            ] Down MacroShares, which comprise [     ] MacroShares Units, as described in "PLAN OF DISTRIBUTION." The sale of the Up MacroShares and Down MacroShares is expected to occur on or about [              ], 2008.

The Up MacroShares may be issued only in MacroShares Units consisting of a minimum of 50,000 Up MacroShares issued by the Up Trust and 50,000 Down MacroShares issued by the Down Trust. The Up Trust and Down Trust will issue their shares in the minimum amounts that constitute a MacroShares Unit on an ongoing basis only to persons who qualify as authorized participants at the per share underlying value of those shares on the business day on which a creation order for the shares is delivered to and accepted by the administrative agent. Subsequent to the offering of the Up MacroShares and the Down MacroShares by the Initial Purchasers, the Up MacroShares will be offered continuously to authorized participants as part of MacroShares Units at their per share underlying value and may be sold by authorized participants to the public at the market price prevailing at the time of any such sale.

The date of this prospectus is February [   ], 2008.

We are providing information to you about the MacroShares¹ Medical Inflation Up Shares Series 2008-1. You should rely only on the information contained in this prospectus. We have not, and no authorized participant has, authorized any person to provide you with information that is different from that contained in this prospectus. We are offering to sell, and seeking offers to buy, MacroShares Medical Inflation Up Shares Series 2008-1 only in states where such offers and sales are permitted.

Table of Contents

NOTE ABOUT CERTAIN INFORMATION CONTAINED IN THIS PROSPECTUS	1
WHERE YOU CAN FIND MORE INFORMATION	1
REPORTS TO SHAREHOLDERS	1
FORWARD-LOOKING STATEMENTS	2
TRANSACTION DIAGRAM	3
PROSPECTUS SUMMARY	4
RISK FACTORS	26
You may lose your entire investment in the Up MacroShares that you hold; there is no guarantee as to the amount of any quarterly distribution or the amount of the final distribution.	26
There is currently no market for the Up MacroShares, and no market may develop.	27
Fluctuations in the underlying value of the Up Trust and other factors may affect the market price of your Up MacroShares.	28
The Up Trust will make distributions on the Up MacroShares solely from the assets deposited in the paired trusts.	29
Income on the treasuries may be insufficient to make quarterly distributions.	29
The paired trusts may incur losses in connection with treasuries delivered upon the default of a repurchase agreement counterparty.	30
The return on your shares is uncertain.	30
The Up MacroShares are not a perfect hedge against the rate of medical inflation.	34
The rate of inflation is variable and volatile in the short-term and it is difficult to predict it in the long-term; many contingent factors may influence the rate of inflation in the price of medical services and commodities.	35
The historical performance of the Applicable Reference Value of Medical Inflation is not an indication of its future performance.	37
The Up Trust is not regulated as a commodity pool and none of the Up MacroShares are regulated by the Commodity Futures Trading Commission.	37
Redemption and creation orders are subject to postponement, suspension or rejection in certain circumstances; no redemptions are permitted prior to July 1, 2008 and a fee is payable for creations prior to that date.	37
If the Up Trust is taxable as a corporation for United States federal income tax purposes, your distributions will be reduced.	38
If the Up Trust were determined not to qualify as a securitization partnership, and the Up Trust were to have built-in losses at the time you transfer your shares, the value of your shares could be effected.	38
You should be aware of the tax consequence of your investment in the Up MacroShares. For example, you may have United States federal income tax liabilities in advance, or in excess, of your quarterly distributions. Lack of sufficient trading of futures market based on the medical component of the CPI-U may result in the imposition of withholding tax liability on the Up Trust.	38
The Up MacroShares do not confer upon their holders many of the rights normally associated with shares issued by a corporation.	39
Potential conflicts of interests.	39
GLOSSARY	39

^{1 MACRO® is a federally-registered service mark of MacroMarkets LLC. MacroMarkets LLC considers all references, singular or plural, to " MACRO®" or " MACRO " in this prospectus its service mark and reserves all rights to that service mark.}

USE OF PROCEEDS	39
THE DEPOSITOR	39
MACROMARKETS LLC	40
FORMATION OF THE PAIRED TRUSTS	41
DESCRIPTION OF THE UP MACROSHARES	42
DESCRIPTION OF THE CONSUMER PRICE INDEX AND THE MEDICAL GOODS AND SERVICES COMPONENT OF THE CONSUMER PRICE INDEX	55
Overview of the Consumer Price Index	55
Scope and Publication	56
The Structure of the CPI	56
The Medical Care Component of the CPI	59
DESCRIPTION OF THE UP TRUST ASSETS	62
DESCRIPTION OF THE TRUST AGREEMENTS	66
MATERIAL UNITED STATES FEDERAL INCOME TAX CONSEQUENCES	73
STATE TAX CONSEQUENCES	79
CERTAIN ERISA CONSIDERATIONS	79
PLAN OF DISTRIBUTION	80
LEGAL OPINIONS	81
EXPERTS	82
GLOSSARY OF DEFINED TERMS	82
Appendix A: Hypothetical Scenarios	A-1
Appendix B: Historical Performance of Medical Inflation and Treasury Rates	B-1
Appendix C: Hypothetical Underlying Value Calculations	C-1
Appendix D: Transactions With Affiliated Persons	D-1
Report of Independent Registered Public Accounting Firm	F-1
Financial Statements for the MacroShares Medical Inflation Up Trust Series 2008-1	F-2

Unless otherwise indicated, all references in this prospectus to the "depositor," "we," "us," "our," or similar terms refer to MACRO Inflation Depositor, LLC.

We include cross-references in this prospectus to sections in these materials where you can find further related discussions. The preceding table of contents provides the pages on which these sections begin.

NOTE ABOUT CERTAIN INFORMATION CONTAINED IN THIS PROSPECTUS

The information contained in the sections entitled "DESCRIPTION OF THE BUREAU OF LABOR STATISTICS INFLATION RATES" and "DESCRIPTION OF THE APPLICABLE REFERENCE VALUE OF INFLATION" is based on information obtained from the U.S. Department of Labor, Bureau of Labor Statistics, the website maintained by the United States Department of Labor at http://www.bls.gov/cpi/home.htm and other sources that we believe to be reliable. However, we have not independently verified the accuracy and completeness of such information.

WHERE YOU CAN FIND MORE INFORMATION

We have filed with the Securities and Exchange Commission, or the "SEC," a registration statement under the United States Securities Act of 1933, as amended, which we refer to as the "Securities Act," with respect to the shares offered in this prospectus. This prospectus contains summaries of the material terms of the documents it refers to, but does not contain all of the information set forth in the registration statement of which this prospectus is a part. For further information, we refer you to the registration statement. You can inspect and copy the registration statement at the public reference facilities maintained by the SEC. The SEC's public reference facilities are located at its Public Reference Section, One Station Place, 100 F Street, N.E., Washington, D.C. 20549. Information as to the operation of the public reference facility is available by calling the SEC at 1-800-SEC-0330. The SEC maintains an internet website that contains reports, information statements and other information that we file electronically with the SEC. You may access the website at http://www.sec.gov.

This is a prospectus for the offering of the MacroShares Medical Inflation Up Shares Series 2008-1. We are only offering the MacroShares Medical Inflation Up Shares Series 2008-1 in this prospectus. This prospectus does not constitute an offer of shares to any person in any state or other jurisdiction in which such offer would be unlawful.

REPORTS TO SHAREHOLDERS

We will prepare and file with the Securities and Exchange Commission, in accordance with the requirements of the Securities Exchange Act of 1934, as amended, quarterly reports on Form 10-Q, annual reports on Form 10-K and current reports on Form 8-K for the MacroShares Medical Inflation Up Trust Series 2008-1. You may contact your broker to obtain paper copies of these reports.

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FORWARD-LOOKING STATEMENTS

The SEC encourages issuers to disclose forward-looking information so that investors can better understand the future prospects of their investments and make informed investment decisions. This prospectus contains these types of statements. We make these statements directly in this prospectus. Words such as "anticipates," "estimates," "expects," "projects," "intends," "plans," "believes" and words or terms of similar substance used in connection with any discussion of the future performance of the shares offered in this prospectus are forward-looking statements. All forward-looking statements reflect our present expectation of future events and the realization of these future events is subject to a number of important variables that could cause actual results to differ materially from those described in the forward-looking statements. The "RISK FACTORS" section of this prospectus provides examples of these variables. You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this prospectus. Except for our ongoing obligation to disclose material information under the federal securities laws, we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

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TRANSACTION DIAGRAM

The following diagram shows the relationship between the Up Trust and the Down Trust.

(1) Under the income distribution agreement, as of any distribution date, the Up Trust will either (a) be required to pay a portion of its available income, as defined in this prospectus, to the Down Trust or (b) be entitled to receive all or a portion of the Down Trust's available income, based, in each case, on the Applicable Reference Value of Medical Inflation for each day during the preceding calculation period.

(2) Under each settlement contract, in connection with the final scheduled termination date, an early termination date or any redemption date, the Up Trust will either (a) be required to make a final payment out of its assets to the Down Trust or (b) be entitled to receive a final payment from the Down Trust out of the assets of the Down Trust, based, in each case, on the Applicable Reference Value of Medical Inflation for the period from the closing date through the date of redemption.

(3) Treasuries include bills, bonds and notes issued and guaranteed by the United States Treasury and repurchase agreements collateralized by United States Treasury securities.

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PROSPECTUS SUMMARY

This summary highlights information contained elsewhere in this prospectus, but may not include all of the information that may be important to you. You should read this entire prospectus carefully, including the "RISK FACTORS" and "FORWARD-LOOKING STATEMENTS" sections, before making an investment decision.

This is a prospectus for the offering of the Up MacroShares. In this prospectus, we discuss matters relating to the Up Trust and also matters relating to the Down Trust to the extent that these matters are relevant to you, as a holder of Up MacroShares. Only the Up MacroShares are being offered by this prospectus.

Please note that when we refer in this summary to the "per share underlying value" that is represented by your Up MacroShares on any date, we mean the amount that you would be entitled to receive as a final distribution on that date if the paired trusts were to settle the settlement contracts and the Up Trust were to make a final distribution on your Up MacroShares. Such a final distribution is, however, merely hypothetical and we refer to it solely for the purpose of explaining the meaning of underlying value and the terms of the income distribution agreement and the settlement contracts. As a holder of Up MacroShares, you are entitled to receive a final distribution on those shares only on the final scheduled termination date, an early termination date or, if you are an authorized participant, upon directing a redemption of those shares on any redemption date, and you must sell your Up MacroShares in order to liquidate your investment in those shares at any time prior to those dates.

The formula used to calculate underlying value is designed to compensate holders of the Up MacroShares for a rate of increase in the value of the medical care component of the Consumer Price Index that is above a certain designated "hurdle rate," compounded for the period from the closing date to the relevant date of measurement. However, the amount of this compensation is not designed to equal, in absolute terms or in any specified proportion, the increase in the price of medical goods and services and an investment in the shares will not offset such price increases but will provide only some measure of protection against them. The amount of that protection depends upon certain structural features of the transaction as well as the methodology for calculating the medical component of the CPI-U. Please review carefully the risk factor entitled "The Up MacroShares are not a perfect hedge against inflation" in the "RISK FACTORS" section of this prospectus.

The Issuers and the Securities Offered

On February [   ], 2008, the MacroShares Medical Inflation Up Trust Series 2008-1, which is referred to in this prospectus as the "Up Trust," was established by us, in our capacity as depositor, under the laws of the State of New York. On February [ ], 2008, the trust agreement for the Up Trust was amended and restated to provide for the issuance of MacroShares Medical Inflation Up Shares Series 2008-1, or the "Up MacroShares," which will represent undivided beneficial interests in the Up Trust.

For more information about the Up Trust, see "FORMATION OF THE PAIRED TRUSTS." For more information about us, see "THEDEPOSITOR."

We are MACRO Inflation Depositor, LLC and we are acting as "depositor" for the Up Trust, as well as the Down Trust described in the next section of this summary. We were established as a limited liability company in the State of Delaware on November 27, 2007, and are a wholly-owned, limited-purpose subsidiary of MacroMarkets LLC. In our capacity as depositor, our principal duties consist of forming the Up and Down Trusts, preparing and filing all periodic reports required to be filed by the trusts, and maintaining the listing of the Up and Down MacroShares on a national exchange.

The Paired Trusts

Concurrently with the formation of the Up Trust, we have also formed under New York law, and act as depositor for, the MacroShares Medical Inflation Down Trust, which is referred to in this prospectus as the "Down Trust." We refer to the Up Trust and the Down Trust as the "paired trusts." We also refer to the Down Trust as the "paired trust" with respect to the Up Trust and to the Up Trust as the "paired trust" with respect to the Down Trust. The paired trusts entered into an income distribution agreement with each other on [         ], 2008, which is also referred to as the "closing date," and intend to enter into one or more settlement contracts in connection with each paired issuance of paired shares.

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The Down Trust will issue the MacroShares Medical Inflation Down Shares, or the "Down MacroShares." The Down MacroShares will each represent an undivided beneficial interest in the Down Trust. We refer to the Up MacroShares and the Down MacroShares as the "paired shares."

At any time after the closing date, authorized participants may direct the issuance of paired shares by delivering a creation order for a paired issuance to MacroMarkets LLC, which is acting as the administrative agent for the two trusts, in accordance with the procedures described in this prospectus. Up and Down MacroShares will only be issued in the form of MacroShares Units composed of 50,000 Up MacroShares and 50,000 Down MacroShares. Paired shares will always be issued at the per share underlying value of those shares at the time that the relevant creation order is received. Following delivery by the authorized participant to the trustee of funds equal to the aggregate underlying value of the shares being issued, the trustee will credit the authorized participant's account at DTC with the number of paired shares created by that authorized participant in accordance with the procedures specified in the participants agreement and described in this prospectus.

The trustee for the paired trusts will use the net proceeds received by each trust in connection with each paired issuance to acquire, in accordance with the directions of the administrative agent and on behalf of each paired trust, bills, bonds and notes issued and guaranteed by the United States Treasury and repurchase agreements collateralized by United States Treasury securities, that are, in each case, scheduled to mature prior to the quarterly distribution date. We refer to these United States Treasury securities and repurchase agreements generically as "treasuries."

The Income Distribution Agreement and the Settlement Contracts

The paired trusts enter into an income distribution agreement under which the trusts make quarterly payments to each other out of the income generated by their treasuries that remains available after each trust has paid its fees and expenses. Under the income distribution agreement, the Up Trust on each distribution date, will either (1) be required to pay a portion of its available income to the Down Trust or (2) be entitled to receive a portion of the Down Trust's available income, based, in each case, on the level of the Applicable Reference Value of Medical Inflation during the preceding calculation period. On each distribution date, a quarterly distribution of all available income on deposit in the Up Trust will be made on the Up MacroShares after the Up Trust has made or received a payment under the income distribution agreement.

For more information about the income distribution agreement, see "DESCRIPTION OF THE UP MACROSHARES — Quarterly Distributions" and "DESCRIPTION OF THE UP TRUST ASSETS — The Income Distribution Agreement."

The Up Trust will also enter into multiple settlement contracts with the Down Trust. In order to facilitate paired issuances and paired optional redemptions, the paired trusts will settle one settlement contract in connection with the optional redemption of each MacroShares Unit and will enter into a new settlement contract in connection with the paired issuance of each new MacroShares Unit, except that multiple creation orders and multiple redemption orders received on the same day will be netted for purposes of determining the net increase or decrease in the number of outstanding MacroShares Units. A "MacroShares Unit" will consist of 50,000 Up MacroShares and 50,000 Down MacroShares. Under each settlement contract, the Up Trust will either (1) be required to make a final payment out of its assets to the Down Trust or (2) be entitled to receive a final payment from the Down Trust out of the assets of the Down Trust. These settlement obligations will be based on the change in the level of the Applicable Reference Value of Medical Inflation above the compounded hurdle rate during the period from the closing date through and including (i) the last day preceding the final scheduled termination date, (ii) the last day preceding an early termination date or (iii) in the case of a redemption, the relevant business day on which a redemption order is placed by an authorized participant. The final distribution made on the Up MacroShares will depend upon the final payment that the Up Trust was required to make or entitled to receive under the settlement contracts.

For more information about the settlement contracts, see "DESCRIPTION OF THE UP MACROSHARES — Final Distribution" and "DESCRIPTION OF THE UP TRUST ASSETS — The Settlement Contracts."

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The Trust Agreements

The Up Trust and the Down Trust have been formed and their activities are specified under the terms of two separate amended and restated trust agreements entered into by us, as depositor, State Street Bank and Trust Company, as the trustee for each of the trusts, MacroMarkets LLC, as administrative agent, Natixis Securities North America Inc., as a marketing agent and MACRO Financial, LLC, also as a marketing agent. As a holder of Up MacroShares, your rights will be governed by the trust agreement for the Up Trust. For a description of the terms of the trust agreement, see "DESCRIPTION OF THE TRUST AGREEMENT."

The Trustee

State Street Bank and Trust Company, a Massachusetts trust company, will act as trustee for the Up Trust and the Down Trust pursuant to two separate trust agreements. The trustee will perform a number of duties on behalf of the trusts, of which the following are important to you, as a holder of Up MacroShares:

· effecting paired optional redemptions and paired issuances of paired shares in accordance with the directions of the administrative agent;

· making quarterly distributions and a final distribution to the holders of the Up MacroShares;

· acting as the custodian for the treasuries and all other assets of each of the paired trusts;

· settling purchase orders for treasuries that are placed on behalf of the Up Trust by the administrative agent, in accordance with the directions of the administrative agent;

· on each business day, calculating the per share underlying value of one Up MacroShare and providing such value to the administrative agent for posting on the website maintained by the administrative agent at http://www.macromarkets.com;

· calculating, for each distribution date, the amount of available income on deposit in each of the paired trusts, the payment due under the income distribution agreement and the quarterly distributions to be made on the Up MacroShares;

· calculating, in connection with each redemption date, early termination date and the final scheduled termination date, the respective underlying values of the paired trusts as of the applicable redemption date, early termination date or final scheduled termination date, the final payment due under the settlement contracts being settled and the final distribution to be made on the Up MacroShares, in the case of an early termination date or the final scheduled termination date; and

· providing notification of the occurrence of certain of the termination triggers.

For performing its duties under the Up Trust agreement, the trustee will be compensated as described under "DESCRIPTION OF THE TRUST AGREEMENT — Fees and Expenses of the Paired Trusts."

You may inspect the trust agreement and the records maintained by the trustee on behalf of any of the trusts at the office of the trustee during regular business hours upon two business days' prior notice at 200 Clarendon Street, Boston, Massachusetts 02116.

For more information about the trustee and its responsibilities under the trust agreement, see "DESCRIPTION OF THE TRUST AGREEMENT."

The Administrative Agent and the Marketing Agents

MacroMarkets LLC, a Delaware limited liability company, will act as the administrative agent for the Up Trust and the Down Trust and will be a party to the trust agreement for each of the trusts. Its rights and responsibilities will be specified in each trust agreement. For performing its duties as administrative agent under the trust agreement, MacroMarkets LLC will be compensated as described under "DESCRIPTION OF THE TRUST AGREEMENT — Fees and Expenses of the Paired Trusts."

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The administrative agent will perform or oversee the performance of a number of duties on behalf of the Up and Down Trusts, of which the following are important to you , as a holder of Up MacroShares:

· directing the trustee in the acquisition of new treasuries for the paired trusts on each distribution date and each issuance date, including placing the purchase orders for such treasuries, in accordance with the acquisition guidelines that are specified in the trust agreements for the paired trusts and described in this prospectus under "DESCRIPTION OF THE UP TRUST ASSETS — United States Treasury Obligations;"

· processing redemption and creation orders for MacroShares from authorized participants;

· selecting treasuries to be delivered between the paired trusts in connection with the settlement of the settlement contracts and treasuries to be delivered to redeeming authorized participants in connection with paired optional redemptions in accordance with the rules specified in the trust agreements;

· directing the trustee in effecting redemptions and issuances;

· maintaining its website located at http://www.macromarkets.com, where you can obtain information about the performance of your Up MacroShares; and

· providing notification of the occurrence of certain termination triggers.

For more information about the administrative agent and its responsibilities under the trust agreement, see "DESCRIPTION OF THE TRUST AGREEMENT."

MACRO Financial, LLC, a Delaware limited liability company, and Natixis Securities North America Inc., a New York corporation, will act as the marketing agents for the Up and Down Trusts. The duties of the marketing agents will include developing a marketing plan for the paired trusts, preparing marketing materials and organizing investor presentations. Natixis Securities North America Inc. is not affiliated with us, the Up Trust, the Down Trust, MacroMarkets LLC, the trustee or any of our or their respective affiliates. For performing their duties as marketing agents, MACRO Financial, LLC and Natixis Securities North America Inc. will be compensated as described under "DESCRIPTION OF THE TRUST AGREEMENT — Fees and Expenses of the Paired Trusts."

Daily Reporting

At the beginning of each business day, not later than one hour prior to the commencement of trading on the New York Stock Exchange or "NYSE," the trustee will calculate the underlying value of the Up Trust for that business day and the portion of that underlying value that is allocable to one Up MacroShare, and it will provide those values to the administrative agent, who will post them on its website located at http://www.macromarkets.com. The trustee will base its calculation of underlying value on the administrative agent's calculation of the Applicable Reference Value of Medical Inflation, which it will provide to the trustee. No other entity will be responsible for confirming the administrative agent's calculation of the Applicable Reference Value of Medical Inflation or the trustee's calculation of underlying value.

The Assets of the Up Trust

The assets of the Up Trust will consist of:

· U.S. treasury securities and what we refer to as "income" on those securities, consisting of stated interest on treasury notes and bonds and the discount that is realized when the par amount received on a treasury bill, note or bond at maturity exceeds the purchase price at which the Up Trust acquired that treasury security;

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· treasury repurchase agreements and what we refer to as "income" on those agreements consisting of the difference between the purchase price and the repurchase price for the treasuries borrowed under those agreements;

· the trust's rights under the income distribution agreement;

· the trust's rights under the settlement contracts;

· the trust's rights under the licensing agreement with MacroMarkets LLC to use the patented MACROs structure;

· the trust's rights under its trust agreement to rely on the services provided by the administrative agent, the marketing agents and the trustee;

· a securities account created under the Up Trust agreement into which all of the treasuries will be deposited for the benefit of the holders of the Up MacroShares;

· a distribution account created under the Up Trust agreement into which all income realized on the treasuries and all amounts received under the income distribution agreement and the settlement contracts will be deposited and then used, first, to make a deposit to the fee payment account, second, to make payments to the Down Trust under the income distribution agreement and the settlement contracts, if applicable, and, third, to make quarterly and final distributions to the holders of the Up MacroShares;

· a fee payment account created under the Up Trust agreement into which funds will be deposited on each distribution date for the purpose of paying the fees and expenses of the Up Trust; and

· a netting account created under the Up Trust agreement to which the trustee credits (1) Up MacroShares being redeemed in paired optional redemptions and nets such shares against any shares that are being created in paired issuances on the same date, and (2) cash delivered by authorized participants in connection with paired issuances and nets such cash against the final distributions to be made in connection with paired optional redemptions being effected on the same date.

The treasuries purchased on behalf of the Up Trust on each distribution date or in connection with each paired issuance of Up MacroShares may consist of bills, notes and bonds of varying maturities and repurchase agreements of varying terms that are fully collateralized by treasuries and entered into with counterparties that meet specified capital requirements or are deemed creditworthy by the administrative agent. Each treasury and treasury repurchase agreement must mature or terminate prior to the next scheduled distribution date. When we refer to "treasuries" in this prospectus, the term includes both treasuries and treasury repurchase agreements on treasuries. On each distribution date, except for the final scheduled termination date or an early termination date, the administrative agent will direct the trustee to reinvest the proceeds of the maturity of the paired trusts' treasuries in new treasuries. The administrative agent will also direct the trustee to invest in treasuries all funds delivered to it in connection with each paired issuance of paired shares. The obligations of the paired trusts to each other under the income distribution agreement and the settlement contracts will be secured by the treasuries and any cash on deposit in each of those trusts.

On each distribution date and each issuance order date, the administrative agent will use commercially reasonable efforts to identify and direct the trustee to purchase, on behalf of each of the paired trusts, treasuries with the same maturities or terms, stated or implied interest rates, if any, and applicable discount rates in order for each trust to be able to realize comparable amounts of income during each quarter. The administrative agent will select treasuries for acquisition by the trustee in accordance with the acquisition guidelines specified in each trust agreement and described in more detail in this prospectus under "DESCRIPTION OF THE UP TRUST ASSETS — United States Treasury Obligations." Treasuries will be acquired and held in the minimum permissible denominations in order to facilitate the maintenance of parity in the assets held by each of the paired trusts. Although the administrative agent will seek to direct the trustee to keep all funds on deposit in each paired trust invested in treasuries, a portion of the assets of a paired trust may from time to time be held in the form of cash, due to mismatches between the maturity profiles of treasuries available for purchase and the length of time between distribution dates. In addition, any treasuries delivered in connection with a paired optional redemption will be selected by the administrative agent on a "last in, first out" basis. If interest rates are increasing and funds received in connection with paired issuances are being invested in higher-yielding treasuries, this method of selection may result in relatively higher-yielding treasuries being delivered to redeeming authorized participants and relatively lower-yielding treasuries remaining in the paired trusts, thereby causing a decrease in both trusts' daily yield rates. Conversely, if interest rates are decreasing and funds received in connection with paired issuances are being invested in lower-yielding treasuries, this method of selection may result in the relatively lower-yielding treasuries being delivered to redeeming authorized participants. The treasuries selected by the administrative agent to be delivered as the final distribution in a paired optional redemption will be distributed ratably, by type, to each redeeming authorized participant. See "RISK FACTORS — The return on your shares is uncertain — The paired trusts may deliver treasuries instead of cash in a paired optional redemption."

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For more information about the assets of the Up Trust, see "DESCRIPTION OF THE UP TRUST ASSETS."

The Applicable Reference Value of Medical Inflation

The amount of each payment required to be made by the paired trusts under the income distribution agreement will be based on the Applicable Reference Value of Medical Inflation during the preceding calculation period and the amount of the settlement payment to be made under the settlement contracts will be based on the Applicable Reference Value of Medical Inflation on the day preceding the business day on which those payments are made. When we refer to the "Applicable Reference Value of Medical Inflation," we are referring to the daily linear interpolation of the monthly value calculated and published by the Bureau of Labor Statistics for the medical care component of the Consumer Price Index for All Urban Consumers or the "CPI-U." The Applicable Reference Value of Medical Inflation will be calculated for each calendar day using the following formula:

where t is a specified calendar day in current calendar month M; CPI_M-2 and CPI_M-3 are the values of the medical care component of the CPI-U for the second and third preceding calendar months, respectively, as determined and published by the BLS on the corresponding index publication days; and D is the number of days in current calendar month.

The following is an example showing the calculation of the Applicable Reference Value of Medical Inflation for the 30^th day of July 2007:

where 348.225 is the medical care component of the CPI-U for April; 349.087 is the medical care component of the CPI-U for May; and, therefore, the Applicable Reference Value of Medical Inflation for the 30^th day of July 2007 is 349.031.

For a description of how the Applicable Reference Value of Medical Inflation is determined by the BLS, see "DESCRIPTION OF THE APPLICABLE REFERENCE VALUE OF MEDICAL INFLATION — The Announcement of the Rate for Medical Inflation" in this prospectus.

When we refer to an "index publication day," we are referring to the business day in each month on which the BLS publishes the value for the medical care component of the CPI-U for the previous month. The BLS generally publishes this value on a business day occurring around the middle of each calendar month. At the beginning of each year, the BLS releases a schedule listing the index publication days for that year, which can be located at http://www.bls.gov/schedule/schedule/by_prog/cpi_sched.htm.

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The trustee will calculate the underlying value of the Up Trust for each business day based upon the daily interpolated Applicable Reference Value of Medical Inflation for the preceding day. See "Calculation of Underlying Value" below. The Applicable Reference Value of Medical Inflation will not be retroactively adjusted to take into account any corrections made by the BLS after any index publication day to the value for the medical care component of the CPI-U that it published on that day. See "DESCRIPTION OF THE CONSUMER PRICE INDEX AND THE MEDICAL GOODS AND SERVICES COMPONENT OF THE CONSUMER PRICE INDEX — Limitation of the CPI-U" for a discussion of the BLS's policy about revisions to the CPI-U.

Calculation of Underlying Value

The final distribution made on the Up MacroShares on the final scheduled termination date, an early termination date or a redemption date will be based upon the underlying value of the Up Trust (1) in the case of the final scheduled termination date, on that final scheduled termination date, (2) in the case of an early termination date, on that early termination date, and (3) in the case of a redemption date, on the related redemption order date. Underlying value will be calculated for each business day at the beginning of that business day and will be based upon the Applicable Reference Value of Medical Inflation on the preceding day, regardless of whether that preceding day is a business day or a non-business day. For example, each Monday's underlying value will based upon the Applicable Reference Value of Medical Inflation for Sunday. The underlying value on each determination date represents the aggregate amount of the assets in the paired trusts to which the Up Trust would be entitled if the settlement contracts were settled on that date. The underlying value of the Up Trust on each determination date also represents the aggregate final distribution to which holders of the Up MacroShares would be entitled if those shares were redeemed on that date.

After the closing date, the ratio of the Applicable Reference Value of Medical Inflation on any particular day to the Applicable Reference Value of Medical Inflation on the closing date may fluctuate above or below an annual hurdle rate of [4]%, which is compounded at the conclusion of every twelve months that elapses during the period of time from the closing date to the relevant day of measurement. Accordingly, we refer to the hurdle rate as being compounded "annually." If the ratio of the Applicable Reference Value of Medical Inflation on any day to the Applicable Reference Value of Medical Inflation on the closing date, which we also refer to as the "medical inflation ratio," is greater than the hurdle rate of [4]%, compounded annually for the period of time from the closing date to the relevant day of measurement, the underlying value of the Up Trust will increase to include a portion of the assets in the Down Trust. If this medical inflation ratio is less than the compounded hurdle rate, than the underlying value of the Up Trust will decrease, because it will owe a portion of its assets to the Down Trust. The relationship between changes in the level of the Applicable Reference Value of Medical Inflation and changes in the underlying value of the Up Trust is not linear, which is discussed under "RISK FACTORS — The Up MacroShares are not a perfect hedge against the rate of medical inflation."

Underlying value is calculated for each business day as follows:

· the sum of the Up earned income accruals for each day that has elapsed during the current calculation period up to and including the current business day

plus

· the UP investment amount on that date multiplied by the leveraged settlement factor, calculated for the day preceding the current business day.

The "settlement factor" is equal to

10

where CPI_tis the Applicable Reference Value of Medical Inflation on a particular day; CPI₀is the Applicable Reference Value of Medical Inflation on the closing date; and p equals a fraction, the numerator of which is the number of days that has elapsed since the closing date and the denominator is either 365 or 366, depending upon the actual number of days in the current year.

We refer to , as of the relevant day of measurement, as the "compounded hurdle rate."

The settlement factor for any day of measurement is the number, either greater than one or less than one, by which the compounded hurdle rate would have to be multiplied in order for that rate to equal the ratio of CPI_t over CPI₀, which represents the ratio of the Applicable Reference Value of Medical Inflation on that day of measurement to the Applicable Reference Value of Medical Inflation on the closing date.

If the settlement factor is greater than 1, then the underlying value of the Up Trust will increase to include all of the cash and treasuries on deposit in the Up Trust plus a portion of the cash and treasuries on deposit in the Down Trust. If the settlement is less than 1, then the underlying value of the Up Trust will decrease, because it will owe portion of its cash and treasuries to the Down Trust.

Once the settlement factor has been calculated, it will be doubled by the leverage factor, by first subtracting the number 1, multiplying by 2 and then adding back the number 1.

The "leveraged settlement factor" will equal: 2 (settlement factor - 1).

The following is an example of the calculation of the leveraged settlement factor which results in an increase in the underlying value of the Up Trust:

leveraged settlement factor=  

where t is November 1, 2009; the closing date is February 1, 2008; p equals 1.748177 years, which is calculated as the sum of (1) 335, which is the number of days between February 1, 2008 and December 31, 2008, divided by 366 (because 2008 has 366 days), and (2) 304, which is the number of days between January 1, 2009 and November 1, 2009, divided by 365 (because 2009 has 365 days); CPI₀ is 212; and CPI_t is 230. The per share underlying value of one Up MacroShare would equal $20 multiplied by 1.026024, or $20.52048, plus the sum of the per share Up earned income accruals for each day that has elapsed during the current calculation period, up to and including the date of measurement. In this example, the Applicable Reference Value of Medical Inflation has increased by 8.4906%, while an investment at the compounded hurdle rate would have increased by 7.097%. Therefore, the Applicable Rate of Medical Inflation has grown more then the compounded hurdle rate since the closing date and results in a $0.52048 increase (2.6024% of $20) in the per share underlying value of one Up MacroShare.

The following is an example of the calculation of the leveraged settlement factor which results in a decrease in the underlying value of the Up Trust:

leveraged settlement factor=  

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where t is November 15, 2010; the closing date is February 1, 2008, p equals 2.786533 years, which is calculated as the sum of (1) 335, which is the number of days between February 1, 2008 and December 31, 2008, divided by 366 (because 2008 has 366 days), (2) 365, which is the number of days between January 1, 2009 and December 31, 2009, divided by 365 (because 2009 has 365 days, and (3) 310, which is the number of days between January 1, 2010 and November 15, 2010, over 365 (because 2010 has 365 days); CPI₀ is 212 and CPI_t is 233. The per share underlying value of one Up MacroShare would equal $20 multiplied by 0.970544, or $19.41088, plus the sum of the per share Up earned income accruals for each day that has elapsed during the current calculation period, up to and including the current date. In this example, the Applicable Reference Value of Medical Inflation has increased by 9.9057%, while an investment at the compounded hurdle rate would have increased by 11.5486%. Therefore the Applicable Reference Value of Medical Inflation has grown at a slower rate than the compounded hurdle rate since the closing date and this results in a $0.58912 decrease (0.970544% of $20) in the per share underlying value of one Up MacroShare. Furthermore, in order for the underlying value of the Up Trust to return to at least its per share underlying value on the closing date (of $20), the compounded hurdle rate during the remaining time until the final scheduled redemption date must average at least 4.21414% per annum.

Hypothetical calculations of underlying value are included for illustrative purposes in Appendix C to this prospectus.

The "Up investment amount" will equal, on any distribution date, the amount of cash that was actually invested on behalf of the Up Trust in treasuries on that distribution date, which is required to equal the lesser of (x) the aggregate par amount of its outstanding shares and (y) all funds that the trust holds on deposit on that distribution date. The "Up investment amount" will equal, on any day during a calculation period (other than the distribution date), the aggregate par amount of the Up MacroShares that are outstanding on that day if the amount actually invested on the preceding distribution date was equal to the Up aggregate par amount on that date. If the amount actually invested on the last distribution date was less than the Up aggregate par amount, then the "Up investment amount" for such day of the ensuing calculation period will equal the amount that was actually invested divided by the number of Up MacroShares outstanding on that distribution date, multiplied by the number of Up MacroShares that are outstanding on the day on which the calculation is being made. Since the trust is required to invest an amount equal to the Up aggregate par amount in treasuries on each distribution date, the Up investment amount should be equal to the Up aggregate par amount, as increased and decreased by redemptions and paired issuances, throughout the ensuing calculation period. The only case in which this will not be true is if the Up Trust's daily fee accrual rate exceeded the daily yield rate on its treasuries during one or more preceding calculation periods and the resulting deficiency was not made up with income realized by the Up Trust during other preceding calculation periods following a general rise in interest rates. If a deficiency does exist during a calculation period, this deficiency will be reflected in the per share underlying value at which authorized participants may create and redeem the Up MacroShares.

The "Down investment amount" will be calculated in the same manner as the Up investment amount.

The "Up earned income accrual" will equal, for each calendar day:

· the sum of the Up available income accrual and the Down available income accrual for that day multiplied by a fraction the numerator of which is the underlying value of the Up Trust as of the last preceding business day and the denominator of which is the sum of the respective underlying values of the Up Trust and the Down Trust, each also as of the last preceding business day,

plus

· if the date of calculation is also an issuance date on which a net increase in the Up aggregate par amount has occurred after giving effect to all paired issuances and paired optional redemptions on that date, the product of the number of Up MacroShares created on such date constituting such net increase and the income component of the per share underlying value of each such Up MacroShare, representing the Up earned income accrual allocable to such share during the period from the last preceding distribution date to such issuance date,

minus

· if the date of calculation is also a redemption date on which a net decrease in the Up aggregate par amount has occurred after giving effect to all paired optional redemptions and paired issuances on that date, the product of the number of Up MacroShares redeemed on such date constituting such net decrease and the income component of the per share underlying value of each such Up MacroShare, representing the Up earned income accrual allocable to such share during the period from the last preceding distribution date to such redemption date.

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The Up earned income accrual for each calculation period will be equal to the sum of the earned income accruals for each day of that calculation period.

The "Up available income accrual" and the "Down available income accrual" for each day is (i) the sum of, for each treasury on deposit in the applicable trust on that day, the product of the purchase price at which the trust acquired that treasury (or the par amount of that treasury for any treasury that was not purchased at a discount) multiplied by the daily yield rate applicable to that treasury minus (ii) the daily fee accrual. If the Up or Down available income accrual is a negative number, then such accrual will be equal to zero.

The "daily fee accrual" for the Up or Down Trust is the Up or Down asset amount, as applicable, on each day multiplied by the daily fee accrual rate. The sum of the daily fee accruals for each of the trusts for an entire calculation period will be equal to the "fee deduction amount" for that calculation period for that trust. The Up asset amount and Down asset amount are defined in the glossary of this prospectus.

We refer to each period that begins on (but excludes) the second business day prior to the preceding distribution date and ends on (and includes) the second business day prior to the current distribution date, as a "calculation period."

For purposes of calculating the Up available income accrual and the Down available income accrual, the "daily yield rate" for each treasury on deposit in the applicable trust will be the yield rate applicable to that treasury divided by either 365 or 366, depending upon the actual number of days in the current year. The "yield rate" for each treasury will be equal to its stated interest rate, if any, and/or any applicable discount rate, based on the date of purchase and the purchase price at which the applicable trust acquired that treasury, or, in the case of treasury repurchase agreements, the difference between its purchase price and its repurchase price, expressed as a percentage of such purchase price. The "daily fee accrual rate" will be equal to an annual rate of 1.00% divided by 365 or 366, depending on the actual number of days in the current year. These rates represent the annual rate at which the funds of each paired trust are allocated to be used for the payment of each trust's fees and expenses. If actual expenses and fees on any distribution date exceed the fee deduction amount that has accrued at the daily fee accrual rate during the preceding calculation period, additional funds will be withdrawn from the assets on deposit in the Up Trust and its underlying value will be adjusted to reflect this additional withdrawal. For more information about calculating the income and expenses of the paired trusts, see "DESCRIPTION OF THE UP SHARES — Calculation of Underlying Value."

The proportion of assets on deposit in the Up Trust and the Down Trust will initially be 1:1 and this proportion will be maintained throughout the entire transaction by virtue of the requirement that redemptions and issuances must be effected in MacroShares Units composed of an equal number of Up and Down MacroShares. Maintaining this proportion insures that the underlying value formula and the yield on your Up MacroShares will not be affected by increases or decreases in the size of the paired trusts due to redemptions and subsequent issuances.

For a more detailed description of the calculation of underlying value, see "DESCRIPTION OF THE UP MACROSHARES — Calculation of Underlying Value."

Quarterly Distributions

A "distribution date" is scheduled to occur for the Up MacroShares on the second business day preceding each record date, commencing in [      ] of 2008. On each distribution date, the Up Trust will declare a quarterly distribution on the Up MacroShares. This quarterly distribution will be made out of the income that the Up Trust holds on deposit after it has deposited the fee deduction amount and any additional deduction amount into the fee payment account, either made or received a payment under the income distribution agreement, and acquired treasuries with an aggregate purchase price equal to the aggregate par amount of the outstanding Up MacroShares on that distribution date. Each shareholder who is a registered holder of Up MacroShares on the "record date," which is the last business day of March, June, September and December of each year, commencing in [      ] of 2008, will be entitled to receive the quarterly distribution. The quarterly distribution will be paid out to shareholders on the third business day of the month immediately following the month in which the related distribution date occurred, on the date we refer to as the "distribution payment date."

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On each distribution date, the Up Trust's entitlement under the income distribution agreement to its available income and the available income in the Down Trust will be based on the Applicable Reference Value of Medical Inflation during the preceding calculation period. For each day during the calculation period preceding each distribution date, the entitlement of the Up Trust under the income distribution agreement, which we refer to as its "Up earned income accrual," for that day will be determined as follows:

· If the medical inflation ratio of the Applicable Reference Value of Medical Inflation on the day preceding the day of determination to the Applicable Reference Value of Medical Inflation on the closing date is greater than the hurdle rate compounded for the period of time elapsed from the closing date until that preceding day, the Up Trust will become entitled to retain all of its available income accrual for that day and to receive a portion of the Down Trust's available income accrual for that day.

· If the medical inflation ratio of the Applicable Reference Value of Medical Inflation on the day preceding the day of determination to the Applicable Reference Value of Medical Inflation on the closing date is less than the hurdle rate compounded for the period of time elapsed from the closing date until that preceding day, the Up Trust will become obligated to pay a portion of its available income accrual for that day to the Down Trust.

If the actual fees and expenses of the Up Trust on any distribution date exceed the sum of the Up Trust's daily fee accruals or its "fee deduction amount" for the preceding calculation period, funds equal to the amount of such excess fees and expenses, which is referred to as an "additional deduction amount," will be deposited into the fee deduction account on that distribution date. Any additional deduction amount will reduce the amount of available income of the Up Trust and the amount of its quarterly distribution on that distribution date will be reduced accordingly, even though the earned income components of underlying value throughout the preceding calculation period indicated that a higher quarterly distribution would be made on that distribution date. If amounts are due to the Up Trust from the Down Trust under the income distribution agreement on any distribution date, but the actual fees and expenses of the Down Trust exceeded its fee deduction amount, then an additional deduction amount will be required to be deducted from the Down Trust's available income and the amount payable by the Down Trust to the Up Trust under the income distribution agreement and the quarterly distribution made by the Up Trust will be reduced accordingly. The quarterly fees and expenses of the Up Trust, will consist of (1) the variable fees specified, in this summary and also in the section entitled “DESCRIPTION OF THE TRUST AGREEMENTS — Fees and Expenses of the Paired Trusts,” plus (2) fixed fees and expenses which are expected to equal approximately $760,000 per year. The same variable fees and the same amount of fixed expenses are expected to be incurred by the Down Trust.

The underlying value of the Up Trust on each distribution date will be calculated before available income, if any, is deducted from that underlying value and set aside for payment as a quarterly distribution on the related distribution payment date. As a result, the underlying value of the Up Trust on the day following each distribution date will reflect a relative decrease from the underlying value on that distribution date which will be unrelated to any movement in the level of the Applicable Reference Value of Medical Inflation.

On each distribution date, other than on the final scheduled termination date or an early termination date and other than with respect to any shares for which a redemption order was placed and settled prior to the related record date, the Up Trust will declare a "quarterly distribution" on each outstanding Up MacroShare equal to:

· the sum of Up earned income accruals for each day of the preceding calculation period

multiplied by

· a fraction the numerator of which is one Up MacroShare and the denominator of which is the aggregate number of outstanding Up MacroShares on that distribution date.

On the distribution payment date that follows each distribution date, the Up Trust will distribute such amount on each outstanding Up MacroShare.

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For a more detailed description of how payments under the income distribution agreement are calculated, see "DESCRIPTION OF THE UP TRUST ASSETS — The Income Distribution Agreement."

Distributions of the Up earned income accruals on the final scheduled termination date, an early termination date or any redemption date will be made as part of the final distribution that is made on those dates, as described in the next section of this summary entitled "— Final Distribution," and in greater detail in the section entitled "DESCRIPTION OF THE UP MACROSHARES — Final Distribution."

On each distribution date, the "available income" of the Up Trust will be equal to all funds on deposit in the trust on that distribution date after the trust has (i) set aside an amount equal to the fee deduction amount plus any additional deduction amount to pay fees and expenses, (ii) made a payment to or received a payment from the Down Trust under the income distribution agreement and (iii) acquired treasuries with an aggregate purchase price equal to the aggregate par amount of the Up MacroShares as of that distribution date.

If the available income of the Up Trust for any calculation period is a negative number, then the available income of the Up Trust for the applicable distribution date will be equal to zero and the Up Trust will not make any payments under the income distribution agreement or any quarterly distribution to its shareholders on that distribution date unless it was entitled to and received a portion of the Down Trust's available income. However, since the administrative agent will be required to use commercially reasonable efforts to direct the acquisition of identical assets for each of the paired trusts, and each trust has the same daily fee accrual rate, it is unlikely that there would be a significant difference in the income accrued by each of the trusts during any period.

We refer to the product of the aggregate number of outstanding shares issued by the Up Trust and a stated par amount of $[20] per share as the "Up aggregate par amount" and to the product of the aggregate number of outstanding shares issued by the Down Trust and a stated par amount of $[20] per share as the "Down aggregate par amount."

If available, an amount equal to the Up aggregate par amount will always be reinvested by the trustee, at the direction of the administrative agent, in new treasuries on each distribution date unless that distribution date is the final scheduled termination date or an early termination date. If a redemption order is delivered on a distribution date or on the day preceding a distribution date, the Up aggregate par amount will first be reduced by the aggregate par amount of any Up MacroShares being redeemed. If, after depositing the fee deduction amount plus any additional deduction amount into the fee payment account, the funds remaining on deposit in the Up Trust on any distribution date are equal to or less than the Up aggregate par amount, then all of these remaining funds must be reinvested in treasuries and the trust will have no available income on that date. If less than the Up aggregate par amount is invested in treasuries on any distribution date because the fee deduction amount plus any additional deduction amount exceeded the income on the Up Trust's treasuries, the deficiency in the amount that is invested must be made up out of income received on subsequent distribution dates until the amount invested does equal the Up aggregate par amount.

The Up Trust may make minimal or no quarterly distributions to its shareholders on one or more distribution dates if treasury yield rates drop to and remain below the fee accrual rate of 1.00% following the closing date, as such rate may be effectively adjusted by the withdrawal of additional deduction amounts from the Up Trust. However, assuming there are no deficiencies in the amount that was invested on behalf of the paired trusts during previous calculation periods and that actual fees and expenses did not exceed the fee deduction amount, any daily yield on the treasuries during any calculation period that is in excess of the daily fee accrual rate for that calculation period will be distributed to the holders of the paired shares as a quarterly distribution. The allocation of this yield as between the Up and the Down MacroShares will be determined under the income distribution agreement based on the Applicable Reference Value of Medical Inflation on each day of the preceding calculation period. See "RISK FACTORS — Income on the treasuries may be insufficient to make quarterly distributions."

The administrative agent will always use a "last in, first out" method for selecting which treasuries to deliver in a redemption of the shares. As a result, in both a rising and a falling interest rate environment, paired optional redemptions that are effected between distribution dates may result in a decrease in the daily yield rate on the treasuries in the paired trusts for the remaining shareholders. See "RISK FACTORS — The return on your shares is uncertain — The paired trusts may deliver treasuries instead of cash in a paired optional redemption."

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The available income of the Down Trust will be calculated in the same way as that of the Up Trust. If available, an amount equal to the Down aggregate par amount on each distribution date (after taking into account any redemptions directed on that date) will always be reinvested by the trustee in new treasuries (unless such distribution date is the final scheduled termination date or an early termination date), but the amount actually invested may be less on one or more distribution dates if the fee deduction amount plus any additional deduction amount for the Down Trust exceeded the Down Trust's income on those distribution dates.

If the Up Trust has no available income on any distribution date, then it will not make any payment under the income distribution agreement that it may otherwise have been required to make to the Down Trust. Similarly, if on any distribution date the proceeds of the treasuries in the Down Trust minus its fee deduction amount plus any additional deduction amount are equal to or less than the Down aggregate par amount, then the Down Trust will not have any available income and it will not make any payment under the income distribution agreement that it may otherwise have been required to make to the Up Trust on that distribution date. If either of the paired trusts fails to make a payment under the income distribution agreement on any distribution date because it does not have any available income, that trust will not be required to make up that payment on any subsequent distribution date, even if it has funds available to do so.

Furthermore, if on any distribution date the Up Trust does not have any available income and does not receive any available income from the Down Trust, it will not make any quarterly distribution to its shareholders on that distribution date. The Up Trust is not required to make quarterly distributions in any stated amount and if no funds are available to make a quarterly distribution on any distribution date, no amounts will be payable with respect to that distribution date on any subsequent date. See "RISK FACTORS — You may lose your entire investment in the Up MacroShares which you hold; there is no guarantee as to the amount of any quarterly distribution or the amount of the final distribution."

Final Distribution

General

The Up Trust will declare a final distribution on all or a portion of the Up MacroShares on the earliest to occur of:

· the distribution date scheduled to occur on [          ], 2018, which we refer to as the "final scheduled termination date";

· an "early termination date," which is the next distribution date that follows the occurrence of a termination trigger; and

· a "redemption order date," which is any business day on which an authorized participant places an order for a paired optional redemption of all or a portion of the paired shares.

The final distribution declared by the Up Trust on the final scheduled termination date, an early termination date or any redemption order date will depend upon the payments that it is required to make to, or that it is entitled to receive from, the Down Trust under the settlement contracts that are settled in connection with the redemption of shares. The final payment under the settlement contracts will, in turn, be determined by the underlying value of the Up Trust on (i) the final scheduled termination date, (ii) the early termination date and, (iii) in the case of a paired optional redemption, the relevant redemption order date.

The purpose of the final payment under the settlement contracts is to transfer assets between the paired trusts such that each trust has cash and treasuries in an amount equal to its underlying value at the time of settlement.

· If the medical inflation ratio of the Applicable Reference Value of Medical Inflation on the relevant day of measurement to the Applicable Reference Value of Medical Inflation on the closing date is greater than hurdle rate, compounded for the period of time from the closing date to the relevant day of measurement, the underlying value of the Up Trust will be equal to all of the cash and treasuries that it holds on deposit plus a portion of the Down Trust's cash and treasuries.

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· If the medical inflation ratio of the Applicable Reference Value of Medical Inflation on the relevant day of measurement to the Applicable Reference Value of Medical Inflation on the closing date is less than hurdle rate, compounded for the period of time from the closing date to the relevant day of measurement, the underlying value of the Up Trust will be equal to only that portion of the cash and treasuries that it holds on deposit which it is not required to deliver to the Down Trust.

For a more detailed description of how the underlying value of the Up Trust and payments under the settlement contracts are calculated, see "DESCRIPTION OF THE UP MACROSHARES — Calculation of Underlying Value" and "DESCRIPTION OF THE UP TRUST ASSETS — The Settlement Contracts."

On the final scheduled termination date or an early termination date, the Up Trust will declare a final distribution in redemption of its Up MacroShares in an amount equal to the underlying value of the Up Trust on such final scheduled termination date or early termination date. On the distribution payment date that follows the final scheduled termination date or early termination date, the trustee will pay the final distribution to each holder of the outstanding Up MacroShares in redemption of those shares.

The redemption of all or only a portion of the paired shares in a paired optional redemption may only be directed by one or more authorized participants who are the beneficial holders of those shares on any business day. As discussed in greater detail later in this section, unless you are an authorized participant, you will not have a right to direct a redemption of your Up MacroShares. Consequently, you will only be able to liquidate your investment in the Up MacroShares prior to the final scheduled termination date or an early termination date by selling them to an investor who is willing to purchase them from you, including any authorized participant who may wish to acquire those shares in order to direct a paired optional redemption. The market price that you are able to obtain for your Up MacroShares may be less than the price you paid for those shares and less than the per share underlying value that is represented by those shares for the reasons discussed in "RISK FACTORS — Fluctuations in the underlying value of the Up Trust and other factors may effect the market price of your Up MacroShares."

If the fee deduction amount plus any additional deduction amount that is required to be deposited into the fee payment account and made available for the payment of the fees and expenses of the Up Trust exceed the income of the Up Trust on the current distribution date or on one or more preceding distribution dates and the resulting deficiency in the Up investment amount was not made up on subsequent distribution dates, the underlying value of the Up Trust and, consequently, the final distribution declared by the Up Trust on the final scheduled termination date, an early termination date or any redemption order date will reflect that resulting deficiency.

Final Distributions on the Final Scheduled Termination Date or an Early Termination Date

On the final scheduled termination date or an early termination date, the trustee will cause the paired trusts to settle all of the settlement contracts using the funds they hold on deposit on those dates, which will consist of all interest, discount, principal and any other amounts received by each trust upon the maturity of its treasuries on or after those dates. After the settlement contracts have been settled, the Up Trust will declare a final distribution in redemption of its outstanding shares using all of the funds it then holds on deposit. On the distribution payment date that follows the final scheduled termination date or early termination date, the Up Trust will distribute on each outstanding Up MacroShare a "final distribution" in cash equal to:

· the underlying value of the Up Trust on that final scheduled termination date or that early termination date

divided by

· the aggregate number of Up MacroShares that have been issued but not yet redeemed as of that date.

A final distribution will be distributed by the Trustee, on each outstanding Up MacroShare, on the distribution payment date that follows the final scheduled termination date or early termination date.

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For purposes of settling the settlement contracts and making a final distribution on the final scheduled termination date or an early termination date, underlying value will include the Up earned income accrual for the final scheduled termination date or early termination date. The final distribution will include the cumulative Up earned income accruals that would have been distributed as a quarterly distribution if the final scheduled termination date or early termination date had been an ordinary distribution date.

Upon receipt of a final distribution on the final scheduled termination date or an early termination date, your Up MacroShares will be considered to be redeemed in full and the Up Trust will have no further obligations with respect to those shares even if the amount of the final distribution is less than the aggregate par amount of your Up MacroShares or less than the purchase price you paid for those shares. See "RISK FACTORS — You may lose your entire investment in the Up MacroShares which you hold; there is no guarantee as to the amount of any quarterly distribution or the amount of the final distribution."

Authorized participants may continue to direct paired optional redemptions at the per share underlying value of the shares being redeemed after the occurrence of a termination trigger related to a decrease in the underlying value of the Up Trust to 15% or less of the assets which it holds on deposit or an increase in that underlying value to 185% or more of the assets it holds on deposit. The last redemption order may be placed on the last business day prior to the early termination date that will follow the termination trigger.

Final Distributions in Paired Optional Redemptions

Any time on and after July 1, 2008 but prior to the final scheduled termination date or an early termination date, the paired shares may be redeemed on any business day in what we refer to as a "paired optional redemption." The discussion which follows describing paired optional redemptions and the final distribution that will be declared on the related redemption order date applies only to authorized participants, because only authorized participants can redeem the Up MacroShares. However, this discussion is relevant to you as a holder of Up MacroShares, because it explains the rules that authorized participants must follow in order to effect paired optional redemptions and the ability to effect these redemptions may affect the demand for the Up MacroShares. See"RISK FACTORS — The return on your shares is uncertain — The right to redeem the Up MacroShares is limited."

On any business day occurring after July 1, 2008, any authorized participant may direct a paired optional redemption in which the Up MacroShares and Down MacroShares will be redeemed concurrently and proportionately in MacroShares Units. A "MacroShares Unit" consists of 50,000 Up MacroShares and 50,000 Down MacroShares. A tender of paired shares for redemption will be irrevocable.

In order to be an "authorized participant," an entity must (1) be a registered broker-dealer and a member in good standing with the Financial Industry Regulatory Authority ("FINRA"), or a participant in the securities markets such as a bank or other financial institution that is not required to register as a broker-dealer or be a member of the FINRA in order to engage in securities transactions, (2) be a participant in DTC or have indirect access to the clearing facilities of DTC by virtue of a custodial relationship with a DTC participant, and (3) have entered into a "participants agreement" with us, the administrative agent and the trustee which specifies procedures for the issuance and redemption of paired shares. The participants agreement is described in this prospectus under "DESCRIPTION OF THE UP MACROSHARES — Final Distribution."

Authorized participants must place redemption orders with the administrative agent by 4:00 p.m. New York time on any business day. The date on which an authorized participant places a redemption order is referred to as the "redemption order date," and the following business day on which the redemption is effected is referred to as the "redemption date," except that, in the case of any redemption order that is delivered on a distribution date or on the business day following a distribution date, the "redemption date" will be the third business day following the redemption order date to ensure that any authorized participant who places a redemption order on these two days will still be considered a holder of record on the record date and, therefore, eligible to receive its quarterly distribution for the preceding calculation period. Each redeeming authorized participant must deliver to the administrative agent a redemption order with the following information:

· the authorized participant's e-mail address and personal identification number, and the personal identification number of the person who is submitting the creation order on behalf of the authorized participant; and

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· the number of MacroShares Units being redeemed.

Not later than 10:00 a.m. New York time on the redemption date, the authorized participant who placed the redemption order must deliver to the trustee:

· Up MacroShares and Down MacroShares that in the aggregate constitute the requisite number of MacroShares Units being redeemed by such authorized participant;

· the applicable "redemption cash component," if applicable, which are funds that must be delivered by the authorized participant in connection with any redemption in which treasuries are being delivered to make the final distribution and these treasuries, valued at their acquisition cost, represent a value in excess of the per share underlying value of the shares being redeemed; and

· a transaction fee of $2,000, payable directly to the trustee by the authorized participant to compensate the trustee for administrative costs related to effecting the paired optional redemption.

If all conditions to effecting a paired optional redemption are satisfied, the trustee will effect the redemption by delivering cash and/or treasuries in accordance with the instructions of the administrative agent to the redeeming authorized participant by 3:00 p.m. New York time on the redemption date. If the redemption order was placed on a distribution date, the redeeming authorized participant will receive cash. If there was a net increase in the aggregate par amount of the paired trusts on any redemption date that was also an issuance date, because more MacroShares Units were created than redeemed, redeeming authorized participants will also receive their final distribution from the paired trusts in cash out of the funds delivered to the trusts by the authorized participants who created shares on the same date. If any paired issuances were effected on the redemption date, even if there was a net decrease in the aggregate par amount of the paired trusts, redeeming authorized participants will receive a portion of their final distribution in cash out of the funds delivered to the trusts by the creating authorized participants and also out of the cash proceeds of any treasury repurchase agreements that are on deposit in the distribution account of each trust. Any remaining portion of the final distribution will be delivered in treasuries.

The amount of cash and/or treasuries that will be delivered on the redemption date in a paired optional redemption will always be equal to the aggregate per share underlying values of the paired shares being redeemed, calculated as of the redemption order date. In the case of a paired optional redemption that is ordered on a distribution date or on the business day following a distribution date, the amount delivered on the related redemption date will consist of the aggregate per share underlying value of the shares being redeemed plus the earned income accruals for all intervening days between the redemption order date and the redemption date, calculated on the basis of the Applicable Reference Value of Medical Inflation as of the day preceding the redemption order date.

Upon receipt of the final distribution in a paired optional redemption, the Up MacroShares presented for redemption will be considered to be redeemed in full and the Up Trust will have no further obligations with respect to those shares, even if the amount of the final distribution was less than the aggregate par amount of those shares or less than the purchase price at which those shares were acquired by the authorized participant. See "RISK FACTORS — The return on your shares is uncertain — The paired trusts may deliver treasuries instead of cash in a paired optional redemption."

In order to satisfy the requirement that one settlement contract must always be outstanding for each outstanding MacroShares Unit, new settlement contracts will be entered into if there is a net increase in the Up and Down aggregate par amounts and existing settlement contracts will be settled if there is a net decrease in these aggregate par amounts on any day that is both a redemption date and an issuance date. On any day on which shares are being redeemed, but no new shares are being issued, the number of settlement contracts that will be settled will be equal to the number of MacroShares Units that are being redeemed.

In connection with the settlement of the settlement contracts and payment of a final distribution in the case of redemption in which treasuries must be delivered, the administrative agent will direct the trustee to select and segregate treasuries on a "last in, first out" basis such that the value of the segregated treasuries is equal to the product of the applicable redemption percentage and the aggregate value of all of the treasuries held by each trust. The "value" of each treasury will be equal to the purchase price at which the applicable paired trust acquired that treasury plus all interest and/or discount accrued on that treasury since its acquisition date. The "redemption percentage" for the Up and Down MacroShares in a paired optional redemption is equal to a fraction the numerator of which is the aggregate number of Up or Down MacroShares that are being redeemed and the denominator of which is the aggregate number of Up or Down MacroShares that are outstanding prior to the redemption. The selection and delivery of treasuries must comply with certain requirements and conditions, as described in this prospectus under "DESCRIPTION OF THE UP MACROSHARES — Final Distribution" and "DESCRIPTION OF THE UP TRUST ASSETS — United States Treasury Obligations." For a discussion of the potential risks associated with the delivery of treasuries instead of cash as a final distribution, see "RISK FACTORS — The return on your shares is uncertain — The paired trusts may deliver treasuries instead of cash in a paired optional redemption."

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After the settlement contracts have been settled, the paired trust that made a payment under the settlement contracts will deliver all of its remaining segregated treasuries to the redeeming authorized participant as the final distribution on the shares being redeemed. The paired trust that received a payment under the settlement contracts will deliver all of its own segregated treasuries and all of the treasuries that it received from the other trust to the redeeming authorized participant as the final distribution on the shares being redeemed. The treasuries selected by the administrative agent to be delivered as the final distribution will be distributed ratably, by type, to each redeeming authorized participant.

Following a paired optional redemption, the trustee will record a reduction in the aggregate number of Up MacroShares and Down MacroShares that are outstanding. If MacroShares Units are being both redeemed and issued on the same day at the direction of several authorized participants, the trustee will record a reduction only if a net decrease in the aggregate par amount has occurred. For more information about paired optional redemptions, see "DESCRIPTION OF THE UP MACROSHARES — Final Distribution."

Paired Issuances

At any time prior to the final scheduled termination date or an early termination date, on any business day, an authorized participant may effect a "paired issuance" by directing the paired trusts to issue additional shares in a minimum number of Up and Down MacroShares constituting at least one MacroShares Unit. If so directed by the authorized participant, the Up Trust and the Down Trust will issue additional paired shares to the authorized participant to satisfy its creation order. Paired shares will always be issued by the relevant trust at the per share underlying value of these shares on the date on which a creation order is delivered by an authorized participant. Authorized participants will be required to pay a fee to the paired trusts in connection with any paired issuance that is directed prior to July 1, 2008, in an amount equal to [3.00]% of the aggregate par amount of paired shares being created. This fee is the equivalent of the underwriting fee that is payable by investors who create paired shares on the closing date.

Although the number of Up MacroShares will increase with each issuance and decrease with each redemption by an authorized participant, the Up MacroShares you hold will always represent the same entitlement to the distributions made by the Up Trust, even though your proportionate share of the assets of the trust, expressed as a percentage, may increase or decrease based on the aggregate par amount of the Up MacroShares that are outstanding on any specified date.

To create a new MacroShares Unit, an authorized participant must place a creation order with the administrative agent by 4:00 p.m. New York time on any business day. Any creation order that is not placed within the specified time will be automatically cancelled and may be resubmitted by the applicable authorized participant, if it so desires, on the next business day at that day's per share underlying value. The day on which an authorized participant delivers a creation order is referred to as the "issuance order date" and the following business day on which the paired issuance is effected is referred to as the "issuance date," except that, in the case of any creation order that is delivered on a distribution date or on the business day following a distribution date, the "issuance date" will be the third business day following the issuance order date to ensure that any authorized participant who places a creation order on these two days, after underlying value no longer reflects earned income accruals for the preceding calculation period, will not be eligible to receive a quarterly distribution on the distribution payment date that follows that distribution date. Each creating authorized participant must deliver to the administrative agent a creation order with the following information:

· the authorized participant's e-mail and personal identification number and the personal identification number of the person who is submitting the creation order on behalf of the authorized participant; and

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· the number of MacroShares Units being created.

By 10:00 a.m. New York time on the issuance date, the authorized participant must deposit immediately available funds in an amount equal to:

· the aggregate per share underlying value of the Up MacroShares being created, as measured on the issuance order date;

· the aggregate per share underlying value of the Down MacroShares being created, as measured on the issuance order date;

· a transaction fee of $2,000, payable directly to the trustee by the authorized participant to compensate the trustee for administrative costs related to effecting the paired issuance; and

· for any paired issuance directed prior to July 1, 2008, a fee equal to [3.00]% of the aggregate par amount of paired shares being created.

In the case of any paired issuance ordered on a distribution date or on the business day following a distribution date, the amount that must be delivered by the authorized participant must also include the earned income accruals for each intervening day between the issuance order date up to but not including the issuance date, as calculated on the basis of the Applicable Reference Value of Medical Inflation on the day preceding the issuance order date.

The fee charged for paired issuances directed prior to July 1, 2008 will be divided evenly between the paired trusts and will be deposited into each trust's distribution account. It will be held in the distribution account as part of each trust's available income and will be distributed to each trust's shareholders as part of the quarterly distribution on the next scheduled distribution date.

Creation orders for new MacroShares Units will be processed through a manual clearing process operated by DTC. By 3:00 p.m. New York time on the issuance date, the administrative agent will instruct the trustee to deliver to the authorized participant's account at DTC Up and Down MacroShares that were created in the paired issuance.

In order to satisfy the requirement that one settlement contract must always be outstanding for each outstanding MacroShares Unit, new settlement contracts will be entered into if there is a net increase in the Up and Down aggregate par amount and settlement contracts will be settled if there is a net decrease in these aggregate par amounts on any day that is both an issuance date and a redemption date. The trustee will cause the paired trusts to enter into one new settlement contract for each new MacroShares Unit that is created in a paired issuance on any issuance date that is not also a redemption date.

The trustee will deposit one-half of the aggregate funds received by it in connection with an issuance of paired shares into the Up Trust and the other half into the Down Trust, without regard to the per share underlying values at which the Up and Down MacroShares were issued, in order to preserve the one-to-one ratio of assets on deposit in the paired trusts.

Following a paired issuance, the trustee will record an increase in the aggregate number of Up MacroShares and Down MacroShares that are outstanding. If MacroShares Units are being both issued and redeemed on the same day at the direction of several authorized participants, the trustee will record an increase only if a net increase in the aggregate par amount has occurred.

For more information about paired issuances, see "DESCRIPTION OF THE UP MACROSHARES — Paired Issuances."

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Termination Triggers

The occurrence of specified events, which we refer to as "termination triggers," will cause an automatic termination of the income distribution agreement and the settlement contracts and an early redemption of the paired shares. Upon obtaining knowledge or receiving notice of the occurrence of a termination trigger, we will file a Form 8-K disclosing the termination trigger. The following events will constitute termination triggers:

· on any scheduled index publication day, an aggregate inflation index designated as the medical care aggregate index ceases to be calculated or published by the BLS or ceases to constitute a component of the CPI-U;

· on any calendar day, the underlying value of the Up Trust rises to or above 185% of the cash and treasuries on deposit in that trust or falls to or below 15% of the cash and treasuries on deposit in that trust, and remains at this level for the next two (2) consecutive index publication days;

· either of the paired trusts becomes required to register as an "investment company" under the Investment Company Act of 1940, as amended;

· either of the paired trusts becomes a commodities pool that is subject to regulation under the Commodity Exchange Act, as amended;

· DTC becomes unwilling or unable to act as depository and no suitable replacement is willing or able to assume the duties of a depository for the paired trusts;

· the administrative agent resigns or is unable to perform its duties under one or both trust agreements for any of the paired trusts, or becomes bankrupt or insolvent, and no suitable replacement is willing and able to assume the duties of the administrative agent under the trust agreements;

· we elect to terminate the Up Trust and 66 and 2/3% of the holders of the Up Trust and the Down Trust, each voting as a separate class, consent to such termination;

· either of the paired trusts is adjudged to be bankrupt or insolvent or becomes involved in voluntary or involuntary insolvency or similar proceedings that are not dismissed within 90 days;

· we determine in our good faith discretion that there is a material risk that the Up Trust is subject to withholding tax liability, and we elect to terminate the paired trusts;

· the amount of cash and treasuries on deposit in the Up Trust or the Down Trust is reduced to less than ten (10) million dollars; and

· the amount of cash and treasuries on deposit in the Up Trust or the Down Trust is reduced to fifty (50) million dollars or less and we elect, in our discretion, to terminate the paired trusts.

The administrative agent will be responsible for notifying us and the trustee of the occurrence of the termination triggers that result from a specified increase or decrease in the underlying value of the Up Trust, the cessation of the calculation and publication of the medical care index as a component of the CPI-U, the resignation of the administrative agent or its bankruptcy, the consent of the Up and Down Trust shareholders to an early termination of the paired trusts following our election to effect such termination, and our decision to terminate the trusts if there is a material risk that withholding tax liability may be imposed on the paired holding trusts or if the total assets of each trust are reduced below $50 million. The trustee, upon obtaining knowledge of the occurrence of any of the other termination triggers described above, will be responsible for notifying us and the administrative agent of such occurrence.

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On the next distribution date following the occurrence of a termination trigger, which we refer to as an "early termination date," the trustee will cause the paired trusts to terminate the income distribution agreement and settle all of the settlement contracts and then declare a final distribution in redemption of all of their outstanding shares, based on the underlying value of each paired trust on the early termination date. This underlying value may be higher or lower than the underlying value at the time when the termination trigger occurred, as described under "RISK FACTORS — The return on your shares is uncertain — The paired trusts may terminate early." The final distribution will be determined as described above under "— Final Distribution" and in greater detail under "DESCRIPTION OF THE UP MACROSHARES — Final Distribution." Following this final distribution, the Up MacroShares will be considered to be redeemed in full and will cease to be outstanding.

Authorized participants may continue to direct paired optional redemptions and paired issuances at the per share underlying value of the shares being created after the occurrence of a termination trigger related to a decrease in the underlying value of one of the paired trusts to 15% or less of the assets that trust holds on deposit. The last creation or redemption order may be placed on the last business day prior to the early termination date that will follow the termination trigger.

Any payments under the income distribution agreement and the settlement contracts and any quarterly or final distribution to be made by either of the paired trusts may be subject to delays pending the resolution of bankruptcy proceedings if the relevant termination trigger was the voluntary or involuntary bankruptcy of either of the paired trusts.

For more information about termination triggers, see "DESCRIPTION OF THE UP MACROSHARES — Termination Triggers."

Fees and Expenses

On each distribution date, the Up Trust is required to deposit the fee deduction amount into the fee payment account to be applied to the payment of the expenses and fees incurred by the trust during the preceding calculation period. The "fee deduction amount" will equal, for each calculation period, the sum of, for each day during that calculation period, the Up asset amount as of that day multiplied by a daily fee accrual rate, which will be equal to an annual rate of 1.00% divided by 365 or 366, depending upon the number of days in the current year. After first being used to pay the expenses of the trust, which will include (i) registration fees, (ii) prospectus printing and delivery expenses, (iii) trust administration expenses and (iv) treasury settlement expenses, the remaining funds in the fee payment account will be applied to pay the fees charged by entities that provide services or license intellectual property to the trust. These fees will principally include (i) a fee payable to the trustee for administering the trust, (ii) fees payable to independent accountants for the trust, (iii) fees payable to the New York Stock Exchange for acting as a listing exchange agent, (iv) legal fees incurred by the trust (v) all other fees and expenses of third-party service providers incurred by or on behalf of the trust, including in connection with its formation, which was paid on behalf of the trust by [MacroMarkets LLC and Natixis Securities North America Inc.], (vi) a fee payable to MacroMarkets LLC for acting as the administrative agent on behalf of the trust, which will accrue at an annualized rate of 0.05% of the Up asset amount, (vii) a fee payable to Natixis Securities North America Inc. for acting as a marketing agent for the trust, which will accrue at an annualized rate of 0.20% of the Up Asset Amount, (viii) a fee payable to MACRO Financial, LLC for acting as a marketing agent for the trust, which will accrue at an annualized rate of 0.20% of the Up asset amount, (ix) a licensing fee payable to MacroMarkets LLC for the use of its intellectual property related to the patented MACROs structure, which will accrue at an annualized rate of 0.10% on the Up asset amount, (x) a structuring fee payable to MacroMarkets LLC for structuring the transactions described in this prospectus, which will accrue at an annualized rate of 0.05% on the Up asset amount. Each of the fees that accrue at an annualized rate will be calculated on the basis of the actual number of days in the current year. These fees and expenses payable by the Up Trust will accrue during each calculation period and will be payable in arrears on each distribution payment date or, at the direction of the administrative agent, on any business day occurring during each calculation period.

The amounts of the variable fees payable by the Up Trust which are described in clauses (vi) through (x) above will depend upon the aggregate amount of assets on deposit in the trust. The fixed fees and expenses of the Up Trust are expected to equal approximately $190,000 on a quarterly basis and $760,000 annually. The Down Trust is expected to incur the same variable fees and the same amount of fixed fees and expenses.

To the extent that the fee deduction amount is insufficient on any distribution date to pay in full the fees and expenses of the Up Trust, an "additional deduction amount" equal to the amount necessary to pay such excess fees and expenses will be withdrawn from the assets of the Up Trust, which will result in a decrease in the underlying value of the Up Trust. See "RISK FACTORS— Income on the treasuries may be insufficient to make quarterly distributions."

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On the distribution payment date that follows the distribution date occurring in December of each calendar year, any portion of fee deduction amounts deposited into the fee payment account during the preceding calendar year that are excess of that needed to pay in full the expenses and fees of the Up Trust will be delivered by the trustee to us, in our capacity as the depositor for the trust.

A fee deduction amount will be calculated for the Down Trust in the same manner as that described above for the Up Trust and will be applied on each distribution date, together with any additional deduction amount, to pay the fees and expenses of the Down Trust, which are expected to be comparable to those of the Up Trust.

For more information about the fees and expenses of the paired trusts, see "DESCRIPTION OF THE TRUST AGREEMENT — Fees and Expenses of the Paired Trusts."

Form of the Shares

The Up MacroShares will be issued in the form of one or more global certificates registered in the name of Cede & Co., as the nominee of The Depository Trust Company, or "DTC," and deposited with DTC in the United States or with Clearstream Banking, société anonyme or Euroclear Bank S.A./NV in Europe. If you are not a participant in DTC or in Clearstream or Euroclear, you may hold an interest in the Up MacroShares only by opening an account with a participant or with certain banks, brokers, dealers, trust companies and other parties that maintain a custodial relationship with a DTC participant. You will not receive a physical certificate and you will not be considered the registered holder of the global certificate representing your Up MacroShares.

The Up MacroShares may only be issued to, or redeemed at the direction of, authorized participants and only in MacroShares Units consisting of 50,000 Up MacroShares and 50,000 Down MacroShares. Once issued, the MacroShares can be held and exchanged in the secondary market by investors. No minimum lot requirements are applicable to such shares.

For more information about the form of your shares, see "DESCRIPTION OF THE UP SHARES — Book-Entry Registration."

Listing

The Up MacroShares will trade on the New York Stock Exchange under the symbol "[ ]." See"DESCRIPTION OF THE UP MACROSHARES — Listing."

Federal Income Tax Considerations

Skadden, Arps, Slate, Meagher & Flom LLP will issue its opinion that for United States federal income tax purposes, the Up Trust will be classified as a partnership and not as an association or publicly traded partnership taxable as a corporation. Accordingly, holders of Up MacroShares will be required to include in income their distributive share of the income, gain, loss and deduction of the Up Trust regardless of any cash distributions on their shares; moreover, the ability of such holders to utilize those deductions and losses will be subject to limitations. In addition, gain or loss attributable to redemptions by holders of Up MacroShares will, to the fullest extent allowable, be attributed to such redeeming shareholders. See "MATERIAL UNITED STATES FEDERAL INCOME TAX CONSEQUENCES" for a more detailed discussion.

ERISA Considerations

We anticipate that the Up MacroShares will meet the criteria for "publicly-offered securities" under the Plan Assets Regulation issued by the Department of Labor.

Although no assurances can be given, we expect that:

· there will be no restrictions imposed on the transfer of the Up MacroShares under the Employee Retirement Income Security Act of 1974, as amended, which we refer to as "ERISA";

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· the Up MacroShares will be held by at least 100 independent investors at the conclusion of this offering; and

· the Up MacroShares will be sold as part of an offering pursuant to an effective registration statement under the Securities Act of 1933, as amended, and then will be timely registered under the Securities Exchange Act of 1934, as amended.

If the Up MacroShares were to fail to meet the criteria of publicly-offered securities, the assets of the Up Trust could be deemed under ERISA to include the assets of any plans that invested in the Up Trust. In that event, transactions involving the Up Trust's assets and parties in interest or disqualified persons with respect to plans that invested in the trust will be prohibited under ERISA and the Internal Revenue Code of 1986, as amended, unless another exception to the Plan Assets Regulation or a statutory or administrative exception to the prohibited transaction rules applies.

For a detailed discussion of the ERISA-related considerations that apply to an investment in the Up MacroShares, see "CERTAIN ERISA CONSIDERATIONS.

CUSIP Numbers

The CUSIP numbers assigned to the Up MacroShares and the Down MacroShares are as follows:

Up MacroShares	Down MacroShares
CUSIP No.: [                                      ]	CUSIP No.: [                                     ]

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RISK FACTORS

An investment in the Up MacroShares involves significant risks. You should carefully review the information contained in this section before making an investment decision.

Please note that when we refer in this section to the "per share underlying value" that is represented by your Up MacroShares on any date, we mean the amount that you would be entitled to receive as a final distribution on that date if the paired trusts were to settle the settlement contracts and the Up Trust were to make a final distribution on your Up MacroShares. Such a final distribution is, however, merely hypothetical and we refer to it solely for the purpose of explaining the meaning of underlying value and the terms of the income distribution agreement and the settlement contracts. As a holder of Up MacroShares, you are entitled to receive a final distribution on those shares only on the final scheduled termination date, an early termination date or, if you are an authorized participant, upon directing a redemption of those shares on any redemption date, and you must sell your Up MacroShares in order to liquidate your investment in those shares at any time prior to those dates.

You may lose your entire investment in the Up MacroShares that you hold; there is no guarantee as to the amount of any quarterly distribution or the amount of the final distribution.

The Up Trust will make the following distributions out of the funds to which it is entitled under the income distribution agreement and the settlement contracts: (i) quarterly distributions of the available income on deposit in the Up Trust on each distribution date after it has made or received the required payment under the income distribution agreement and (ii) a final distribution of the assets on deposit in the Up Trust after it has made or received the required final payment under the settlement contracts on the final scheduled termination date, an early termination date or any redemption date. The Up Trust will make quarterly distributions and a final distribution to each holder of its Up MacroShares.

The amount of the quarterly distribution that the Up Trust will make on each distribution date will depend upon the amount of income realized by the paired trusts on their treasuries and on the level of the Applicable Reference Value of Medical Inflation during the calculation period that preceded that distribution date, which will determine the Up Trust's entitlements to that income. On the final scheduled termination date or an early termination date, any available income that the Up Trust would have distributed if those dates were ordinary distribution dates will instead be included in the final distribution made by the Up Trust on the Up MacroShares on those dates. On any redemption date, any available income to which the Up Trust has become entitled since the last distribution date will be included in the final distribution made by the Up Trust on that redemption date. The amount of the quarterly distribution on any distribution date or the available income included in the final distribution may be less than you expected or it may be eliminated entirely as a result of the following factors:

· if the medical inflation ratio of the Applicable Reference Value of Medical Inflation during any calculation period to the Applicable Reference Value of Medical Inflation on the closing date is generally less than the hurdle rate of [4]% compounded annually for the period from the closing date to each day of that calculation period, the Up Trust will be required to pay a portion of its available income to the Down Trust under the income distribution agreement, instead of being able to distribute that income to its shareholders;

· in order to pay the fees and expenses of the Up Trust, a fee deduction amount equal to an annualized fee accrual rate of 100 basis points on the assets of the Up Trust, plus an additional deduction amount if actual fees and expenses of the trusts exceed this accrual rate, are required to be deducted from the income of the Up Trust before the trust may distribute any portion of that income as a quarterly distribution or final distribution to shareholders. If the fee deduction amount and any additional deduction amount exceed the Up Trust's treasury income, the trust will not have any available income for distribution to its shareholders. In addition, if the Up Trust was not able to invest an amount equal to the aggregate par amount of its shares in treasuries on any distribution date, it will be required to use income realized on subsequent distribution dates to make up the deficiency in the amount invested; and

· a fee deduction amount based on the same accrual rate of 100 basis points and any additional deduction amount, if necessary, must also be deducted from the income of the Down Trust to pay the fees and expenses of the Down Trust. If these deductions exceed the Down Trust's treasury income, the Down Trust will not be required to make any payment out of that income to the Up Trust under the income distribution agreement or the settlement contracts, as applicable.

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The final distribution on your Up MacroShares will depend upon the underlying value of the Up Trust on the final scheduled termination date or early termination date, or on the redemption order date that precedes a redemption date.

If the ratio of the Applicable Reference Value of Medical Inflation on any day to the Applicable Reference Value of Medical Inflation on the closing date divided by the compounded hurdle rate is equal to a settlement factor of less than one, the underlying value of the Up Trust will be equal to the treasuries and cash it holds on deposit minus the portion of those treasuries and cash that it would be required to deliver to the Down Trust if the settlement contracts were terminated on that day. Conversely, if the ratio of the Applicable Reference Value of Medical Inflation on any day to the Applicable Reference Value of Medical Inflation on the closing date divided by the compounded hurdle rate is equal to a settlement factor of greater than one, the underlying value of the Up Trust will be equal to the treasuries and cash it holds on deposit plus the portion of the treasuries and cash in the Down Trust to which it would be entitled if the settlement contracts were terminated on that day. When the settlement contracts are actually settled on the final scheduled termination date, an early termination date, or any redemption date, one of the paired trusts will make a payment to the other trust such that the amount of funds on deposit in each trust is equal to that trust's underlying value as of such final scheduled termination date or early termination date, or as of the preceding redemption order date. The Up Trust will make a final distribution on the Up MacroShares after making or receiving the required final payment under the settlement contracts.

The initial underlying value of the Up Trust on the closing date will be equal to the aggregate par amount of the Up MacroShares issued on that date. However, if the ratio of the Applicable Reference Value of Medical Inflation at any time after the closing date to the Applicable Reference Value of Medical Inflation on the closing date is less than the hurdle rate of [4]% compounded annually for the period of time from the closing date to the relevant day of measurement, the underlying value of the Up Trust and the per share underlying value of your Up MacroShares will decrease. If the final scheduled termination date, an early termination date, or a redemption date occurs at a time as of which the Applicable Reference Value of Medical Inflation has not grown in value since the closing date at a rate that is greater than the compounded hurdle rate, the Up Trust will make a final distribution that will be equal to less than the funds it holds on deposit, because it will be required to pay a portion of those funds to the Down Trust under the settlement contracts. In this case, the final distribution made on your Up MacroShares will be below the par amount of those shares and it may also be below the purchase price that you paid for them. As a result, you may lose all or substantially all of your investment in the Up MacroShares.

There is currently no market for the Up MacroShares, and no market may develop.

No market will exist for the Up MacroShares prior to their initial issuance. The Up MacroShares, as well as the Down MacroShares, will be listed on the New York Stock Exchange and we will seek to maintain such listings while any of these shares are outstanding. However, we cannot guarantee that a secondary market will develop for your Up MacroShares or, if a secondary market does develop, that it will provide liquidity of investment or continue for the life of those shares. Any authorized participant may, but will not be obligated to, make a market in the Up MacroShares or the Down MacroShares. The Up MacroShares may experience price volatility due to the fact that there may be only a limited number of prospective buyers for the shares and the fact that there may be large-scale redemptions and a significant decrease in the size of the paired trusts as the rate of change in the Applicable Reference Value of Medical Inflation approaches a level at which a termination trigger may occur. Price volatility may affect the price that you are able to obtain for your shares and your ability to resell the shares. The lack of a market for the Down MacroShares may adversely affect the development of a market for your Up MacroShares. Due to the foregoing considerations, you must be prepared to hold your Up MacroShares until their final scheduled termination date. The underlying value of the Up Trust on the final scheduled termination date may be significantly less than its original underlying value and you may, as a result, receive only a minimal or no final distribution on that date and lose all or substantially all of your investment in the Up MacroShares.

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Fluctuations in the underlying value of the Up Trust and other factors may affect the market price of your Up MacroShares.

The market price of your Up MacroShares will be determined by a number of different factors, including the proportion of the current underlying value of the Up Trust that is represented by those Up MacroShares, also referred to as their "per share underlying value," which will depend upon the rate of change in the Applicable Reference Value of Medical Inflation, as well as factors such as the prevailing interest rate environment, investor expectations about the inflation rate, the expected growth and vitality of the U.S. economy, the market for medical goods and services, the expansion of government-provided and administered health care, and the supply and demand for your shares. The market price of your shares on any date may differ from their per share underlying value as of that date for many reasons, including, but not limited to, the following:

· investors may expect that the rate of growth in the Applicable Reference Value of Medical Inflation will increase in the future and this expectation may cause an increase in the market price of your shares above their per share underlying value due to the fact that the Up MacroShares are potentially a long-term investment; for the same reason, investors' expectations that the rate of growth in the Applicable Reference Value of Medical Inflation will decrease in the future may cause a decrease in the market price of your shares below their per share underlying value;

· the lack of availability of the Down MacroShares in the secondary markets may cause an authorized participant to have to pay a premium for those shares in order to be able to effect a paired optional redemption; and, as a result, the price which an authorized participant is willing to pay for your Up MacroShares may decline;

· as the per share underlying value of the Up MacroShares approaches its maximum or minimum value, the expectation that a termination trigger will occur in the near future and the Paired Trusts will terminate;

· the value of your Up MacroShares, as reflected in the quarterly and annual financial statements prepared by us on behalf of the Up Trust, may be more or less than the per share underlying value of those shares due to the application of accounting principles to the valuation of the settlement contracts held by the Up Trust, which may adversely affect the market price of your Up MacroShares;

· a significant trade of either the Up MacroShares or the Down MacroShares may occur late in the day and no corresponding sale or acquisition of the paired shares which aligns their market price with such trade may occur on that same day, resulting in the apparent divergence of the price of the paired shares which is remedied by trading on ensuing days;

· the Macros product structure is new and may be unfamiliar to investors;

· the lack of an active trading market may decrease liquidity and depress the price of both the Up MacroShares and the Down MacroShares; and

· the supply of Up MacroShares may exceed demand for such shares or demand may exceed supply.

We note that MacroShares issued by trusts formed by our affiliate, Macro Securities Depositor, LLC, which reference oil futures contracts have at times traded at prices that failed to track the underlying value of those shares for one or several of the reasons discussed above.

The Up MacroShares can only be redeemed by authorized participants and only as part of a MacroShares Unit consisting of at least 50,000 Up MacroShares and 50,000 Down MacroShares. Consequently, in order to liquidate your investment in the Up MacroShares, you may have to sell those shares at their prevailing market price, which may be below their per share underlying value for the reasons discussed above.

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The Up Trust will make distributions on the Up MacroShares solely from the assets deposited in the paired trusts.

The Up Trust will not have any assets or sources of funds other than the treasuries purchased with the net proceeds of the sale of the Up MacroShares and its rights to receive payments from the Down Trust under the income distribution agreement and the settlement contracts. The Up Trust will be the only entity obligated to make distributions on the Up MacroShares. The Up MacroShares will not be insured or guaranteed by us, the authorized participants, the trustee, the administrative agent, the marketing agents, or any of their respective affiliates. Holders of Up MacroShares will have no contractual recourse to any of these persons or to any other person or entity if the Up Trust has insufficient assets to make any quarterly distributions or a final distribution. The Up MacroShares are not insured or guaranteed by the United States government or any government agency or instrumentality and are not an investment in a money-market type fund.

The entitlement of the Up Trust to its assets and a portion, if any, of the assets in the Down Trust will be based on, and will fluctuate with, its underlying value, which will, in turn, fluctuate based on the level of the Applicable Reference Value of Medical Inflation, as described in this prospectus. Regardless of fluctuations in the respective underlying values of the paired trusts, no assets other than available income under the income distribution agreement will be transferred between the trusts until one or more settlement contracts are settled on a redemption date or all settlement contracts are settled on an early termination date or the final scheduled termination date. The sole sources of the final distribution on the Up MacroShares on any of these dates will be:

· the portion of the cash and/or treasuries in the Up Trust, if any, which the Up Trust is entitled to retain under the settlement contracts, and

· the portion or all of the cash and/or treasuries in the Down Trust, if any, which the Up Trust is entitled to receive under the settlement contracts.

The Down Trust will satisfy its obligations under the settlement contracts only out of the assets that it holds on deposit, which will consist of cash and the treasuries that the trustee, at the direction of the administrative agent, purchased on its behalf with the net proceeds of the sale of the Down MacroShares. The Down Trust will satisfy its obligations under the income distribution agreement only out of the income that it receives on its treasuries during the relevant calculation period, after it has set aside a portion of that income equal to the fee deduction amount and any additional deduction amount to pay its fees and expenses.

If the Applicable Reference Value of Medical Inflation has not grown in value at a rate since the closing date that is greater than the hurdle rate of [4]% compounded annually for the period of time from the closing date to the relevant day of measurement, or if that Applicable Reference Value of Medical Inflation has declined since the closing date during a period of deflation, the underlying value of the Up Trust will decrease significantly and such decreases will be magnified by the leverage factor. The underlying value of the Up Trust may decrease to the point at which it would be entitled to none of its own assets or income and none of the assets or income in the Down Trust. In such circumstances, you will lose all or substantially all of your investment in your Up MacroShares.

Income on the treasuries may be insufficient to make quarterly distributions.

The assets on deposit in the paired trusts will consist entirely of treasuries that mature prior to each distribution date and repurchase agreements that are collateralized by treasuries and that terminate within twenty-four hours of their execution. The treasury repurchase agreements will terminate overnight and will be rolled over into new repurchase agreements with yield rates that are then prevailing in the market. Distribution dates will occur quarterly and, on these dates, each of the paired trusts must reinvest the proceeds of the matured treasuries in new treasuries that will be trading at a discount or earning interest at a stated rate, in each case, based on the rates prevailing at the time of reinvestment. If prevailing interest rates or the discount rates offered on the treasuries decline, the interest income realized by the paired trusts will decline and the aggregate amount of quarterly distributions made by the paired trusts will be reduced. In addition, the paired trusts will be required to hold their treasuries to maturity, so if interest rates increase or the treasuries are being sold at higher discounts at any time during the period between distribution dates, you will not be able to benefit from these changes until the next distribution date. As a result you are exposed, as a holder of Up MacroShares, to interest rate risk on the treasuries and treasury repurchase agreements.

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Each of the paired trusts must pay its fees and expenses on each distribution date out of interest income, and if that income is insufficient, out of amounts that would otherwise be invested in treasuries on that distribution date. Fees and expenses are generally expected to accrue at an annual rate of 1.00% on the assets of the Up Trust. This rate is based upon estimates of fees and expenses which will be incurred on a quarterly or annual basis, such as the fees and expenses of independent accountants and outside counsel incurred in connection with the filing of quarterly reports. If the estimates of these fees and expenses are inaccurate or if unexpected expenses are incurred, the quarterly distributions on your Up MacroShares will be reduced or eliminated, and, if these fees and expenses exceed the income realized by the Up Trust on its treasuries and the other assets on deposit in the Up Trust must be used to pay these fees and expenses, this will result in a decrease in the underlying value of the Up Trust and in the per share underlying value of your Up MacroShares.

The trustee is required to reinvest on behalf of each of the paired trusts an amount equal to the aggregate par amount of that trust's shares in treasuries on each distribution date, if that amount is available to be reinvested out of the trust's assets (other than treasury income) on that date. If less than that amount is available, the resulting deficiency must be made up on subsequent distribution dates out of income available on those dates, if any, which will result in less income being distributed to you in your quarterly distribution on those dates.

If prevailing interest rates remain low for an extended period of time, less income will be available to cover the fee deduction amount and any additional deduction amount and, as a result, little or no quarterly distributions will be made by the Up Trust on the Up MacroShares. If the fee deduction amount, together with any additional deduction amount, exceed the Up Trust’s treasury income, the per share underlying value of your Up MacroShares will be reduced by the amount of assets needed to be applied to pay in full such fees and expenses.

The paired trusts may incur losses in connection with treasuries delivered upon the default of a repurchase agreement counterparty.

The administrative agent will instruct the trustee to invest a portion of the funds on deposit in each of the paired trusts in repurchase agreements for U.S. Treasury obligations. In the event that the seller under a treasury repurchase agreement defaults on its obligation to repurchase from the applicable trust the U.S. Treasury securities that were transferred under that agreement, the trustee will be required to deliver a default notice to the seller. After delivery of that notice, the trustee will be entitled to exercise all of the remedies permitted to be taken under the repurchase agreement, including retaining the transferred treasuries, in which case the trustee, acting at the direction of the administrative agent, must liquidate these treasuries on behalf of the applicable trust. The seller in each repurchase agreement entered into by either trust will be required to deliver treasuries with a market value, as measured on the date of transfer and discounted by the expected transaction costs which would be incurred if the trust had to liquidate such collateral following a default by the seller, that will be at least equal to the repurchase price specified in such repurchase agreement. However, in the event that the actual price that the trust is able to obtain for the treasuries is less than what those treasuries were valued at for purposes of the repurchase agreement, the amount of funds available to make quarterly and final distributions to you, as a holder of Up MacroShares, may be reduced.

The return on your shares is uncertain.

Your pre-tax return depends on several factors. Your pre-tax return on an investment in the Up MacroShares will depend upon:

· the purchase price you paid for your shares;

· the amount and timing of income realized by the paired trusts on their treasuries;

· the amount of quarterly distributions made by the Up Trust on the Up MacroShares;

· the length of time that your shares are outstanding; and

· the underlying value of the Up Trust on the relevant redemption order date or on the final scheduled termination date or early termination date on which you receive the final distribution on your shares or, if you sell your shares, the price that you are able to obtain for your shares.

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The underlying value of the Up Trust on any given date is uncertain. The underlying value of the Up Trust will be calculated for each business day by reference to the interpolated daily value of the Applicable Reference Value of Medical Inflation on the preceding day, which will be based upon the value of the medical component of the CPI-U that was calculated and published by the BLS for the second and third preceding calendar months. The formula for calculating the underlying value of the Up Trust is described in detail in the summary section of this prospectus and under "DESCRIPTION OF THE UP MACROSHARES— Calculation of Underlying Value." Hypothetical calculations of underlying value are included for illustrative purposes in Appendix C to this prospectus. The underlying value on any business day will equal:

· if the medical inflation ratio of the Applicable Reference Value of Medical Inflation on the preceding day to the Applicable Reference Rate of Medical Inflation on the closing date is greater than the hurdle rate compounded annually for the time period from the closing date to that preceding day that is the day of measurement, all of the cash and treasuries on deposit in the Up Trust plus a portion of the cash and treasuries in the Down Trust, such portion being doubled by the leverage factor, plus all available income realized on the Up Trust's treasuries and portion of the Down Trust's available income; and

· if the medical inflation ratio of the Applicable Reference Value of Medical Inflation on the preceding day to the Applicable Reference Rate of Medical Inflation on the closing date is less than the hurdle rate compounded annually for the time period from the closing date to that preceding day that is the day of measurement, the cash and treasuries on deposit in the Up Trust minus that portion of the Up Trust’s cash and treasuries to which the Down Trust is entitled, such portion being doubled by the leverage factor, plus the available income realized on the Up Trust's treasuries minus the portion of that available income to which the Down Trust is entitled.

On each business day, the underlying value of the Up Trust will represent the portion of the assets in the paired trusts to which the Up Trust would be entitled if the settlement contracts were settled on that date. The per share underlying value of your shares represents the portion of the underlying value of the Up Trust on any day that you would be entitled to receive as the final distribution on your shares if that day were the final scheduled termination date, an early termination date or a redemption date. If the Up Trust's underlying value has declined significantly when the final distribution is made on your Up MacroShares on the final scheduled termination date, an early termination date or a redemption date, you will lose all or substantially all of your investment in the Up MacroShares. Although you can never lose more than the amount you invested in the Up MacroShares, your losses may be relatively greater if you purchased your shares at a premium over their per share underlying value.

The impact of changes in the Applicable Reference Value of Medical Inflation is doubled by the leverage factor. The medical inflation ratio of the Applicable Reference Value of Medical Inflation on a certain day to the Applicable Reference Value of Medical Inflation on the closing day, divided by the compounded hurdle rate, will yield a settlement factor by which the assets held on deposit by the Up Trust must be multiplied in order to determine the trust's underlying value. Before being so applied, this settlement factor is first adjusted by a leverage factor, which is equal to 2. The effect of this is to double any increase in the underlying value of the Up Trust as well as to double any decline in that underlying value, making the per share underlying value and the market price of your Up MacroShares potentially more volatile than the value of medical inflation which those shares reference.

Quarterly distributions are based on the level of the Applicable Reference Value of Medical Inflation. The paired trusts will realize income on their treasuries in the form of accrued interest and/or discount received on those treasuries and in the form of yield realized on the treasury repurchase agreements. After each of the paired trusts has deducted an amount equal to the fee deduction amount and, if necessary, any additional deduction amount, to pay in full its fees and expenses, and reinvested an amount equal to the Up or Down aggregate par amount, as applicable, in new treasuries on each distribution date, one of the paired trusts will be required to pay all or a portion of its remaining or "available" income, if any, to the other paired trust under the income distribution agreement, based on the Applicable Reference Value of Medical Inflation during the preceding calculation period. If the ratio of the Applicable Reference Value of Medical Inflation during any calculation period to that value on the closing date was greater than the compounded hurdle rate, the amount of quarterly distributions made by the Up Trust to its shareholders on the next distribution date or as part of the final distribution on a redemption date will include a portion of the Down Trust’s available treasury income. If that ratio was less during any calculation period than the compounded hurdle rate, the amount of quarterly distributions made by the Up Trust to its shareholders on the next distribution date or as part of the final distribution on a redemption date will be less than its available treasury income for that period, because it will owe a portion of that income to the Down Trust.

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The right to redeem the Up MacroShares is limited. The Up MacroShares may only be redeemed by authorized participants and only in paired optional redemptions in which paired Up and Down MacroShares constituting one or more MacroShares Units are tendered for redemption. No redemptions are permitted prior to July 1, 2008. Only authorized participants that participate in DTC and have signed a participants agreement with us, the administrative agent and the trustee will be entitled to present a MacroShares Unit for redemption. Unless you are an authorized participant and hold the requisite number of Paired Shares, as applicable, you will not be able to effect a paired optional redemption. As a result, you must be prepared to hold your Up MacroShares until their final scheduled termination date or to sell them in the secondary market, if any exists, at the prevailing market price, which may be below their per share underlying value and below the rate that you paid for those shares. There may be no authorized participants who are willing to purchase your Up MacroShares when you desire to sell them, because, among other reasons, no authorized participant is able to satisfy the conditions for a paired optional redemption. Furthermore, if the Down MacroShares are trading at a premium over their share of the underlying value of the Down Trust, the market price of the Up MacroShares may be adversely effected, because authorized participants may be willing to acquire your shares only if you sell them at a discount from their proportionate share of the Up Trust's underlying value. Due to the fact that shares are always redeemed at their per share underlying value, authorized participants would lose money in any paired optional redemption in connection with which they had to acquire the Up and/or Down MacroShares at a premium to such per share underlying value. If you are unable to sell your shares in the secondary market to an authorized participant or to another investor, you may be prevented from realizing gains on the shares or be forced to incur increasing losses as the Applicable Reference Value of Medical Inflation continues to grow over time at a rate that is increasingly slower than the compounded hurdle rate or begins to decrease during a period of deflation and the underlying value of the Up Trust continues to decrease.

The paired trusts may deliver treasuries instead of cash in a paired optional redemption. The paired trusts will always deliver cash in a paired optional redemption so long as the trusts have cash available from the maturity proceeds of their treasury repurchase agreements or from funds delivered by authorized participants who are directing paired issuances on the same date on which redemptions are also occurring. On each distribution date, the administrative agent will be required to adjust the amount of treasury repurchase agreements which it directs the trustee to acquire based on the actual redemption experience of the paired trusts during the preceding twelve-month period. However, if the paired trusts do not have sufficient cash available to effect a paired optional redemption entirely in cash, then the paired trusts will satisfy all or a portion of the final distribution by delivering treasuries they hold on deposit to the redeeming authorized participant. Each of the paired trusts is required to deliver treasuries with a value equal to the underlying value of the applicable trust on the redemption date, or the portion of that underlying value that is allocable to the shares that are being redeemed. The paired trusts will always value their treasuries at the acquisition cost of those treasuries. However, because the market price of the treasuries delivered in a paired optional redemption may have decreased since the time that they were acquired by the paired trusts, the redeeming authorized participant may receive less if it liquidates those treasuries immediately after it receives them than it would have realized had it received a final distribution in cash or it were to hold the treasuries to their maturity. The market risk on the treasuries to which authorized participants may be exposed when they effect such paired optional redemptions may adversely affect the price they are willing to pay for the Up MacroShares.

If the paired trusts deliver treasuries in a paired optional redemption, the remaining holders of Up MacroShares may realize somewhat reduced income accruals after the redemption, because the administrative agent will use the last in, first out method to select treasuries for delivery to redeeming authorized participants. As a result, if interest rates were to fall during a calculation period and several redemptions were followed by one or more issuances later during that period, the relatively higher-yielding treasuries that were acquired by the paired trusts on the preceding distribution date would be delivered to redeeming authorized participants and would be replaced with relatively lower-yielding treasuries following the paired issuances. Conversely, in a rising interest rate environment during a calculation period in which issuances were followed by redemptions, the relatively higher-yielding treasuries acquired in connection with the issuances would be delivered to redeeming authorized participants in the redemptions.

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Moreover, a falling interest rate environment during any calculation period between distribution dates could create an incentive for authorized participants to effect a paired optional redemption for the purpose of receiving a delivery of the paired trusts' relatively higher-yielding treasuries, which would adversely affect the remaining holders of the Up MacroShares. Such an incentive would exist during a time when (1) the paired trusts had no more cash available to distribute in connection with redemptions, (2) authorized participants could obtain both the Up MacroShares and the Down MacroShares at market prices that were equal to or less than the per share underlying value of those shares, (3) the transaction costs associated with effecting a paired optional redemption were exceeded by the value of the treasuries that were delivered, and (4) authorized participants were prepared to hold the treasuries they received to their maturity in order to realize the full discount from par that was associated with those treasuries.

The paired trusts may terminate early. The Up Trust may terminate prior to the final scheduled termination date for the Up MacroShares as a result of the occurrence of one of the termination triggers described in this prospectus. Following the occurrence of any termination trigger, the paired trusts will settle all of the settlement contracts and make a final distribution on the Paired Shares. This early redemption may occur before you have had an opportunity to realize the maximum gain that you could have realized had the underlying value of the Up Trust risen to its highest possible level, or to reduce your existing losses resulting from declines in the level of the Applicable Reference Value of Medical Inflation or a declining rate of growth in that value. If the rate moves in a direction that would have increased the underlying value of the Up Trust after the Up MacroShares have been redeemed, you will not be able to benefit from that rate movement.

We may, at our discretion, terminate the paired trusts and cause all of the Up and Down MacroShares to be redeemed at their per share underlying value at the end of the calculation period that precedes the resulting early termination date if the amount of assets on deposit in either trust is reduced to fifty ($50) million dollars or less. In such a circumstance, the market for the Up MacroShares may be limited, making it difficult to liquidate the shares prior to the early termination date; further, once investors have received their final distribution following the occurrence of such a termination trigger, investors may not be able to identify a comparable investment referencing the value of the medical component of the Consumer Price Index for all Urban Consumers.

A termination trigger will occur when (1) the underlying value of the Up Trust reflects its entitlement to 15% or less of the assets it holds on deposit or (2) the underlying value of the Up Trust reflects its entitlement to 185% or more of the assets it holds on deposit, in each case, on two (2) consecutive index publication days. Following a termination trigger, your Up MacroShares will be subject to a mandatory redemption on the next scheduled distribution date and you will receive a final distribution that will be calculated based on the Applicable Reference Value of Medical Inflation on the last day preceding that distribution date, also known as the "early termination date." These termination triggers exist, because the gains on your Up MacroShares are limited to the amount of assets in the Down Trust, as discussed below in "— The return on the Up MacroShares is capped," and your losses are limited to the amount of assets in the Up Trust and, once the underlying value of either of the paired trusts begins to approach zero, the market price of your Up MacroShares, as well as the shares of the Down Trust, could begin to diverge significantly from their per share underlying value. Unless you are able to sell your Up MacroShares prior to the early termination date, you will receive a final distribution in redemption of those shares that is based on the Applicable Reference Value of Medical Inflation on the last calendar day preceding the mandatory redemption that will occur on that early termination date.

The return on the Up MacroShares is capped. The return on the Up MacroShares is limited by the amount of assets in the Down Trust. Regardless of how fast the rate of growth in the Applicable Reference Value of Medical Inflation is, the Up Trust will not be entitled to receive an amount greater than 100% of the assets in the Down Trust. If the rate of growth is so great that the underlying value of the Up Trust rises to or above 185% of the assets it holds on deposit at any time and remains at or above that level for two (2) consecutive index publication days, an early termination will occur and the paired shares will automatically be redeemed at their per share underlying value on the next scheduled distribution date. After receiving this final distribution, you may not be able to reinvest it in an instrument that allows you to achieve the same return as the return you realized on your Up MacroShares or to benefit from any increases in the rate of growth in the Applicable Reference Value of Medical Inflation.

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The Up MacroShares are not a perfect hedge against medical inflation.

General. The formula used to calculate underlying value is designed to compensate holders of the Up MacroShares for a rate of increase in the value of the medical care component of the CPI-U that is above the designated "hurdle rate," compounded annually for the period from the closing date to the relevant date of measurement. Conversely, the underlying value formula is designed to create an obligation on the part of the holders of the Up MacroShares to compensate the holders of the Down MacroShares if the rate of increase in the value of the medical care component of the CPI-U is less than the designated hurdle rate or if that value decreases from its level on the closing date during a period of deflation. However, the amount of the compensation that the underlying value formula will yield to the holders of the Up MacroShares is not designed to equal, in absolute terms or in any specified proportion, the increase in the price of medical goods and services, as reflected in the value of the medical component of the CPI-U and an investment in the shares will not fully offset such price increases, but will provide only some measure of protection against them. The amount of that protection depends upon how quickly these increases occur relative to the compounded hurdle rate, the magnification of the resulting increases and decreases in underlying value that will result from the application of the leverage factor, the length of time you hold your Up MacroShares, the date on which you sell or redeem those shares and, in the case of a sale, the price you obtain for your shares. The next four paragraphs discuss additional reasons why the yield realized on the Up MacroShares does not provide complete protection against inflation in the cost of medical commodities and services.

Increases in underlying value will not offset the cost associated with medical inflation. An investment in the Up MacroShares will only increase in value, as measured by the per share underlying value of each share, if the Applicable Reference Value of Medical Inflation grows at a faster rate than the compounded hurdle rate. Accordingly, an investment in the Up MacroShares will not produce a yield that would cover the actual cost of medical inflation experienced by a consumer of medical goods and services. If the rate of growth in the Applicable Reference Value of Medical Inflation since the closing date is positive but below the compounded hurdle rate, the per share underlying value of the Up MacroShares will decrease below their per share underlying value on the closing date. If the rate of growth since the closing date is greater than the compounded hurdle rate, the per share underlying value of the Up MacroShares will increase only to reflect the excess growth over and above the compounded hurdle rate multiplied by the leverage factor. As a result, a holder of Up MacroShares would not realize a yield on those shares that would offset the medical costs incurred during such year which are due to inflation.

Changes in medical inflation and changes in underlying value are not proportional. The relationship between changes in the level of the Applicable Reference Value of Medical Inflation and changes in the underlying value of the Up Trust is not proportional. For any given increase or decrease in the Applicable Reference Value of Medical Inflation, there will not be a proportional increase or decrease in the underlying value of the Up Trust. Instead, the change in the underlying value on any day of measurement will depend upon, in addition to the Applicable Reference Value of Medical Inflation, (1) the length of the period of time from the closing date to the measurement date, and (2) whether the rate of growth in the Applicable Reference Value of Medical Inflation has been above or below the compounded hurdle rate during that period of time. For example, if the rate of growth in the Applicable Reference Value of Medical Inflation has been below the compounded hurdle rate for some time, the Applicable Reference Value must thereafter grow well in excess of the compounded hurdle rate in order to "offset" the earlier, much slower rate of growth in order to obtain the same increase in underlying value for the Up Trust that would result from a steady growth in the Applicable Reference Value of Medical Inflation that was only slightly above the compounded hurdle rate throughout the relevant period from closing date to measurement date. The fact that the performance of the Applicable Reference Value of Medical Inflation since the closing date (rather than its performance during the last month or the last year) is considered in the calculation of its rate of growth, as well as the existence of the hurdle rate and its daily compounding, prevent a proportional relationship between changes in the Applicable Reference Value of Medical Inflation and changes in the underlying value of the Up Trust.

There are significant disparities in medical costs among different users and geographic regions. Each consumer of medical goods and services will generally utilize only a fraction of the many different medical goods and services that are available for his or her consumption. Moreover, such utilization will occur within a fairly small geographic area in which the cost of medical goods and services may be significantly higher than or less than the same goods and services offered in another geographic region. However, the medical component of the CPI-U reflects a weighted average of the cost of a great variety of medical goods and services that are provided in all of the various urban regions of the United States. Depending upon your geographic location and the particular medical goods and services for which you bore the cost, the increase in the cost of medical goods and services which you experience may be greater than or less than the increase in the medical component of the CPI-U. Accordingly, an investment in the Up MacroShares, the per share underlying value of which will reflect the average rate of inflation in the cost of all medical goods and services sampled by the BLS across all of the 38 geographic areas into which the United States has been divided by the BLS for purposes of calculating the CPI-U, may not adequately hedge the inflation in the cost of medical goods and services which you experience.

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Corrections to the medical component of the CPI-U will not be reflected in the underlying value of the Up MacroShares. The BLS has a presumption in policy and practice against revisions to the CPI-U, because the CPI-U is so widely used as a benchmark by the market, governmental agencies and individuals and any revisions could be costly for these many users of the index. If however, the BLS were to issue a correction of a previously-published value for the medical component of the CPI-U, the Applicable Reference Value of Medical Inflation and the underlying value that was determined by reference to that value will not be revised in response to such correction. Due to the BLS policy against corrections and the fact that any such corrections will not, in any case, be reflected in the calculation of underlying value, there may be a greater disparity between the yield on the Up MacroShares and actual increases in the cost of medical services and commodities.

The rate of inflation is variable and volatile in the short-term and it is difficult to predict it in the long-term; many contingent factors may influence the rate of inflation in the price of medical services and commodities.

General. The rate of growth in the Applicable Reference Value of Medical Inflation can be affected by many factors the likelihood and combined impact of which is difficult to predict. These factors include:

· investor expectations about the future rate of inflation in the prices of medical goods and services;

· new laws and regulations that impact the cost structure of health care service providers (for example, caps on medical malpractice claims);

· changes in the relative weights assigned to each of the expenditure categories that compose the medical component of the Consumer Price Index for all Urban Consumers;

· additions to, and/or deletions or the discontinuation of, any of the expenditure categories of the medical component of the Consumer Price Index for all Urban Consumers;

· changes to the methodology employed by the BLS in measuring or calculating the medical component of the Consumer Price Index for all Urban Consumers;

· major medical or technological advances that impact the demand for certain medical goods or services (for example, a cure for certain types of cancer or a drug that reverses the effects of heart disease);

· an epidemic or disaster that requires unique government-based solutions;

· a move toward, or the institution of, some form of government-provided health care insurance; and

· fiscal and monetary policies pursued by the federal government and the Federal Reserve.

The last two factors are discussed in greater detail below.

Impact of government-provided health care insurance. A number of plans which seek to provide health care insurance to all American residents or all those who are currently uninsured or underinsured have been proposed in recent years. While it is impossible to predict which, if any, of these plans may be enacted and implemented by the federal government in the future and the precise shape such plan may take as it makes its way through the process of being considered and amended by both Houses of Congress, such a plan may have a fundamental impact on the entire pricing structure of, and market for, medical goods and services. The principal feature of certain of the plans that are currently being proposed is the granting of tax cuts or tax deductions to individuals to be used for their health care expenses. The benefit of such a plan is alleged to be that individuals will be able to spend their money on the medical goods and services that they most need or desire. Accordingly, such plans could be expected to increase the demand for many medical goods and services and result in higher prices. Other plans are based on a government-supported network of providers and patients with limitations imposed on reimbursable costs, but most of these plans allow individuals to opt out of the network. Capping medical costs could restrain inflation of medical costs, while the existence of a market composed of self-pay individuals who opt out of the government-administered plan may result in a significant inflation in medical care prices for those who are not sensitive to cost but demand superior service or treatments. Any plan which extends medical insurance to previously uninsured or underinsured individuals may increase utilization of medical goods and services and result in price increases. At the same time, such a plan may reduce or eliminate the dependence of uninsured individuals on care provided in emergency rooms, the cost of which is borne by the provider hospital, which then passes on some portion of that cost in the form of higher prices for other medical treatments. To the extent that a decrease in uninsured individuals eliminates the need for this "cost-sharing," it may result in a decrease in the cost of medical goods and services. While the specific features of any government-administered and/or subsidized health care insurance plan that may be passed in the future is difficult to predict, such a plan is likely to have an impact on the rate of inflation in medical goods and services and the yield on your Up MacroShares, and such impact may be significant.

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Effects of monetary and fiscal policy. The Federal Reserve pursues monetary polices and the federal government pursues fiscal policies which seek to promote what the individuals who support and implement such policies believe to be, among other goals, a healthy rate of economic growth, level of investment and savings rate for the U.S. economy. These policies may seek to address the impact of certain external variables on the U.S. economy, such as if the U.S. is engaged in fighting a war or if investor confidence in a particular sector of the economy collapses. The use of such policies and the understanding of their effect may also change from time to time depending on the political beliefs of the individuals appointed to run the Federal Reserve and the individuals elected to serve in the federal government.

The Federal Reserve increases and decreases the rates at which banks may lend money to individuals and to other banks with the goal of affecting levels of investment in the economy. Decreases in interest rates generally result in increased levels of investment and serve to stimulate the economy. However, the availability of money or credit at lower rates generally results in higher inflation rates as individuals increase their demand for various consumer items, which leads to higher prices. Decreases in interest rates would be expected generally to increase the cost of medical goods and services, because they would cause an increase in the demand for various discretionary services, like plastic surgery or fertility treatments, and demand for higher-quality care, such as brand name drugs and cutting-edge or experimental treatments. Conversely, increases in interest rates generally decrease the level of inflation, because money becomes more expensive and demand for various goods and services declines, which should also generally be the case for medical goods and services. There may, however, be certain non-discretionary medical goods and services which are less sensitive to fluctuations in interest rates, such as, for example, the cost of emergency care for a broken limb.

The federal government employs various fiscal policies to stimulate the economy or, in some cases, to restrain inflationary pressures. For example, tax cuts are generally employed to stimulate spending and tax increases tend to depress spending. Tax increases would generally result in decreased demand and a slower rate of growth in medical care cost increases, while tax cuts would generally result in increased demand for medical goods and services and a higher rate of growth in medical care costs. The level of government spending also impacts the price of consumer goods and services. A significant increase in government spending on medical goods and services would constitute an increase in demand and result in higher prices while a significant decline in government spending will result in a slower rate of growth in medical care costs.

Monetary and fiscal policies are employed for various reasons and while the general consequences of any one such policy considered in isolation may be anticipated, the combination of several of these policies employed for various time periods and in the pursuit of various goals by changing political administrations and regulators will have an impact on the cost of medical goods and services and the resulting yield on your Up MacroShares that is difficult to predict.

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The historical performance of the Applicable Reference Value of Medical Inflation is not an indication of its future performance.

It is difficult to predict whether the Applicable Reference Value of Medical Inflation will grow at a rate in excess of, or below, the specified hurdle rate of [4]% compounded for the period of time from the closing date to relevant date of measurement. It is also possible that the Applicable Reference Value of Medical Inflation will decrease compared to that value as of the closing date during a period of deflation, which will make it less likely that the value, as measured in future periods, will have changed since the closing date at a rate in excess of the compounded hurdle rate. The prices of medical goods and services are determined, and directly and indirectly influenced, by a large number of complex and interrelated factors. Accordingly, past levels of the Applicable Reference Value of Medical Inflation are not indicative of its future growth or the rate at which it will grow during any specified period of time following the closing date.

The Up Trust is not regulated as a commodity pool and none of the Up MacroShares are regulated by the Commodity Futures Trading Commission.

The Up Trust does not hold or trade in commodity futures contracts or other instruments regulated under the Commodity Exchange Act, as amended (the "CEA"), as administered by the Commodity Futures Trading Commission. The income distribution agreement and the settlement contracts held by the Up Trust constitute contracts, agreements and transactions which are generally excluded from regulation under the CEA, except that certain anti-fraud and anti-manipulation provisions of the CEA continue to apply to these transactions. Furthermore, the Up Trust is not a commodity pool for purposes of the CEA, and the operators and other service providers of the trusts are not subject to regulation as a commodity pool operator or a commodity trading advisor by the Commodity Futures Trading Commission. Moreover, neither the income distribution agreement and the settlement contracts, nor the Up MacroShares, are instruments subject to regulation by the Commodity Futures Trading Commission. Consequently, holders of Up MacroShares do not have the regulatory protections provided to investors in instruments or commodity pools that are regulated by the Commodity Futures Trading Commission and will not receive the disclosure document or financial reports that would otherwise be required to be delivered under the CEA.

Redemption and creation orders are subject to postponement, suspension or rejection in certain circumstances; no redemptions are permitted prior to July 1, 2008 and a fee is payable for creations prior to that date.

The administrative agent is required to suspend the right to effect a paired optional redemption or a paired issuance or postpone any redemption date or issuance date, (i) for any period during which the New York Stock Exchange is closed or trading on the exchange is suspended or restricted, (ii) for any period during which an emergency exists as a result of which the delivery or acquisition of treasuries is not reasonably practicable, (iii) if such redemption would cause the amount of cash and treasuries on deposit in the Up Trust and the Down Trust to equal less than 10 million dollars or (iv) for such other period as we, the trustee or the administrative agent determine to be necessary for the protection of the shareholders. In addition, the administrative agent may, in its discretion, reject any redemption order or creation order (i) that is not in the proper form required by the participants agreement, (ii) if insufficient shares, in the case of a redemption order, or insufficient funds, in the case of a creation order are tendered to the trustee, (iii) if we determined, based upon an opinion of counsel that such order would have adverse tax or securities laws consequences for either of the shareholders, (iv) if circumstances outside of our control or of the control of the trustee or the administrative agent make it impractical or not feasible to process the order, (v) if the Down Trustee has notified the Up Trustee that it or the administrative agent has rejected the related order delivered under the Down Trust agreement or (vi) if the fulfillment of the order, in the opinion of counsel to the administrative agent, may be unlawful. In addition, the administrative agent may reject any creation order if there are not sufficient paired shares registered pursuant to the Securities Act to fulfill the order. None of the trustee, the administrative agent or us will be liable to any person in any way for any loss or damage that may result from any such suspension, postponement or rejection. Any such postponement, suspension or rejection may adversely affect the ability of authorized participants to effect paired issuances or paired optional redemptions and the demand for and market price of the Up MacroShares.

No paired redemptions of Up and Down MacroShares will be permitted to be made during the period from the closing date until July 1, 2008. In addition, a fee of [3.00]% will be payable in connection with any paired issuances made prior to July 1, 2008. These restrictions may also adversely affect the demand for and market price of the Up MacroShares during the period when they are in effect.

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If the Up Trust is taxable as a corporation for United States federal income tax purposes, your distributions will be reduced.

There is no authority directly on point dealing with securities such as the Up MacroShares or transactions of the type described. Nevertheless, our tax counsel is of the opinion that the Up Trust will be classified for United States federal income tax purposes as a partnership and not as an association or publicly traded partnership taxable as a corporation. These opinions, however, are not binding on the Internal Revenue Service or the courts, either of which could take a contrary position. No rulings have been sought from the IRS. Accordingly, there can be no assurance that the IRS will not challenge the opinions expressed in this prospectus or that a court would not sustain such a challenge.

If the Up Trust were classified as a publicly traded partnership taxable as a corporation for United States federal income tax purposes by the IRS and this classification were upheld by the courts, the Up Trust's taxable income would be subject to income tax at regular corporate rates before being distributed as quarterly and final distributions to holders of the Up MacroShares. Furthermore, the income of the Up Trust would not flow through to the holders of the Up MacroShares for reporting on their own returns. The imposition of tax on the Up Trust would reduce amounts available for distribution to a holder of Up MacroShares.

If the Up Trust were determined not to qualify as a securitization partnership, and the Up Trust were to have built-in losses at the time you transfer your shares, the value of your shares could be effected.

There is no authority directly on point dealing with the classification of partnerships as securitization partnerships. It is possible that the IRS could assert that the Up Trust does not qualify as a securitization partnership.

If the Up Trust does not qualify as a securitization partnership and has a built-in loss at the time a share is transferred in excess of $250,000, then the purchaser of the Up MacroShare would have its basis in its share of the Up Trust's assets reduced by an amount equal to the difference between its basis in its Up MacroShare (as determined for federal income tax purposes) and its proportionate share of the Up Trust's tax basis in its assets. It is unclear, however, given the publicly traded nature of the Up MacroShares and the nature of the Up Trust's assets how such adjustments might be tracked and applied, and accordingly, how such shareholders might be affected. See "MATERIAL UNITED STATES FEDERAL INCOME TAX CONSEQUENCES" for more information.

You should be aware of the tax consequence of your investment in the Up MacroShares. For example, you may have United States federal income tax liabilities in advance, or in excess, of your quarterly distributions.

It is possible that as a holder of Up MacroShares you may recognize taxable income in advance, or in excess, of your receipt of any cash distributions with respect to those shares. In addition, capital losses and deductions in respect of payments under the income distribution agreement, trustee fees, licensing fees and other expenses associated with the Up Trust will be separately stated for you and you may deduct such losses and expenses only to the extent permitted by law. In that regard, you should be aware that deductions for capital losses are subject to limitations and, if you are a non-corporate holder, you will be subject to the "miscellaneous itemized" deduction rules of Section 67 of the Internal Revenue Code of 1986, which means that those deductions, taken together with all your other miscellaneous itemized deductions, are only deductible to the extent that they exceed 2% of your adjusted gross income. Furthermore, for all non-corporate holders with adjusted gross incomes above an annually prescribed amount, Section 68 of the Internal Revenue Code of 1986 imposes a reduction in the total amount for most itemized deductions.

Lack of sufficient trading of futures based on the medical component of the CPI-U on an organized exchange may result in the imposition of withholding tax liability on the Up Trust.

We expect that there will be sufficient trading on a recognized commodities exchange of futures on the medical care component of the CPI-U to satisfy a tax requirement that such futures are "of a kind customarily dealt in" on such exchange. There is, however, no authority directly addressing how much trading is required to satisfy such requirement. If such requirement were not satisfied, non-U.S. holders of the Up and Down MacroShares could be treated as earning income that is effectively connected with the conduct of a trade or business within the United States ("ECI"). ECI earned by non-U.S. holders is taxable by the United States at full U.S. income tax rates and each such non-U.S. holder would be subject to quarterly withholding at the highest applicable rate (currently, 35% for both individuals and corporations), on an estimated basis, on its allocable share of the income of the applicable paired trust, whether or not it received distributions from that trust. In addition, the applicable paired trust would be jointly and severally liable for such withholding taxes. The imposition of such tax on the paired trusts, if not reimbursed in full by the non-U.S. holders of the paired shares, would reduce the amounts available for distribution to all holders of the Up and Down MacroShares. In such circumstances, we may exercise our right to declare an early termination date and redeem all outstanding shares of the Up and Down Trusts, which will have the consequences described in the risk factor entitled "The return on your shares is uncertain — The paired trusts may terminate early."

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The Up MacroShares do not confer upon their holders many of the rights normally associated with shares issued by a corporation.

The holders of the Up MacroShares are not entitled to many of the rights typically exercised by shareholders in a corporation. By acquiring Up MacroShares, you are not acquiring the right to elect directors, to vote on certain matters relating to the Up Trust, or to take other actions generally associated with the ownership of shares in a corporation. You will only have the limited rights described under "DESCRIPTION OF THE TRUST AGREEMENTS — Trustee Termination Events" and "— Modification and Waiver."

Potential conflicts of interests.

We will act as depositor for the Down Trust and may from time to time act as depositor for other issuers of MacroShares offered in public and private offerings. MACRO Financial, LLC will act as a marketing agent for the Down Trust and may from time to time act as a marketing agent for other issuers of MacroShares offered in public and private offerings. Both we and MACRO Financial, LLC are affiliates of MacroMarkets LLC, which will act as the administrative agent for the Down Trust and from time to time act as administrative agent for other issuers of MacroShares offered in public and private offerings. The paired trusts will also pay MacroMarkets LLC a licensing fee for the right to use the patented MACROs structure in structuring, issuing and offering MacroShares. Our interests and the interests of our affiliates may in certain circumstances be different from the interests of the holders of Up MacroShares.

GLOSSARY

This prospectus uses defined terms. You can find definitions of important terms used in this prospectus under "GLOSSARY OF DEFINED TERMS" beginning on page [83] in this prospectus.

USE OF PROCEEDS

The trustee for the Paired Trusts will use the net proceeds received by each trust in connection with each Paired Issuance (i) to reimburse Natixis Securities North America Inc. and MacroMarkets LLC for all of their upfront expenses incurred in connection with the formation of the Paired Trusts and the registration of the Up and Down MacroShares, and (ii) to acquire, in accordance with the directions of the administrative agent and on behalf of each Paired trust, bills, bonds and notes issued and guaranteed by the United States Treasury and repurchase agreements collateralized by United States Treasury securities, that are, in each case, scheduled to mature prior to each Distribution Date. We refer to these obligations generically as "treasuries."

The trustee will always deposit one-half of these treasuries into the Up Trust and one-half into the Down Trust, without regard to the respective underlying values of the trusts at the time of the Paired Issuance.

THE DEPOSITOR

We were established as a limited liability company in the State of Delaware on November 27, 2007, and are a wholly-owned, limited-purpose subsidiary of MacroMarkets LLC, the owner of the patent on the MACROs structure. Our address for notices is care of The Corporation Trust Company, at 1209 Orange Street, Wilmington, New Castle County, Delaware 19801. Our telephone number is (888) MACROS1.

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Our limited liability company agreement provides that we may conduct any lawful activities necessary or incidental to acquiring, owning, holding, pledging and transferring assets and serving as depositor of one or more trusts that may issue and sell securities.

Our principal duties consist of:

· forming the Paired trusts;

· preparing and filing all periodic reports required to be filed by the Paired trusts; and

· maintaining the listing of the Up and Down MacroShares on a national exchange.

MACROMARKETS LLC

MacroMarkets LLC is a financial services company that has developed its patented MACRO® Securities, or "MACROs," as a means of transforming various economic goods and aggregate economic measures into interests that can be acquired by individual investors in the form of publicly tradeable securities. MACROs are securities the value of which is linked to the performance of a reference index, rate or other economic variable.

The following are brief profiles of the principal managers and officers of MacroMarkets LLC:

Robert J. Shiller is a founding member of MacroMarkets LLC and also a member of its Board of Managers. Professor Shiller was a founder and director of Case Shiller Weiss, Inc. prior to joining MacroMarkets LLC, and participated in developing CSW's products and services. He was also instrumental in helping to develop the MACROs (Proxy Assets) design and patent. He is the author of two books which developed some of the concepts of index-based risk management that helped lead to the development of MACROs: Macro Markets: Creating Institutions for Managing Society's Largest Economic Risks, Oxford University Press, 1993, and The New Financial Order: Risk in the 21st Century, Princeton University Press, 2003. He is also the author of Market Volatility, MIT Press, 1989, and of Irrational Exuberance, Princeton University Press 2000, which was a New York Times Best Seller. Professor Shiller is currently the Stanley B. Resor Professor of Economics at the Cowles Foundation for Research in Economics and International Center for Finance at Yale University. He was elected fellow of the Econometric Society in 1980. Since 1982, he has been Research Associate of the National Bureau of Economic Research, and is co-director of its workshops in behavioral economics. He has received a Guggenheim Fellowship, an honorary doctorate and several honorary professorships. He is a member of the New York Philosophical Society and a fellow of the New York Academy of Arts and Sciences.

Samuel R. Masucci, III has been instrumental in the growth of MacroMarkets LLC. In 2001, he began serving as an independent consultant to the company and focused on converting MacroMarkets LLC's patented ideas into tradeable products. In January 2002, he took on the role of Chief Operating Officer and daily management of the company. In September 2005, Mr. Masucci was appointed MacroMarkets LLC's President and Chief Executive Officer. Mr. Masucci has more than 15 years of experience on Wall Street, and has held senior management positions at Bear Stearns, UBS and Merrill Lynch. In 1997, he was a leader in the development of property derivatives by creating structured products that allow pension funds, insurance companies and hedge funds to invest in U.K. home price appreciation. Mr. Masucci headed a group to develop, securitize and trade Shared Appreciation Mortgages in both Europe and the U.S. as a means for homeowners to share home price risk in exchange for below market interest rates. He worked on developing institutional interest in high LTV residential mortgages. In 2001, he founded Cobblestone Consulting to bridge the gap between mortgage trade desks and small to medium-sized mortgage banks and lenders. During that time he developed pricing, insurance and exit strategies for more than $1 billion of high LTV residential mortgages.

Larry Larkin is a Managing Director of MacroMarkets LLC and a member of its Board of Managers. Mr. Larkin has spent 20 years at Goldman Sachs creating equity options, futures, program trading, and over-the-counter derivatives. He has held senior positions at First Boston, Leland O'Brien and Rubenstein, ING-Barings, and the American Stock Exchange. At the American Stock Exchange, he was responsible for New Product Development and the development of Exchange Traded Funds (ETFs). Mr. Larkin has served on the Board of Directors of the New York Futures Exchange, committees for the S.I.A., and the Chicago Mercantile Exchange. Mr. Larkin is a Chartered Financial Analyst (CFA).

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MacroMarkets LLC has licensed the use of its patent on the MACROs structure to each of the Paired trusts. For a description of the licensing fee payable by the Paired trusts, see "DESCRIPTION OF THE TRUST AGREEMENTS — Fees and Expenses of the Paired trusts." For more information about the MACRO Licensing Agreement, see "DESCRIPTION OF THE UP TRUST ASSETS — The MACROLicensing Agreement." MACRO® is a federally registered service mark of MacroMarkets LLC. MacroMarkets LLC considers all references, singular or plural, to "MACRO®" or "MACRO" in this prospectus its service mark and reserves all rights to that service mark.

FORMATION OF THE PAIRED TRUSTS

We have created the Up Trust pursuant to the Up Trust Agreement. The Up Trust will issue the Up MacroShares offered by this prospectus.

We have also concurrently created the Down Trust pursuant to the Down Trust Agreement. The Down Trust will issue the Down MacroShares.

The Up Trust and the Down Trust were formed by us under the laws of the State of New York.

The Paired trusts entered into an income distribution agreement on the closing date and will enter into one or more settlement contracts with each other in connection with each Paired Issuance. The income distribution agreement and the settlement contracts are described under "DESCRIPTION OF THE UP TRUST ASSETS — The Income Distribution Agreement" and "— The Settlement Contracts." Payments under the income distribution agreement and the settlement contracts will be calculated on the basis of the level of the Applicable Reference Value of Medical Inflation, which is described under "DESCRIPTION OF THE APPLICABLE REFERENCE VALUE OF INFLATION." The payments that are made or received by the Up Trust under the income distribution agreement will determine Quarterly Distributions on the Up MacroShares, which are described under "DESCRIPTION OF THE UP MACROSHARES — Quarterly Distributions." The final payment made or received by the Up Trust under the settlement contracts will determine the Final Distribution on the Up MacroShares, which is described under "DESCRIPTION OF THE UP MACROSHARES — Final Distribution."

The assets of the Up Trust will consist of:

· treasuries of the type described under "DESCRIPTION OF THE UP TRUST ASSETS — United States Treasury Obligations" and what we refer to as "income" on those treasuries, consisting of stated interest on treasury notes and bonds and the discount that is realized when the par amount received on a treasury bill, note or bond at maturity exceeds the purchase price at which the Up Trust acquired that treasury, or interest paid on amounts borrowed under treasury repurchase agreements;

· the trust's rights under the income distribution agreement, as described under "DESCRIPTION OF THE UP TRUST ASSETS — The Income Distribution Agreement";

· the trust's rights under the settlement contracts, as described under "DESCRIPTION OF THE UP TRUST ASSETS — The Settlement Contracts";

· the trust's rights under the MACRO Licensing Agreement with MacroMarkets LLC to use the patented MACROs structure, as described under "DESCRIPTION OF THE UP TRUST ASSETS — The MACRO Licensing Agreement";

· the trust's rights under its trust agreement to rely on the services provided by the administrative agent, the marketing agents and the trustee, as described under "DESCRIPTION OF THE TRUST AGREEMENTS";

· a securities account created under the Up Trust Agreement into which all of the treasuries will be deposited for the benefit of the holders of the Up MacroShares;

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· a distribution account created under the Up Trust Agreement into which all income realized on the treasuries and all amounts received under the income distribution agreement and the settlement contracts will be deposited and then used first, to make a deposit to the fee payment account, second, to make payments to the Down Trust under the income distribution agreement and the settlement contracts, if applicable, and, third, to make Quarterly and Final Distributions to the holders of the Up MacroShares;

· a fee payment account created under the Up Trust Agreement into which the fee deduction amount and any additional deduction amount will be deposited on each Distribution Date and applied to pay the expenses and fees of the Up Trust; and

· a netting account created under the Up Trust Agreement to which the trustee credits (1) Up MacroShares being redeemed in Paired Optional Redemptions and nets such shares against any shares that are being created in Paired Issuances on the same date, and (2) cash delivered by Authorized Participants in connection with Paired Issuances and nets such cash against the Final Distributions to be made in connection with Paired Optional Redemptions being effected on the same date.

The assets of the Down Trust will be identical to those described above for the Up Trust.

For more information about the assets of the Paired trusts, see "DESCRIPTION OF THE UP TRUST ASSETS."

DESCRIPTION OF THE UP MACROSHARES

General

The initial Underlying Value of the Up Trust, after the first Paired Issuance occurs, will be equal to the Up Aggregate Par Amount of the shares issued in that Paired Issuance. It will also be equal to the initial Up Asset Amount, which will consist of the aggregate purchase price of the treasuries that the trustee acquires on behalf of the Up Trust with the proceeds of the first Paired Issuance. After the initial Issuance Date, the Underlying Value of the Up Trust will fluctuate based upon how much greater or lesser the Medical Inflation Ratio is compared to the Compounded Hurdle Rate. However, periodic increases and reductions in the Underlying Value of the Up Trust will have no effect on the Up Asset Amount or on the Up Aggregate Par Amount. The Up Aggregate Par Amount will be increased only by Paired Issuances of additional Up MacroShares and reduced only by redemptions of Up MacroShares. Similarly, the Up Asset Amount will increase only when additional assets are deposited into the Up Trust in connection with a Paired Issuance and will be reduced only when one or more settlement contracts are settled in connection with a redemption of Up MacroShares. The Up Asset Amount will be lower than the Up Aggregate Par Amount only if the fees and expenses of the Up Trust have exceeded the Up Trust's income on any Distribution Date and, as a result, a portion of the proceeds of the treasuries which would otherwise be reinvested were instead used to cover such fees and expenses, as described under "— Quarterly Distributions."

Each Up MacroShare will have a stated par amount of $[20] per share. The entitlement of each holder of Up MacroShares to any Quarterly Distributions and the Final Distribution made by the Up Trust will be based on the number of Up MacroShares held by that holder and the proportion that this number bears to the aggregate number of Up MacroShares issued by the Up Trust and outstanding on the relevant Distribution Payment Date.

The Up MacroShares will be issued by the Up Trust pursuant to the terms of the Up Trust Agreement. Each Up MacroShare represents an undivided beneficial interest in the Up Trust. The Up MacroShares do not represent interests in or obligations of us, the trustee, the administrative agent, any Authorized Participant, the marketing agents, or any of our or their affiliates.

The Up MacroShares are denominated in, and all distributions with respect to the shares will be payable in, United States dollars. There are no holding or transfer restrictions or minimum lot requirements applicable to the Up MacroShares.

The Up MacroShares will be delivered in book-entry form only through DTC.

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Calculation of Underlying Value

The Final Distribution made on the Up MacroShares on the Final Scheduled Termination Date, an Early Termination Date or a Redemption Date will be based upon the Underlying Value of the Up Trust (1)on the Final Scheduled Termination Date, (2) on the Early Termination Date, and (3) in the case of a Redemption Date, on the related Redemption Order Date. Underlying value will be calculated for each business day at the beginning of that business day and will be based upon the Applicable Reference Value of Medical Inflation as of the preceding day, regardless of whether that preceding day is a business day or a non-business day. For example, each Monday's underlying value will based upon the Applicable Reference Value of Medical Inflation for Sunday. The Underlying Value of the Up Trust on any day represents the aggregate amount of the assets in the Paired trusts to which the Up Trust would be entitled if the settlement contracts were settled on that day. The Underlying Value of the Up Trust on each day also represents the aggregate Final Distribution to which holders of the Up MacroShares would be entitled if those shares were redeemed on that day.

Underlying Value for each business day is equal to:

· the sum of the Up Earned Income Accruals for each day that has elapsed during the current calculation period, up to and including the current business day

plus

· the Up Investment Amount on that date multiplied by the Leveraged Settlement Factor, calculated as of the day preceding the current business day.

After the Closing Date, the Medical Inflation Ratio may fluctuate above or below the Compounded Hurdle Rate. If the Medical Inflation Ratio divided by the Compounded Hurdle Rate is equal to a Leveraged Settlement Factor that is greater than one, the Underlying Value of the Up Trust will be equal to all of its treasuries and cash and a portion of the Down Trust's treasuries and cash. If the Medical Inflation Ratio divided by the Compounded Hurdle Rate is equal to a Leveraged Settlement Factor that is less than one, the Underlying Value of the Up Trust will be equal to only that portion of its treasuries and cash which it is not required to deliver to the Down Trust under the settlement contracts.

Hypothetical calculations of underlying value are included for illustrative purposes in Appendix C to this prospectus.

Quarterly Distributions

On each Distribution Date, the Up Trust will declare a Quarterly Distribution on the Up MacroShares. This Quarterly Distribution will be made out of the income that the Up Trust holds on deposit after it has:

· deposited the Fee Deduction Amount and any Additional Deduction Amount into the fee payment account;

· either made or received a payment under the income distribution agreement on that Distribution Date; and

· acquired treasuries with an aggregate purchase price equal to the Up Aggregate Par Amount.

Each shareholder who is a registered holder of Up MacroShares on the Record Date will be entitled to receive the Quarterly Distribution, as calculated below. The Quarterly Distribution will be paid out to shareholders on the Distribution Payment Date that follows each Distribution Date.

On each Distribution Date, the Up Trust's entitlement under the income distribution agreement to its Available Income and the Available Income in the Down Trust will be based on the Applicable Reference Value of Medical Inflation on each day during the preceding Calculation Period. On each day during the Calculation Period that precedes each Distribution Date, the entitlement of the Up Trust under the income distribution agreement, which we refer to as its "Up Earned Income Accrual," for that day is determined as follows:

· If the Medical Inflation Ratio is greater than the Compounded Hurdle Rate on the day preceding the day of measurement, the Up Trust will become entitled to retain all of its Available Income accrual for that day and to receive all or a portion of the Down Trust's Available Income accrual for that day.

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· If the Medical Inflation Ratio is less than the Compounded Hurdle Rate on the day preceding the day of measurement, the Up Trust will become obligated to pay all or a portion of its Available Income accrual for that day to the Down Trust.

If the actual fees and expenses of the Up Trust on any Distribution Date exceed the Up Fee Deduction Amount for the preceding Calculation Period, an Additional Deduction Amount will be deposited into the fee deduction account on that Distribution Date. Any Additional Deduction Amount will reduce the amount of Available Income of the Up Trust and the amount of its Quarterly Distribution on that Distribution Date will be reduced accordingly, even though the earned income components of Underlying Value throughout the preceding Calculation Period indicated that a higher Quarterly Distribution would be made on that Distribution Date. If amounts are due to the Up Trust from the Down Trust under the income distribution agreement on any Distribution Date, but the actual fees and expenses of the Down Trust exceeded its Fee Deduction Amount, then an Additional Deduction Amount will be required to be deducted from the Down Trust's available income and the amount payable by the Down Trust to the Up Trust under the income distribution agreement and the Quarterly Distribution made by the Up Trust will be reduced accordingly. The quarterly fees and expenses of the Up Trust, will consist of (1) the variable fees specified in the section entitled “DESCRIPTION OF THE TRUST AGREEMENTS — Fees and expenses of the Paired Trusts,” plus fixed fees and expensese which are expected to equal approximately $760,000 per year. The same variable and fixed fees and expenses are expected to be incurred by the Down Trust.

The Underlying Value of the Up Trust on each Distribution Date will be calculated before Available Income, if any, is deducted from that Underlying Value and set aside for payment as a Quarterly Distribution on the related Distribution Payment Date. As a result, the Underlying Value of the Up Trust on the day following each Distribution Date will reflect a relative decrease from the Underlying Value on that Distribution Date which will be unrelated to any movement in the level of the Applicable Reference Value of Medical Inflation.

On each Distribution Date, other than on the Final Scheduled Termination Date or an Early Termination Date and other than with respect to any shares for which a redemption order was placed on that Distribution Date, the Up Trust will declare a "Quarterly Distribution" on each outstanding Up MacroShare equal to:

· the sum of Up Earned Income Accruals for each day of the preceding Calculation Period

multiplied by

· a fraction the numerator of which is one Up MacroShare and the denominator of which is the aggregate number of outstanding Up MacroShares on that Distribution Date.

On the Distribution Payment Date that follows each Distribution Date, the Up Trust will distribute such amount to each outstanding Up MacroShare.

For a more detailed description of how payments under the income distribution agreement are calculated, see "DESCRIPTION OF THE UP TRUST ASSETS — The Income Distribution Agreement."

Distributions of the Up Earned Income Accruals on the Final Scheduled Termination Date, an Early Termination Date or any Redemption Date will be made as part of the Final Distribution that is made on those dates, as described below under "— Final Distribution."

If available, an amount equal to the Up Aggregate Par Amount will always be reinvested by the trustee, at the direction of the administrative agent, in new treasuries on each Distribution Date unless that Distribution Date is the Final Scheduled Termination Date or an Early Termination Date. If a redemption order is delivered on a Distribution Date, the Up Aggregate Par Amount will first be reduced by the aggregate par amount of any Up MacroShares being redeemed on that date. If, after depositing the Fee Deduction Amount into the fee payment account, the funds remaining on deposit in the Up Trust on any Distribution Date are equal to or less than the Up Aggregate Par Amount, then all of these remaining funds must be reinvested in treasuries and the trust will have no Available Income on that date. If less than the Up Aggregate Par Amount is invested in treasuries on any Distribution Date because the Fee Deduction Amount exceeded the income on the Up Trust's treasuries, the deficiency in the amount that is invested must be made up out of income received on subsequent Distribution Dates until the amount invested does equal the Up Aggregate Par Amount.

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The Up Trust may make minimal or no quarterly distributions to its shareholders on one or more Distribution Dates, if treasury yield rates drop to and remain below the fee accrual rate of 1.00%. Assuming there are no deficiencies in the amount that was invested on behalf of each of the Paired trusts during previous Calculation Periods, any daily yield on the treasuries during any Calculation Period that is in excess of the Daily Fee Accrual Rate for that Calculation Period will be distributed to the holders of the Paired Shares as a Quarterly Distribution. The allocation of this yield as between the Up and the Down MacroShares will be determined under the income distribution agreement based on the respective Underlying Values of each of the Paired trusts on each day of the preceding Calculation Period. See "RISK FACTORS — Income on the treasuries may be insufficient to make quarterly distributions."

If available, an amount equal to the Down Aggregate Par Amount on each Distribution Date (after taking into account any redemptions directed on that date) will always be reinvested by the trustee in new treasuries (unless such Distribution Date is the Final Scheduled Termination Date or an Early Termination Date), but the amount actually invested may be less on one or more Distribution Dates if the Fee Deduction Amount of the Down Trust exceeded the Down Trust's income on those Distribution Dates.

If the aggregate purchase price of the treasuries on deposit in the Up Trust or the Down Trust is less than the Up Aggregate Par Amount or the Down Aggregate Par Amount, as applicable, because the Fee Deduction Amount exceeded the income on its treasuries on one or more previous Distribution Dates, income on the current Distribution Date will first be used to make up this shortfall before any payments under the income distribution agreement or any Quarterly Distributions are made. The Up Trust may make minimal or no Quarterly Distributions to its shareholders on one or more Distribution Dates if treasury yield rates drop to and remain below the aggregate Daily Fee Accrual Rate. See "RISK FACTORS — Income on the treasuries may be insufficient to make quarterly distributions."

On each Distribution Date and each Issuance Order Date, the administrative agent will use commercially reasonable efforts to identify and direct the trustee to purchase, on behalf of each of the Paired trusts, treasuries with the same maturities or terms, stated or implied interest rates, if any, and applicable discount rates in order for each trust to be able to realize comparable amounts of income during each quarter. The administrative agent will select treasuries for acquisition by the trustee in accordance with the acquisition guidelines specified in each of the Up and Down Trust Agreements. Treasuries will be acquired and held in the minimum permissible denominations in order to facilitate the maintenance of parity in the assets held by each of the Paired trusts. Although the administrative agent will use commercially reasonable efforts to direct the trustee to keep all funds on deposit in each Paired trust invested in treasuries, a portion of the assets of a Paired trust may from time to time be held in the form of cash, due to mismatches between the month profiles of treasuries available for purchase and the length of time between Distribution Dates.

If on any Distribution Date the proceeds of the treasuries in the Up Trust minus its Fee Deduction Amount are equal to or less than the Up Aggregate Par Amount, then the Up Trust will not make any payment under the income distribution agreement that it may otherwise have been required to make to the Down Trust. Similarly, if on any Distribution Date the proceeds of the treasuries in the Down Trust minus its Fee Deduction Amount are equal to or less than the Down Aggregate Par Amount, then the Down Trust will not have any Available Income and it will not make any payment under the income distribution agreement that it may otherwise have been required to make to the Up Trust on that Distribution Date. If either of the Paired trusts fails to make a payment under the income distribution agreement on any Distribution Date because it does not have any Available Income, that trust will not be required to make up that payment on any subsequent Distribution Date, even if it has funds available to do so.

Furthermore, if on any Distribution Date the Up Trust does not have any Available Income and does not receive any Available Income from the Down Trust, it will not make any Quarterly Distribution to its shareholders on that Distribution Date. The Up Trust is not required to make Quarterly Distributions in any stated amount and if no funds are available to make a Quarterly Distribution on any Distribution Date, no amounts will be payable with respect to that Distribution Date on any subsequent date. See"RISK FACTORS — You may lose your entire investment in the Up MacroShares which you hold; there is no guarantee as to the amount of any quarterly distribution or the amount of the final distribution."

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Final Distribution

General

The Up Trust will declare a Final Distribution on all or a portion of the Up MacroShares on the earliest to occur of:

· the Final Scheduled Termination Date;

· an Early Termination Date; and

· a Redemption Order Date.

The Final Distribution declared by the Up Trust on the Final Scheduled Termination Date, an Early Termination Date or any Redemption Order Date will depend upon the payments that it is required to make to, or that it is entitled to receive from, the Down Trust under the settlement contracts that are settled in connection with the redemption of shares. The final payment under the settlement contracts will, in turn, be based on the Underlying Value of the Up Trust on:

· the Final Scheduled Termination Date;

· the Early Termination Date; and

· in the case of a Paired Optional Redemption, the relevant Redemption Order Date.

This Underlying Value will be based on the Applicable Reference Value of Medical Inflation on the day preceding the Business Day on which the Underlying Value is calculated. If the Medical Inflation Ratio is greater than the Compounded Hurdle Rate on the relevant day, the Up Trust will be entitled to receive a final payment from the Down Trust under the settlement contracts in an amount equal to the Leveraged Settlement Factor minus one. If the Medical Inflation Ratio is below the Compounded Hurdle Rate on the relevant day, the Up Trust will be required to make a final payment to the Down Trust under the settlement contracts in an amount equal to the absolute value of the Leveraged Settlement Factor minus one.

The purpose of the final payment under the settlement contracts is to transfer assets between the Paired trusts such that each trust has cash and treasuries in an amount equal to its Underlying Value at the time of settlement. For a more detailed description of how the Underlying Value of the Up Trust and payments under the settlement contracts are calculated, see "— Calculation of Underlying Value" and "DESCRIPTION OF THE UP TRUST ASSETS — The Settlement Contracts."

On the Final Scheduled Termination Date or an Early Termination Date, the Up Trust will declare a Final Distribution in redemption of its Up MacroShares in an amount equal to the Underlying Value of the Up Trust on the Final Scheduled Termination Date or the Early Termination Date. On the Distribution Payment Date that follows the Final Scheduled Termination Date or Early Termination Date, the trustee will pay the Final Distribution to each holder of the outstanding Up MacroShares in redemption of those shares.

The redemption of all or only a portion of the Paired Shares in a Paired Optional Redemption may be directed by one or more Authorized Participants who are beneficial holders of those shares on any Business Day. As discussed in greater detail later in this section, unless you are an Authorized Participant, you will not have a right to direct a redemption of your Up MacroShares. Consequently, you will only be able to liquidate your investment in the Up MacroShares prior to the Final Scheduled Termination Date or an Early Termination Date by selling them to an investor who is willing to purchase them from you, including any Authorized Participant who may wish to acquire those shares in order to direct a Paired Optional Redemption. The market price that you are able to obtain for your Up MacroShares may be less than the price you paid for those shares and less than the Per Share Underlying Value that is represented by those shares for the reasons discussed in "RISK FACTORS — Fluctuations in the underlying value of the Up Trust and other factors may affect the market price of your Up MacroShares."

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If the Fee Deduction Amount and any Additional Deduction Amount that is required to be deposited into the fee payment account and made available for the payment of the fees and expenses of the Up Trust exceed the income of the Up Trust on the current Distribution Date or on one or more preceding Distribution Dates and the resulting deficiency in the Up Investment Amount was not made up on subsequent Distribution Dates, the Underlying Value of the Up Trust and, consequently, the Final Distribution declared by the Up Trust on the Final Scheduled Termination Date, an Early Termination Date or any Redemption Order Date will reflect that resulting deficiency.

Final Distributions on the Final Scheduled Termination Date or an Early Termination Date

On the Final Scheduled Termination Date or an Early Termination Date, the trustee will cause the Paired trusts to settle all of the settlement contracts using the funds they hold on deposit on those dates, which will consist of all interest, discount, principal and any other amounts received by each trust upon the maturity of its treasuries on or after those dates. After the settlement contracts have been settled, the Up Trust will declare a Final Distribution in redemption of its outstanding shares using all of the funds it then holds on deposit. On the Distribution Payment Date that follows the Final Scheduled Termination Date or Early Termination Date, the Up Trust will distribute on each outstanding Up MacroShare, a "Final Distribution" in cash equal to:

· the Underlying Value of the Up Trust on that Final Scheduled Termination Date or that Early Termination Date

divided by

· the aggregate number of Up MacroShares that have been issued but not yet redeemed as of that date.

A Final Distribution will be distributed by the Trustee, on each outstanding Up MacroShare, on the Distribution Payment date that follows the Final Scheduled Termination date or Early Termination Date.

For purposes of settling the settlement contracts and making a Final Distribution on the Final Scheduled Termination Date or an Early Termination Date, Underlying Value will include the Up Earned Income Accrual for the Final Scheduled Termination Date or Early Termination Date. The Final Distribution will include the cumulative Up Earned Income Accruals that would have been distributed as a Quarterly Distribution if the Final Scheduled Termination Date or Early Termination Date had been an ordinary Distribution Date.

Upon receipt of a Final Distribution on the Final Scheduled Termination Date or an Early Termination Date, your Up MacroShares will be considered to be redeemed in full and the Up Trust will have no further obligations with respect to those shares even if the amount of the Final Distribution is less than the aggregate par amount of your Up MacroShares or less than the purchase price you paid for those shares. See "RISK FACTORS — You may lose your entire investment in the Up MacroShares which you hold; there is no guarantee as to the amount of any quarterly distribution or the amount of the final distribution."

Authorized Participants may continue to direct Paired Optional Redemptions at the Per Share Underlying Value of the shares being redeemed after the occurrence of a Termination Trigger related to a decrease in the Underlying Value of the Up Trust to 15% or less of the assets which that trust holds on deposit or an increase in that Underlying Value to 185% or more of the assets which that trust holds on deposit. The last redemption order may be placed on the last Business Day prior to the Early Termination Date that will follow the Termination Trigger.

Final Distributions in Paired Optional Redemptions

At any time after July 1, 2008 but prior to the Final Scheduled Termination Date or an Early Termination Date, the Paired Shares may be redeemed on any Business Day in what we refer to as a "Paired Optional Redemption." The Paired Shares may only be redeemed by Authorized Participants. However, the discussion which follows describing Paired Optional Redemptions and the Final Distribution that will be declared on the related Redemption Order Date is relevant to you as a holder of Up MacroShares even if you are not an Authorized Participant, because it explains the rules that Authorized Participants must follow in order to effect Paired Optional Redemptions and the ability to effect these redemptions may affect the demand for your Up MacroShares. See"RISK FACTORS — The return on your shares is uncertain — The right to redeem the Up MacroShares is limited."

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On any Business Day after July 1, 2008, any Authorized Participant may direct a Paired Optional Redemption in which the Up MacroShares and Down MacroShares will be redeemed concurrently and proportionately in MacroShares Units. Only Authorized Participants may direct the redemption of Paired Shares.

In order to effect a Paired Optional Redemption, an Authorized Participant must present to the trustee Paired Shares in the minimum aggregate number that constitutes a MacroShares Unit. Authorized Participants may acquire one or more MacroShares Units by purchasing a sufficient number of shares. A tender of Paired Shares for redemption will be irrevocable.

Authorized Participants must place redemption orders with the administrative agent at 4:00 P.M. and prior to the end of trading on the New York Stock Exchange. Any redemption order that is not placed within the specified time prior to the close of trading on the New York Stock Exchange will be automatically cancelled and may be resubmitted by the applicable Authorized Participant, if it so desires, on the next Business Day at that day's Per Share Underlying Value. The Authorized Participant will place its redemption order on the Redemption Order Date and the Paired Optional Redemption will be effected on the related Redemption Date. Each redeeming Authorized Participant must deliver to the administrative agent a redemption order with the following information:

· the Authorized Participant's name and personal identification number, and the personal identification number of the person who is submitting the creation order on behalf of the Authorized Participant;

· the number of MacroShares Units being redeemed.

Not later than 10:00 a.m. New York time on the Redemption Date, the Authorized Participant who placed the redemption order must deliver to the trustee:

· Up MacroShares and Down MacroShares that in the aggregate constitute the requisite number of MacroShares Units being redeemed by such Authorized Participant;

· the applicable Redemption Cash Component, if applicable; and

· a transaction fee of $2,000, payable directly to the trustee by the Authorized Participant to compensate the trustee for administrative costs related to effecting the Paired Optional Redemption.

If all conditions to effecting a Paired Optional Redemption are satisfied, the trustee will effect the redemption by delivering cash and/or treasuries in accordance with the instructions of the administrative agent to the redeeming Authorized Participant by 3:00 p.m. New York City time on the Redemption Date. If the redemption order was placed on a Distribution Date, the redeeming Authorized Participant will receive cash. If there was a net increase in the aggregate par amount of the Paired trusts on any Redemption Date that was also an Issuance Date, because more MacroShares Units were created than redeemed, redeeming Authorized Participants will also receive their Final Distribution from the Paired trusts in cash out of the funds delivered to the trusts by the Authorized Participants who created shares on the same date. If any Paired Issuances were effected on the Redemption Date, even if there was a net decrease in the aggregate par amount of the Paired trusts, redeeming Authorized Participants will receive a portion of their Final Distribution in cash out of the funds delivered to the trusts by the creating Authorized Participants and also out of the cash proceeds of any treasury repurchase agreements that are on deposit in the distribution account of each trust. Any remaining portion of the Final Distribution will be delivered in treasuries.

The amount of cash and/or treasuries that will be delivered on the Redemption Date in a Paired Optional Redemption will always be equal to the aggregate Per Share Underlying Values of the Paired Shares being redeemed, calculated as of the Redemption Order Date. In the case of a Paired Optional Redemption that is ordered on a Distribution Date or on the Business Day following a Distribution Date, the amount delivered on the related Redemption Date will consist of the aggregate Per Share Underlying Value of the shares being redeemed plus the Up and Down Earned Income Accruals for all intervening days between the Redemption Order Date and the Redemption Date, calculated on the basis of the Applicable Reference Value of Medical Inflation as of the day preceding the Redemption Order Date.

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Upon receipt of the Final Distribution in a Paired Optional Redemption, the Up MacroShares presented for redemption will be considered to be redeemed in full and the Up Trust will have no further obligations with respect to those shares, even if the amount of the Final Distribution was less than the aggregate par amount of those shares or less than the purchase price at which those shares were acquired by the Authorized Participant. See "RISK FACTORS — The return on your shares is uncertain — The paired trusts may deliver treasuries instead of cash in a paired optional redemption."

In order to satisfy the requirement that one settlement contract must always be outstanding for each outstanding MacroShares Unit, new settlement contracts will be entered into if there is a net increase in the Up and Down Aggregate Par Amounts and existing settlement contracts will be settled if there is a net decrease in these aggregate par amounts on any day that is both a Redemption Date and an issuance date. On any day on which shares are being redeemed, but no new shares are being issued, the number of settlement contracts that will be settled will be equal to the number of MacroShares Units that are being redeemed.

In connection with the settlement of the settlement contracts and payment of a Final Distribution in the case of redemption in which treasuries must be delivered, the administrative agent will direct the trustee to select and segregate treasuries on a "last in, first out" basis such that the value of the segregated treasuries is equal to theproductof the applicable Redemption Percentage and the aggregate Value of all the treasuries held by each trust. The selection and delivery of treasuries as a Final Distribution must comply with all of the conditions specified in Appendix D to this prospectus. For a discussion of the potential risks associated with the delivery of treasuries instead of cash as a Final Distribution, see "RISK FACTORS — The return on your shares is uncertain — The paired trusts may deliver treasuries instead of cash in a paired optional redemption."

After the settlement contracts have been settled, the Paired Trust that made a payment under the settlement contracts will deliver all of its remaining segregated treasuries to the redeeming Authorized Participant as the Final Distribution on the shares being redeemed. The Paired Trust that received a payment under the settlement contracts will deliver all of its own segregated treasuries and all of the treasuries that it received from the other trust to the redeeming Authorized Participant as the Final Distribution on the shares being redeemed. The treasuries selected by the administrative agent to be delivered as the Final Distribution will be distributed ratably, by type, to each redeeming Authorized Participant.

Following a Paired Optional Redemption, the trustee will record a reduction in the aggregate number of Up MacroShares and Down MacroShares that are outstanding. If MacroShares Units are being both redeemed and issued on the same day at the direction of several Authorized Participants, the trustee will record such reduction only if a net decrease in the aggregate par amount has occurred.

Paired Issuances

Any time prior to the Final Scheduled Termination Date or an Early Termination Date, on any Business Day, an Authorized Participant may effect a "Paired Issuance" by directing the Paired Trusts to issue additional shares in a minimum number of Up and Down MacroShares constituting at least one MacroShares Unit. If so directed by the Authorized Participant, the Up Trust and the Down Trust will issue additional Paired Shares to the Authorized Participant to satisfy its creation order. Paired Shares will always be issued by the relevant trust at the Per Share Underlying Value of these shares on the date on which a creation order is delivered by an Authorized Participant. Authorized participants will be required to pay a fee to the Paired Trusts in connection with any Paired Issuance that is directed prior to July 1, 2008, in an amount equal to [3.00]% of the aggregate par amount of Paired Shares being created. This fee is the equivalent of the underwriting fee that is payable by investors who create Paired Shares on the closing date.

Although the number of Up MacroShares will increase with each issuance and decrease with each redemption by an Authorized Participant, the Up MacroShares you hold will always represent the same entitlement to the distributions made by the Up Trust, even though your proportionate share of the assets of the trust, expressed as a percentage, may increase or decrease based on the aggregate par amount of the Up MacroShares that are outstanding on any specified date.

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To create a new MacroShares Unit, an Authorized Participant must place a creation order with the administrative agent at 4:00 p.m. or prior to the end of trading on the listing exchange. Any creation order that is not placed within the specified time prior to the close of trading will be automatically cancelled and may be resubmitted by the applicable Authorized Participant, if it so desires, on the next Business Day at that day's Per Share Underlying Value. An Authorized Participant who wishes to effect a Paired Issuance will deliver a creation order on the Issuance Order Date. The Issuance Date, which is the day on which the Paired Issuance is effected, will be the Business Day following the Issuance Order Date, except that, in the case of any creation order that is delivered on a Distribution Date or on the Business Day following a Distribution Date, the Issuance Date will be the third Business Day following the Issuance Order Date to ensure that any Authorized Participant who places a creation order on these two days, after Underlying Value no longer reflects Earned Income Accruals for the preceding Calculation Period, will not be eligible to receive a Quarterly Distribution on the Distribution Payment Date that follows that Distribution Date. Each creating Authorized Participant must deliver to the administrative agent a creation order including the following information:

· the Authorized Participant's e-mail and personal identification number and the personal identification number of the person who is submitting the creation order on behalf of the Authorized Participant; and

· the number of MacroShares Units being created.

By 10:00 a.m. New York time on the Issuance Date, the Authorized Participant must deposit:

· immediately available funds in an amount equal to the Per Share Underlying Value of the Up MacroShares being created, as measured on the Issuance Order Date;

· immediately available funds in an amount equal to the Per Share Underlying Value of the Down MacroShares being created, as measured on the Issuance Order Date;

· a transaction fee of $2,000, payable directly to the trustee by the Authorized Participant to compensate the trustee for administrative costs related to effecting the Paired Issuance; and

· for any Paired Issuance directed prior to July 1, 2008, a fee equal to [3.00]% of the aggregate par amount of Paired Shares being created.

In the case of any Paired Issuance ordered on a Distribution Date or on the Business Day following a Distribution Date, the amount that must be delivered by the Authorized Participant must also include the Up and Down Earned Income Accruals for each intervening day between the Issuance Order Date up to but not including the Issuance Date, as calculated on the basis of the Applicable Reference Value of Medical Inflation on the day preceding the Issuance Order Date.

The fee charged for Paired Issuances directed prior to July 1, 2008 will be divided evenly between the Paired Trusts and will be deposited into each trust's distribution account. It will be held in the distribution account as part of each trust's available income and will be distributed to each trust's shareholders as part of the Quarterly Distribution on the next scheduled distribution date.

Creation orders for new MacroShares Units will be processed through a manual clearing process operated by DTC. By 3:00 p.m. New York City time on the Issuance Date, the administrative agent will instruct the trustee to deliver to the Authorized Participant's account at DTC Up and Down MacroShares equal to the number of shares that were created in the Paired Issuance.

In order to satisfy the requirement that one settlement contract must always be outstanding for each outstanding MacroShares Unit, new settlement contracts will be entered into if there is a net increase in the Up and Down Aggregate Par Amount and settlement contracts will be settled if there is a net decrease in these Aggregate Par Amounts on any day that is both an Issuance Date and a Redemption Date. The trustee will cause the Paired trusts to enter into one new settlement contract for each new MacroShares Unit that is created in a Paired Issuance on any Issuance Date that is not also a Redemption Date.

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The trustee will deposit one-half of the aggregate funds received by it in connection with an issuance of Paired Shares into the Up Trust and the other half into the Down Trust, without regard to the Per Share Underlying Values at which the Up and Down MacroShares were issued, in order to preserve the one-to-one ratio of assets on deposit in the Paired Trusts.

Following a Paired Issuance, the trustee will record an increase in the aggregate number of Up MacroShares and Down MacroShares that are outstanding. If MacroShares Units are being both issued and redeemed on the same day, at the direction of several Authorized Participants, the trustee will record an increase only if a net increase in the Aggregate Par Amount has occurred.

Authorized Participants may continue to direct Paired Issuances at the Per Share Underlying Value of the shares being created after the occurrence of a Termination Trigger related to a decrease in the Underlying Value of one of the Paired trusts to 15% or less of the assets that trust holds on deposit. The last creation order may be placed on the last Business Day prior to the Early Termination Date that will follow the Termination Trigger.

In connection with any Paired Issuance, any Authorized Participant that creates a MacroShares Unit will be deemed to be an underwriter of the Paired Shares and will be subject to the prospectus delivery requirements and liability provisions of the Securities Act. See "PLAN OF DISTRIBUTION."

Book-Entry Registration

The Up MacroShares will be evidenced by one or more global certificates. We will deposit each global certificate representing the Up MacroShares with The Depository Trust Company in the United States or with Clearstream Banking, société anonyme or Euroclear Bank S.A./NV in Europe. We refer to The Depository Trust Company as "DTC," Clearstream Banking, société anonyme as "Clearstream" and the Euroclear system operated by Euroclear Bank S.A./NV as "Euroclear." Each global certificate will be registered in the name of Cede & Co. as DTC's nominee. Except as set forth below, a global certificate may be transferred, in whole or in part, only to another nominee of DTC or to a successor of DTC or its nominee.

Beneficial interests in a global certificate may be held directly or indirectly through DTC, Clearstream or Euroclear. Clearstream and Euroclear will hold omnibus positions on behalf of their participants through customers' securities accounts in Clearstream's and Euroclear's names on the books of their respective depositaries that in turn will hold such positions in customers' securities accounts in the depositaries' names on the books of DTC. Citibank N.A. will act as the relevant depositary for Clearstream, and JPMorgan Chase Bank, N.A. (formerly known as JPMorgan Bank) will act as the relevant depositary for Euroclear. Transfers between participants will be effected in the ordinary way in accordance with DTC rules and will be settled in clearinghouse funds. The laws of some states require that certain persons take physical delivery of securities in definitive form. As a result, the ability to transfer beneficial interests in the global certificate to those persons may be limited.

Shareholders who are not participants may beneficially own interests in a global certificate held by DTC only through participants, or certain banks, brokers, dealers, trust companies and other parties that clear through or maintain a custodial relationship with a participant, either directly or indirectly, which we refer to as "indirect participants." So long as Cede & Co., as the nominee of DTC, is the registered owner of a global certificate, Cede & Co. for all purposes will be considered the sole holder of the global certificates. Except as provided below, owners of beneficial interests in a global certificate will:

· not receive physical delivery of certificates in definitive registered form; and

· not be considered holders of the global certificate.

The trustee will make distributions on the shares to Cede & Co., as the registered owner of the global certificate, by wire transfer of immediately available funds on each Distribution Payment Date and on each settlement date for Paired Optional Redemptions. We and the trustee will not be liable for the accuracy of, and are not responsible for maintaining, supervising or reviewing DTC's records or any participant's records relating to the book-entry certificates. We and the trustee will not be responsible or liable for errors in payments made on account of the book-entry certificates, unless such error in payment was caused by an instruction error originating from us or the trustee.

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Transfers between participants in DTC will be effected in accordance with DTC's procedures and will be settled in same-day funds, and transfers between participants in Euroclear and Clearstream will be effected in accordance with their respective rules and operating procedures.

Cross-market transfers between the participants in DTC, on the one hand, and Euroclear or Clearstream, on the other hand, will be effected through DTC in accordance with DTC's rules on behalf of Euroclear or Clearstream, as the case may be, by its respective depositary. These cross-market transactions, however, will require delivery of instructions to Euroclear or Clearstream, as the case may be, by the counterparty in that system in accordance with the rules and procedures and within the established deadlines (Brussels time) of that system. Euroclear or Clearstream will, if the transaction meets its settlement requirements, deliver instructions to its respective depositary to take action to effect final settlement on its behalf by delivering or receiving interest in the relevant global certificate in DTC, and making or receiving distributions in accordance with normal procedures for same-day funds settlement applicable to DTC. Euroclear or Clearstream participants may not deliver instructions directly to depositaries for Euroclear or Clearstream.

Although DTC has agreed to the foregoing procedures to facilitate transfers of interest in the global certificates among participants in DTC, it is under no obligation to perform or to continue to perform those procedures, and those procedures may be discontinued at any time. DTC has advised us that it will take any action permitted to be taken by a holder of shares, including the presentation of shares for redemption or exchange, only at the direction of one or more participants to whose account with DTC interests in the global certificate are credited, and only in respect of those shares represented by the global certificates as to which the participant or participants has or have given such direction.

DTC has advised us that it is:

· a limited purpose trust company organized under the laws of the State of New York and a member of the Federal Reserve System;

· a "clearing corporation" within the meaning of the Uniform Commercial Code; and

· a "clearing agency" registered pursuant to the provisions of Section 17A of the Exchange Act.

DTC was created to hold securities for its participants and to facilitate the clearance and settlement of securities transactions between participants through electronic book-entry changes to the accounts of its participants. Participants include securities brokers, dealers, banks, trust companies, clearing corporations and other organizations. Some of the participants or their representatives, together with other entities, own DTC. Indirect access to the DTC system is available to others such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a participant, either directly or indirectly.

Clearstream Banking, société anonyme, Luxembourg, has advised us that it is:

· incorporated under the laws of the Grand Duchy of Luxembourg as a professional depository; and

· subject to regulation by the Commission de Surveillance du Secteur Financier in Luxembourg.

Clearstream holds certificates for its participants. Clearstream facilitates the clearance and settlement of securities transactions between Clearstream participants through electronic book-entry changes in the accounts of Clearstream participants, eliminating the need for physical movement of securities. Clearstream provides to Clearstream participants, among other things, services for safekeeping, administration, clearance and settlement of internationally traded securities and securities lending and borrowing. Clearstream interfaces with domestic markets in several countries. Clearstream participants are recognized financial institutions around the world, including underwriters, securities brokers and dealers, banks, trust companies, clearing corporations and certain other organizations. Indirect access to Clearstream is also available to others, such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a Clearstream participant, either directly or indirectly.

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Distributions, to the extent received by the relevant depositary for Clearstream, with respect to the securities held beneficially through Clearstream, will be credited to cash accounts of Clearstream participants in accordance with its rules and procedures.

Euroclear Bank S.A./NV has advised us that it is:

· licensed by the Belgian Banking and Finance Commission to carry out banking activities on a global basis; and

· regulated and examined by the Belgian Banking and Finance Commission.

Euroclear was created in 1968 to hold securities for its participants and to clear and settle transactions between Euroclear participants through simultaneous electronic book-entry delivery and payment. Transactions may be settled in any of 32 currencies, including United States dollars. Euroclear is operated by Euroclear Bank S.A./NV under contract with Euroclear Clearance Systems S.C., a Belgian cooperative corporation. Euroclear Bank S.A./NV conducts all operations. All Euroclear securities clearance accounts and Euroclear cash accounts are accounts with Euroclear Bank S.A./NV, not Euroclear Clearance Systems S.C. Euroclear Clearance Systems S.C. establishes policy for Euroclear on behalf of Euroclear participants. Euroclear participants include banks (including central banks), securities brokers and dealers and other professional financial intermediaries. Indirect access to Euroclear is also available to other firms that clear through or maintain a custodial relationship with a Euroclear participant, either directly or indirectly.

Securities clearance accounts and cash accounts with Euroclear Bank S.A./NV are governed by the terms and conditions governing use of Euroclear and the related operating procedures of the Euroclear system and applicable Belgian law. These terms and conditions, operating procedures and laws govern transfers of securities and cash within Euroclear, withdrawals of securities and cash from Euroclear, and receipts of distributions with respect to securities in Euroclear. All securities in Euroclear are held on a fungible basis without attribution of specific certificates to specific securities clearance accounts. Euroclear Bank S.A./NV acts under the terms and conditions only on behalf of Euroclear participants and has no record of or relationship with persons holding through Euroclear participants.

DTC, Clearstream and Euroclear have agreed to the foregoing procedures to facilitate transfers of interests in a global certificate among participants. However, DTC, Clearstream and Euroclear are under no obligation to perform or continue to perform these procedures and may discontinue these procedures at any time.

We will issue the shares in definitive certificated form, which we refer to as "Definitive Certificates," if DTC notifies us that it is unwilling or unable to continue as depositary or DTC ceases to be a clearing agency registered under the Exchange Act, and a successor depositary is not appointed by us within 90 days. In addition, beneficial interests in a global certificate may be exchanged for Definitive Certificates upon request by or on behalf of DTC in accordance with customary procedures. We may determine at any time and in our sole discretion that shares shall no longer be represented by global certificates, in which case we will issue shares in definitive form in exchange for the global certificates.

Termination Triggers

Following the occurrence of specified events, which we refer to as "Termination Triggers," the income distribution agreement and the settlement contracts will automatically terminate and the trustee will redeem all of the Paired Shares. Upon obtaining knowledge or receiving notice of the occurrence of a Termination Trigger, we will file a Form 8-K disclosing the Termination Trigger pursuant to Regulation FD. The following events will constitute Termination Triggers:

· on any Index Publication Day, an aggregate index designated as the medical care aggregate index ceases to be calculated or published by the BLS or ceases to constitute a component of the CPI-U;

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· on any business day, the Underlying Value of the Up Trust rises to or above 185% of the Up Asset Amount or falls to or below 15% of the Up Asset Amount, and remains at this level for the next two (2) consecutive Index Publication Days;

· either of the Paired trusts becomes required to register as an "investment company" under the Investment Company Act of 1940, as amended;

· either of the Paired trusts becomes a commodities pool that is subject to regulation under the Commodity Exchange Act, as amended;

· DTC becomes unwilling or unable to act as depository and no suitable replacement is willing or able to assume the duties of the depository for the Paired Trusts;

· the administrative agent resigns or is unable to perform its duties under one or all of the Trust Agreements for any of the Paired trusts, or becomes bankrupt or insolvent, and no suitable replacement is willing and able to assume the duties of the administrative agent under the Trust Agreements;

· we elect to terminate the Up Trust and 66 and 2/3% of the holders of the Up Trust and the Down Trust, each voting as a separate class consent to such termination;

· either of the Paired trusts is adjudged to be bankrupt or insolvent or becomes involved in voluntary or involuntary insolvency or similar proceedings that are not dismissed within 90 days;

· we determine in our good faith discretion that there is a material risk that the Up Trust is subject to withholding tax liability, and we elect to terminate the paired trusts;

· the amount of cash and treasuries on deposit in the Up Trust or the Down Trust is reduced to less than ten (10) million dollars; and

· the amount of cash and treasuries on deposit in the Up Trust or the Down Trust is reduced to fifty (50) million dollars or less and we elect, in our discretion, to terminate the Paired Trusts.

On the Early Termination Date, the trustee will cause the Paired Trusts to terminate the income distribution agreement and settle all of the settlement contracts and then declare a final distribution in redemption of all of their outstanding shares, based on the Underlying Value of the Paired Trust on the Early Termination Date. This Underlying Value may be higher or lower than the Underlying Value at the time when the Termination Trigger occurred, as described under "RISK FACTORS — The return on your shares is uncertain — The paired trusts may terminate early." This Final Distribution will be determined as described above under "— Final Distribution." Upon receipt of this Final Distribution, all of the Up and Down MacroShares will be considered to be redeemed. After all funds on deposit in the Paired Trusts have been distributed to the holders of the Paired Shares, the trustee will liquidate the Paired Trusts.

Authorized Participants may continue to direct Paired Optional Redemptions and Paired Issuances at the Per Share Underlying Value of the shares being created after the occurrence of a Termination Trigger related to a decrease in the Underlying Value of one of the Paired Trusts to 15% or less of the assets that trust holds on deposit. The last creation or redemption order may be placed on the last Business Day prior to the Early Termination Date that will follow the Termination Trigger.

Any payments under the income distribution agreement and the settlement contracts and any Quarterly or Final Distribution to be made by either of the Paired Trusts may be subject to delays pending the resolution of bankruptcy proceedings if the relevant Termination Trigger was the voluntary or involuntary bankruptcy of either of the Paired Trusts. Any delay of this type will affect when holders of Up MacroShares receive the Final Distribution on their shares.

The administrative agent will be responsible for notifying us and the trustee of the occurrence of the Termination Triggers that results from a specified increase or decrease in the underlying value of the Up Trust, the cessation of the calculation and publication of the medical care index as a component of the CPI-U, the resignation of the administrative agent or its bankruptcy, and the consent of the Up and Down Trust shareholders to an early termination of the Paired Trusts following our election to effect such termination, and our decision to terminate the trusts if there is a material risk that withholding tax liability may be imposed on the Paired Trusts or if the total assets of each are reduced below $50 million. The trustee, upon obtaining knowledge of the occurrence of any of the other Termination Triggers described above, the trustee will be responsible for notifying us and the administrative agent of such occurrence.

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Listing

On the Closing Date, the Up MacroShares will be listed and eligible for trading on the New York Stock Exchange under the symbol "[  ]." However, there is no assurance that the shares will continue to be eligible for trading on the New York Stock Exchange during the entire time they remain outstanding.

DESCRIPTION OF THE CONSUMER PRICE INDEX

AND THE MEDICAL GOODS AND SERVICES COMPONENT

OF THE CONSUMER PRICE INDEX

Overview of the Consumer Price Index

The consumer price index, or the "CPI," is a measure of the average change over time in the price of various consumer items selected to represent the consumer sector of the U.S. economy. The CPI is published every month by the Bureau of Labor Statistics, or the "BLS," and represents a weighted average of the changes in the prices of items in various categories of consumer goods, such as food, clothing, shelter, and medical services. The CPI is an index which represents the aggregate increase in consumer prices since a base reference period, from which calculation of inflation occurring over shorter periods within that period may be calculated. The Up MacroShares reference only the medical care component of the CPI for All Urban Consumers, but general information about the calculation methodology for, and BLS policies related to, the CPI for All Urban Consumers is relevant to understanding how the medical component is calculated.

The information in this section, as well as general information relating to the consumer price index that is contained in the "RISK FACTORS" section of this prospectus, is primarily derived from information made available by the BLS, which operates under the auspices of the United States Department of Labor. The information in this section about the calculation methodology for the CPI summarizes the methodology that was in place and being used by the BLS as of June 2007. The calculation methodology may change at any time. None of the Depositor, the Trustee, the Administrative Agent nor the Marketing Agents have contractual agreement with or control over the BLS and its decisions regarding the calculation of the CPI or any component of CPI, or any changes made to that methodology.

THE INFORMATION PROVIDED IN THIS SECTION IS SUBJECT, IN ALL RESPECTS, TO THE ACTUAL METHODOLOGY APPLIED BY THE BLS TO DETERMINE THE CPI, WHICH IS SUBJECT TO CHANGE ANY TIME AT THE DISCRETION OF THE BLS. CURRENTLY, THE BLS PUBLISHES A MORE DETAILED SUMMARY OF ITS METHODOLOGY FOR CALCULATING THE CPI AT www.bls.gov/cpi/. IN ADDITION, A MANUAL ENTITLED "BLS Handbook of Methods," IN WHICH A CHAPTER IS DEDICATED TO CALCULATION METHODOLOGY FOR THE CPI, MAY BE ACCESSED ON THE BLS WEBSITE AT www.bls.gov/opub/hom/pdf/homch17.pdf OR A PRINTED COPY MAY BE OBTAINED FROM THE U.S. GOVERNMENT PRINTING OFFICE BY CONTACTING US AT (888) MACROS1. INVESTORS SHOULD REFER TO THE BLS WEBSITE AND THIS MANUAL FOR A DETAILED DESCRIPTION OF THE ACTUAL METHODOLOGY USED BY THE BLS AT ANY PARTICULAR TIME TO CALCULATE THE CPI.

The CPI's measurement objectives and the standards according to which the BLS defines any bias in the CPI are derived from the broader framework of a hypothetical cost-of-living index. The goal of any cost-of-living index is to determine the lowest hypothetical expenditure level necessary at this month’s prices to achieve the same standard of living as that attained during a base reference time period. The ratio of this hypothetical cost during the current period to the actual cost of a base-period consumption basket during the base period constitutes a cost-of-living index. The broadest form of a cost-of-living index, referred to as an unconditional cost-of-living index, would reflect changes in non-price factors such as crime rates, weather conditions and health status. In contrast, the objective of the CPI is to provide an approximation of a conditional cost-of-living index that includes only the prices of market goods and services and government-provided goods for which explicit user charges are assessed. Free goods, characteristics of the environment (such as air and water quality), the value of leisure time and goods and services that governments provide at no cost are not within the scope of the CPI, although these factors may have a major impact on an individual's actual standard of living.

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The concept and measurement goals of a hypothetical broad cost-of-living index framework guide the decisions of the BLS about the ongoing construction and operation of the CPI, which are reflected in the numerous changes that the BLS has made to its calculation methodology over the years, including six comprehensive revisions in how the CPI is calculated that have been implemented since its inception in 1919. The revisions in CPI calculation methodology which have been introduced over the years within the framework of a broad cost-of-living index have reflected not only the BLS's own experience and research, but also the criticism and feedback provided by various sources, such as the Advisory Committee appointed by the American Statistical Association whose recommendations served as the basis for the 1940 comprehensive revision of the CPI, and assessments of the CPI that have been published in professional journals and books. The implementation of each such revision resulted in a movement in the level of the CPI for the ensuing month. Accordingly, changes in the level of the CPI over time have reflected not only price changes but also revisions to CPI calculation methodology.

The CPI is an important macroeconomic measure for the U.S. economy. It is used as an indicator of the impact and effectiveness of fiscal and monetary policies employed by the U.S. federal government. The CPI is also used by both governmental agencies and the private sector to adjust income payments. Social Security benefits, food stamps programs and military and federal civil service pension payments are all indexed to the CPI. In the private sector, many collective bargaining agreements tie automatic wage increases to the CPI and individuals use the index to keep rents, alimony, and child support payments in line with changing prices. The CPI is also used as a means of preventing inflation-induced tax changes, because the federal income tax rules, and those of many States, adjust tax brackets, the standard deduction, and other monetary values in the tax code on the basis of the level of the CPI. Finally, the CPI is also used as a deflator of other economic indicators calculated by the U.S. government. The statistical programs which are used to calculate such economic indicators employ the CPI or its components to adjust for price changes and produce inflation-free versions of such indicators. Examples of CPI-adjusted indicators include components of the U.S. Department of Commerce National Income and Product Accounts (such as Gross Domestic Product and personal consumption expenditures), retail sales measures and the BLS hourly and weekly earnings series.

Scope and Publication

The goal of the CPI is to reflect pricing in the consumption sector of the U.S. economy. As such, the CPI does not cover changes in the prices of investment property such as stocks, bonds, real estate, and business expenses. It also does not cover purchases of real estate, antiques and collectibles, all of which are viewed as investment expenditures. The CPI also does not include the following factors which may affect an individual's income: employer-provided in-kind benefits, cash gifts to individuals or charities and child support and alimony payments. In addition, for practical reasons, the CPI excludes illegal goods and services and the value of home-produced items (other than owners’ equivalent rent). Price changes in goods provided by the government at subsidized prices (for example, public transportation) are included in the CPI, but changes in subsidies to a recipient’s income (for example, food stamps) are excluded. Finally, only sales tax and any other taxes which are part of the final price of consumer products are within the scope of the CPI.

The CPI is published every month. Each month’s index value reflects the average change in the prices of consumer goods and services in comparison to a base period, which is currently the two-year period from 1982-84 for most components of the CPI, including medical inflation. For example, the consumer price index for all urban consumers, or the "CPI-U," for March 2002 was 178.8. This number means that a representative basket of consumer items that cost $100 in 1982-84 would have cost $178.80 in March 2002.

The Structure of the CPI

General Overview

The CPI is a complex mathematical construct that combines economic theory with sampling and other statistical techniques and uses data from various consumer surveys to produce a measure of average price changes for the consumption sector of the American economy. In order to calculate the consumer price index for all urban consumers or CPI-U, the urban areas of the United States are divided into 38 geographic regions called "index areas," and the set of all goods and services purchased by consumers is divided into 211 categories, each of which is called an "item stratum," producing 8,018 (38 multiplied by 211) index area/item stratum combinations. The CPI-U is calculated in two stages. The first stage involves the calculation of "basic indices," which show the average price change of sample items within each of the 8,018 CPI index area/item stratum combinations. For example, the electricity index for the Boston CPI area is a basic index. The weights assigned to a particular item for the first stage come from the sampling frame for the item stratum within the index area. During the second stage, "aggregate indexes" are produced by averaging across subsets of the 8,018 CPI index area/item stratum combinations. For example, the "Boston all-items index" is an average of all 211 basic indices for each item stratum in the Boston index area. Similarly, the aggregate index for electricity is an average of the basic indexes for electricity in each of the 38 index areas. The "U.S.-city average—all-items CPI" is an aggregate index representing the average of all 8,018 basic indexes. The weighing used in the calculation of aggregate indices during the second stage is based on reported expenditures from a consumer expenditure survey. A sample item’s weight in the aggregate indices represents the fraction of the share of total consumer spending that is devoted to that item.

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Data Collection and Basic Indices Calculation

The BLS divides the CPI basket of consumer goods and services into a hierarchy of categories and a number of sub-categories. The first category is the category of the eight "Major Groups," which consist of: (1) "Food and Beverages," (2) "Housing," (3) "Apparel," (4) "Transportation," (5) "Medical Care," (6) "Recreation," (7) "Education and Communication" and (8) a group consisting of "Other Goods and Services." Each of these eight Major Groups are divided into sub-groups. For example, the Major Group of Food and Beverages is divided into sub-groups such as "cereal and bakery products" and "meats, poultry, fish and eggs." These subgroups, in turn, are further subdivided into "Expenditure Classes." For example, the "cereal and bakery products" sub-group is divided into two Expenditure Classes: "cereals and cereal products" and "bakery products." Each Expenditure Class is further divided into various item strata. For example, the "bakery products" Expenditure Class is divided into the following item strata: "bread," "cookies," and "other bakery products." Finally, each item stratum is further subdivided into "entry level items." For example, the "other bakery products items" stratum includes the "cracker and bread and cracker products or sweetrolls," and the "coffee cake & doughnuts (excluding frozen)" entry level items. There are a total of 305 entry level items which are the ultimate sampling units for consumer items selected by the BLS for inclusion in the CPI-U. Each entry level item represents the lowest level of item category definition from which data collectors select actual products for sampling. Products are sampled within each index area in selected retail stores, also referred to as "sampling outlets." To enable the CPI to reflect changes in the marketplace, new sampling items and sampling outlets are selected each year, on a rotating basis, for approximately 25 percent of the item strata in each primary sampling unit, or PSU, the smallest geographic area in which pricing is done for the CPI.

The following chart illustrates the weight assigned to each of the eight Major Groups in the calculation of the CPI (rounded to the nearest whole number) December 2006 (2003-2004 Weights):

Of the 209 commodities and services item strata, 185 are "priced strata," meaning that an established market price may be obtained for products belonging within such strata. Of the 185 priced strata, most are priced by actual sampling by BLS' field representatives and only a few, such as airline fares, intercity train fares, used vehicles and health insurance, use secondary sources of pricing data. The 24 remaining commodities and services item strata, all of which have very small weights within the CPI, are, for a variety of reasons, "unsampled" or "truncated from pricing," meaning that their prices are imputed from the prices of items in related priced strata.

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The CPI for all Urban Consumers

The BLS publishes different consumer price indices which are based on sampling different consumer populations. As provided herein, the CPI that is based on the broadest sampling of the consumer population is the "consumer price index for all urban consumers," or the "CPI-U." The CPI-U, which the BLS first began publishing in January of 1978, represents the buying habits of the residents of urban or metropolitan areas in the Unites States, or the "U-Population." The U-population, which represented about 87 percent of the U.S. population in the 1990 census, covers all households in the United States, other than people living in rural, non-metropolitan areas, in farm households, on military installations, in religious communities, and in institutions such as prisons and mental hospitals.

The CPI-U reflects changes in prices resulting from all causes that recur on a regular yearly basis, including normal seasonal price movements due to, for example, the weather, harvesting seasons, the school year, production cycles, model changeovers, holidays, and seasonal sales. The BLS also publishes a seasonally adjusted CPI-U index that does not take into account these effects; however, because seasonally-adjusted indices are subject to annual revision, they are not usually used as benchmarks for financial products. In contrast to seasonally adjusted indices, the CPI-U is final when issued.

Limitations of the CPI-U

The CPI-U is estimated from a sample of consumer purchases and is not a comprehensive measure of price change. Consequently, the index results may deviate from those that would be obtained if all consumer transactions were covered. This deviation is attributed to sampling error. These types of sampling errors represent the statistical limitations of the CPI-U.

A different kind of error in the CPI-U can occur when, for example, a respondent provides BLS field representatives with inaccurate or incomplete information. This is called non-sampling error. BLS attempts to minimize non-sampling errors by obtaining prices through personal observation whenever possible and by correcting errors immediately upon discovery. The field representatives, technicians, and commodity specialists who collect, process, and analyze the price data are trained to watch for deviations in reported prices that might be due to non-sampling errors.

Finally, the CPI-U cannot be understood to represent the price change experience of any one individual, household, or family. While the CPI-U covers a wide variety of the items that are available for purchase at a particular time to urban consumers as part of their aggregate spending on goods and services, most individuals concentrate their spending on a relatively small fraction of the total number of items available for purchase in the market. Accordingly, the CPI-U represents the inflation experienced by a hypothetical, composite consumer. In addition, the CPI-U may not provide an accurate measure of the price movement experience of specific population groups, such as the elderly or the poor.

Due to the fact that the CPI-U is so widely used as a benchmark by the market, governmental agencies and individuals, revisions could be costly for the users of the index. Accordingly, there is a presumption in BLS policy and practice against revisions to the CPI-U. When a mistake is discovered, BLS staff evaluate the error in the context of BLS guidelines for issuing corrections to previously published CPI-U data. For purposes of determining the Applicable Reference Value of Medical Inflation, however, any subsequent corrections to the CPI-U values released for any calendar month will not be taken into consideration or used to recalculate the Underlying Value of the Up MacroShares.

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The Medical Care Component of the CPI

General

The Major Group of "Medical Care" represents, as of December 2006 (2003-2004 Weights) [6.281]% of the total consumer items which are covered by the CPI-U. The CPI-U "medical care aggregate index" covers two sub-groups: (i) "Medical Care Commodities," consisting of two expenditure categories: "Prescription Drugs" and "Over-the-Counter Drugs and Medical Supplies," which are together responsible, as of December 2006 (2003-2004 Weights), for approximately [23.021]% of the CPI-U medical care aggregate index, and (ii) "Medical Care Services," consisting of three expenditure categories: "Professional Services," "Hospital Services," and "Health Insurance," which collectively, as of December 2006 (2003-2004 Weights), represent approximately [76.962]% of the CPI-U medical care aggregate index. Medical Care Commodities are assigned a smaller weight in the CPI-U than Medical Care Services in part because medical commodity items that are commonly sold together with, or in the context of providing, a medical service are included in Medical Care Services. For example, eyeglasses are included in Medical Care Services, because they are often sold as part of an eye examination.

The movement of CPI medical care index is based on the average change in the prices of the sample set of entry level items selected to compose such index—for example, a prescription for a specific medicine or a visit of a specified duration to a doctor or a hospital. The "outlets" providing medical care, such as pharmacies, doctors’ offices and hospitals, and the medical items which will be sampled in each such outlet are chosen by means of the commodities and services sampling procedure described above. The CPI data collectors select the sample items in each entry level category by surveying respondents who purchased medical commodities and/or services in the chosen outlets. The CPI defines the transaction price for medical care items as all payments received or expected to be received from eligible payers, including both patients and insurers.

The following chart represents historical performance of the medical care component of the CPI-U (U.S. city average), not seasonally adjusted, since 1997:

Year	Jan		Feb		Mar		Apr		May		Jun		Jul		Aug		Sep		Oct		Nov		Dec
1997		231.8		232.7		233.4		233.8		234.2		234.4		234.8		235.2		235.4		235.8		236.4		237.1
1998		238.1		239.3		239.8		240.7		241.4		242.0		242.7		243.5		243.9		244.3		244.7		245.2
1999		246.6		247.7		248.3		249.1		249.5		250.2		251.1		251.9		252.3		252.8		253.3		254.2
2000		255.5		257.0		258.1		258.8		259.4		260.5		261.4		262.6		263.1		263.7		264.1		264.8
2001		267.1		268.9		270.0		270.8		271.4		272.5		273.1		274.4		275.0		275.9		276.7		277.3
2002		279.6		281.0		282.0		283.2		284.1		284.7		286.6		287.3		287.7		289.2		290.5		291.3
2003		292.6		293.7		294.2		294.6		295.5		296.3		297.6		298.4		299.2		299.9		300.8		302.1
2004		303.6		306.0		307.5		308.3		309.0		310.0		311.0		311.6		312.3		313.3		314.1		314.9
2005		316.8		319.3		320.7		321.5		322.2		322.9		324.1		323.9		324.6		326.2		328.1		328.4
2006		329.5		332.1		333.8		334.7		335.6		336.0		337.0		337.7		338.3		339.3		340.1		340.1
2007		343.510		346.457		347.172		348.225		349.087		349.510		351.643		352.961		353.723		355.653

Medical Care Commodities

The first expenditure category within the sub-group of Medical Care Commodities is "prescription drugs," which currently includes the following item strata: "prescription drugs" and "unsampled rent or repair of medical equipment." The second expenditure category is "non-prescription drugs and medical supplies," consisting of two item strata, "internal and respiratory over-the-counter drugs" and "non-prescription medical equipment and supplies." This last item stratum is further divided into three entry level item categories: (1) "topicals and dressings," (2) "medical equipment for general use" and (3) "supportive and convalescent medical equipment."

One of the more difficult problems faced in compiling a price index is the accurate measurement of changes in quality due to changing product specifications and consumption patterns. The concept of the CPI requires a measurement over time of the cost of purchasing an unchanging, constant-quality set of goods and services. In reality, products disappear, products are replaced with "improved" versions, and entirely new products emerge. The BLS has developed a replacement procedure for such cases which is based on the attributes of the item that is to be replaced. The Medical Care Commodities subgroup presents additional difficulties that arise from the introduction of new prescription drugs into the market, the expiration of a drug’s patent protection and the subsequent introduction of equivalent generic drugs, and the loss of the prescription status of a drug. The CPI program has developed a series of techniques to take into account the effects of such changes. Thus, for example, in connection with the introduction of new prescription drugs into the market, the BLS implemented in 2001 the within-outlet item 2-year item rotation, which is designed to enhance the timeliness and representativeness of the item samples in categories where the array of items consumed is thought to be changing rapidly. In connection with allowing generic versions of prescription drugs coming off patent to be included in the CPI, a process was introduced in 1995 which allows the generics an opportunity to build sales volume in an individual pharmacy outlet over a 6-month period, and then, through statistical disaggregation the generic versions of the drug have a one-time chance to be selected as a sample item in proportion to their sales volume at the particular outlet. Finally, in connection with the loss of prescription status, the CPI retains the item as part of the prescription drug sample while using its over-the-counter price. Thus, the prescription drug item strata shows any price change that occurs as the result of drugs changing status from prescription to over-the-counter. The over-the-counter version of the drug remains in the prescription drug sample until it rotates out during the next rotation scheduled for that item, generally slated for 2 years after the original prescription drug was brought into the sample. At future sample rotations, the over-the-counter item is eligible for inclusion in the non-prescription drug item stratum but ineligible for inclusion in the prescription drug stratum. Similarly, should a drug in the non-prescription sample change its status to prescription, the CPI would show the resulting price change, if any, in the non-prescription drugs and supplies stratum.

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Medical Care Services

The first expenditure category in the sub-group of Medical Care Services is "Professional Services," which currently consists of the following item strata: (i) physicians services that are rendered by medical professionals with a doctor of medicine degree (including osteopaths who are not MDs), (ii) dental services, (iii) eyeglasses and eye care and (iv) services performed and billed by medical practitioners who are not included in the prior categories, such as chiropractic and physical therapy, podiatry, audiology (including hearing aids), acupuncture, nursing, nutritional counseling, occupational therapy, and psychology and psychotherapy.

The second expenditure category under Medical Care Services is "Hospital and Related Services," which currently consists of the following item strata: (i) hospital services and (ii) nursing homes and adult care. Items in the hospital services stratum cover the hospital portion of a medical treatment, including inpatient and outpatient services. The pricing unit is the hospital visit, defined by a date of admission and a date of discharge, as documented on a hospital bill and usually associated with a specific diagnosis or medical condition. At initiation, the CPI data collector works with the respondent to select a hospital bill based on revenues generated by eligible payers. The data collector refers to the bill to describe the sampled item in terms of the bundle of goods and services consumed during a specified time frame or visit for the purpose of bringing the patient to the physical (or mental) state required for discharge from the hospital.

The CPI requirement that the quality of the items being sampled be maintained as an unchanging constant once again presents a challenge as it did in the Medical Care Commodities subgroup, due to the fact that not all factors affecting the quality of medical care services can be accounted for in the list of descriptions for a particular priced item. Many factors determining the quality of a medical care event such as a hospital visit or a dental appointment are intangible and not easily measured. In particular, improved technologies and procedures can sometimes lead to quality changes that BLS cannot measure. There are, however, certain types of changes in medical care items for which the BLS can quantify a difference in quality and adjust for it. For example, suppose the item the price of which the CPI is tracking is a limited visit to a physician’s office for treatment of a sore throat. If the physician changes the service so that a throat culture is always included in the cost of the visit, BLS would not reflect the addition of the throat culture as a price increase. In this case, the item description would make the change in service clear to the medical care analyst so that it could be treated as a different unique service. If the physician identifies the cost of the office visit with the throat culture for the previous month, a price change in the cost of the office visit with a throat culture can be reflected from the previous month.

The third and the last expenditure category under Medical Care Services is "Health Insurance." The CPI employs an indirect method to measure price changes for health insurance. This indirect approach deconstructs medical insurance into three parts: (i) changes in the prices of medical care items covered by health insurance policies, (ii) changes in the cost of administering the policies and (iii) changes in the cost of maintaining reserves and, as appropriate, profits. Most of the expenditure for health insurance goes for the first item—the part that reflects insurers’ payments for medical treatment. The CPI allocates this portion of health insurance spending on various treatments in proportion to claims paid out for each of them. The remaining weight for the other two portions of health insurance spending constitutes overhead of the insurers. Only consumer-paid insurance is within the scope of the CPI; ineligible health insurance receipts include those paid by employers, Medicare Part A (funded through payroll taxes), Medicaid, TriCare (coverage for military families), and workers’ compensation.

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The following chart illustrates the relative importance of components of the CPI Medical Care:

December 2006 (2003-2004 Weights) (rounded to the nearest whole number):

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DESCRIPTION OF THE UP TRUST ASSETS

General

The assets of the Up Trust will consist of cash and the treasuries and repurchase agreements on treasuries in which it will invest its cash from time to time, the trust's rights under the income distribution agreement, the settlement contracts, the distribution agreement and the MACRO Licensing Agreement, and trust accounts established and held by the trustee for the benefit of the Up Trust.

United States Treasury Obligations

On each Distribution Date, each Issuance Date, and any other date on which there is cash on deposit in the Paired trusts that is not required to make payments under the income distribution agreement or the settlement contracts or to make Quarterly or Final Distributions to shareholders, all such cash will be invested by the trustee, acting in accordance with the directions of the administrative agent and on behalf of each Paired trust, in bills, notes and bonds issued and backed by the full faith and credit of the government of the United States of America, which mature prior to the next scheduled Distribution Date, and which we refer to as "eligible treasuries." Cash will also be invested in agreements for the sale and repurchase of, and collateralized by, U.S. Treasury securities, which qualify as "eligible repos," because (i) they are entered into with a seller that is bank with at least one billion U.S. dollars in assets or a registered securities dealer that is deemed creditworthy by the administrative agent, (ii) they terminate within 24 hours following their execution, (iii) they are denominated in U.S. dollars, and (iv) they are "collateralized fully," meaning that (A) the value of the assets collateralizing the repo (less transaction costs, including loss of interest, that the trusts reasonably could expect to incur if the seller were to default) is, and during the entire term of the repo remains, at least equal to the resale price payable by the seller under the repo, (B) title to the underlying collateral assets passes to the trust or, if the asset transfer is recharacterized as a secured loan, the trust will have a perfected first priority security interest in the assets securing the seller's obligations, (C) such assets are held by a custodian bank for the benefit of the trusts during the term of the repo, (D) such assets consist entirely of U.S. Treasury obligations, and (E) upon the insolvency of the seller, the repo would qualify under a provision of applicable insolvency law providing an exclusion from any automatic stay of creditors' rights against the seller. We collectively refer to eligible treasury securities and eligible repos as "treasuries" in this prospectus.

The Paired trusts will invest their cash in eligible treasuries and eligible repos in order to generate income to pay the fees and expenses of each of the Paired Trusts and to generate income to shareholders from cash on deposit in each of the Paired Trusts that is not immediately needed for other purposes. The Paired trusts will hold a portion of their trust assets in eligible overnight repos, because these agreements mature and convert to cash within one day, which will make it possible for the Paired trusts to have sufficient cash available on each day to be able to effect any Paired Optional Redemptions ordered on that day in cash rather than by delivering treasuries. The administrative agent will initially direct the trustee to invest a maximum of 35% of the assets of each Paired trust in eligible repos. On every other Distribution Date, the administrative agent will be required to use commercially reasonable efforts to direct the investment of the trust's funds in such a manner that the percentage of assets held in eligible repos will be equal to 10% plus the highest actual percentage of Up MacroShares that was redeemed on any one Redemption Date, relative to the total number of outstanding Up MacroShares on that Redemption Date, during the preceding twelve months.

The eligible sale and repurchase agreements which the administrative agent will select on behalf of the Paired trusts will be entered into by the trustee, on behalf of the applicable trust, acting as the "buyer," and a bank or securities dealer that will act as the "seller." The seller will transfer U.S. Treasury securities to the applicable trust in exchange for a cash payment by the trust and such seller will promise to repurchase these securities within 24 hours of the execution of the agreement. The seller must deliver to the trust U.S. Treasury securities with a market value, as measured on the date of transfer and discounted by the expected transaction costs which would be incurred if the trust had to liquidate such collateral following a default by the seller, that is at least equal to the repurchase price specified in such repurchase agreement. The repurchase rate for the U.S. Treasury securities will be equal to the purchase rate paid by the trust plus an additional amount, which will constitute the implicit interest that will be earned by the trust on the repo. Upon payment of the repurchase rate, legal title to the underlying U.S. Treasury securities will be transferred back to the seller. However, the administrative agent expects to "roll-over" the cash proceeds of each day's repos into new overnight repos if these proceeds are not needed to effect redemptions. Accordingly, the U.S. Treasury securities that collateralize the repos will remain in the possession of the Paired trusts until the repo arrangement with a particular seller is terminated. In the event that a seller were to default on its obligation to repurchase the U.S. Treasury securities from a trust, the trustee, acting on behalf of the applicable trust would be required to deliver a notice of default to the seller and, following the delivery of that notice, the trustee would be entitled to pursue any remedies permitted under the terms of the eligible repo, including retaining the U.S. Treasury securities that were transferred under the eligible repo. Following a seller default, the trust will have to liquidate these securities and will incur transaction costs and be exposed to market risk in connection with such liquidation. See "RISK FACTORS — The paired trusts may incur losses in connection with treasuries delivered upon the default of a repurchase agreement counterparty."

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The principal terms of the eligible repos will be set forth in the Global Master Repurchase Agreement (September 1996 version) prepared and updated from time to time by The Bond Market Association. These terms will include (1) the delivery obligations of the seller, (2) the method of valuation of the U.S. Treasury securities that will collateralize the repo, and (3) rights and obligations of each party in the event of a default by the seller. The master agreement will be supplemented by a written confirmation setting forth the pricing terms for the repo which will be negotiated on behalf of the Paired trusts by the administrative agent. The pricing terms will consist of the term of the repo, which will always be overnight, and the repurchase rate or implicit yield to be earned by the applicable trust on the repo. Yield rates on repos are determined by the supply and demand for money, as reflected in the Federal funds rate, as well as the term of the repo and the creditworthiness of the seller; these rates do not depend upon the rates on the underlying U.S. Treasury securities. The administrative agent will enter into eligible repos in accordance with the acquisition guidelines described below.

On each Distribution Date, except for the Final Scheduled Termination Date or an Early Termination Date, the administrative agent will direct the trustee to reinvest the proceeds received upon the month of the Up and Down Trust's treasuries in new treasuries in the amount described under "DESCRIPTION OF THE UP MACROSHARES — Quarterly Distributions." The administrative agent will also direct the trustee to invest in treasuries all funds delivered to it in connection with each Paired Issuance and the month proceeds of any treasuries that mature during the Calculation Period. On the Final Scheduled Termination Date or an Early Termination Date, all of the proceeds of the treasuries in the Paired trusts will be used to make final payments under the settlement contracts and a Final Distribution on each Paired Share. On any Redemption Date for all or any portion of the outstanding Paired Shares that is also a Distribution Date, all or the allocable portion of the cash in the Paired trusts will be used to make final payments under the settlement contracts being settled and these proceeds will then be delivered to the Authorized Participants who are redeeming Paired Shares as a Final Distribution on those shares. On any Redemption Date for all or any portion of the outstanding Paired Shares that is not a Distribution Date, all or the allocable portion of the cash and/or treasuries held by the Paired trusts will be used to make final payments under the settlement contracts being settled and these treasuries and/or cash will then be delivered to the Authorized Participants who are redeeming Paired Shares as a Final Distribution on those shares. The administrative agent will select treasuries for delivery to Authorized Participants in accordance with the requirements and conditions specified for transactions with affiliated persons set forth in Appendix D to this prospectus.

The assets in the Down Trust will be invested in treasuries with the same month profiles as the treasuries on deposit in the Up Trust. The obligations of the Down Trust to the Up Trust under the income distribution agreement and the settlement contracts will be secured by the treasuries and any cash on deposit in the Down Trust, and the obligations of the Up Trust to the Down Trust under the income distribution agreement and the settlement contracts will be secured by the treasuries and any cash on deposit in the Up Trust.

On each Distribution Date and each Issuance Order Date, the administrative agent will identify and direct the trustee to purchase, on behalf of each of the Paired trusts, eligible treasuries with the same maturities or terms, stated interest rates, if any, and applicable discount rates, and eligible repos with the same yield rates, in order for each trust to be able to realize comparable amounts of income during each quarter. The administrative agent will select eligible treasuries and eligible repos for acquisition by the trustee in accordance with the following acquisition guidelines which are contained in each of the Up and Down Trust Agreements:

· eligible treasuries will be selected based on best execution;

· eligible repos will be selected based on best execution;

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· no eligible repo may be entered into with, and no eligible treasury may be purchased from, any person who is an Affiliated Person (as defined in Section 2(a)(3) of the Investment Company Act of 1940, as amended) with respect to us, either of the Paired trusts, the trustee, the administrative agent, the marketing agents or any authorized participant who qualifies as a statutory underwriter for the Paired trusts; provided, that eligible repos and eligible treasuries may be entered into with such authorized participants if they fall within a specified rate range of the best available yield and otherwise comply with the requirements and conditions specified for transactions with affiliated persons in Appendix D to this prospectus;

· eligible treasuries and eligible repos must be allocated as between the Up Trust and the Down Trust in such a manner that each of the Paired trusts will hold an identical portfolio of these treasuries and repos, or as close to an identical portfolio as is commercially feasible; and

· a minimum of 65% of the funds of each of the Paired trusts during any Calculation Period will be invested in eligible treasuries and a maximum of 35% of such funds may be invested in eligible repos; provided, that the administrative agent will use its commercially reasonable efforts on every other Distribution Date to adjust this allocation so that the amount invested in eligible repos is equal to 10% plus the highest percentage of Up MacroShares that were redeemed on any one Redemption Date during the preceding twelve-month period.

Eligible treasuries will be acquired and held in the minimum permissible denominations in order to facilitate the maintenance of parity in the assets held by each of the Paired trusts. Although the administrative agent will use commercially reasonable efforts to direct the trustee to keep all funds on deposit in each Paired trust invested in treasuries, a portion of the assets of a Paired trust may from time to time be held in the form of cash, due to mismatches between the maturity profiles of treasuries available for purchase and the length of time between Distribution Dates. In addition, any treasuries delivered in connection with a Paired Optional Redemption will be selected by the administrative agent on a "last in, first out" basis and in accordance with the requirements set forth in Appendix D to this prospectus. If interest rates are increasing and funds received in connection with Paired Issuances are being invested in higher-yielding treasuries, this method of selection may result in the relatively higher-yielding treasuries being delivered to redeeming Authorized Participants and relatively lower-yielding treasuries remaining in the Paired trusts, thereby causing a decrease in both trusts' Daily Yield Rates. Conversely, if interest rates are decreasing and funds received in connection with Paired Issuances are being invested in lower-yielding treasuries, this method of selection may result in the relatively lower-yielding treasuries being delivered to redeeming Authorized Participants. The treasuries selected by the administrative agent to be delivered as the Final Distribution in a Paired Optional Redemption will be distributed ratably, by type, to each redeeming Authorized Participant. In addition, the treasuries will always be valued at their acquisition cost plus accrued interest. In the event that the market value of the treasuries being delivered has declined since their acquisition by the applicable trust, an Authorized Participant will receive a Final Distribution that is less than the Per Share Underlying Value of the shares it is redeeming, unless it holds the treasuries delivered to it to their month. See "RISK FACTORS — The return on your shares is uncertain — The paired trusts may deliver treasuries instead of cash in a paired optional redemption."

The Income Distribution Agreement

On the Closing Date, the Up Trust will enter into a master ISDA agreement, referred to as the "Master ISDA," with the Down Trust. The trustee will also be a party to the Master ISDA and all of the schedules and confirmations executed as part of the Master ISDA. The Paired Trusts will also execute on the closing date a confirmation to the Master ISDA which we refer to in this prospectus as the "income distribution agreement." Under the income distribution agreement, if the Up Earned Income Accrual is less than the Up Available Income Accrual, the Up Trust will be required to make a payment to the Down Trust on that Distribution Date; if the Down Earned Income Accrual is less than the Down Available Income Accrual, the Up Trust will be entitled to receive a payment from the Down Trust on that Distribution Date.

Payments under the income distribution agreement will be calculated as follows:

With respect to any Distribution Date, an amount equal to:

· if the Up Earned Income Accrual for the preceding Calculation Period is less than the Available Income of the Up Trust on that Distribution Date, the Up Trust must make a payment to the Down Trust under the income distribution agreement in an amount equal to the positive difference between the Up Available Income and the Up Earned Income Accrual for such Calculation Period; and

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· if the Down Earned Income Accrual for the preceding Calculation Period is less than the Available Income of the Down Trust on that Distribution Date, the Up Trust will be entitled to receive a payment from the Down Trust under the income distribution agreement in an amount equal to the positive difference between the Down Available Income and the Down Earned Income Accrual for such Calculation Period.

The trustee will calculate the Underlying Value of each of the Paired trusts, as well as the Up Available Income Accrual and Down Available Income Accrual, and the Up Earned Income Accrual and Down Earned Income Accrual on each Distribution Date and the trustee will use those calculations to determine the required payment to be made under the income distribution agreement and then cause the Up or the Down Trust, as applicable, to make that payment to the other Paired trust.

The Settlement Contracts

In connection with each Paired Issuance, the Paired Trusts will also execute a number of identical confirmations to the Master ISDA, which we refer to in this prospectus as the "settlement contracts." Each settlement contract will have a notional amount equal to the aggregate par amount of one MacroShares Unit. A new settlement contract will be entered into by the Paired trusts upon the Paired Issuance of each new MacroShares Unit of Paired Shares, and upon the redemption of one or more MacroShares Units in a Paired Optional Redemption, an equal number of settlement contracts will be settled, except that multiple creation orders and multiple redemption orders received on the same day will be netted for purposes of determining the net increase or decrease in the number of outstanding MacroShares Units. All of the settlement contracts will terminate and be settled on the earliest to occur of the Final Scheduled Termination Date, an Early Termination Date or a Redemption Date for all of the outstanding Paired Shares. Under each settlement contract, the Up Trust will be required to transfer a portion of its assets to the Down Trust if the Medical Inflation Ratio is below the Compounded Hurdle Rate on the day preceding the Final Scheduled Termination Date or Early Termination Date or, in the case of a Paired Optional Redemption, the day preceding the related Redemption Order Date, and the Down Trust will be required to transfer a portion of its assets to the Up Trust if the Medical Inflation Ratio is above the Compounded Hurdle Rate on the relevant date. On the Final Scheduled Termination Date or an Early Termination Date, the applicable Paired Trust must make a final payment out of the proceeds of the treasuries which it holds on deposit on that date to settle all of the settlement contracts. On each Redemption Date that occurs between Distribution Dates, the applicable Paired Trust must transfer all or a portion of its cash and/or treasuries to the other Paired Trust in order to settle one or more of the settlement contracts. A portion of the amount delivered on a Redemption Date may be in the form of cash, in the case of mismatches between the minimum denominations on the treasuries and the payment to be made under the settlement contracts. If the settlement payment date for any settlement contract is not a Distribution Date, the Down Trust or the Up Trust, as applicable, will instead of cash deliver treasuries with a Value equal to any Down settlement payment or Up settlement payment, as applicable, owed on such date.

In order to settle the settlement contracts being terminated on the applicable Redemption Date or in connection with an Early Termination Date or the Final Scheduled Termination Date:

· if the Underlying Value of the Down Trust on the relevant Redemption Order Date, the Final Scheduled Termination Date or the Early Termination Date is less than the Down Asset Amount on such date, the Down Trust will pay a settlement payment to the Up Trust in an amount equal to (i) the excess of such Down Asset Amount over such Underlying Value multiplied by (ii) the applicable Redemption Percentage; and

· if the Underlying Value of the Up Trust on the relevant Redemption Order Date, the Final Scheduled Termination Date or the Early Termination Date is less than the Up Asset Amount on such date, the Up Trust will pay a settlement payment to the Down Trust in an amount equal to (i) the excess of such Up Asset Amount over such Underlying Value multiplied by (ii) the applicable Redemption Percentage.

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DESCRIPTION OF THE TRUST AGREEMENTS

General

The Up Trust will be governed by, and it will issue the Up MacroShares pursuant to, the Up Trust Agreement.

We have also created the Down Trust pursuant to, and that trust will issue the Down MacroShares under, the Down Trust Agreement.

We sometimes collectively refer to the Up Trust Agreement and the Down Trust Agreement as the "Trust Agreements" and each individually as a "Trust Agreement."

The Trustee

State Street Bank and Trust Company, a Massachusetts trust company, will act as trustee for the Up Trust and the Down Trust. The office of the trustee is located at 200 Clarendon Street, Boston, Massachusetts 02116 and its telephone number is (617) 937-6700.

For performing its duties under the Up Trust Agreement, the trustee will be compensated out of funds on deposit in the fee payment account as described below under "— Fees and Expenses of the Paired Trusts."

The Trust Agreements will provide that the trustee and any director, officer, employee or agent of the trustee will be indemnified by the trusts in the circumstances and to the extent described under "—Certain Matters Regarding Us,Natixis Securities North America Inc., MACRO Financial, LLC and the Trustee." In addition, the Trust Agreements will provide that the trustee may be terminated and replaced by a successor trustee in the circumstances described under "— Trustee Termination Events."

State Street Bank and Trust Company and any successor trustee under any of the Trust Agreements must satisfy the following eligibility criteria: it must (i) be a bank or trust company organized and doing business under the laws of the United States of America or any state thereof, authorized under such laws to exercise corporate trust powers and subject to supervision or examination by federal or state authority, (ii) have a combined capital and surplus of at least $100,000,000, (iii) maintain any credit or deposit rating required by nationally recognized rating organizations (as of the date hereof "A-1" for Standard & Poor's Rating Service or "P-1" for Moody's Investors Service, Inc.) and (iv) accept and act in the capacity of trustee under each of the Paired Trusts. If such bank publishes reports of condition at least annually, pursuant to law or to the requirements of the aforesaid supervising or examining authority, then for the purpose of these eligibility criteria, the combined capital and surplus of such bank or trust company shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time the Trustee ceases to be eligible in accordance with the these eligibility criteria, the Trustee shall resign immediately in the manner and with the effect specified in the Trust Agreements.

The Administrative Agent

MacroMarkets LLC, a Delaware limited liability company and our affiliate, will act as administrative agent for the Up Trust and the Down Trust. Its rights and responsibilities will be specified in each Trust Agreement and are summarized below under "— Duties of the Administrative Agent." The administrative agent will not be liable for any investment losses on the treasuries. For performing its duties as administrative agent under the Up Trust Agreement, MacroMarkets LLC will receive an amount equal to 0.05% of the Up Asset Amount, which will be payable out of funds on deposit in the fee payment account as described below under "— Fees and Expenses of the Paired Trusts."

The Marketing Agents

Natixis Securities North America Inc., a New York corporation, and MACRO Financial, LLC, a Delaware limited liability company, will act as the marketing agents for the Up and Down Trusts. The duties of the marketing agents will include developing a marketing plan for the Paired trusts, preparing marketing materials and organizing investor presentations. Natixis Securities North America Inc. is not affiliated with the Paired Trusts or with MacroMarkets LLC, Macro Inflation Depositor, LLC, the trustee or any of their respective affiliates.

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Fees and Expenses of the Paired Trusts

Pursuant to the Up Trust Agreement, on each Distribution Date, the Up Trust is required to deposit the Fee Deduction Amount in the fee payment account to be applied to the payment of the expenses and fees incurred by the Up Trust during the preceding Calculation Period. After first being used to pay the expenses of the trusts, which will include (i) registration fees, (ii) prospectus printing and delivery expenses, (iii) trust administration expenses and (iv) treasury settlement expenses, the remaining funds in the fee payment account will be applied to pay the fees charged by entities that provide services or license intellectual property to the trusts. These fees will principally include (i) a fee payable to the trustee for administering the Up Trust, (ii) fees payable to independent accountants for the Up Trust, (iii) fees payable to the New York Stock Exchange for acting as listing exchange agent, (iv) legal fees incurred by the Up Trust, (v) all other fees and expenses of third-party service providers incurred by or on behalf of the trusts, including in connection with their formation, which was paid on behalf of the trusts by [MacroMarkets LLC and Natixis Securities North America Inc.], (vi) a fee payable to MacroMarkets LLC for acting as the administrative agent on behalf of the Up Trust, which will accrue at an annualized rate of 0.05% of the Up Asset Amount, (vii) a fee payable to Natixis Securities North America Inc. for acting as a marketing agent for the Up Trust, which will accrue at an annualized rate of 0.20% of the Up Asset Amount, (viii) a fee payable to MACRO Financial, LLC for acting as an additional marketing agent for the Up Trust, which will accrue at an annualized rate of 0.20% of the Up Asset Amount, (ix) a licensing fee payable to MacroMarkets LLC for the use of its intellectual property related to the patented MACROs structure, which will accrue at an annualized rate of 0.10% on the Up Asset Amount and (x) a structuring fee payable to MacroMarkets LLC for structuring the transactions described in this prospectus, which will accrue at an annualized rate of 0.05% on the Up asset amount. Each of the fees that accrue at an annualized rate will be calculated on the basis of the actual number of days in the current year. These fees and expenses payable by the Up Trust will accrue during each Calculation Period and will be payable in arrears on each Distribution Payment Date or, at the direction of the administrative agent, on any Business Day occurring during each Calculation Period.

To the extent that the fee deduction amount is insufficient on any distribution date to pay in full the fees and expenses of the Up Trust, an Additional Deduction Amount, equal to the amount necessary to pay such excess fees and expenses, will be withdrawn from the assets of the Up Trust, which will result in a decrease in the underlying value of the Up Trust. See "RISK FACTORS— Income on the treasuries may be insufficient to make quarterly distributions".

On the distribution payment date that follows the distribution date occurring in December of each calendar year, any portion of fee deduction amounts deposited into the fee payment account during the preceding calendar year that are excess of that needed to pay in full the expenses and fees of the Up Trust will be delivered by the trustee to us, in our capacity as the depositor for the trusts.

Similarly, a Fee Deduction Amount and, if necessary, an Additional Deduction Amount, will be applied by the trustee for the Down Trust will be applied on each Distribution Date to pay the fees and expenses of the Down Trust, which are expected to be comparable to those of the Up Trust.

The amount of the variable fees payable by the Up Trust which are specified in clauses (vi) through (x) above will depend upon the aggregate amount of assets on deposit in the Up Trust from time to time. The fixed fees and expenses of the Up Trust are expected to equal approximately $190,000 on a quarterly basis and $760,000 annually. The Down Trust is expected to incur the same variable fees and the same amount of fixed fees and expenses.

The trustee will also be entitled to the transaction fees payable in connection with Paired Issuances and Paired Optional Redemptions. See "DESCRIPTION OF THE UP MACROSHARES — Final Distribution" and "— Paired Issuances."

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Collections and Other Administrative Procedures

The trustee will make reasonable efforts to collect, on behalf of the Up Trust, all payments under the treasuries, the settlement contracts and the income distribution agreement.

Calculations

On each business day, the trustee will calculate the Underlying Value of the Up Trust and the Per Share Underlying Value of one Up MacroShare for that day and provide those values to the administrative agent for posting on the website maintained by the administrative agent at http://www.macromarkets.com not later than one hour prior to the commencement of trading on the New York Stock Exchange. The trustee will base its calculations on the administrative agent's calculation of the Applicable Reference Value of Medical Inflation, which it will provide to the trustee. The trustee will also calculate and provide to the administrative agent, within the time period agreed upon by the trustee and the administrative agent, the amount of income allocable to each Up and Down Trust for each calendar day, the amount of Available Income in each of the Paired Trusts for each calculation period and the Quarterly Distribution and Final Distribution to be made by each of the Paired Trusts on each Distribution Date. All calculations made by the trustee will be conclusive and binding on the holders of the Paired Shares, absent manifest error. No other entity will be responsible for confirming the administrative agent's calculation of the Applicable Reference Value of Medical Inflation or the trustee's calculation of Underlying Value.

Certain Matters Regarding Us, MacroMarkets LLC, MACRO Financial, LLC, Natixis Securities North America Inc. and the Trustee

Each Trust Agreement will provide that we, MacroMarkets LLC, MACRO Financial, LLC, Natixis Securities North America Inc. and any of our or their respective directors, officers, employees and agents will not incur any liability for taking any action, or omitting to take action, in good faith pursuant to that trust agreement or for errors in judgment, provided that we, MacroMarkets LLC, MACRO Financial, LLC, Natixis Securities North America Inc. and any person related to us, MacroMarkets LLC MACRO Financial, LLC and Natixis Securities North America Inc. will not be protected against any liability that results:

· from gross negligence, willful misfeasance or bad faith in the performance of our, MacroMarkets LLC's, MACRO Financial, LLC's or Natixis Securities North America Inc.'s duties; or

· by reason of reckless disregard of our, MacroMarkets LLC's, MACRO Financial, LLC's or Natixis Securities North America Inc.'s respective obligations and duties under any Trust Agreement.

In addition, MacroMarkets LLC, as administrative agent, will be required to compensate the applicable Paired trust for any reduced income resulting from a violation by the administrative agent of the requirements and conditions contained in Appendix D to this prospectus relating to transaction with affiliated persons.

Each Trust Agreement may also provide that we, the trustee, and any of our or the trustee's respective directors, officers, members, managers, shareholders, employees, agents, affiliates (as defined in Regulation S-X of the Securities Act) and subsidiaries will be:

· entitled to indemnification by the related trust, and

· held harmless against any loss, liability or expense incurred in connection with any legal action relating to that Trust Agreement and related transaction documents or the shares issued by the related trust, unless the loss, liability or expense incurred was a result of our, the trustee's or a related person's gross negligence, willful misfeasance, willful misconduct or bad faith (in our case) or negligence, willful misconduct or bad faith (in the case of the trustee) in the performance of our or the trustee's respective duties and obligations or by reason of the reckless disregard of these duties and obligations.

The trustee will not be liable for any indemnification provided to any person by the Up Trust or us. Any indemnification expenses will be paid out of the Fee Deduction Amount provided that any amounts payable to the trustee or related person in respect of indemnification may be payable in advance or shall be secured by a lien on the assets of the related trust. If the Fee Deduction Amount is insufficient to cover any such indemnification expenses, they will be paid out of Additional Deduction Amounts withdrawn from the assets of the Paired trusts.

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In addition, each Trust Agreement will provide that neither we nor the trustee will be under any obligation to appear in, prosecute or defend any legal action which is not incidental to our or its respective responsibilities under that Trust Agreement or which in our or its opinion may involve us or it in any expense or liability. We and the trustee may, however, in our or its discretion take any such action which we or it may deem necessary or desirable with respect to the related Trust Agreement and the rights and duties of the parties and the interests of the shareholders under that Trust Agreement.

Any person into or with which the trustee may be merged or consolidated, or any person resulting from any merger or consolidation to which the trustee is a party, or any person succeeding to the business of the trustee, will be the successor of the trustee under the Trust Agreements provided that such successor shall be otherwise qualified and eligible under the provisions of the Trust Agreements.

Modification and Waiver

No amendment to any Trust Agreement may:

· modify the formula for calculating Underlying Value or any defined terms related to that formula; or

· modify the 1:1 relative proportion of Up MacroShares to Down MacroShares that together constitute a MacroShares Unit.

Without the written consent of each shareholder of any of the Paired Trusts that would be adversely effected, and subject to the restrictions outlined above, no amendment to any Trust Agreement may:

· modify the amount or timing of any distributions that are required to be made on the Paired Shares; or

· reduce the percentage of shareholders that are required to consent to the foregoing amendment and the first two amendments in the next paragraph.

Subject to the restrictions outlined above, with the written consent of shareholders representing a majority of the Up Aggregate Par Amount, we and the trustee may amend any Trust Agreement for the purpose of:

· adding any provisions to or changing in any manner or eliminating any of the provisions of that Trust Agreement;

· modifying in any manner the rights of the shareholders;

· in the event that the depositor and administrative agent default on their contractual obligations to pay the fees and expenses of the paired trusts that exceed 100 basis points, applying funds on deposit in the applicable paired trust to pay such excess fees and expenses.

If any such amendment is adopted and approved by each holder of the Up MacroShares, such amendment shall not be effective unless and until an identical amendment has been made to the Down Trust Agreement in accordance with the amendment provisions of that agreement.

Subject to the restrictions outlined above, we and the trustee may amend any of Trust Agreements without notice to or consent of the shareholders:

· to cure any ambiguity or to correct or supplement any provision which may be defective or inconsistent with any other provision of any Trust Agreement;

· to conform the provisions of the Trust Agreements to this prospectus and the related attachments to this prospectus;

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· to add to the covenants, restrictions or obligations of any entity under any Trust Agreement for the benefit of the shareholders or to modify any provisions of that Trust Agreement so long as such modification does not adversely affect the interests of the shareholders of that trust in any material respect;

· to evidence and provide for the acceptance of appointment under any Trust Agreement of a successor trustee, a successor administrative agent or any successor marketing agent;

· to modify the procedures for effecting Paired Issuances and Paired Optional Redemptions or for directing and settling creation orders, redemption orders and exchange orders in connection with an amendment to a Participants Agreement; and

· to comply with any requirements imposed by the Code or any securities laws.

The trustee will not enter into any amendment or modification which would cause either of the Paired Trusts to be required to register as an investment company under the Investment Company Act of 1940, as amended, or to be regulated as a commodity pool under the Commodity Exchange Act, as amended.

Voting Rights

Each holder of Up MacroShares will be entitled to vote under the Up Trust Agreement on the following matters:

· any amendments requiring the prior written consent of shareholders under the Up Trust Agreement, as described under "—Modification and Waiver";

· the termination of the trustee under the Up Trust Agreement; and

· the appointment of a successor trustee under the Up Trust Agreement.

Each holder's voting rights as of any Business Day will be based on the par amount of its Up MacroShares relative to the aggregate par amount of all Up MacroShares that remain outstanding on that date.

As described in this prospectus under "DESCRIPTION OF THE UP MACROSHARES — Final Distribution," only Authorized Participants may exercise the right to direct the issuance and redemption of the Up MacroShares.

Reports to Shareholders

We will prepare, on behalf of the Up Trust, quarterly reports on Form 10-Q with respect to each calendar quarter and annual reports on Form 10-K with respect to each calendar year. The reports on Form 10-K will include financial statements audited on behalf of the Up Trust by PricewaterhouseCoopers, LLP, acting as the trust's independent registered public accountants. In addition, the settlement contracts will be valued in such financial statements by the administrative agent at fair value. As there is no market for the settlement contracts, and no such market is expected to develop, the administrative agent will determine the fair value of the settlement contracts by reference to various inputs, including the contractual amount due to or from the paired trust , applicable market indices, and the rates of transactions in Up MacroShares on the New York Stock Exchange. The fair value of the settlement contracts is generally expected to be the contractual amount due to or from the Paired Trust upon settlement, but may be different from such contractual amount. As a result, the fair value of such contracts for financial reporting purposes may differ from the underlying value at which the Up MacroShares are redeemed or created, and such differences could be material. We will also prepare current reports on Form 8-K. We will file all such reports with the Securities and Exchange Commission. You may contact your broker to obtain paper copies of these reports.

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Duties of the Trustee

Under the Trust Agreements, the duties of the trustee will include:

· causing the Paired Trusts to make their required payments under the income distribution agreement and the settlement contracts;

· making Quarterly Distributions and a Final Distribution to the holders of the Up MacroShares;

· administering Paired Optional Redemptions and delivering treasuries to redeeming shareholders on each Redemption Date in accordance with the provisions described under "DESCRIPTION OF THE UP MACROSHARES — Final Distribution";

· administering each of the Paired Trusts;

· paying the fees and expenses of each of the Paired Trusts;

· effecting Paired Issuances in accordance with the provisions described under "DESCRIPTION OF THE UP MACROSHARES —Paired Issuances";

· effecting Paired Optional Redemptions in accordance with the provisions described under "DESCRIPTION OF THE UP MACROSHARES — Final Distribution — Final Distributions in Paired Optional Redemptions";

· acting as the custodian for the treasuries and all other assets of each of the Paired Trusts;

· settling purchase orders for treasuries that are placed on behalf of the Up Trust by the administrative agent, in accordance with the directions of the administrative agent;

· on each business day, calculating the Underlying Value of the Up Trust and the Per Share Underlying Value of one Up MacroShare and providing such values to the administrative agent for posting on the website maintained by the administrative agent at http://www.macromarkets.com;

· calculating, for each Distribution Date, the amount of Available Income on deposit in each of the Paired Trusts, the payment due under the income distribution agreement and the Quarterly Distributions to be made on the Up MacroShares;

· calculating, in connection with each Redemption Date, Early Termination Date and the Final Scheduled Termination Date, the respective underlying values of the Paired Trusts on the related Redemption Order Date, the Termination Date or the Final Scheduled Termination Date, as applicable, the final payment due under the settlement contracts being settled on those dates and the Final Distribution to be made on the Up MacroShares;

· preparing any notices required under the Trust Agreements;

· providing notification of the occurrence of certain Termination Triggers; and

· performing all of the other obligations required of it under the Trust Agreements and the other transaction documents.

The trustee may engage any other persons to assist it with its duties under the Trust Agreements, but the trustee will remain liable to the shareholders for the performance of these duties.

The trustee will not make any representations as to the validity or sufficiency of any Trust Agreement, the shares issued by any of the trusts, the assets in any of the trusts, the settlement contracts, the income distribution agreement, the MACRO Licensing Agreement or any other related agreement, document or instrument. The trustee is required to perform only those duties specifically enumerated under the related Trust Agreement. Upon receipt of the various certificates, statements, reports or other instruments required to be furnished to it, the trustee is required to examine them to determine whether they are in the form which the related Trust Agreement requires. However, the trustee is not responsible for the accuracy or content of any of these documents furnished to it under any Trust Agreement.

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The trustee may be held liable under any Trust Agreement for its own grossly negligent action or failure to act, or for its own misconduct. However, the trustee will not be personally liable with respect to any action it takes, suffers or omits to take in good faith in accordance with the direction of the shareholders. The trustee is not required to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties under any Trust Agreement, or in the exercise of any of its rights or powers, if it has reasonable grounds for believing that repayment of those funds or adequate indemnity against any related risk or liability is not reasonably assured to it.

Duties of the Administrative Agent

Under the Trust Agreements, the administrative agent will perform or oversee the performance of a number of duties including, among others:

· directing the trustee in the acquisition of new treasuries for the Paired Trusts on each Distribution Date and each Issuance Date, including placing the purchase orders for such treasuries, in accordance with the acquisition guidelines that are specified in the Trust Agreements for the Paired trusts and described in this prospectus under "DESCRIPTION OF THE UP TRUST ASSETS — United States Treasury Obligations";

· selecting treasuries and repurchase agreements on treasuries to be delivered in connection with the settlement of the settlement contracts and in connection with Paired Optional Redemptions in accordance with the rules specified in the Trust Agreements;

· processing redemption and creation orders for Paired Shares from Authorized Participants;

· directing the trustee in effecting Paired Optional Redemptions and Paired Issuances;

· maintaining its website located at http://www.macromarkets.com, where investors can obtain information about the performance of the Paired Shares; and

· providing notification of the occurrence of certain Termination Triggers.

Trustee Termination Events

A "Trustee Termination Event" under the Up or Down Trust Agreement will consist of the following:

· a failure to make any Quarterly Distribution in the amount determined in accordance with the calculations required to be made under the applicable Trust Agreement, to the extent that funds are available in the applicable trust to make those distributions, which failure continues unremedied for a period of five (5) or more Business Days;

· a failure to distribute the proceeds of all of the assets of the applicable trust on the Final Scheduled Termination Date, which failure continues unremedied for a period of five (5) or more Business Days;

· a failure to make any payment required to be made under the income distribution agreement or the settlement contracts, to the extent that the applicable trust has the funds available to make any such payment, which failure continues unremedied for a period of five (5) or more Business Days;

· a failure by the trustee to observe or perform in any material respect any of its other covenants or obligations under the applicable Trust Agreement, which failure continues unremedied for thirty (30) days after the giving of written notice of such failure to the trustee by us or by not less than 25% of the shareholders, voting by par amount;

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· the trustee becoming ineligible or incapable of acting as trustee under the related Trust Agreement; and

· the occurrence of a Trustee Termination Event under the trust agreements for any of the other Paired Trusts as a result of which the trustee is terminated under such trust agreement.

So long as a Trustee Termination Event remains unremedied, we may and, at the direction of the required percentage of shareholders, we will terminate the trustee's rights and obligations under the applicable Trust Agreement. A successor trustee will succeed to all the responsibilities, duties and liabilities of the terminated trustee under the applicable Trust Agreement and will be entitled to similar compensation arrangements. If no successor trustee has been appointed and has accepted the appointment within the period specified in the applicable Trust Agreement after the delivery of a notice of removal, the terminated trustee may petition a court of competent jurisdiction for the appointment of a successor trustee with a net worth at the time of its appointment of at least $100,000,000. Pending that appointment, the terminated trustee is obligated to continue to act as trustee under the applicable Trust Agreement. Without the consent of a majority of the shareholders, voting by Par Amount, the compensation to be paid to the successor trustee may not be greater than the compensation paid to the terminated trustee under the applicable Trust Agreement.

Resignation of Trustee

The trustee may, upon written notice to us, resign at any time. If the trustee resigns we will be obligated to use our best efforts to appoint a successor trustee. If no successor trustee has been appointed and has accepted its appointment within a specified period, the resigning trustee may petition any court of competent jurisdiction to appoint a successor trustee. A resignation of the trustee will not become effective until a successor trustee has been appointed and has accepted its appointment.

Removal and Resignation of Administrative Agent

The administrative agent may, upon written notice to us, resign at any time. The administrative agent may also be removed, with or without cause, at any time by us upon written notice. A resignation or removal of the administrative agent will not become effective until a successor administrative agent has been appointed and has accepted its appointment.

Termination of the Trusts

If we are adjudged to be insolvent or if we are liquidated or dissolved for any reason, this will not (1) result in a termination of any of the Trust Agreements, or the Up Trust or the Down Trust, (2) entitle our legal representatives or assigns to petition any court to partition or wind up all or any part of the Up Trust or the Down Trust or any of their respective properties or (3) otherwise affect the rights, obligations and liabilities of the trustee or the shareholders of any of the trusts.

MATERIAL UNITED STATES FEDERAL INCOME TAX CONSEQUENCES

The following describes certain material United States federal income tax consequences of the purchase, ownership and disposition of Up MacroShares. This summary is based on the Code, final, temporary and proposed Treasury regulations, and Internal Revenue Service, or the "IRS," and judicial rulings, all as in effect on the date of this prospectus, and all of which are subject to change or differing interpretations, possibly on a retroactive basis. Apart from the opinion expressed below, see "— Classification of the Up Trust," Tax Counsel (as identified below) will provide no other opinion relating to United States federal income tax matters with respect to the trust or shares.

This summary is addressed only to shareholders who hold those shares as capital assets and not as a hedge, a position in a "straddle" or other conversion transaction or as part of a "synthetic" security or other integrated financial transaction. This summary does not describe all of the tax consequences of purchasing, owning or disposing of shares that may be relevant to investors in light of their particular circumstances. For example, this summary does not address all United States federal income tax issues relating to shares that may be relevant to financial institutions, partnerships, tax-exempt organizations, insurance companies, dealers or traders in securities or currencies or persons whose functional currency is not the U.S. dollar. This discussion does not address alternative minimum tax consequences, nor does it address any state, local or foreign tax consequences of purchasing, owning or disposing of shares.

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As used in this section, a "U.S. Holder" means a U.S. Person who is a beneficial owner of an Up MacroShare. A "U.S. Person" means a person that is, for United States federal income tax purposes:

· a citizen or resident of the United States,

· a corporation created or organized in, or under the laws of, the United States, any state of the United States, or the District of Columbia,

· an estate, the income of which is subject to United States federal income taxation regardless of its source, or

· a trust if (a) a court within the United States is able to exercise primary supervision over the administration of the trust, and (b) one or more U.S. Persons have the authority to control all substantial decisions of the trust.

"Non-U.S. Persons" means persons (other than entities treated as domestic partnerships for United States federal income tax purposes) that are not U.S. Persons.

For United States federal income tax purposes, the treatment of any beneficial owner of an interest in a partnership, including for this purpose any entity treated as a partnership for United States federal income tax purposes, will generally depend upon the status of the partner and upon the activities of the partnership. Partnerships and partners in such partnerships should consult their tax advisors about the United States federal income tax consequences of purchasing, owning and disposing of shares.

There is no authority directly on point dealing with securities such as Up MacroShares or the transactions of the type described in this prospectus, and the opinion of Tax Counsel is not binding on the IRS or the courts, either of which could take a contrary position. No rulings have been sought from the IRS. Accordingly, there can be no assurance that the IRS will not challenge the opinions expressed herein or that a court would not sustain such a challenge.

It is strongly recommended that each prospective investor in Up MacroShares consult with its tax advisor regarding the application of tax laws to its particular situation.

Classification of the Up Trust

Tax Counsel is of the opinion that, under current law, and based on the facts and assumptions set forth in such opinion, the Up Trust will be classified for United States federal income tax purposes as a partnership and not as an association or publicly traded partnership taxable as a corporation, and the remainder of this discussion assumes such classification. Partnerships are not subject to United States federal income tax. Rather, the taxable income of a partnership is allocated among its partners and included in their taxable income. If the Up Trust were classified as a publicly traded partnership taxable as a corporation for United States federal income tax purposes, the Up Trust's taxable income would be subject to tax at regular corporate rates and such income would not flow through to its shareholders for reporting on their own returns. The imposition of tax at the Up Trust level would reduce amounts available for distribution to its shareholders.

Classification of Up MacroShares

For United States federal income tax purposes, each holder of an Up MacroShare will be considered to be a partner in the partnership constituted by the Up Trust. Each such shareholder will be required to include in its gross income its distributive share of income attributable to the Up Trust.

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Incomeand Deductions

A U.S. Holder of shares in the Up Trust will be required to take into account in computing the U.S. Holder's United States federal income tax liability:

· the U.S. Holder's distributive share of the income, gains, losses, deductions, credits and items of tax preference and other tax items of the Up Trust in which the U.S. Holder has directly invested for any taxable year of the Up Trust ending within or with the taxable year of the U.S. Holder, without regard to whether any distribution from the Up Trust has been or will be received.

The Up Trust items of income and loss will generally have the same character (ordinary or capital, short-term or long-term) and source in the hands of U.S. Holders as they have in the hands of the Up Trust. As a result of the rules governing the allocation of income, gains, deductions and losses explained more fully below and the various limitations on certain deductions, a U.S. Holder may recognize taxable income in advance of (and potentially in excess of) its receipt of any cash distributions with respect to its Up MacroShares.

Allocation of Up Trust Income, Gains and Losses

Under Section 704(b) of the Code:

· a U.S. Holder's distributive share of an item of Up Trust income, gain, loss or deduction is determined in accordance with the U.S. Holder's "interest in the partnership" if the allocations of income, gain, loss and deduction under the Up Trust Agreement lack "substantial economic effect," and

· each U.S. Holder is required to take into account such distributive share for each taxable year of the Up Trust on the holder's separate federal income tax return for the holder's taxable year that includes the last day of that taxable year of the Up Trust, except that if the U.S. Holder disposes of all of its Up MacroShares, the U.S. Holder will be required to take into account such distributive share for the holder's taxable year that includes the date of disposition.

Final regulations promulgated under Section 704(b) of the Code contain intricate and detailed tests for determining whether allocations have "substantial economic effect." The allocations of income, gain, loss and deduction under the Up Trust Agreement are intended to meet these tests and, accordingly, we believe that the allocations under the Up Trust Agreement generally correspond to the U.S. Holders' interests in the Up Trust and, as a consequence, that such allocations should not be substantially modified if challenged by the IRS.

Payments or accruals of earnings on the United States Treasury obligations held as collateral by the Up Trust will be taxable as ordinary income at the time those earnings accrue. Although not free from doubt because of the lack of direct authority, the Up Trust will treat gain (or loss) recognized in respect to the settlement contracts as capital gain (or loss). The Up Trust will treat payments received or made pursuant to the income distribution agreement as resulting in ordinary gain or loss; however, there can be no assurance that the IRS or a court will not treat them as capital gains or losses. Because the Up Trust will be an accrual-basis taxpayer for United States federal income tax purposes, income that is recognized for United States federal income tax purposes will accrue on Up MacroShares and will be allocated to holders of Up MacroShares on a daily accrual basis, regardless of the U.S. Holder's method of accounting. Actual cash distributions on Up MacroShares in respect of such accrual income will not, however, be separately reported as taxable income to the U.S. Holder at the time they are received. The Up Trust expects that its taxable year will be a calendar year unless another taxable year is required by law.

In addition, non-corporate U.S. Holders will be subject to the "miscellaneous itemized" deduction rules of Section 67 of the Code, and, as a result, deductions in respect of payments under the income distribution agreement, trustee fees, licensing fees, and other expenses associated with the Up Trust will be separately stated for each such U.S. Holder and will be deductible by it only to the extent such expenses, taken together with all other miscellaneous itemized deductions of each such U.S. Holder, exceed 2% of each such U.S. Holder's adjusted gross income. Furthermore, Section 68 of the Code further restricts the ability of an individual with an adjusted gross income in excess of certain specified amounts to deduct such investment expenses (and most other itemized deductions) (collectively, "Overall Limited Deductions"). Under that provision, Overall Limited Deductions in excess of 2% of adjusted gross income may be deducted only to the extent such Overall Limited Deductions exceed the lesser of (i) 3% of the excess of the individual's adjusted gross income over the specific amount or (ii) 80% of the amount of the Overall Limited Deductions otherwise allowable for the taxable year.

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Limitation on Deductibility of Partnership Losses

A U.S. Holder is restricted from taking into account for United States federal income tax purposes any Up Trust loss in excess of such U.S. Holder's adjusted tax basis (calculated as described below) in its Up MacroShares, as the case may be. In addition, United States federal income tax law restricts certain U.S. Persons, including individuals and certain non-corporate taxpayers and closely-held corporations, from taking into account for United States federal income tax purposes any Up Trust net loss in excess of the amounts for which such U.S. Holder is "at risk" with respect to its shares as of the end of the Up Trust's taxable year in which such loss occurred. The amount for which such a U.S. Holder is "at risk" with respect to its Up MacroShares, as the case may be, generally is equal to its adjusted tax basis for such shares, less any amounts borrowed:

· in connection with its acquisition of such shares for which it is not personally liable and for which it has pledged no property other than its shares,

· from persons who have a proprietary interest in the Up Trust and from certain persons related to such persons or

· for which the U.S. Holder is protected against loss through non-recourse financing, guarantees or similar arrangements.

A corporate taxpayer can utilize capital losses only to offset capital gains, with unused capital losses carried back three years and carried forward five years. Up to $3,000 of the excess of capital losses over capital gains in any year may be used to offset the ordinary income of non-corporate taxpayers, with any balance carried over indefinitely for use in subsequent years, subject to the same limitation.

Non-corporate investors (and certain closely-held corporations, personal service corporations and S corporations) are subject to the limitations on using losses from passive business activities to offset business income, salary income and portfolio income (e.g., interest, dividends, capital gains from portfolio investments, royalties, etc.). All, or substantially all, of the Up Trust's income may be treated as portfolio income for these purposes. Therefore, investors may not be able to use passive business losses (such as losses from limited partnership interests) to offset income from the Up Trust.

Sale, Exchange, or Redemption of Up MacroShares

Whereas changes in the value of the Applicable Reference Value of Medical Inflation will not, in and of themselves, result in the recognition of income or loss by a U.S. Holder, the termination of one or more settlement contracts will result in the recognition of gain or loss by the Up Trust. In the case of a sale, exchange, redemption or other disposition of all or a portion of a U.S. Holder's Up MacroShares, as the case may be, a U.S. Holder will generally recognize taxable gain or loss equal to the difference between the amount realized on such sale, exchange, redemption or other disposition and such U.S. Holder's tax basis in such shares. The amount realized is generally equal to the amount of the proceeds or cash distributions received in redemption (including any constructive cash distributions) and the U.S. Holder's adjusted tax basis in such shares. Any gain or loss recognized with respect to such a sale or redemption generally will be treated as capital gain or loss and will be long-term capital gain if such shares were held for more than one year. Long-term capital gains of individuals are generally taxed at preferential rates.

A U.S. Holder will not recognize loss upon the partial redemption of its shares. Upon a distribution (including a constructive distribution) in partial redemption of a U.S. Holder's shares, or any other distribution (or constructive distribution) other than a distribution in redemption of all of a U.S. Holder's shares, the U.S. Holder's adjusted tax basis in its shares will be reduced and gain will be recognized to the extent that the U.S. Holder's adjusted tax basis would have been reduced below zero, as described below in "— Adjusted Tax Basis for Up MacroShares." Because a U.S. Holder's tax basis in its shares is not adjusted to take into account the U.S. Holder's allocable share of the Up Trust's items of income or loss until the end of the Up Trust's taxable year, partial redemptions during the taxable year could result in taxable gain to a U.S. Holder even if the U.S. Holder's tax basis will be increased in respect of the U.S. Holder's share of Up Trust income for the taxable year and, as a result, no such gain would result if the same partial redemption were made at the end of the taxable year. Furthermore, in the case of a partial redemption, shares of the Up Trust's income or loss allocable to a U.S. Holder at the end of the taxable year will be taken into account by the U.S. Holder of the partially redeemed shares and will increase or decrease, as the case may be, such U.S. Holder's tax basis in its remaining shares as of the end of such taxable year. Gain or loss attributable to redemptions by Up MacroShareholders will be allocated to redeeming U.S. Holders under the Up Trust Agreement. The ability of a U.S. Holder to utilize a capital loss recognized on the sale of shares to offset ordinary income is limited.

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Adjusted Tax Basis for Up MacroShares

A U.S. Holder's adjusted tax basis in its Up MacroShares generally will be equal to the amount of its initial capital contribution increased by (a) any additional capital contributions made by such U.S. Holder and (b) such U.S. Holder's allocable share of (i) items of Up Trust income and gain and (ii) indebtedness of the Up Trust. A U.S. Holder's adjusted tax basis in its shares generally will be decreased, but not below zero, by the amount of any cash distributions received by such U.S. Holders from the Up Trust and by such U.S. Holder's allocable share of (a) items of Up Trust deduction and loss and (b) any constructive distributions resulting from a reduction in such U.S. Holder's share of indebtedness of the Up Trust.

Adjustments to Basis in Up Trust Assets

The Code provides that the basis of partnership property is not adjusted upon the transfer of an interest in the partnership unless an election has been made under Section 754 of the Code or the partnership is subject to mandatory adjustments under Section 743(b) because it has a "substantial built-in loss" with respect to its assets immediately after such transfer (generally, in excess of $250,000) and certain exceptions do not apply. The Up Trust does not expect to make the election permitted by Section 754 of the Code and expects to qualify as a "securitization partnership" within the meaning of Section 743(f) of the Code and accordingly should qualify for an exception such that, even if it were to have a substantial built-in loss, the partnership should not be subject to mandatory adjustments. Given the absence of applicable authority with respect to the classification of partnerships as securitization partnerships, however, no assurance can be given that the IRS might not successfully assert that the Up Trust does not qualify as a securitization partnership. If it were determined that the Up Trust did not qualify as a securitization partnership and a substantial built-in loss were to exist at the time of a transfer of an Up MacroShare, the Up Trust would be subject to Section 743(b) adjustments.

If Section 743(b) adjustments were required to be made, a subsequent purchaser of an Up MacroShare would have its basis in such holder's share of the Up Trust's assets reduced by an amount equal to the difference between the purchaser's initial adjusted United States federal income tax basis in such share and such holder's proportionate share of the Up Trust's tax basis in its assets. Section 743(b) adjustments would be made in respect of each subsequent purchaser separately and would not affect any other shareholders. It is unclear, however, given the publicly traded nature of the Up MacroShares and the nature of the Up Trust's assets, how, as a practical matter, such adjustments would be tracked and applied, and accordingly, how shareholders might be effected.

Up Trust Audits

Each U.S. Holder is required to treat partnership items on its tax return in a manner consistent with the treatment of the items on the Up Trust's tax return, except to the extent that the U.S. Holder notifies the IRS of any inconsistencies. It is possible that the federal information tax returns filed with the IRS by the Up Trust will be audited. Such an audit would generally be conducted at the trust level in a single proceeding rather than in separate proceedings with each partner. In any trust-level audit, the Up Trust will be represented by Macro Inflation Depositor, LLC as "tax matters partner." The Up Trust would bear the costs of any such audit. The tax matters partner would have the authority, among other things, to extend the applicable statute of limitations and enter into an administrative settlement with the IRS with regard to the Up Trust. Any such settlement by the Up Trust would not be binding upon any U.S. Holder who is timely identified to the IRS. However, the Up Trust Agreement provides that the U.S. Holders agree, to the extent permitted by law, not to take a position for tax purposes inconsistent with one taken by the Up Trust or by the tax matters partner. Under certain circumstances, U.S. Holders may have the right to participate (at their own expense) in litigation initiated by the trustee of the Up Trust and to initiate litigation with the IRS. Recently enacted legislation permits the IRS to determine, based on the partnership's return, whether to apply the procedures described above.

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Investment Interest Limitation

Interest on any amount borrowed by a non-corporate investor to purchase shares, and interest expense incurred by the Up Trust, will be "investment interest" and is subject to limitation on deductibility. In general, investment interest will be deductible only to the extent of a taxpayer's "net investment income." For this purpose, "net investment income" will include net income from the Up Trust and other income from property held for investment (other than property that generates passive business income). However, long-term capital gain is excluded from the definition of net investment income unless the taxpayer makes a special election to treat such gain as ordinary income rather than long-term capital gain. Interest that is not deductible in the year incurred because of the investment interest limitation may be carried forward and deducted in a future year in which the taxpayer has sufficient investment income.

Syndication and Organizational Expenditures

Expenditures for the organization and syndication of partnerships are not deductible in the year in which they are paid or accrued. The amount of such expenditures that constitutes syndication expenditures is not deductible. The amount of such expenditure that constitutes organizational expenditures within the meaning of Section 709 of the Code generally may be amortized ratably over a period of 180 months. There can be no assurance that the IRS will not successfully assert that a portion of the amounts paid by the Up Trust to the trustee, us or others should be deemed to be a reimbursement for organizational expenditures or nondeductible syndication expenses. If the IRS were successful in such assertion, U.S. Holders could recognize income in respect of their shares in excess of the amounts of current income distributed to them.

Tax Shelter Regulations

In certain circumstances, a U.S. Holder of shares who disposes of the shares in a transaction resulting in the recognition by the holder of significant losses in excess of certain threshold amounts may be obligated to disclose its participation in such transaction in accordance with regulations governing tax shelters and other potentially tax-motivated transactions (the "Tax Shelter Regulations"). Failure to make the required disclosure in tax returns and statements will result in significant penalties. Investors should consult their tax advisors concerning any possible disclosure obligation under the Tax Shelter Regulations with respect to the disposition of their shares.

Information Reporting and Backup Withholding Tax

In general, income tax information with respect to Up MacroShares will be reported to shareholders on Schedule K-1, which should be mailed to shareholders of Up MacroShares as promptly as possible following each calendar year. Backup withholding tax may also apply to such payments if the U.S. Holder fails to comply with certain identification requirements.

Non-U.S. Holders

A "Non-U.S. Holder" means a holder other than a U.S. Holder. We expect that there will be sufficient trading on a recognized commodities exchange of futures on the medical care component of the CPI-U to satisfy a tax requirement that such futures are "of a kind customarily dealt in" on such exchange. There is, however, no authority directly addressing how much trading is required to satisfy such requirement. Assuming that such requirement is met, then for United States federal income tax purposes, Non-U.S. Holders of shares who furnish a properly completed IRS Form W-8BEN, Form W-8ECI or W-8IMY, as applicable, should not be subject to withholding tax on their allocable share of payments or accruals of earnings on the United States Treasury obligations or payments received pursuant to the income distribution agreement or the settlement contracts. If, contrary to expectations, such requirement is not met, Non-U.S. Holders could be treated as earning income that is effectively connected with the conduct of a trade or business within the United States ("ECI"). ECI earned by Non-U.S. Holders is taxable by the United States at full U.S. income tax rates and each such Non-U.S. Holder would be subject to quarterly withholding at the highest applicable rate (currently, 35% for both individuals and corporation), on an estimated basis, on its allocable share of the income of the Up Trust whether or not it received distributions from the Up Trust. Generally, a Non-U.S. Holder will not be subject to United States federal income taxation on capital gains earned in connection with holding, selling or redeeming shares where such Non-U.S. Holder:

· does not have an office or fixed place of business in the U.S. and otherwise does not carry on a U.S. trade or business;

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· is not an individual who is present in the U.S. for 183 days or more in a taxable year or who has a "tax home" in the U.S. for U.S. federal income tax purposes; or is not a former citizen of the U.S.

Backup Withholding

A Non-U.S. Holder who fails to establish its exemption from backup withholding by certifying its status on IRS Form W-8BEN, W-8ECI or W-8IMY, as applicable, may be subject to backup withholding tax. Any amount withheld under the backup withholding rules will be allowed as a refund or a credit against such Non-U.S. Holder's federal income tax liability, if any, provided the required information is timely furnished by such Non-US. Holder to the IRS. Non-U.S. Holders should consult their tax advisors regarding the filing of a U.S. tax return for claiming a refund of any such backup withholding.

STATE TAX CONSEQUENCES

In addition to the federal income tax consequences described in "MATERIAL UNITED STATES FEDERAL INCOME TAX CONSEQUENCES," you should consider the state income tax consequences of the acquisition, ownership, and disposition of the shares. State income tax law may differ substantially from the corresponding federal law, and this discussion does not purport to describe any aspect of the income tax laws of any state. Therefore, you should consult your tax advisor with respect to the various state tax consequences of an investment in the shares.

CERTAIN ERISA CONSIDERATIONS

Up MacroShares

We anticipate that the Up MacroShares offered in this prospectus will meet the criteria of "publicly-offered securities" pursuant to the Plan Assets Regulation issued by the Department of Labor.

Although no assurances can be given, we expect that:

· there will be no restrictions imposed on the transfer of the Up MacroShares;

· the Up MacroShares will be held by at least 100 independent investors at the conclusion of this offering; and

· the Up MacroShares will be sold as part of an offering pursuant to an effective registration statement under the Securities Act and then will be timely registered under the Exchange Act.

If the Up MacroShares were to fail to meet the criteria of publicly-offered securities, the assets of the Up Trust could be deemed under ERISA to include the assets of any plans that invested in the Up Trust. In that event, transactions involving the Up Trust's assets and parties in interest or disqualified persons with respect to plans that invested in the trust will be prohibited under ERISA and the Code, unless another exception to the Plan Assets Regulation or a statutory or administrative exception applies.

Prospective fiduciaries of a plan considering the purchase of Up MacroShares should consult with their legal advisors concerning the impact of ERISA and the Code and the potential consequences of making an investment in the shares with respect to their specific circumstances. Each plan fiduciary should take into account, among other considerations:

· whether the fiduciary has the authority to make the investment,

· the composition of the plan's portfolio with respect to diversification by type of asset,

· the plan's funding objectives,

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· the tax effects of the investment,

· whether the assets of the trust that are represented by the Up MacroShares would be considered plan assets, and

· whether, under the general fiduciary standards of investment prudence and diversification an investment in the Up MacroShares is appropriate for the plan taking into account the overall investment policy of the plan and the composition of the plan's investment portfolio.

Any purchaser of Up MacroShares that is an insurance company using the assets of an insurance company general account should note that pursuant to Section 401(c) of ERISA, the Department of Labor issued regulations providing that the assets of an insurance company general account will not be treated as "plan assets" for purposes of the fiduciary responsibility provisions of ERISA and Section 4975 of the Code to the extent such assets relate to contracts issued to employee benefit plans on or before December 31, 1998 and the insurer satisfies various conditions. The plan asset status of insurance company separate accounts is unaffected by Section 401(c) of ERISA, and separate account assets continue to be treated as the plan assets of any such plan invested in a separate account.

Certain employee benefit plans, such as governmental plans (as defined in Section 3(32) of ERISA) and certain church plans (as defined in Section 3(33) of ERISA), are not subject to the requirements of ERISA or Section 4975 of the Code. Accordingly, assets of such plans may be invested in the offered shares without regard to the ERISA considerations described in this prospectus, subject to the provisions or other applicable federal and state law. However, any such plan that is qualified and exempt from taxation under Sections 401(a) and 501(a) of the Code is subject to the prohibited transaction rules set forth in Section 503 of the Code.

PLAN OF DISTRIBUTION

In addition to, and independent of, the purchase of the Up MacroShares by the Initial Purchasers as described below, the Up Trust will issue newly created Up MacroShares to Authorized Participants in Paired Issuances on a continuous basis. The Up MacroShares will be issued solely as part of MacroShares Units, each constituting 50,000 Up MacroShares and 50,000 Down MacroShares. Each MacroShares Unit will be issued by the Paired Trusts in exchange for cash deposited into the Paired Trusts in an amount equal to the combined Per Share Underlying Value of the Up MacroShares and the Down MacroShares, as measured on the date on which an order for Paired Shares is received. Only Authorized Participants may place orders with the Up Trust (and, concurrently, with the Down Trust) for Paired Issuances.

Due to the fact that Up MacroShares can be issued on an ongoing basis, at any point during the life of the Up Trust, a continuous "distribution," within the meaning of the Securities Act, will be occurring. Authorized Participants, other broker-dealers and all other persons are cautioned that some of their activities will result in their being deemed to be participants in a distribution in a manner which would render them statutory underwriters and subject them to the prospectus delivery requirements and liability provisions of the Securities Act. For example, an Authorized Participant or any other person will be deemed to be a statutory underwriter of the Up MacroShares if it deposits cash into the Up Trust and the Down Trust in exchange for MacroShares Units, and after the issuance sells the Up MacroShares which were part of the MacroShares Unit to its customers. An Authorized Participant or any other person will also be deemed to be a statutory underwriter of the Up MacroShares if, after creating Up MacroShares, the Authorized Participant subsequently sells the Up MacroShares to its customers; or if it couples the creation of new shares with an active selling effort involving the solicitation of secondary market demand for the shares. A determination of whether a particular market participant is a statutory underwriter must take into account all the facts and circumstances pertaining to the activities of that participant or its clients in the particular case, and the examples mentioned above should not be considered a complete description of all the activities that would lead to the designation of a person as a statutory underwriter.

Investors that purchase Up MacroShares through a commission/fee-based brokerage account may pay commissions/fees charged by the brokerage account. We recommend that investors review the terms of their brokerage accounts for details on applicable charges.

Dealers that are not "underwriters" but nonetheless are participating in a distribution (as contrasted to ordinary secondary trading transactions), and thus dealing with Up MacroShares that are part of an "unsold allotment" within the meaning of Section 4(3)(C) of the Securities Act, will be unable to take advantage of the prospectus-delivery exemption provided by Section 4(3) of the Securities Act and will, therefore, be subject to the prospectus delivery requirements of the Securities Act.

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We intend to qualify the Up MacroShares in states selected by us and through broker-dealers who are members of the National Association of Securities Dealers, Inc. Investors intending to create or redeem MacroShares Units through Authorized Participants in transactions not involving a broker-dealer registered in the respective investor's state of domicile or residence should consult their respective legal advisor regarding applicable broker-dealer or securities regulatory requirements under the state securities laws prior to that creation or redemption.

Authorized Participants will not receive from us or any of our affiliates any fees or other compensation in connection with the creation and sale of the Up MacroShares. The Authorized Participants or their respective affiliates may receive customary compensation and brokerage fees from investors who purchase Up MacroShares. The difference between the rate paid by Authorized Participants as underwriters and the rate paid to such Authorized Participants by investors will be deemed underwriting compensation. An Authorized Participant who directs a Paired Issuance is under no obligation to buy any specific number of MacroShares Units and may sell the MacroShares Units that it has purchased. In addition, an Authorized Participant is under no obligation to create or redeem MacroShares Units at any time, and an Authorized Participant is under no obligation to offer to the public any shares that are part of a MacroShares Unit which it did not create. In connection with any Paired Issuance, any Authorized Participant that creates a MacroShares Unit will be deemed to be a statutory underwriter of the Paired Shares and will be subject to the prospectus delivery requirements and liability provisions of the Securities Act. An Authorized Participant will be required to deliver a prospectus in connection with any transaction for which the Authorized Participant will be deemed a statutory underwriter.

The marketing agents are assisting us in (1) developing and executing a marketing plan for the Up Trust on an ongoing basis and (2) preparing marketing materials for the Up MacroShares. Fees are paid to the marketing agents by the trustee out of the Fee Deduction Amount as compensation for the services performed by it for the Up Trust. MACRO Financial, LLC may from time to time compensate individual brokers and dealers who are FINRA members, but who are not Authorized Participants, in connection with sales of the Up MacroShares made by such brokers and dealers. The aggregate sum of the marketing agents' compensation, the Administrative Agent's compensation, any sales compensation paid by MACRO Financial, LLC to individual brokers and dealers, and any expenses reimbursable to the Marketing Agent and the Administrative Agent with regard to the sale of the Up MacroShares, will, in no event, exceed the maximum amount of 10% of the gross proceeds of this offering.

[                     ] and [             ] also called the Initial Purchasers, have, subject to conditions, agreed to purchase [           ] Up MacroShares and Down MacroShares, which comprise of [    ] MacroShares Units, at the price of $[             ] per each such share pursuant to a distribution agreement among the Depositor and the Initial Purchasers. Total proceeds of the Up Trust from the sale of its shares to the Initial Purchasers will be [              ]. The public offering price of the Up MacroShares will be determined by reference to, among other considerations, the Applicable Reference Value of Medical Inflation and the known index values of the medical care component of the CPI-U in addition to prevailing market price of such shares at the time of sale. The Up MacroShares held by the Initial Purchasers may be sold at different prices if sold at different times. The Initial Purchasers may receive commissions/fees from investors who purchase the Up MacroShares.

The Up MacroShares will be listed on the New York Stock Exchange under the trading symbol "[      ]."

LEGAL OPINIONS

Certain legal matters relating to the Up MacroShares and certain federal income tax consequences will be passed upon for us, the Paired Trusts and MacroMarkets LLC by Skadden, Arps, Slate, Meagher & Flom LLP. Skadden, Arps, Slate, Meagher & Flom LLP has from time to time represented and is currently representing us, MacroMarkets LLC and their affiliates in connection with other transactions.

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EXPERTS

The Financial Statements of the Up Trust as of January [ ], 2008, which are included in this prospectus, have been so included in reliance on the report of [                         ], independent registered public accounting firm, given on the authority of said firm as experts in accounting and auditing.

GLOSSARY OF DEFINED TERMS

"Additional Deduction Amount" the amount of funds withdrawn from the assets of the Up Trust or the Down Trust, as applicable, to pay the fees and expenses incurred by that trust in excess of its Fee Deduction Amount.

"Applicable Reference Value of Medical Inflation" means the daily linear interpolation of the monthly value calculated and published by the Bureau of Labor Statistics for the medical care component of the CPI-U. The Applicable Reference Value of Inflation is determined for each calendar day using the following formula:

CPIt	=	CPIM-3	+	t-1	(CPIM-2 - CPIM-3)
				D

where t is a specified calendar day in current calendar month M;

CPI_M-2 and CPI_M-3 are the Applicable Reference Values of Medical Inflation for the second and third preceding calendar months, respectively, as determined and published by the BLS on the corresponding Index Publication Days; and

D is the number of days in current calendar month.

"Authorized Participant" means an entity that:

· a registered broker-dealer and a member in good standing with the Financial Industry Regulatory Authority ("FINRA"), or a participant in the securities markets such as a bank or other financial institution that is not required to register as a broker-dealer or be a member of FINRA in order to engage in securities transactions;

· is a participant in DTC or has indirect access to the clearing facilities of DTC by virtue of a custodial relationship with a DTC participant; and

· has entered into a Participants Agreement.

"Available Income"means, on each Distribution Date, an amount calculated for each of the Paired trusts as all funds on deposit in the applicable trust on that Distribution Date after that trust has (i) set aside an amount equal to the Fee Deduction Amount to pay fees and expenses, (ii) paid or received a payment from the other Paired trust under the income distribution agreement and (iii) acquired treasuries with an aggregate purchase rate equal to the aggregate par amount of its shares as of that Distribution Date.

If the Available Income of either Paired trust for any Calculation Period is a negative number, then the Available Income of that trust for the applicable Distribution Date will be equal to zero and that trust will not make any payments under the income distribution agreement or any Quarterly Distribution to its shareholders on that Distribution Date unless it was entitled to and received a portion of the other Paired trust's Available Income.

"BLS"means Bureau of Labor Statistics.

"Business Day"means any day other than a Saturday, a Sunday or a day on which banking institutions and stock exchanges in New York, New York are authorized or required by law, regulation or executive order to close.

"Calculation Period"means, for each Distribution Date, the period beginning on (but excluding) the second Business Day prior to the preceding Distribution Date (or, in the case of the first Distribution Date, beginning on the Closing Date) and ending on (and including) the second Business Day prior to the current Distribution Date (or, in the case of the last Distribution Date, ending on and including the Distribution Payment Date that follows the Final Scheduled Termination Date or Early Termination Date).

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"Closing Date"means February [     ], 2008.

"Code"means the Internal Revenue Code of 1986, as amended.

"Compounded Hurdle Rate" equals, for each calendar day, (1 + .04)^p, where p equals a fraction the numerator of which is the number of days that has elapsed since the closing date and the denominator is either 365 or 366, depending upon the actual number of days in the current year.

"CPI-U" means Consumer Price Index for All Urban Consumers.

"Daily Fee Accrual" means, for each day occurring during any Calculation Period for the Up or Down Trust, the Up or Down Asset Amount, as applicable, multiplied by the Daily Fee Accrual Rate on that day. The sum of the Daily Fee Accruals for the Up Trust or the Down Trust for an entire Calculation Period will be equal to the Fee Deduction Amount for that Calculation Period and that trust.

"Daily Fee Accrual Rate"means an annual rate equal to 1.00%, divided by 365 or 366, depending on the actual number of days in the current year. This rate represents the annual rate at which the fees and expenses of each of the Paired trusts are assumed to accrue.

"Daily Yield Rate" means for purposes of calculating the Up Available Income Accrual and the Down Available Income Accrual for each treasury on deposit in the applicable trust, the yield rate applicable to that treasury divided by either 365 or 366, depending upon the actual number of days in the current year. For purposes of this definition, the "yield rate" for each treasury will be equal to its stated or implied interest or yield rate, if any, or any applicable discount rate, based on the date of purchase, the purchase rate at which the applicable Paired trust acquired that treasury and, in the case of treasury repurchase agreements, the repurchase rate.

"Distribution Date"means the second Business Day preceding each Record Date.

"Distribution Payment Date"means the third Business Day of the month immediately following the month in which the related Distribution Date occurred.

"Down Aggregate Par Amount"means an amount determined on any date by multiplying the aggregate number of Down MacroShares issued by the Down Trust, whether on the Closing Date or in Paired Issuances less any shares that were redeemed prior to that date, by the Par Amount.

"Down Asset Amount"refers to the amount of assets on deposit in the Down Trust, calculated as of any day occurring during any Calculation Period as the sum of:

· the Down Investment Amount

plus

· the sum of the Down Available Income Accruals for each elapsed day of that Calculation Period (not including the day of measurement)

minus

· the portion of those Down Available Income Accruals that were distributed in connection with all Paired Optional Redemptions that have occurred during that Calculation Period prior to the day of measurement

plus

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· the portion of the proceeds of all Paired Issuances that have occurred during that Calculation Period prior to the day of measurement that represent the aggregate Down Available Income Accruals that would have accrued on the aggregate par amount of the Down MacroShares that were created in such Paired Issuances if such shares had been outstanding during the period from the last distribution date to the applicable Issuance Date.

The Down Asset Amount on each Distribution Date will not be calculated as described above, but will instead be equal to the aggregate amount of funds on deposit in the Down Trust on that Distribution Date, including all interest, discount, principal and any other amounts received upon the month of its treasuries held by the Down Trust during the preceding Calculation Period.

"Down Available Income Accrual" means, for each day occurring during any Calculation Period, (i) the sum of, for each treasury on deposit in the Down Trust on that date, the product of the purchase rate at which the trust acquired that treasury (or, in the case of any treasury that was not acquired at a discount, the par amount of that treasury) multiplied by the Daily Yield Rate applicable to that treasury minus (ii) the Daily Fee Accrual. If the result of the foregoing calculation is a negative number, then the Down Available Income Accrual will be equal to zero.

"Down Earned Income Accrual" means, for each calendar day occurring during any Calculation Period:

· the sum of the Down Available Income Accrual and the Up Available Income Accrual for that day multiplied by a fraction the numerator of which is the Underlying Value of the Up Trust as of the last preceding business day and the denominator of which is the sum of the such Underlying Value and the underlying value of the Down Trust, each also as of the last preceding business day,

plus

· if the day of measurement is also an Issuance Date on which a net increase in the Down Aggregate Par Amount has occurred after giving effect to all Paired Issuances and Paired Optional Redemptions on that date, the product of the number of Down MacroShares created on such date constituting such net increase and the income component of the Per Share Underlying Value of each such Down MacroShare, representing the Down Earned Income Accrual allocable to such share during the period from the last preceding Distribution Date to such Issuance Date,

minus

· if the day of measurement is also a Redemption Date on which a net decrease in the Down Aggregate Par Amount has occurred after giving effect to all Paired Optional Redemptions and Paired Issuances, the product of the number of Down MacroShares redeemed on such day constituting such net decrease and the income component of the Per Share Underlying Value of each such Down MacroShare, representing the Down Earned Income Accrual allocable to such share during the period from the last preceding Distribution Date to such Redemption Date.

The Down Earned Income Accrual for each Calculation Period will be equal to the sum of the Down Earned Income Accruals for each day of that Calculation Period.

"Down Trust Agreement"means the amended and restated trust agreement, dated as of January [ ], 2008, entered into by us, as depositor, State Street Bank and Trust Company, as trustee for the Down Trust, MacroMarkets LLC, as administrative agent, Natixis Securities North America Inc., as a marketing agent, and MACRO Financial, LLC, as a marketing agent.

"Down Investment Amount" will equal, on any Distribution Date, the amount of cash that was actually invested on behalf of the Down Trust in treasuries on that Distribution Date, which is required to equal the lesser of (x) the aggregate par amount of its outstanding shares and (y) all funds that the trust holds on deposit on that Distribution Date. The "Down Investment Amount" on any other day occurring during any Calculation Period will equal the aggregate par amount of the Down MacroShares that are outstanding on that date if the amount actually invested on the preceding Distribution Date was equal to the Down Aggregate Par Amount on that date. If the amount actually invested on the last Distribution Date was less than the Down Aggregate Par Amount, then the "Down Investment Amount" for each day of the ensuing Calculation Period will equal the amount that was actually invested divided by the number of Down MacroShares outstanding on that Distribution Date, multiplied by the number of Down MacroShares that are outstanding on that day of measurement.

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"DTC"means The Depository Trust Company.

"Early Termination Date"means the next Distribution Date that follows the occurrence of a Termination Trigger.

"Exchange Act"means the Securities Exchange Act of 1934, as amended.

"Fee Deduction Amount"means, for each Calculation Period and each Paired trust, an amount equal to the sum of, for each day during that Calculation Period, the Up Asset Amount or the Down Asset Amount, as applicable, as of that day multiplied by the Daily Fee Accrual Rate.

"Final Distribution"means any distribution made in redemption of all or a portion of the Up MacroShares on the Final Scheduled Termination Date, an Early Termination Date or a Redemption Date, as described in "DESCRIPTION OF THE UP MACROSHARES — Final Distribution."

"Final Scheduled Termination Date"means the Distribution Date scheduled to occur on [], 2018.

"Hurdle Rate"means [4.00]%.

"Index Publication Day" means the business day in each month on which the BLS publishes the value for the medical care component of the CPI-U for the previous month. At the beginning of each year, the BLS releases a schedule listing the index publication days for that year, which can be located at http://www.bls.gov/schedule/schedule/by_prog/cpi_sched.htm.

"Issuance Date" means the Business Day following each Issuance Order Date on which a Paired Issuance is effected, provided that, in the case of any creation order that is delivered on a Distribution Date or the Business Day following the Distribution Date, the "Issuance Date" will be the third Business Day following the Issuance Order Date.

"Issuance Order Date"means the Business Day on which an Authorized Participant delivers a creation order to the administrative agent directing a Paired Issuance.

"Leveraged Settlement Factor"equals, on any date,

where CPI_tis the Applicable Reference Value of Medical Inflation on a particular day; CPI₀is the Applicable Reference Value of Medical Inflation on the closing date; and p equals a fraction, the numerator of which is the number of days that has elapsed since the closing date and the denominator is either 365 or 366, depending upon the actual number of days in the current year.

"MacroShares Unit"means 50,000 Up MacroShares and 50,000 Down MacroShares.

"Medical Inflation Ratio" means the ratio of the Applicable Reference Value of Medical Inflation as of any particular day to the Applicable Reference Value of Medical Inflation as of the Closing Date.

"Paired Shares"means the Up MacroShares and the Down MacroShares.

"Paired trusts"means the Up Trust and the Down Trust.

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"Paired Issuance"means the issuance of Paired Shares in MacroShares Units as described in "DESCRIPTION OF THE UP MACROSHARES — Paired Issuances."

"Paired Optional Redemption"means a redemption of the Paired Shares in MacroShares Units as described in "DESCRIPTION OF THE UP MACROSHARES — Final Distribution — Final Distributions in Paired Optional Redemptions."

"Par Amount"means for each Up MacroShare and each Down MacroShare, a stated amount equal to $[20] per share.

"Participants Agreement"means an agreement entered into by us, the entity or entities acting as the administrative agents and trustees of the Up Trust and the Down Trust and an Authorized Participant, that specifies procedures for the Paired Issuance and Paired Optional Redemption of Paired Shares.

"Per Share Underlying Value" means, with respect to each Business Day occurring during any Calculation Period and (i) each Up MacroShare, an amount calculated by dividing the Underlying Value of the Up Trust by the number of Up MacroShares outstanding on that day, and (ii) each Down MacroShare, an amount calculated by dividing the Underlying Value of the Down Trust by the number of Down MacroShares outstanding on that day.

"Quarterly Distribution"means, for each Distribution Date, the distribution to be made to the holders of the Up MacroShares that is described in "DESCRIPTION OF THE UP MACROSHARES — Quarterly Distributions."

"Record Date"means the last Business Day of March, June, September and December of each year, commencing in March of 2008.

"Redemption Cash Component"means the funds that must be delivered by the Authorized Participant to the trustee in connection with any redemption in which treasuries are being delivered to make the Final Distribution and these treasuries, valued at their acquisition cost, represent a value in excess of the Per Share Underlying Value of the shares being redeemed.

"Redemption Date" means the Business Day following the Redemption Order Date on which a Paired Optional Redemption is effected or, in the event that the Redemption Order Date is a Distribution Date or the Business Day following the Distribution Date, on the third Business Day after the Redemption Order Date.

"Redemption Order Date"means any Business Day on which an Authorized Participant places an order for a Paired Optional Redemption.

"Redemption Percentage" means:

· on any Redemption Order Date, a fraction, expressed as a percentage:

- the numerator of which is the aggregate number of Up MacroShares that are being redeemed and the denominator of which is the aggregate number of Up MacroShares that are outstanding prior to the redemption, in the case of the Up MacroShares; and

- the numerator of which is the aggregate number of Down MacroShares that are being redeemed and the denominator of which is the aggregate number of Down MacroShares that are outstanding prior to the redemption, in the case of the Down MacroShares; or

· on the Final Scheduled Termination Date or an Early Termination Date, a percentage equal to 100%.

"Securities Act" means the United States Securities Act of 1933, as amended.

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"Settlement Factor" will equal, on any day of measurement, the Medical Inflation Ratio on that day divided by the Compounded Hurdle Rate.

"Termination Triggers"has the meaning described in "DESCRIPTION OF THE UP MACROSHARES — Termination Triggers."

"Trust Agreements"means the Up Trust Agreement and the Down Trust Agreement.

"Trustee Termination Event"has the meaning described in"DESCRIPTION OF THE TRUST AGREEMENTS — Trustee Termination Events."

"Underlying Value" of the Up Trust will equal, on any Business Day occurring during any Calculation Period:

· the sum of the Up Earned Income Accruals for each day that has elapsed during the current Calculation Period, up to and including the current Business Day

plus

· the Up Investment Amount on that date multiplied by the Leveraged Settlement Factor, calculated as of the day preceding the current Business Day.

The Underlying Value for any Business Day that is preceded by one or more days that are not Business Days will include the Up Earned Income Accruals for each of these days, calculated on the basis of the Applicable Reference Value of Medical Inflation as of the day preceding each such non-Business Day.

The Underlying Value of the Down Trust will be equal to the Up Asset Amount plus the Down Asset Amount minus the Underlying Value of the Up Trust.

"Up Aggregate Par Amount"means an amount determined on any date by multiplying the aggregate number of Up MacroShares issued by the Up Trust on any Issuance Date, less any shares that were redeemed prior to that date, by the Par Amount.

"Up Asset Amount"refers to the amount of assets on deposit in the Up Trust, calculated as of each day occurring during any Calculation Period as the sum of:

· the Up Investment Amount

plus

· the sum of the Up Available Income Accruals for each elapsed day of that Calculation Period (not including the day of measurement)

minus

· the portion of those Up Available Income Accruals that were distributed in connection with all Paired Optional Redemptions that have occurred during that Calculation Period prior to the day of measurement

plus

· the portion of the proceeds of all Paired Issuances that have occurred during that Calculation Period prior to the date of measurement that represent the aggregate Up Available Income Accruals that would have accrued on the aggregate par amount of the Up MacroShares that were created in such Paired Issuances if such shares had been outstanding during the period from the last distribution date to the applicable Issuance Date.

87

The Up Asset Amount on each Distribution Date will not be calculated as described above, but will instead be equal to the aggregate amount of funds on deposit in the Up Trust on that Distribution Date, including all interest, discount, principal and any other amounts received upon the month of its treasuries held by the Down Trust during the preceding Calculation Period.

"Up Available Income Accrual" means, for each day occurring during any Calculation Period, (i) the sum of, for each treasury on deposit in the Up Trust on that day, the product of the purchase rate at which the trust acquired that treasury (or, in the case of any treasury that was not acquired at a discount, the par amount of that treasury) multiplied by the Daily Yield Rate applicable to that treasury minus (ii) the Daily Fee Accrual. If the result of the foregoing calculation is a negative number, then the Up Available Income Accrual will be equal to zero.

"Up Earned Income Accrual" means, for each calendar day occurring during any Calculation Period:

· the sum of the Up Available Income Accrual and the Down Available Income Accrual for that day multiplied by a fraction the numerator of which is the Underlying Value of the Up Trust as of the last preceding business day and the denominator of which is the sum of the such Underlying Value and the underlying value of the Down Trust, each also as of the last preceding business day,

plus

· if the day of measurement is also an Issuance Date on which a net increase in the Up Aggregate Par Amount has occurred after giving effect to all Paired Issuances and Paired Optional Redemptions on that date, the product of the number of Up MacroShares created on such date constituting such net increase and the income component of the Per Share Underlying Value of each such Up MacroShare, representing the Up Earned Income Accrual allocable to such share during the period from the last preceding Distribution Date to such Issuance Date;

minus

· if the day of measurement is also a Redemption Date on which a net decrease in the Up Aggregate Par Amount has occurred after giving effect to all Paired Optional Redemptions and Paired Issuances on that day, the product of the number of Up MacroShares redeemed on such day constituting such net decrease and the income component of the Per Share Underlying Value of each such Up MacroShare, representing the Up Earned Income Accrual allocable to such share during the period from the last preceding Distribution Date to such Redemption Date.

The Up Earned Income Accrual for each Calculation Period will be equal to the sum of the Up Earned Income Accruals for each day of that Calculation Period.

"Up Trust Agreement"means the amended and restated trust agreement, dated as of January [ ], 2008, entered into by us, as depositor, State Street Bank and Trust Company, as trustee for the Up Trust, MacroMarkets LLC, as administrative agent, Natixis Securities North America Inc., as a marketing agent and MACRO Financial, LLC, also as a marketing agent.

"Up Investment Amount" will equal, on any Distribution Date, the amount of cash that was actually invested on behalf of the Up Trust in treasuries on that Distribution Date, which is required to equal the lesser of (x) the aggregate par amount of its outstanding shares and (y) all funds that the trust holds on deposit on that Distribution Date. The "Up Investment Amount" on any other day occurring during any Calculation Period will equal the aggregate par amount of the Up MacroShares that are outstanding on that day if the amount actually invested on the preceding Distribution Date was equal to the Up Aggregate Par Amount on that day. If the amount actually invested on the last Distribution Date was less than the Up Aggregate Par Amount, then the "Up Investment Amount" for each day during the ensuing Calculation Period will equal the amount that was actually invested divided by the number of Up MacroShares outstanding on that Distribution Date, multiplied by the number of Up MacroShares that are outstanding on the day of measurement.

"Value" means, with respect to each treasury, the purchase rate at which the applicable Paired Trust acquired that treasury plus all interest and/or discount accrued on that treasury since its acquisition date.

88

Appendix A

Hypothetical Scenarios

As discussed in the preceding sections of this prospectus, Quarterly Distributions and the Final Distribution on your Up MacroShare depend upon the Underlying Value of the Up Trust. The Underlying Value of the Up Trust at any time depends on the level of the Applicable Reference Value of Medical Inflation. It is not possible to show all possible payment scenarios on Up MacroShares, because we cannot predict future fluctuations in the level of the Applicable Reference Value of Medical Inflation or the prevailing interest and discount rates associated with the treasuries deposited in the paired trusts at any particular point in time. However, to illustrate the unique structural and performance characteristics of the Up MacroShares, we have created eighteen different hypothetical scenarios to show the hypothetical performance of one Up MacroShare.

The tables that follow illustrate the performance of one Up MacroShare under various scenarios based on different assumptions about the level of the Applicable Reference Value of Medical Inflation and the yield on the treasuries in the paired trusts. For presentation purposes only, we have assigned hypothetical values to the Applicable Reference Value of Medical Inflation and hypothetical yields on the treasuries in the paired trusts to illustrate different possible performance scenarios. We have set the beginning value of the Applicable Reference Value of Medical at 200, which is the level of the Applicable Reference Value of Medical Inflation on the closing date, to facilitate comparisons between the level of the Applicable Reference Value of Medical Inflation on the closing date and the level of the Applicable Reference Value of Medical Inflation on subsequent dates. The levels of the Applicable Reference Value of Medical Inflation contained in the tables do not represent the actual levels of the Applicable Reference Value of Medical Inflation at any particular point in time and are not predictions about the future levels of the Applicable Reference Value of Medical Inflation.

The tables that follow present fifteen different hypothetical scenarios. The following matrix represents the various scenarios covered by the fifteen hypothetical tables:

Price Levels	Interest Rate Scenarios
	Interest Rates Rise	Interest Rates Fall	Interest Rates Remain Constant
Value of medical inflation increases above 4% annually	Table 1	Table 2	Table 3
Value of medical inflation decreases	Table 4	Table 5	Table 6
Value of medical inflation is volatile with the net change remaining around 4% annually	Table 7	Table 8	Table 9
Value of medical inflation is volatile with the net change below 4% annually	Table 10	Table 11	Table 12
Value of medical inflation is volatile with a net change above 4% annually	Table 13	Table 14	Table 15
Value of medical inflation increases less than 4% annually	Table X	Table Y	Table Z

A-1

Appendix A

Each of the following hypothetical tables is based on the following assumptions:

· the current starting level of the Applicable Reference Value of Medical Inflation on the closing date is 200;

· the final scheduled termination date is August 15th, 2012;

· the Up Aggregate Par Amount is equal to the Down Aggregate Par Amount;

· The underlying value of the Up Trust is calculated by reference to the rate of change in the Applicable Reference Value of Medical Inflation compared to the Applicable Reference Value of Medical Inflation on the closing date compounded at the hurdle rate of [4.0]% per annum.

· no paired optional redemptions will occur prior to the final scheduled termination date;

· no subsequent issuances will occur during the period from the closing date to the final scheduled termination date;

· no Termination Triggers will occur during the period from the closing date to the final scheduled termination date;

· on the closing date, the portion of the Underlying Value of the Up Trust allocable to one Up MacroShare is $20.00 and the portion of the Underlying Value of the Down Trust allocable to one Down MacroShare is $20.00;

· the aggregate annual fees for the Up Trust, including MSR’s licensing fee, the trustee’s fee and the expenses of the Up Trust, will be equal to 1.00% per annum; and

· the aggregate annual fees for the Down Trust, including MSR's licensing fee, the trustee's fee and the expenses of the Down Trust, will be equal to 1.00% per annum

A-2

Appendix A

As an example of the way the MACRO trusts function in a scenario in which the available income are insufficient to pay the quarterly fees of the trusts, we refer you to the hypothetical table on page B-4. In that hypothetical table, during the months June 20, 2003 to April 20, 2004, the available income did not suffice to pay the daily fees which caused the reduction of the par amount and, accordingly, the underlying value. As soon as the treasuries earnings increased above the level of the quarterly fees and available income accruals were created, as was the case in June 2004, the available income accruals were used to increase the par amount, which would continue until the par amount reached its original value.

A-3

Appendix A

 Hypothetical Table 1: Value of medical inflation increases above 4% annually and interest rates rise

The following table illustrates the hypothetical scenario in which the Applicable Reference Value of Medical Inflation has increased at a rate above the compounded hurdle rate and the interest rate on the treasuries held in the paired trusts increased steadily from the closing date through the final scheduled termination date.

Quarter Ended	Value (1)	Three-Month Treasury Yield (2)	Total Fees (3)		Total Value Change	Change in Value Since the Most Recent Period	Calculated Value (4)		Income Distributions		Cumulative Income Less Fees (5)		Underlying Value (6)
			Up MacroShare	Down MacroShare			Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare
November 15, 2007	200.00	4.00%					$20.00	$20.00			-	-	20.00	20.00
February 15, 2008	203.00	4.10%	$0.050	$0.050	1.50%	1.50%	$20.20	$19.80	$0.15	$0.15	$0.15	$0.15	$20.36	$19.94
May 15, 2008	206.05	4.20%	$0.050	$0.050	3.02%	1.50%	$20.41	$19.59	$0.16	$0.15	$0.31	$0.31	$20.57	$19.74
August 15, 2008	209.14	4.30%	$0.050	$0.050	4.57%	1.50%	$20.61	$19.39	$0.16	$0.16	$0.47	$0.47	$20.78	$19.54
November 15, 2008	212.27	4.40%	$0.050	$0.050	6.14%	1.50%	$20.82	$19.18	$0.17	$0.16	$0.63	$0.63	$20.99	$19.34
February 15, 2009	215.46	4.50%	$0.050	$0.050	7.73%	1.50%	$21.03	$18.97	$0.18	$0.16	$0.80	$0.80	$21.21	$19.13
May 15, 2009	218.69	4.60%	$0.050	$0.050	9.34%	1.50%	$21.24	$18.76	$0.19	$0.16	$0.98	$0.98	$21.42	$18.93
August 15, 2009	221.97	4.70%	$0.050	$0.050	10.98%	1.50%	$21.45	$18.55	$0.19	$0.17	$1.16	$1.16	$21.64	$18.72
November 15, 2009	225.30	4.80%	$0.050	$0.050	12.65%	1.50%	$21.66	$18.34	$0.20	$0.17	$1.34	$1.34	$21.86	$18.51
February 15, 2010	228.68	4.90%	$0.050	$0.050	14.34%	1.50%	$21.87	$18.13	$0.21	$0.17	$1.53	$1.53	$22.08	$18.30
May 15, 2010	232.11	5.00%	$0.050	$0.050	16.05%	1.50%	$22.09	$17.91	$0.22	$0.17	$1.73	$1.73	$22.30	$18.09
August 15, 2010	235.59	5.10%	$0.050	$0.050	17.79%	1.50%	$22.30	$17.70	$0.22	$0.18	$1.93	$1.93	$22.52	$17.88
November 15, 2010	239.12	5.20%	$0.050	$0.050	19.56%	1.50%	$22.52	$17.48	$0.23	$0.18	$2.13	$2.13	$22.75	$17.66
February 15, 2011	242.71	5.30%	$0.050	$0.050	21.36%	1.50%	$22.73	$17.27	$0.24	$0.18	$2.34	$2.34	$22.97	$17.45
May 15, 2011	246.35	5.40%	$0.050	$0.050	23.18%	1.50%	$22.95	$17.05	$0.25	$0.18	$2.56	$2.56	$23.20	$17.23
August 15, 2011	250.05	5.50%	$0.050	$0.050	25.02%	1.50%	$23.17	$16.83	$0.25	$0.19	$2.78	$2.78	$23.42	$17.02
November 15, 2011	253.80	5.60%	$0.050	$0.050	26.90%	1.50%	$23.39	$16.61	$0.26	$0.19	$3.00	$3.00	$23.65	$16.80
February 15, 2012	257.60	5.70%	$0.050	$0.050	28.80%	1.50%	$23.61	$16.39	$0.27	$0.19	$3.23	$3.23	$23.88	$16.58
May 15, 2012	261.47	5.80%	$0.050	$0.050	30.73%	1.50%	$23.83	$16.17	$0.28	$0.19	$3.47	$3.47	$24.11	$16.36
August 15, 2012	265.39	5.90%	$0.050	$0.050	32.70%	1.50%	$24.06	$15.94	$0.29	$0.19	$3.71	$3.71	$24.34	$16.14

(1) “Value” refers to the hypothetical value of the Applicable Reference Value of Medical Inflation.

(2) “Three-Month Treasury Yield” is the hypothetical annualized yield associated with the treasuries that mature on or prior to the next distribution date for each quarterly period.

(3) “Total Fees” are calculated by multiplying the initial underlying value amount by the annualized fee accrual rate equal to 1.00% prorated for the quarterly period over a 365 day year at 91.25 days per quarter.

(4) “Calculated Value” is the “levered rate of change” applied to the closing date value of $20. It is the value of the Up MacroShare or Down MacroShare before allocating income less fees that are applied to the “Underlying Value”.

(5) “Income Distributions” is calculated by multiplying the cumulative percent change in price since the initial period by income net of fees, which is calculated by multiplying the quarterly three-month treasury bill rate by the initial underlying value less quarterly fees.

(6) “Cumulative Income Less Fees” are calculated by adding the income distributions since the initial date to the applicable distribution date.

(7) “Underlying Value” is calculated by adding the Calculated Value of the relevant trust for the applicable distribution date (see related columns above) to the Cumulative Income Less Fees for the related three month period (see related columns above).

The hypothetical scenarios included in this offering document have been prepared by, and are the responsibility of, the Trust’s management. [                                  ] has neither examined nor compiled the accompanying hypothetical scenarios and accordingly, [                                  ] does not express an opinion or any other form of assurances with respect thereto. The [                                  ] report included in this offering document relates to the Trust’s historical financial information. It does not extend to the hypothetical scenarios and should not be read to do so. The hypothetical information shown in this Appendix was not prepared with a view toward compliance with published guidelines of the Securities and Exchange Commission or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information.

A-4

Appendix A

Hypothetical Table 2: Value of medical inflation increases above compounded hurdle rate and interest rates fall
The following table illustrates the hypothetical scenario in which the Applicable Reference Value of Medical Inflation has increased at a rate above 4% annually and the interest rate on the treasuries held in the paired trusts has decreased steadily from the closing date through the final scheduled termination date.
		Three-Month Treasury Yield (2)	Total Fees (3)		Total Value Change	Change in Value Since the Most Recent Period	Calculated Value (4)		Allocated Income After Income Distribution Agreement (5)		Cumulative Income Less Fees (6)		Underlying Value (6)
Quarter Ended	Value (1)		Up MacroShare	Down MacroShare			Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare
November 15, 2007	200.00	4.00%					$20.00	$20.00			-	-	20.00	20.00
February 15, 2008	203.00	3.90%	$0.050	$0.050	1.50%	1.50%	$20.20	$19.80	$0.15	$0.15	$0.15	$0.15	$20.36	$19.94
May 15, 2008	206.05	3.80%	$0.050	$0.050	3.02%	1.50%	$20.41	$19.59	$0.15	$0.14	$0.30	$0.30	$20.56	$19.73
August 15, 2008	209.14	3.70%	$0.050	$0.050	4.57%	1.50%	$20.61	$19.39	$0.14	$0.14	$0.44	$0.44	$20.76	$19.52
November 15, 2008	212.27	3.60%	$0.050	$0.050	6.14%	1.50%	$20.82	$19.18	$0.14	$0.13	$0.57	$0.57	$20.96	$19.31
February 15, 2009	215.46	3.50%	$0.050	$0.050	7.73%	1.50%	$21.03	$18.97	$0.14	$0.12	$0.70	$0.70	$21.17	$19.09
May 15, 2009	218.69	3.40%	$0.050	$0.050	9.34%	1.50%	$21.24	$18.76	$0.13	$0.12	$0.83	$0.83	$21.37	$18.88
August 15, 2009	221.97	3.30%	$0.050	$0.050	10.98%	1.50%	$21.45	$18.55	$0.13	$0.11	$0.95	$0.95	$21.58	$18.66
November 15, 2009	225.30	3.20%	$0.050	$0.050	12.65%	1.50%	$21.66	$18.34	$0.12	$0.11	$1.06	$1.06	$21.78	$18.45
February 15, 2010	228.68	3.10%	$0.050	$0.050	14.34%	1.50%	$21.87	$18.13	$0.12	$0.10	$1.17	$1.17	$21.99	$18.23
May 15, 2010	232.11	3.00%	$0.050	$0.050	16.05%	1.50%	$22.09	$17.91	$0.12	$0.09	$1.28	$1.28	$22.20	$18.01
August 15, 2010	235.59	2.90%	$0.050	$0.050	17.79%	1.50%	$22.30	$17.70	$0.11	$0.09	$1.38	$1.38	$22.41	$17.79
November 15, 2010	239.12	2.80%	$0.050	$0.050	19.56%	1.50%	$22.52	$17.48	$0.11	$0.08	$1.47	$1.47	$22.62	$17.57
February 15, 2011	242.71	2.70%	$0.050	$0.050	21.36%	1.50%	$22.73	$17.27	$0.10	$0.08	$1.56	$1.56	$22.83	$17.35
May 15, 2011	246.35	2.60%	$0.050	$0.050	23.18%	1.50%	$22.95	$17.05	$0.10	$0.07	$1.65	$1.65	$23.05	$17.12
August 15, 2011	250.05	2.50%	$0.050	$0.050	25.02%	1.50%	$23.17	$16.83	$0.09	$0.07	$1.73	$1.73	$23.26	$16.90
November 15, 2011	253.80	2.40%	$0.050	$0.050	26.90%	1.50%	$23.39	$16.61	$0.09	$0.06	$1.80	$1.80	$23.48	$16.67
February 15, 2012	257.60	2.30%	$0.050	$0.050	28.80%	1.50%	$23.61	$16.39	$0.08	$0.06	$1.87	$1.87	$23.69	$16.45
May 15, 2012	261.47	2.20%	$0.050	$0.050	30.73%	1.50%	$23.83	$16.17	$0.08	$0.05	$1.94	$1.94	$23.91	$16.22
August 15, 2012	265.39	2.10%	$0.050	$0.050	32.70%	1.50%	$24.06	$15.94	$0.07	$0.05	$2.00	$2.00	$24.13	$15.99

(1) “Value” refers to the hypothetical value of the Applicable Reference Value of Medical Inflation.

(2) “Three-Month Treasury Yield” is the hypothetical annualized yield associated with the treasuries that mature on or prior to the next distribution date for each quarterly period.

(3) “Total Fees” are calculated by multiplying the initial underlying value amount by the annualized fee accrual rate equal to 1.00% prorated for the quarterly period over a 365 day year at 91.25 days per quarter.

(4) “Calculated Value” is the “levered rate of change” applied to the closing date value of $20. It is the value of the Up MacroShare or Down MacroShare before allocating income less fees that are applied to the “Underlying Value”.

(5) “Income Distributions” is calculated by multiplying the cumulative percent change in price since the initial period by income net of fees, which is calculated by multiplying the quarterly three-month treasury bill rate by the initial underlying value less quarterly fees.

(6) “Cumulative Income Less Fees” are calculated by adding the income distributions since the initial date to the applicable distribution date.

(7) “Underlying Value” is calculated by adding the Calculated Value of the relevant trust for the applicable distribution date (see related columns above) to the Cumulative Income Less Fees for the related three month period (see related columns above).

The hypothetical scenarios included in this offering document have been prepared by, and are the responsibility of, the Trust’s management. [                                  ] has neither examined nor compiled the accompanying hypothetical scenarios and accordingly, [                                  ] does not express an opinion or any other form of assurances with respect thereto. The [                                  ] report included in this offering document relates to the Trust’s historical financial information. It does not extend to the hypothetical scenarios and should not be read to do so. The hypothetical information shown in this Appendix was not prepared with a view toward compliance with published guidelines of the Securities and Exchange Commission or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information.

A-5

Appendix A

Hypothetical Table 3: Value of medical inflation increases above compounded hurdle rate and interest rates remain constant
The following table illustrates the hypothetical scenario in which the Applicable Reference Value of Medical Inflation has increased steadily at a rate above 4% annually and the interest rate on the treasuries held in the paired trusts has not changed from the closing date through the final scheduled termination date.
		Three-Month Treasury Yield (2)	Total Fees (3)		Total Value Change	Change in Value Since the Most Recent Period	Calculated Value (4)		Income Distributions		Cumulative Income Less Fees (5)		Underlying Value (6)
Quarter Ended	Value (1)		Up MacroShare	Down MacroShare			Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare
November 15, 2007	200.00	4.00%					$20.00	$20.00			-	-	$20.00	$20.00
February 15, 2008	203.00	4.00%	$0.050	$0.050	1.50%	1.50%	$20.20	$19.80	$0.15	$0.15	$0.15	$0.15	$20.36	$19.94
May 15, 2008	206.05	4.00%	$0.050	$0.050	3.02%	1.50%	$20.41	$19.59	$0.15	$0.15	$0.30	$0.30	$20.56	$19.74
August 15, 2008	209.14	4.00%	$0.050	$0.050	4.57%	1.50%	$20.61	$19.39	$0.15	$0.15	$0.45	$0.45	$20.77	$19.53
November 15, 2008	212.27	4.00%	$0.050	$0.050	6.14%	1.50%	$20.82	$19.18	$0.16	$0.14	$0.60	$0.60	$20.98	$19.32
February 15, 2009	215.46	4.00%	$0.050	$0.050	7.73%	1.50%	$21.03	$18.97	$0.16	$0.14	$0.75	$0.75	$21.19	$19.11
May 15, 2009	218.69	4.00%	$0.050	$0.050	9.34%	1.50%	$21.24	$18.76	$0.16	$0.14	$0.90	$0.90	$21.40	$18.90
August 15, 2009	221.97	4.00%	$0.050	$0.050	10.98%	1.50%	$21.45	$18.55	$0.16	$0.14	$1.05	$1.05	$21.61	$18.69
November 15, 2009	225.30	4.00%	$0.050	$0.050	12.65%	1.50%	$21.66	$18.34	$0.16	$0.14	$1.20	$1.20	$21.82	$18.48
February 15, 2010	228.68	4.00%	$0.050	$0.050	14.34%	1.50%	$21.87	$18.13	$0.16	$0.14	$1.35	$1.35	$22.04	$18.26
May 15, 2010	232.11	4.00%	$0.050	$0.050	16.05%	1.50%	$22.09	$17.91	$0.17	$0.13	$1.50	$1.50	$22.25	$18.05
August 15, 2010	235.59	4.00%	$0.050	$0.050	17.79%	1.50%	$22.30	$17.70	$0.17	$0.13	$1.65	$1.65	$22.47	$17.83
November 15, 2010	239.12	4.00%	$0.050	$0.050	19.56%	1.50%	$22.52	$17.48	$0.17	$0.13	$1.80	$1.80	$22.68	$17.62
February 15, 2011	242.71	4.00%	$0.050	$0.050	21.36%	1.50%	$22.73	$17.27	$0.17	$0.13	$1.95	$1.95	$22.90	$17.40
May 15, 2011	246.35	4.00%	$0.050	$0.050	23.18%	1.50%	$22.95	$17.05	$0.17	$0.13	$2.10	$2.10	$23.12	$17.18
August 15, 2011	250.05	4.00%	$0.050	$0.050	25.02%	1.50%	$23.17	$16.83	$0.17	$0.13	$2.25	$2.25	$23.34	$16.96
November 15, 2011	253.80	4.00%	$0.050	$0.050	26.90%	1.50%	$23.39	$16.61	$0.18	$0.12	$2.40	$2.40	$23.56	$16.74
February 15, 2012	257.60	4.00%	$0.050	$0.050	28.80%	1.50%	$23.61	$16.39	$0.18	$0.12	$2.55	$2.55	$23.79	$16.51
May 15, 2012	261.47	4.00%	$0.050	$0.050	30.73%	1.50%	$23.83	$16.17	$0.18	$0.12	$2.70	$2.70	$24.01	$16.29
August 15, 2012	265.39	4.00%	$0.050	$0.050	32.70%	1.50%	$24.06	$15.94	$0.18	$0.12	$2.85	$2.85	$24.24	$16.06

(1) “Value” refers to the hypothetical value of the Applicable Reference Value of Medical Inflation.

(2) “Three-Month Treasury Yield” is the hypothetical annualized yield associated with the treasuries that mature on or prior to the next distribution date for each quarterly period.

(3) “Total Fees” are calculated by multiplying the initial underlying value amount by the annualized fee accrual rate equal to 1.00% prorated for the quarterly period over a 365 day year at 91.25 days per quarter.

(4) “Calculated Value” is the “levered rate of change” applied to the closing date value of $20. It is the value of the Up MacroShare or Down MacroShare before allocating income less fees that are applied to the “Underlying Value”.

(5) “Income Distributions” is calculated by multiplying the cumulative percent change in price since the initial period by income net of fees, which is calculated by multiplying the quarterly three-month treasury bill rate by the initial underlying value less quarterly fees.

(6) “Cumulative Income Less Fees” are calculated by adding the income distributions since the initial date to the applicable distribution date.

(7) “Underlying Value” is calculated by adding the Calculated Value of the relevant trust for the applicable distribution date (see related columns above) to the Cumulative Income Less Fees for the related three month period (see related columns above).

The hypothetical scenarios included in this offering document have been prepared by, and are the responsibility of, the Trust’s management. [                                  ] has neither examined nor compiled the accompanying hypothetical scenarios and accordingly, [                                  ] does not express an opinion or any other form of assurances with respect thereto. The [                                  ] report included in this offering document relates to the Trust’s historical financial information. It does not extend to the hypothetical scenarios and should not be read to do so. The hypothetical information shown in this Appendix was not prepared with a view toward compliance with published guidelines of the Securities and Exchange Commission or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information.

A-6

Appendix A

Hypothetical Table 4: Value of medical inflation decreases and interest rates rise
The following table illustrates the hypothetical scenario in which the Applicable Reference Value of Medical Inflation has decreased steadily and the interest rate on the treasuries held in the paired trusts has increased steadily from the closing date through the final scheduled termination date.
		Three-Month Treasury Yield (2)	Total Fees (3)		Total Value Change	Change in Value Since the Most Recent Period	Calculated Value (4)		Income Distributions		Cumulative Income Less Fees (5)		Underlying Value (6)
Quarter Ended	Value (1)		Up MacroShare	Down MacroShare			Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare
November 15, 2007	200.00	4.00%					$20.00	$20.00			-	-	$20.00	$20.00
February 15, 2008	197.00	4.10%	$0.050	$0.050	-1.50%	-1.50%	$19.02	$20.98	$0.14	$0.16	$0.15	$0.15	$19.16	$21.14
May 15, 2008	194.05	4.20%	$0.050	$0.050	-2.98%	-1.50%	$18.06	$21.94	$0.14	$0.17	$0.31	$0.31	$18.20	$22.11
August 15, 2008	191.13	4.30%	$0.050	$0.050	-4.43%	-1.50%	$17.12	$22.88	$0.14	$0.18	$0.47	$0.47	$17.26	$23.06
November 15, 2008	188.27	4.40%	$0.050	$0.050	-5.87%	-1.50%	$16.21	$23.79	$0.13	$0.20	$0.63	$0.63	$16.34	$23.99
February 15, 2009	185.44	4.50%	$0.050	$0.050	-7.28%	-1.50%	$15.31	$24.69	$0.13	$0.21	$0.80	$0.80	$15.44	$24.90
May 15, 2009	182.66	4.60%	$0.050	$0.050	-8.67%	-1.50%	$14.45	$25.55	$0.13	$0.22	$0.98	$0.98	$14.57	$25.78
August 15, 2009	179.92	4.70%	$0.050	$0.050	-10.04%	-1.50%	$13.60	$26.40	$0.12	$0.24	$1.16	$1.16	$13.72	$26.64
November 15, 2009	177.22	4.80%	$0.050	$0.050	-11.39%	-1.50%	$12.77	$27.23	$0.12	$0.25	$1.34	$1.34	$12.89	$27.48
February 15, 2010	174.56	4.90%	$0.050	$0.050	-12.72%	-1.50%	$11.96	$28.04	$0.11	$0.27	$1.53	$1.53	$12.08	$28.30
May 15, 2010	171.95	5.00%	$0.050	$0.050	-14.03%	-1.50%	$11.18	$28.82	$0.11	$0.28	$1.73	$1.73	$11.29	$29.10
August 15, 2010	169.37	5.10%	$0.050	$0.050	-15.32%	-1.50%	$10.41	$29.59	$0.10	$0.30	$1.93	$1.93	$10.51	$29.89
November 15, 2010	166.83	5.20%	$0.050	$0.050	-16.59%	-1.50%	$9.66	$30.34	$0.10	$0.31	$2.13	$2.13	$9.76	$30.65
February 15, 2011	164.32	5.30%	$0.050	$0.050	-17.84%	-1.50%	$8.93	$31.07	$0.09	$0.33	$2.34	$2.34	$9.03	$31.39
May 15, 2011	161.86	5.40%	$0.050	$0.050	-19.07%	-1.50%	$8.22	$31.78	$0.09	$0.34	$2.56	$2.56	$8.31	$32.12
August 15, 2011	159.43	5.50%	$0.050	$0.050	-20.28%	-1.50%	$7.53	$32.47	$0.08	$0.36	$2.78	$2.78	$7.61	$32.83
November 15, 2011	157.04	5.60%	$0.050	$0.050	-21.48%	-1.50%	$6.85	$33.15	$0.08	$0.37	$3.00	$3.00	$6.92	$33.53
February 15, 2012	154.68	5.70%	$0.050	$0.050	-22.66%	-1.50%	$6.19	$33.81	$0.07	$0.39	$3.23	$3.23	$6.26	$34.20
May 15, 2012	152.36	5.80%	$0.050	$0.050	-23.82%	-1.50%	$5.54	$34.46	$0.07	$0.40	$3.47	$3.47	$5.61	$34.86
August 15, 2012	150.08	5.90%	$0.050	$0.050	-24.96%	-1.50%	$4.91	$35.09	$0.06	$0.42	$3.71	$3.71	$4.97	$35.51

(1) “Value” refers to the hypothetical value of the Applicable Reference Value of Medical Inflation.

(2) “Three-Month Treasury Yield” is the hypothetical annualized yield associated with the treasuries that mature on or prior to the next distribution date for each quarterly period.

(3) “Total Fees” are calculated by multiplying the initial underlying value amount by the annualized fee accrual rate equal to 1.00% prorated for the quarterly period over a 365 day year at 91.25 days per quarter.

(4) “Calculated Value” is the “levered rate of change” applied to the closing date value of $20. It is the value of the Up MacroShare or Down MacroShare before allocating income less fees that are applied to the “Underlying Value”.

(5) “Income Distributions” is calculated by multiplying the cumulative percent change in price since the initial period by income net of fees, which is calculated by multiplying the quarterly three-month treasury bill rate by the initial underlying value less quarterly fees.

(6) “Cumulative Income Less Fees” are calculated by adding the income distributions since the initial date to the applicable distribution date.

(7) “Underlying Value” is calculated by adding the Calculated Value of the relevant trust for the applicable distribution date (see related columns above) to the Cumulative Income Less Fees for the related three month period (see related columns above).

The hypothetical scenarios included in this offering document have been prepared by, and are the responsibility of, the Trust’s management. [                                  ] has neither examined nor compiled the accompanying hypothetical scenarios and accordingly, [                                  ] does not express an opinion or any other form of assurances with respect thereto. The [                                  ] report included in this offering document relates to the Trust’s historical financial information. It does not extend to the hypothetical scenarios and should not be read to do so. The hypothetical information shown in this Appendix was not prepared with a view toward compliance with published guidelines of the Securities and Exchange Commission or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information.

A-7

Appendix A

Hypothetical Table 5: Value of medical inflation decreases and interest rates fall
The following table illustrates the hypothetical scenario in which the Applicable Reference Value of Medical Inflation has decreased steadily and the interest rate on the treasuries held in the paired trusts has decreased steadily from the closing date through the final scheduled termination date.
		Three-Month Treasury Yield (2)	Total Fees (3)		Total Value Change	Change in Value Since the Most Recent Period	Calculated Value (4)		Income Distributions		Cumulative Income Less Fees (5)		Underlying Value (6)
Quarter Ended	Value (1)		Up MacroShare	Down MacroShare			Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare
November 15, 2007	200.00	4.00%					$20.00	$20.00			-	-	$20.00	$20.00
February 15, 2008	197.00	3.90%	$0.050	$0.050	-1.50%	-1.50%	$19.02	$20.98	$0.14	$0.16	$0.15	$0.15	$19.16	$21.14
May 15, 2008	194.05	3.80%	$0.050	$0.050	-2.98%	-1.50%	$18.06	$21.94	$0.13	$0.16	$0.30	$0.30	$18.19	$22.10
August 15, 2008	191.13	3.70%	$0.050	$0.050	-4.43%	-1.50%	$17.12	$22.88	$0.12	$0.16	$0.44	$0.44	$17.24	$23.04
November 15, 2008	188.27	3.60%	$0.050	$0.050	-5.87%	-1.50%	$16.21	$23.79	$0.11	$0.16	$0.57	$0.57	$16.31	$23.96
February 15, 2009	185.44	3.50%	$0.050	$0.050	-7.28%	-1.50%	$15.31	$24.69	$0.10	$0.16	$0.70	$0.70	$15.41	$24.85
May 15, 2009	182.66	3.40%	$0.050	$0.050	-8.67%	-1.50%	$14.45	$25.55	$0.09	$0.16	$0.83	$0.83	$14.54	$25.71
August 15, 2009	179.92	3.30%	$0.050	$0.050	-10.04%	-1.50%	$13.60	$26.40	$0.08	$0.16	$0.95	$0.95	$13.68	$26.56
November 15, 2009	177.22	3.20%	$0.050	$0.050	-11.39%	-1.50%	$12.77	$27.23	$0.07	$0.16	$1.06	$1.06	$12.84	$27.39
February 15, 2010	174.56	3.10%	$0.050	$0.050	-12.72%	-1.50%	$11.96	$28.04	$0.07	$0.15	$1.17	$1.17	$12.03	$28.19
May 15, 2010	171.95	3.00%	$0.050	$0.050	-14.03%	-1.50%	$11.18	$28.82	$0.06	$0.15	$1.28	$1.28	$11.24	$28.97
August 15, 2010	169.37	2.90%	$0.050	$0.050	-15.32%	-1.50%	$10.41	$29.59	$0.05	$0.15	$1.38	$1.38	$10.46	$29.74
November 15, 2010	166.83	2.80%	$0.050	$0.050	-16.59%	-1.50%	$9.66	$30.34	$0.05	$0.14	$1.47	$1.47	$9.71	$30.48
February 15, 2011	164.32	2.70%	$0.050	$0.050	-17.84%	-1.50%	$8.93	$31.07	$0.04	$0.14	$1.56	$1.56	$8.97	$31.21
May 15, 2011	161.86	2.60%	$0.050	$0.050	-19.07%	-1.50%	$8.22	$31.78	$0.03	$0.14	$1.65	$1.65	$8.25	$31.92
August 15, 2011	159.43	2.50%	$0.050	$0.050	-20.28%	-1.50%	$7.53	$32.47	$0.03	$0.13	$1.73	$1.73	$7.56	$32.60
November 15, 2011	157.04	2.40%	$0.050	$0.050	-21.48%	-1.50%	$6.85	$33.15	$0.03	$0.12	$1.80	$1.80	$6.87	$33.28
February 15, 2012	154.68	2.30%	$0.050	$0.050	-22.66%	-1.50%	$6.19	$33.81	$0.02	$0.12	$1.87	$1.87	$6.21	$33.93
May 15, 2012	152.36	2.20%	$0.050	$0.050	-23.82%	-1.50%	$5.54	$34.46	$0.02	$0.11	$1.94	$1.94	$5.56	$34.57
August 15, 2012	150.08	2.10%	$0.050	$0.050	-24.96%	-1.50%	$4.91	$35.09	$0.01	$0.11	$2.00	$2.00	$4.93	$35.19

(1) “Value” refers to the hypothetical value of the Applicable Reference Value of Medical Inflation.

(2) “Three-Month Treasury Yield” is the hypothetical annualized yield associated with the treasuries that mature on or prior to the next distribution date for each quarterly period.

(3) “Total Fees” are calculated by multiplying the initial underlying value amount by the annualized fee accrual rate equal to 1.00% prorated for the quarterly period over a 365 day year at 91.25 days per quarter.

(4) “Calculated Value” is the “levered rate of change” applied to the closing date value of $20. It is the value of the Up MacroShare or Down MacroShare before allocating income less fees that are applied to the “Underlying Value”.

(5) “Income Distributions” is calculated by multiplying the cumulative percent change in price since the initial period by income net of fees, which is calculated by multiplying the quarterly three-month treasury bill rate by the initial underlying value less quarterly fees.

(6) “Cumulative Income Less Fees” are calculated by adding the income distributions since the initial date to the applicable distribution date.

(7) “Underlying Value” is calculated by adding the Calculated Value of the relevant trust for the applicable distribution date (see related columns above) to the Cumulative Income Less Fees for the related three month period (see related columns above).

The hypothetical scenarios included in this offering document have been prepared by, and are the responsibility of, the Trust’s management. [                                  ] has neither examined nor compiled the accompanying hypothetical scenarios and accordingly, [                                  ] does not express an opinion or any other form of assurances with respect thereto. The [                                  ] report included in this offering document relates to the Trust’s historical financial information. It does not extend to the hypothetical scenarios and should not be read to do so. The hypothetical information shown in this Appendix was not prepared with a view toward compliance with published guidelines of the Securities and Exchange Commission or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information.

A-8

Appendix A

Hypothetical Table 6: Value of medical inflation decreases and interest rates remain constant
The following table illustrates the hypothetical scenario in which the Applicable Reference Value of Medical Inflation has decreased steadily and the interest rate on the treasuries held in the paired trusts has not changed from the closing date through the final scheduled termination date.
		Three-Month Treasury Yield (2)	Total Fees (3)		Total Value Change	Change in Value Since the Most Recent Period	Calculated Value (4)		Income Distributions		Cumulative Income Less Fees (5)		Underlying Value (6)
Quarter Ended	Value (1)		Up MacroShare	Down MacroShare			Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare
November 15, 2007	200.00	4.00%					$20.00	$20.00			-	-	$20.00	$20.00
February 15, 2008	197.00	4.00%	$0.050	$0.050	-1.50%	-1.50%	$19.02	$20.98	$0.14	$0.16	$0.15	$0.15	$19.16	$21.14
May 15, 2008	194.05	4.00%	$0.050	$0.050	-2.98%	-1.50%	$18.06	$21.94	$0.14	$0.16	$0.30	$0.30	$18.19	$22.11
August 15, 2008	191.13	4.00%	$0.050	$0.050	-4.43%	-1.50%	$17.12	$22.88	$0.13	$0.17	$0.45	$0.45	$17.25	$23.05
November 15, 2008	188.27	4.00%	$0.050	$0.050	-5.87%	-1.50%	$16.21	$23.79	$0.12	$0.18	$0.60	$0.60	$16.33	$23.97
February 15, 2009	185.44	4.00%	$0.050	$0.050	-7.28%	-1.50%	$15.31	$24.69	$0.11	$0.19	$0.75	$0.75	$15.43	$24.87
May 15, 2009	182.66	4.00%	$0.050	$0.050	-8.67%	-1.50%	$14.45	$25.55	$0.11	$0.19	$0.90	$0.90	$14.55	$25.75
August 15, 2009	179.92	4.00%	$0.050	$0.050	-10.04%	-1.50%	$13.60	$26.40	$0.10	$0.20	$1.05	$1.05	$13.70	$26.60
November 15, 2009	177.22	4.00%	$0.050	$0.050	-11.39%	-1.50%	$12.77	$27.23	$0.10	$0.20	$1.20	$1.20	$12.87	$27.43
February 15, 2010	174.56	4.00%	$0.050	$0.050	-12.72%	-1.50%	$11.96	$28.04	$0.09	$0.21	$1.35	$1.35	$12.05	$28.25
May 15, 2010	171.95	4.00%	$0.050	$0.050	-14.03%	-1.50%	$11.18	$28.82	$0.08	$0.22	$1.50	$1.50	$11.26	$29.04
August 15, 2010	169.37	4.00%	$0.050	$0.050	-15.32%	-1.50%	$10.41	$29.59	$0.08	$0.22	$1.65	$1.65	$10.49	$29.81
November 15, 2010	166.83	4.00%	$0.050	$0.050	-16.59%	-1.50%	$9.66	$30.34	$0.07	$0.23	$1.80	$1.80	$9.73	$30.57
February 15, 2011	164.32	4.00%	$0.050	$0.050	-17.84%	-1.50%	$8.93	$31.07	$0.07	$0.23	$1.95	$1.95	$9.00	$31.30
May 15, 2011	161.86	4.00%	$0.050	$0.050	-19.07%	-1.50%	$8.22	$31.78	$0.06	$0.24	$2.10	$2.10	$8.28	$32.02
August 15, 2011	159.43	4.00%	$0.050	$0.050	-20.28%	-1.50%	$7.53	$32.47	$0.06	$0.24	$2.25	$2.25	$7.58	$32.72
November 15, 2011	157.04	4.00%	$0.050	$0.050	-21.48%	-1.50%	$6.85	$33.15	$0.05	$0.25	$2.40	$2.40	$6.90	$33.40
February 15, 2012	154.68	4.00%	$0.050	$0.050	-22.66%	-1.50%	$6.19	$33.81	$0.05	$0.25	$2.55	$2.55	$6.23	$34.07
May 15, 2012	152.36	4.00%	$0.050	$0.050	-23.82%	-1.50%	$5.54	$34.46	$0.04	$0.26	$2.70	$2.70	$5.58	$34.72
August 15, 2012	150.08	4.00%	$0.050	$0.050	-24.96%	-1.50%	$4.91	$35.09	$0.04	$0.26	$2.85	$2.85	$4.95	$35.35

(1) “Value” refers to the hypothetical value of the Applicable Reference Value of Medical Inflation.

(2) “Three-Month Treasury Yield” is the hypothetical annualized yield associated with the treasuries that mature on or prior to the next distribution date for each quarterly period.

(3) “Total Fees” are calculated by multiplying the initial underlying value amount by the annualized fee accrual rate equal to 1.00% prorated for the quarterly period over a 365 day year at 91.25 days per quarter.

(4) “Calculated Value” is the “levered rate of change” applied to the closing date value of $20. It is the value of the Up MacroShare or Down MacroShare before allocating income less fees that are applied to the “Underlying Value”.

(5) “Income Distributions” is calculated by multiplying the cumulative percent change in price since the initial period by income net of fees, which is calculated by multiplying the quarterly three-month treasury bill rate by the initial underlying value less quarterly fees.

(6) “Cumulative Income Less Fees” are calculated by adding the income distributions since the initial date to the applicable distribution date.

(7) “Underlying Value” is calculated by adding the Calculated Value of the relevant trust for the applicable distribution date (see related columns above) to the Cumulative Income Less Fees for the related three month period (see related columns above).

The hypothetical scenarios included in this offering document have been prepared by, and are the responsibility of, the Trust’s management. [                                  ] has neither examined nor compiled the accompanying hypothetical scenarios and accordingly, [                                  ] does not express an opinion or any other form of assurances with respect thereto. The [                                  ] report included in this offering document relates to the Trust’s historical financial information. It does not extend to the hypothetical scenarios and should not be read to do so. The hypothetical information shown in this Appendix was not prepared with a view toward compliance with published guidelines of the Securities and Exchange Commission or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information.

A-9

Appendix A

Hypothetical Table 7: Value of medical inflation is volatile with the net approximate change remaining around the compounded hurdle rate and interest rates rise
The following table illustrates the hypothetical scenario in which the Applicable Reference Value of Medical Inflation has experienced volatility with the net change remaining 4% annually and the interest rate on the treasuries held in the paired trusts has increased steadily from the closing date through the final scheduled termination date.
		Three-Month Treasury Yield (2)	Total Fees (3)		Total Value Change	Change in Value Since the Most Recent Period	Calculated Value (4)		Income Distributions		Cumulative Income Less Fees (5)		Underlying Value (6)
Quarter Ended	Value (1)		Up MacroShare	Down MacroShare			Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare
November 15, 2007	200.00	4.00%					$20.00	$20.00			-	-	$20.00	$20.00
February 15, 2008	202.35	4.10%	$0.050	$0.050	1.18%	1.18%	$20.08	$19.92	$0.15	$0.15	$0.15	$0.15	$20.23	$20.07
May 15, 2008	203.73	4.20%	$0.050	$0.050	1.87%	0.68%	$19.96	$20.04	$0.15	$0.16	$0.31	$0.31	$20.11	$20.20
August 15, 2008	205.81	4.30%	$0.050	$0.050	2.90%	1.02%	$19.97	$20.03	$0.16	$0.16	$0.47	$0.47	$20.13	$20.19
November 15, 2008	207.40	4.40%	$0.050	$0.050	3.70%	0.77%	$19.88	$20.12	$0.16	$0.17	$0.63	$0.63	$20.05	$20.28
February 15, 2009	209.96	4.50%	$0.050	$0.050	4.98%	1.23%	$19.98	$20.02	$0.17	$0.17	$0.80	$0.80	$20.15	$20.19
May 15, 2009	213.21	4.60%	$0.050	$0.050	6.60%	1.55%	$20.21	$19.79	$0.18	$0.17	$0.98	$0.98	$20.38	$19.97
August 15, 2009	215.08	4.70%	$0.050	$0.050	7.54%	0.88%	$20.16	$19.84	$0.18	$0.18	$1.16	$1.16	$20.34	$20.02
November 15, 2009	216.67	4.80%	$0.050	$0.050	8.33%	0.74%	$20.06	$19.94	$0.19	$0.18	$1.34	$1.34	$20.25	$20.12
February 15, 2010	219.09	4.90%	$0.050	$0.050	9.54%	1.12%	$20.12	$19.88	$0.19	$0.19	$1.53	$1.53	$20.31	$20.07
May 15, 2010	222.34	5.00%	$0.050	$0.050	11.17%	1.48%	$20.31	$19.69	$0.20	$0.19	$1.73	$1.73	$20.51	$19.88
August 15, 2010	224.14	5.10%	$0.050	$0.050	12.07%	0.81%	$20.24	$19.76	$0.20	$0.20	$1.93	$1.93	$20.45	$19.95
November 15, 2010	225.59	5.20%	$0.050	$0.050	12.79%	0.65%	$20.11	$19.89	$0.21	$0.20	$2.13	$2.13	$20.32	$20.09
February 15, 2011	227.87	5.30%	$0.050	$0.050	13.93%	1.01%	$20.12	$19.88	$0.21	$0.21	$2.34	$2.34	$20.33	$20.09
May 15, 2011	231.47	5.40%	$0.050	$0.050	15.73%	1.58%	$20.36	$19.64	$0.22	$0.21	$2.56	$2.56	$20.57	$19.86
August 15, 2011	233.06	5.50%	$0.050	$0.050	16.53%	0.69%	$20.24	$19.76	$0.22	$0.22	$2.78	$2.78	$20.46	$19.98
November 15, 2011	234.65	5.60%	$0.050	$0.050	17.32%	0.68%	$20.12	$19.88	$0.23	$0.22	$3.00	$3.00	$20.34	$20.11
February 15, 2012	237.56	5.70%	$0.050	$0.050	18.78%	1.24%	$20.22	$19.78	$0.23	$0.23	$3.23	$3.23	$20.45	$20.01
May 15, 2012	240.82	5.80%	$0.050	$0.050	20.41%	1.37%	$20.37	$19.63	$0.24	$0.23	$3.47	$3.47	$20.61	$19.86
August 15, 2012	243.18	5.90%	$0.050	$0.050	21.59%	0.98%	$20.37	$19.63	$0.24	$0.24	$3.71	$3.71	$20.61	$19.87

(1) “Value” refers to the hypothetical value of the Applicable Reference Value of Medical Inflation.

(2) “Three-Month Treasury Yield” is the hypothetical annualized yield associated with the treasuries that mature on or prior to the next distribution date for each quarterly period.

(3) “Total Fees” are calculated by multiplying the initial underlying value amount by the annualized fee accrual rate equal to 1.00% prorated for the quarterly period over a 365 day year at 91.25 days per quarter.

(4) “Calculated Value” is the “levered rate of change” applied to the closing date value of $20. It is the value of the Up MacroShare or Down MacroShare before allocating income less fees that are applied to the “Underlying Value”.

(5) “Income Distributions” is calculated by multiplying the cumulative percent change in price since the initial period by income net of fees, which is calculated by multiplying the quarterly three-month treasury bill rate by the initial underlying value less quarterly fees.

(6) “Cumulative Income Less Fees” are calculated by adding the income distributions since the initial date to the applicable distribution date.

(7) “Underlying Value” is calculated by adding the Calculated Value of the relevant trust for the applicable distribution date (see related columns above) to the Cumulative Income Less Fees for the related three month period (see related columns above).

The hypothetical scenarios included in this offering document have been prepared by, and are the responsibility of, the Trust’s management. [                                  ] has neither examined nor compiled the accompanying hypothetical scenarios and accordingly, [                                  ] does not express an opinion or any other form of assurances with respect thereto. The [                                  ] report included in this offering document relates to the Trust’s historical financial information. It does not extend to the hypothetical scenarios and should not be read to do so. The hypothetical information shown in this Appendix was not prepared with a view toward compliance with published guidelines of the Securities and Exchange Commission or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information.

A-10

Appendix A

Hypothetical Table 8: Value of medical inflation is volatile with the net approximate change remaining around the compounded hurdle rate and interest rates fall
The following table illustrates the hypothetical scenario in which the Applicable Reference Value of Medical Inflation has experienced volatility with the net change remaining around 4% annually and the interest rate on the treasuries held in the paired trusts has decreased steadily from the closing date through the final scheduled termination date.
		Three-Month Treasury Yield (2)	Total Fees (3)		Total Value Change	Change in Value Since the Most Recent Period	Calculated Value (4)		Income Distributions		Cumulative Income Less Fees (5)		Underlying Value (6)
Quarter Ended	Value (1)		Up MacroShare	Down MacroShare			Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare
November 15, 2007	200.00	4.00%					$20.00	$20.00			-	-	$20.00	$20.00
February 15, 2008	202.35	3.90%	$0.050	$0.050	1.18%	1.18%	$20.08	$19.92	$0.15	$0.15	$0.15	$0.15	$20.23	$20.07
May 15, 2008	203.73	3.80%	$0.050	$0.050	1.87%	0.68%	$19.96	$20.04	$0.14	$0.15	$0.30	$0.30	$20.10	$20.19
August 15, 2008	205.81	3.70%	$0.050	$0.050	2.90%	1.02%	$19.97	$20.03	$0.14	$0.14	$0.44	$0.44	$20.11	$20.17
November 15, 2008	207.40	3.60%	$0.050	$0.050	3.70%	0.77%	$19.88	$20.12	$0.13	$0.14	$0.57	$0.57	$20.02	$20.25
February 15, 2009	209.96	3.50%	$0.050	$0.050	4.98%	1.23%	$19.98	$20.02	$0.13	$0.13	$0.70	$0.70	$20.11	$20.15
May 15, 2009	213.21	3.40%	$0.050	$0.050	6.60%	1.55%	$20.21	$19.79	$0.13	$0.12	$0.83	$0.83	$20.33	$19.92
August 15, 2009	215.08	3.30%	$0.050	$0.050	7.54%	0.88%	$20.16	$19.84	$0.12	$0.12	$0.95	$0.95	$20.28	$19.96
November 15, 2009	216.67	3.20%	$0.050	$0.050	8.33%	0.74%	$20.06	$19.94	$0.12	$0.11	$1.06	$1.06	$20.18	$20.05
February 15, 2010	219.09	3.10%	$0.050	$0.050	9.54%	1.12%	$20.12	$19.88	$0.11	$0.11	$1.17	$1.17	$20.23	$19.99
May 15, 2010	222.34	3.00%	$0.050	$0.050	11.17%	1.48%	$20.31	$19.69	$0.11	$0.10	$1.28	$1.28	$20.42	$19.79
August 15, 2010	224.14	2.90%	$0.050	$0.050	12.07%	0.81%	$20.24	$19.76	$0.10	$0.10	$1.38	$1.38	$20.35	$19.85
November 15, 2010	225.59	2.80%	$0.050	$0.050	12.79%	0.65%	$20.11	$19.89	$0.10	$0.09	$1.47	$1.47	$20.20	$19.99
February 15, 2011	227.87	2.70%	$0.050	$0.050	13.93%	1.01%	$20.12	$19.88	$0.09	$0.09	$1.56	$1.56	$20.21	$19.97
May 15, 2011	231.47	2.60%	$0.050	$0.050	15.73%	1.58%	$20.36	$19.64	$0.09	$0.08	$1.65	$1.65	$20.44	$19.73
August 15, 2011	233.06	2.50%	$0.050	$0.050	16.53%	0.69%	$20.24	$19.76	$0.08	$0.08	$1.73	$1.73	$20.32	$19.84
November 15, 2011	234.65	2.40%	$0.050	$0.050	17.32%	0.68%	$20.12	$19.88	$0.08	$0.07	$1.80	$1.80	$20.19	$19.96
February 15, 2012	237.56	2.30%	$0.050	$0.050	18.78%	1.24%	$20.22	$19.78	$0.07	$0.07	$1.87	$1.87	$20.29	$19.85
May 15, 2012	240.82	2.20%	$0.050	$0.050	20.41%	1.37%	$20.37	$19.63	$0.07	$0.06	$1.94	$1.94	$20.44	$19.69
August 15, 2012	243.18	2.10%	$0.050	$0.050	21.59%	0.98%	$20.37	$19.63	$0.06	$0.06	$2.00	$2.00	$20.43	$19.69

(1) “Value” refers to the hypothetical value of the Applicable Reference Value of Medical Inflation.

(2) “Three-Month Treasury Yield” is the hypothetical annualized yield associated with the treasuries that mature on or prior to the next distribution date for each quarterly period.

(3) “Total Fees” are calculated by multiplying the initial underlying value amount by the annualized fee accrual rate equal to 1.00% prorated for the quarterly period over a 365 day year at 91.25 days per quarter.

(4) “Calculated Value” is the “levered rate of change” applied to the closing date value of $20. It is the value of the Up MacroShare or Down MacroShare before allocating income less fees that are applied to the “Underlying Value”.

(5) “Income Distributions” is calculated by multiplying the cumulative percent change in price since the initial period by income net of fees, which is calculated by multiplying the quarterly three-month treasury bill rate by the initial underlying value less quarterly fees.

(6) “Cumulative Income Less Fees” are calculated by adding the income distributions since the initial date to the applicable distribution date.

(7) “Underlying Value” is calculated by adding the Calculated Value of the relevant trust for the applicable distribution date (see related columns above) to the Cumulative Income Less Fees for the related three month period (see related columns above).

The hypothetical scenarios included in this offering document have been prepared by, and are the responsibility of, the Trust’s management. [                                  ] has neither examined nor compiled the accompanying hypothetical scenarios and accordingly, [                                  ] does not express an opinion or any other form of assurances with respect thereto. The [                                  ] report included in this offering document relates to the Trust’s historical financial information. It does not extend to the hypothetical scenarios and should not be read to do so. The hypothetical information shown in this Appendix was not prepared with a view toward compliance with published guidelines of the Securities and Exchange Commission or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information.

A-11

Appendix A

Hypothetical Table 9: Value of medical inflation is volatile with the net approximate change remaining around the compounded hurdle rate and interest rates remain constant
The following table illustrates the hypothetical scenario in which the Applicable Reference Value of Medical Inflation has experienced volatility with the net change remaining around 4% annually and the interest rate on the treasuries held in the paired trusts has not changed from the closing date through the final scheduled termination date.
		Three-Month Treasury Yield (2)	Total Fees (3)		Total Value Change	Change in Value Since the Most Recent Period	Calculated Value (4)		Income Distributions		Cumulative Income Less Fees (5)		Underlying Value (6)
Quarter Ended	Value (1)		Up MacroShare	Down MacroShare			Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare
November 15, 2007	200.00	4.00%					$20.00	$20.00			-	-	$20.00	$20.00
February 15, 2008	202.35	4.00%	$0.050	$0.050	1.18%	1.18%	$20.08	$19.92	$0.15	$0.15	$0.15	$0.15	$20.23	$20.07
May 15, 2008	203.73	4.00%	$0.050	$0.050	1.87%	0.68%	$19.96	$20.04	$0.15	$0.15	$0.30	$0.30	$20.11	$20.19
August 15, 2008	205.81	4.00%	$0.050	$0.050	2.90%	1.02%	$19.97	$20.03	$0.15	$0.15	$0.45	$0.45	$20.12	$20.18
November 15, 2008	207.40	4.00%	$0.050	$0.050	3.70%	0.77%	$19.88	$20.12	$0.15	$0.15	$0.60	$0.60	$20.03	$20.27
February 15, 2009	209.96	4.00%	$0.050	$0.050	4.98%	1.23%	$19.98	$20.02	$0.15	$0.15	$0.75	$0.75	$20.13	$20.17
May 15, 2009	213.21	4.00%	$0.050	$0.050	6.60%	1.55%	$20.21	$19.79	$0.15	$0.15	$0.90	$0.90	$20.36	$19.94
August 15, 2009	215.08	4.00%	$0.050	$0.050	7.54%	0.88%	$20.16	$19.84	$0.15	$0.15	$1.05	$1.05	$20.31	$19.99
November 15, 2009	216.67	4.00%	$0.050	$0.050	8.33%	0.74%	$20.06	$19.94	$0.15	$0.15	$1.20	$1.20	$20.21	$20.09
February 15, 2010	219.09	4.00%	$0.050	$0.050	9.54%	1.12%	$20.12	$19.88	$0.15	$0.15	$1.35	$1.35	$20.27	$20.03
May 15, 2010	222.34	4.00%	$0.050	$0.050	11.17%	1.48%	$20.31	$19.69	$0.15	$0.15	$1.50	$1.50	$20.47	$19.83
August 15, 2010	224.14	4.00%	$0.050	$0.050	12.07%	0.81%	$20.24	$19.76	$0.15	$0.15	$1.65	$1.65	$20.40	$19.90
November 15, 2010	225.59	4.00%	$0.050	$0.050	12.79%	0.65%	$20.11	$19.89	$0.15	$0.15	$1.80	$1.80	$20.26	$20.04
February 15, 2011	227.87	4.00%	$0.050	$0.050	13.93%	1.01%	$20.12	$19.88	$0.15	$0.15	$1.95	$1.95	$20.27	$20.03
May 15, 2011	231.47	4.00%	$0.050	$0.050	15.73%	1.58%	$20.36	$19.64	$0.15	$0.15	$2.10	$2.10	$20.51	$19.79
August 15, 2011	233.06	4.00%	$0.050	$0.050	16.53%	0.69%	$20.24	$19.76	$0.15	$0.15	$2.25	$2.25	$20.39	$19.91
November 15, 2011	234.65	4.00%	$0.050	$0.050	17.32%	0.68%	$20.12	$19.88	$0.15	$0.15	$2.40	$2.40	$20.27	$20.03
February 15, 2012	237.56	4.00%	$0.050	$0.050	18.78%	1.24%	$20.22	$19.78	$0.15	$0.15	$2.55	$2.55	$20.37	$19.93
May 15, 2012	240.82	4.00%	$0.050	$0.050	20.41%	1.37%	$20.37	$19.63	$0.15	$0.15	$2.70	$2.70	$20.52	$19.78
August 15, 2012	243.18	4.00%	$0.050	$0.050	21.59%	0.98%	$20.37	$19.63	$0.15	$0.15	$2.85	$2.85	$20.52	$19.78

(1) “Value” refers to the hypothetical value of the Applicable Reference Value of Medical Inflation.

(2) “Three-Month Treasury Yield” is the hypothetical annualized yield associated with the treasuries that mature on or prior to the next distribution date for each quarterly period.

(3) “Total Fees” are calculated by multiplying the initial underlying value amount by the annualized fee accrual rate equal to 1.00% prorated for the quarterly period over a 365 day year at 91.25 days per quarter.

(4) “Calculated Value” is the “levered rate of change” applied to the closing date value of $20. It is the value of the Up MacroShare or Down MacroShare before allocating income less fees that are applied to the “Underlying Value”.

(5) “Income Distributions” is calculated by multiplying the cumulative percent change in price since the initial period by income net of fees, which is calculated by multiplying the quarterly three-month treasury bill rate by the initial underlying value less quarterly fees.

(6) “Cumulative Income Less Fees” are calculated by adding the income distributions since the initial date to the applicable distribution date.

(7) “Underlying Value” is calculated by adding the Calculated Value of the relevant trust for the applicable distribution date (see related columns above) to the Cumulative Income Less Fees for the related three month period (see related columns above).

The hypothetical scenarios included in this offering document have been prepared by, and are the responsibility of, the Trust’s management. [                                  ] has neither examined nor compiled the accompanying hypothetical scenarios and accordingly, [                                  ] does not express an opinion or any other form of assurances with respect thereto. The[                                  ] report included in this offering document relates to the Trust’s historical financial information. It does not extend to the hypothetical scenarios and should not be read to do so. The hypothetical information shown in this Appendix was not prepared with a view toward compliance with published guidelines of the Securities and Exchange Commission or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information.

A-12

Appendix A

Hypothetical Table 10: Value of medical inflation is volatile with the net change below 4% annually and interest rates rise
The following table illustrates the hypothetical scenario in which the Applicable Reference Value of Medical Inflation has experienced volatility with the net change below 4% annually and the interest rate on the treasuries held in the holding trusts has increased from the closing date through the final scheduled termination date.
		Three-Month Treasury Yield (2)	Total Fees (3)		Total Value Change	Change in Value Since the Most Recent Period	Calculated Value (4)		Income Distributions		Cumulative Income Less Fees (5)		Underlying Value (6)
Quarter Ended	Value (1)		Up MacroShare	Down MacroShare			Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare
November 15, 2007	200.00	4.00%					$20.00	$20.00			-	-	$20.00	$20.00
February 15, 2008	202.12	4.10%	$0.050	$0.050	1.06%	1.06%	$20.03	$19.97	$0.15	$0.15	$0.15	$0.15	$20.18	$20.12
May 15, 2008	203.88	4.20%	$0.050	$0.050	1.94%	0.87%	$19.98	$20.02	$0.15	$0.16	$0.31	$0.31	$20.14	$20.17
August 15, 2008	205.82	4.30%	$0.050	$0.050	2.91%	0.95%	$19.97	$20.03	$0.16	$0.16	$0.47	$0.47	$20.13	$20.19
November 15, 2008	207.94	4.40%	$0.050	$0.050	3.97%	1.03%	$19.99	$20.01	$0.16	$0.17	$0.63	$0.63	$20.15	$20.18
February 15, 2009	209.60	4.50%	$0.050	$0.050	4.80%	0.80%	$19.91	$20.09	$0.17	$0.17	$0.80	$0.80	$20.08	$20.26
May 15, 2009	211.17	4.60%	$0.050	$0.050	5.59%	0.75%	$19.82	$20.18	$0.17	$0.18	$0.98	$0.98	$19.99	$20.36
August 15, 2009	212.47	4.70%	$0.050	$0.050	6.23%	0.61%	$19.67	$20.33	$0.18	$0.18	$1.16	$1.16	$19.85	$20.51
November 15, 2009	214.04	4.80%	$0.050	$0.050	7.02%	0.74%	$19.58	$20.42	$0.18	$0.19	$1.34	$1.34	$19.76	$20.61
February 15, 2010	215.88	4.90%	$0.050	$0.050	7.94%	0.86%	$19.53	$20.47	$0.19	$0.19	$1.53	$1.53	$19.72	$20.66
May 15, 2010	216.81	5.00%	$0.050	$0.050	8.40%	0.43%	$19.31	$20.69	$0.19	$0.20	$1.73	$1.73	$19.50	$20.89
August 15, 2010	217.73	5.10%	$0.050	$0.050	8.86%	0.43%	$19.09	$20.91	$0.19	$0.21	$1.93	$1.93	$19.28	$21.12
November 15, 2010	219.85	5.20%	$0.050	$0.050	9.93%	0.98%	$19.09	$20.91	$0.20	$0.21	$2.13	$2.13	$19.29	$21.12
February 15, 2011	222.25	5.30%	$0.050	$0.050	11.13%	1.09%	$19.13	$20.87	$0.20	$0.22	$2.34	$2.34	$19.33	$21.09
May 15, 2011	224.10	5.40%	$0.050	$0.050	12.05%	0.83%	$19.07	$20.93	$0.21	$0.22	$2.56	$2.56	$19.28	$21.15
August 15, 2011	225.58	5.50%	$0.050	$0.050	12.79%	0.66%	$18.94	$21.06	$0.21	$0.23	$2.78	$2.78	$19.15	$21.29
November 15, 2011	227.70	5.60%	$0.050	$0.050	13.85%	0.94%	$18.93	$21.07	$0.21	$0.24	$3.00	$3.00	$19.14	$21.31
February 15, 2012	230.01	5.70%	$0.050	$0.050	15.00%	1.01%	$18.94	$21.06	$0.22	$0.24	$3.23	$3.23	$19.16	$21.30
May 15, 2012	231.86	5.80%	$0.050	$0.050	15.93%	0.80%	$18.87	$21.13	$0.22	$0.25	$3.47	$3.47	$19.09	$21.38
August 15, 2012	233.43	5.90%	$0.050	$0.050	16.71%	0.68%	$18.75	$21.25	$0.22	$0.26	$3.71	$3.71	$18.97	$21.51

(1) “Value” refers to the hypothetical value of the Applicable Reference Value of Medical Inflation.

(2) “Three-Month Treasury Yield” is the hypothetical annualized yield associated with the treasuries that mature on or prior to the next distribution date for each quarterly period.

(3) “Total Fees” are calculated by multiplying the initial underlying value amount by the annualized fee accrual rate equal to 1.00% prorated for the quarterly period over a 365 day year at 91.25 days per quarter.

(4) “Calculated Value” is the “levered rate of change” applied to the closing date value of $20. It is the value of the Up MacroShare or Down MacroShare before allocating income less fees that are applied to the “Underlying Value”.

(5) “Income Distributions” is calculated by multiplying the cumulative percent change in price since the initial period by income net of fees, which is calculated by multiplying the quarterly three-month treasury bill rate by the initial underlying value less quarterly fees.

(6) “Cumulative Income Less Fees” are calculated by adding the income distributions since the initial date to the applicable distribution date.

(7) “Underlying Value” is calculated by adding the Calculated Value of the relevant trust for the applicable distribution date (see related columns above) to the Cumulative Income Less Fees for the related three month period (see related columns above).

The hypothetical scenarios included in this offering document have been prepared by, and are the responsibility of, the Trust’s management. [                                  ] has neither examined nor compiled the accompanying hypothetical scenarios and accordingly, [                                  ] does not express an opinion or any other form of assurances with respect thereto. The [                                  ] report included in this offering document relates to the Trust’s historical financial information. It does not extend to the hypothetical scenarios and should not be read to do so. The hypothetical information shown in this Appendix was not prepared with a view toward compliance with published guidelines of the Securities and Exchange Commission or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information.

A-13

Appendix A

Hypothetical Table 11: Value of medical inflation is volatile with the net change below 4% annually and interest rates fall
The following table illustrates the hypothetical scenario in which the Applicable Reference Value of Medical Inflation has experienced volatility with the net change below 4% annually and the interest rate on the treasuries held in the paired trusts decreased from the closing date through the final scheduled termination date.
		Three-Month Treasury Yield (2)	Total Fees (3)		Total Value Change	Change in Value Since the Most Recent Period	Calculated Value (4)		Income Distributions		Cumulative Income Less Fees (5)		Underlying Value (6)
Quarter Ended	Value (1)		Up MacroShare	Down MacroShare			Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare
November 15, 2007	200.00	4.00%					$20.00	$20.00			-	-	$20.00	$20.00
February 15, 2008	202.12	3.90%	$0.050	$0.050	1.06%	1.06%	$20.03	$19.97	$0.15	$0.15	$0.15	$0.15	$20.18	$20.12
May 15, 2008	203.88	3.80%	$0.050	$0.050	1.94%	0.87%	$19.98	$20.02	$0.14	$0.15	$0.30	$0.30	$20.13	$20.16
August 15, 2008	205.82	3.70%	$0.050	$0.050	2.91%	0.95%	$19.97	$20.03	$0.14	$0.14	$0.44	$0.44	$20.11	$20.17
November 15, 2008	207.94	3.60%	$0.050	$0.050	3.97%	1.03%	$19.99	$20.01	$0.13	$0.14	$0.57	$0.57	$20.12	$20.15
February 15, 2009	209.60	3.50%	$0.050	$0.050	4.80%	0.80%	$19.91	$20.09	$0.13	$0.13	$0.70	$0.70	$20.04	$20.22
May 15, 2009	211.17	3.40%	$0.050	$0.050	5.59%	0.75%	$19.82	$20.18	$0.12	$0.13	$0.83	$0.83	$19.95	$20.30
August 15, 2009	212.47	3.30%	$0.050	$0.050	6.23%	0.61%	$19.67	$20.33	$0.12	$0.12	$0.95	$0.95	$19.79	$20.45
November 15, 2009	214.04	3.20%	$0.050	$0.050	7.02%	0.74%	$19.58	$20.42	$0.11	$0.12	$1.06	$1.06	$19.69	$20.54
February 15, 2010	215.88	3.10%	$0.050	$0.050	7.94%	0.86%	$19.53	$20.47	$0.11	$0.11	$1.17	$1.17	$19.64	$20.58
May 15, 2010	216.81	3.00%	$0.050	$0.050	8.40%	0.43%	$19.31	$20.69	$0.10	$0.11	$1.28	$1.28	$19.41	$20.80
August 15, 2010	217.73	2.90%	$0.050	$0.050	8.86%	0.43%	$19.09	$20.91	$0.10	$0.10	$1.38	$1.38	$19.19	$21.01
November 15, 2010	219.85	2.80%	$0.050	$0.050	9.93%	0.98%	$19.09	$20.91	$0.09	$0.10	$1.47	$1.47	$19.18	$21.01
February 15, 2011	222.25	2.70%	$0.050	$0.050	11.13%	1.09%	$19.13	$20.87	$0.09	$0.09	$1.56	$1.56	$19.22	$20.96
May 15, 2011	224.10	2.60%	$0.050	$0.050	12.05%	0.83%	$19.07	$20.93	$0.08	$0.09	$1.65	$1.65	$19.15	$21.02
August 15, 2011	225.58	2.50%	$0.050	$0.050	12.79%	0.66%	$18.94	$21.06	$0.08	$0.08	$1.73	$1.73	$19.02	$21.14
November 15, 2011	227.70	2.40%	$0.050	$0.050	13.85%	0.94%	$18.93	$21.07	$0.07	$0.08	$1.80	$1.80	$19.00	$21.15
February 15, 2012	230.01	2.30%	$0.050	$0.050	15.00%	1.01%	$18.94	$21.06	$0.07	$0.07	$1.87	$1.87	$19.01	$21.13
May 15, 2012	231.86	2.20%	$0.050	$0.050	15.93%	0.80%	$18.87	$21.13	$0.06	$0.07	$1.94	$1.94	$18.93	$21.20
August 15, 2012	233.43	2.10%	$0.050	$0.050	16.71%	0.68%	$18.75	$21.25	$0.06	$0.06	$2.00	$2.00	$18.81	$21.31

(1) “Value” refers to the hypothetical value of the Applicable Reference Value of Medical Inflation.

(2) “Three-Month Treasury Yield” is the hypothetical annualized yield associated with the treasuries that mature on or prior to the next distribution date for each quarterly period.

(3) “Total Fees” are calculated by multiplying the initial underlying value amount by the annualized fee accrual rate equal to 1.00% prorated for the quarterly period over a 365 day year at 91.25 days per quarter.

(4) “Calculated Value” is the “levered rate of change” applied to the closing date value of $20. It is the value of the Up MacroShare or Down MacroShare before allocating income less fees that are applied to the “Underlying Value”.

(5) “Income Distributions” is calculated by multiplying the cumulative percent change in price since the initial period by income net of fees, which is calculated by multiplying the quarterly three-month treasury bill rate by the initial underlying value less quarterly fees.

(6) “Cumulative Income Less Fees” are calculated by adding the income distributions since the initial date to the applicable distribution date.

(7) “Underlying Value” is calculated by adding the Calculated Value of the relevant trust for the applicable distribution date (see related columns above) to the Cumulative Income Less Fees for the related three month period (see related columns above).

The hypothetical scenarios included in this offering document have been prepared by, and are the responsibility of, the Trust’s management. [                                  ] has neither examined nor compiled the accompanying hypothetical scenarios and accordingly, [                                  ] does not express an opinion or any other form of assurances with respect thereto. The[                                  ] report included in this offering document relates to the Trust’s historical financial information. It does not extend to the hypothetical scenarios and should not be read to do so. The hypothetical information shown in this Appendix was not prepared with a view toward compliance with published guidelines of the Securities and Exchange Commission or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information.

A-14

Appendix A

Hypothetical Table 12: Value of medical inflation is volatile with the net change below 4% annually and interest rates remain constant
The following table illustrates the hypothetical scenario in which the Applicable Reference Value of Medical Inflation has experienced volatility with the net change below 4% annually and the interest rate on the treasuries held in the paired trusts remains constant from the closing date through the final scheduled termination date.
		Three-Month Treasury Yield (2)	Total Fees (3)		Total Value Change	Change in Value Since the Most Recent Period	Calculated Value (4)		Income Distributions		Cumulative Income Less Fees (5)		Underlying Value (6)
Quarter Ended	Value (1)		Up MacroShare	Down MacroShare			Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare
November 15, 2007	200.00	4.00%					$20.00	$20.00			-	-	$20.00	$20.00
February 15, 2008	202.12	4.00%	$0.050	$0.050	1.06%	1.06%	$20.03	$19.97	$0.15	$0.15	$0.15	$0.15	$20.18	$20.12
May 15, 2008	203.88	4.00%	$0.050	$0.050	1.94%	0.87%	$19.98	$20.02	$0.15	$0.15	$0.30	$0.30	$20.13	$20.17
August 15, 2008	205.82	4.00%	$0.050	$0.050	2.91%	0.95%	$19.97	$20.03	$0.15	$0.15	$0.45	$0.45	$20.12	$20.18
November 15, 2008	207.94	4.00%	$0.050	$0.050	3.97%	1.03%	$19.99	$20.01	$0.15	$0.15	$0.60	$0.60	$20.14	$20.16
February 15, 2009	209.60	4.00%	$0.050	$0.050	4.80%	0.80%	$19.91	$20.09	$0.15	$0.15	$0.75	$0.75	$20.06	$20.24
May 15, 2009	211.17	4.00%	$0.050	$0.050	5.59%	0.75%	$19.82	$20.18	$0.15	$0.15	$0.90	$0.90	$19.97	$20.33
August 15, 2009	212.47	4.00%	$0.050	$0.050	6.23%	0.61%	$19.67	$20.33	$0.15	$0.15	$1.05	$1.05	$19.82	$20.48
November 15, 2009	214.04	4.00%	$0.050	$0.050	7.02%	0.74%	$19.58	$20.42	$0.15	$0.15	$1.20	$1.20	$19.72	$20.58
February 15, 2010	215.88	4.00%	$0.050	$0.050	7.94%	0.86%	$19.53	$20.47	$0.15	$0.15	$1.35	$1.35	$19.68	$20.62
May 15, 2010	216.81	4.00%	$0.050	$0.050	8.40%	0.43%	$19.31	$20.69	$0.14	$0.16	$1.50	$1.50	$19.46	$20.84
August 15, 2010	217.73	4.00%	$0.050	$0.050	8.86%	0.43%	$19.09	$20.91	$0.14	$0.16	$1.65	$1.65	$19.24	$21.06
November 15, 2010	219.85	4.00%	$0.050	$0.050	9.93%	0.98%	$19.09	$20.91	$0.14	$0.16	$1.80	$1.80	$19.23	$21.07
February 15, 2011	222.25	4.00%	$0.050	$0.050	11.13%	1.09%	$19.13	$20.87	$0.14	$0.16	$1.95	$1.95	$19.27	$21.03
May 15, 2011	224.10	4.00%	$0.050	$0.050	12.05%	0.83%	$19.07	$20.93	$0.14	$0.16	$2.10	$2.10	$19.21	$21.09
August 15, 2011	225.58	4.00%	$0.050	$0.050	12.79%	0.66%	$18.94	$21.06	$0.14	$0.16	$2.25	$2.25	$19.09	$21.21
November 15, 2011	227.70	4.00%	$0.050	$0.050	13.85%	0.94%	$18.93	$21.07	$0.14	$0.16	$2.40	$2.40	$19.07	$21.23
February 15, 2012	230.01	4.00%	$0.050	$0.050	15.00%	1.01%	$18.94	$21.06	$0.14	$0.16	$2.55	$2.55	$19.08	$21.22
May 15, 2012	231.86	4.00%	$0.050	$0.050	15.93%	0.80%	$18.87	$21.13	$0.14	$0.16	$2.70	$2.70	$19.01	$21.29
August 15, 2012	233.43	4.00%	$0.050	$0.050	16.71%	0.68%	$18.75	$21.25	$0.14	$0.16	$2.85	$2.85	$18.89	$21.41

(1) “Value” refers to the hypothetical value of the Applicable Reference Value of Medical Inflation.

(2) “Three-Month Treasury Yield” is the hypothetical annualized yield associated with the treasuries that mature on or prior to the next distribution date for each quarterly period.

(3) “Total Fees” are calculated by multiplying the initial underlying value amount by the annualized fee accrual rate equal to 1.00% prorated for the quarterly period over a 365 day year at 91.25 days per quarter.

(4) “Calculated Value” is the “levered rate of change” applied to the closing date value of $20. It is the value of the Up MacroShare or Down MacroShare before allocating income less fees that are applied to the “Underlying Value”.

(5) “Income Distributions” is calculated by multiplying the cumulative percent change in price since the initial period by income net of fees, which is calculated by multiplying the quarterly three-month treasury bill rate by the initial underlying value less quarterly fees.

(6) “Cumulative Income Less Fees” are calculated by adding the income distributions since the initial date to the applicable distribution date.

(7) “Underlying Value” is calculated by adding the Calculated Value of the relevant trust for the applicable distribution date (see related columns above) to the Cumulative Income Less Fees for the related three month period (see related columns above).

The hypothetical scenarios included in this offering document have been prepared by, and are the responsibility of, the Trust’s management. [                                  ] has neither examined nor compiled the accompanying hypothetical scenarios and accordingly, [                                  ] does not express an opinion or any other form of assurances with respect thereto. The [                                  ] report included in this offering document relates to the Trust’s historical financial information. It does not extend to the hypothetical scenarios and should not be read to do so. The hypothetical information shown in this Appendix was not prepared with a view toward compliance with published guidelines of the Securities and Exchange Commission or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information.

A-15

Appendix A

Hypothetical Table 13: Value of medical inflation is volatile with a net change below 4% annually and interest rates rise
The following table illustrates the hypothetical scenario in which the Applicable Reference Value of Medical Inflation has experienced volatility with a net change above 4% annually and the interest rate on the treasuries held in the paired trusts increased from the closing date through the final scheduled termination date.
		Three-Month Treasury Yield (2)	Total Fees (3)		Total Value Change	Change in Value Since the Most Recent Period	Calculated Value (4)		Income Distributions		Cumulative Income Less Fees (5)		Underlying Value (6)
Quarter Ended	Value (1)		Up MacroShare	Down MacroShare			Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare
November 15, 2007	200.00	4.00%					$20.00	$20.00			-	-	$20.00	$20.00
February 15, 2008	203.72	4.10%	$0.050	$0.050	1.86%	1.86%	$20.35	$19.65	$0.15	$0.15	$0.15	$0.15	$20.50	$19.80
May 15, 2008	207.29	4.20%	$0.050	$0.050	3.65%	1.75%	$20.65	$19.35	$0.16	$0.15	$0.31	$0.31	$20.81	$19.50
August 15, 2008	210.12	4.30%	$0.050	$0.050	5.06%	1.36%	$20.81	$19.19	$0.17	$0.15	$0.47	$0.47	$20.97	$19.35
November 15, 2008	213.99	4.40%	$0.050	$0.050	6.99%	1.84%	$21.15	$18.85	$0.17	$0.16	$0.63	$0.63	$21.33	$19.00
February 15, 2009	218.45	4.50%	$0.050	$0.050	9.23%	2.09%	$21.60	$18.40	$0.18	$0.16	$0.80	$0.80	$21.78	$18.56
May 15, 2009	222.77	4.60%	$0.050	$0.050	11.38%	1.98%	$22.01	$17.99	$0.19	$0.16	$0.98	$0.98	$22.20	$18.15
August 15, 2009	227.23	4.70%	$0.050	$0.050	13.62%	2.00%	$22.43	$17.57	$0.20	$0.16	$1.16	$1.16	$22.63	$17.73
November 15, 2009	231.99	4.80%	$0.050	$0.050	16.00%	2.10%	$22.90	$17.10	$0.21	$0.16	$1.34	$1.34	$23.11	$17.26
February 15, 2010	237.80	4.90%	$0.050	$0.050	18.90%	2.50%	$23.54	$16.46	$0.22	$0.16	$1.53	$1.53	$23.77	$16.61
May 15, 2010	243.30	5.00%	$0.050	$0.050	21.65%	2.32%	$24.12	$15.88	$0.24	$0.15	$1.73	$1.73	$24.35	$16.04
August 15, 2010	248.66	5.10%	$0.050	$0.050	24.33%	2.20%	$24.65	$15.35	$0.25	$0.15	$1.93	$1.93	$24.89	$15.51
November 15, 2010	254.46	5.20%	$0.050	$0.050	27.23%	2.33%	$25.24	$14.76	$0.26	$0.15	$2.13	$2.13	$25.50	$14.91
February 15, 2011	259.52	5.30%	$0.050	$0.050	29.76%	1.99%	$25.69	$14.31	$0.27	$0.15	$2.34	$2.34	$25.96	$14.46
May 15, 2011	264.14	5.40%	$0.050	$0.050	32.07%	1.78%	$26.05	$13.95	$0.28	$0.15	$2.56	$2.56	$26.33	$14.10
August 15, 2011	268.90	5.50%	$0.050	$0.050	34.45%	1.80%	$26.42	$13.58	$0.29	$0.15	$2.78	$2.78	$26.71	$13.73
November 15, 2011	274.26	5.60%	$0.050	$0.050	37.13%	1.99%	$26.89	$13.11	$0.30	$0.15	$3.00	$3.00	$27.19	$13.26
February 15, 2012	279.91	5.70%	$0.050	$0.050	39.96%	2.06%	$27.39	$12.61	$0.31	$0.15	$3.23	$3.23	$27.70	$12.76
May 15, 2012	283.78	5.80%	$0.050	$0.050	41.89%	1.38%	$27.57	$12.43	$0.32	$0.15	$3.47	$3.47	$27.90	$12.57
August 15, 2012	287.65	5.90%	$0.050	$0.050	43.82%	1.36%	$27.75	$12.25	$0.33	$0.15	$3.71	$3.71	$28.08	$12.40

(1) “Value” refers to the hypothetical value of the Applicable Reference Value of Medical Inflation.

(2) “Three-Month Treasury Yield” is the hypothetical annualized yield associated with the treasuries that mature on or prior to the next distribution date for each quarterly period.

(3) “Total Fees” are calculated by multiplying the initial underlying value amount by the annualized fee accrual rate equal to 1.00% prorated for the quarterly period over a 365 day year at 91.25 days per quarter.

(4) “Calculated Value” is the “levered rate of change” applied to the closing date value of $20. It is the value of the Up MacroShare or Down MacroShare before allocating income less fees that are applied to the “Underlying Value”.

(5) “Income Distributions” is calculated by multiplying the cumulative percent change in price since the initial period by income net of fees, which is calculated by multiplying the quarterly three-month treasury bill rate by the initial underlying value less quarterly fees.

(6) “Cumulative Income Less Fees” are calculated by adding the income distributions since the initial date to the applicable distribution date.

(7) “Underlying Value” is calculated by adding the Calculated Value of the relevant trust for the applicable distribution date (see related columns above) to the Cumulative Income Less Fees for the related three month period (see related columns above).

The hypothetical scenarios included in this offering document have been prepared by, and are the responsibility of, the Trust’s management. [                                  ] has neither examined nor compiled the accompanying hypothetical scenarios and accordingly, [                                  ] does not express an opinion or any other form of assurances with respect thereto. The [                                  ] report included in this offering document relates to the Trust’s historical financial information. It does not extend to the hypothetical scenarios and should not be read to do so. The hypothetical information shown in this Appendix was not prepared with a view toward compliance with published guidelines of the Securities and Exchange Commission or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information.

A-16

Appendix A

Hypothetical Table 14: Value of medical inflation is volatile with a net change below 4% annually and interest rates fall
The following table illustrates the hypothetical scenario in which the Applicable Reference Value of Medical Inflation has experienced volatility with a net change above 4% annually and the interest rate on the treasuries held in the paired trusts decreased from the closing date through the final scheduled termination date.
		Three-Month Treasury Yield (2)	Total Fees (3)		Total Value Change	Change in Value Since the Most Recent Period	Calculated Value (4)		Income Distributions		Cumulative Income Less Fees (5)		Underlying Value (6)
Quarter Ended	Value (1)		Up MacroShare	Down MacroShare			Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare
November 15, 2007	200.00	4.00%					$20.00	$20.00			-	-	$20.00	$20.00
February 15, 2008	203.72	3.90%	$0.050	$0.050	1.86%	1.86%	$20.35	$19.65	$0.15	$0.15	$0.15	$0.15	$20.50	$19.80
May 15, 2008	207.29	3.80%	$0.050	$0.050	3.65%	1.75%	$20.65	$19.35	$0.15	$0.14	$0.30	$0.30	$20.80	$19.49
August 15, 2008	210.12	3.70%	$0.050	$0.050	5.06%	1.36%	$20.81	$19.19	$0.15	$0.13	$0.44	$0.44	$20.95	$19.33
November 15, 2008	213.99	3.60%	$0.050	$0.050	6.99%	1.84%	$21.15	$18.85	$0.14	$0.13	$0.57	$0.57	$21.29	$18.98
February 15, 2009	218.45	3.50%	$0.050	$0.050	9.23%	2.09%	$21.60	$18.40	$0.14	$0.12	$0.70	$0.70	$21.74	$18.52
May 15, 2009	222.77	3.40%	$0.050	$0.050	11.38%	1.98%	$22.01	$17.99	$0.14	$0.11	$0.83	$0.83	$22.15	$18.10
August 15, 2009	227.23	3.30%	$0.050	$0.050	13.62%	2.00%	$22.43	$17.57	$0.13	$0.11	$0.95	$0.95	$22.57	$17.67
November 15, 2009	231.99	3.20%	$0.050	$0.050	16.00%	2.10%	$22.90	$17.10	$0.13	$0.10	$1.06	$1.06	$23.03	$17.20
February 15, 2010	237.80	3.10%	$0.050	$0.050	18.90%	2.50%	$23.54	$16.46	$0.13	$0.09	$1.17	$1.17	$23.67	$16.55
May 15, 2010	243.30	3.00%	$0.050	$0.050	21.65%	2.32%	$24.12	$15.88	$0.13	$0.08	$1.28	$1.28	$24.24	$15.97
August 15, 2010	248.66	2.90%	$0.050	$0.050	24.33%	2.20%	$24.65	$15.35	$0.12	$0.08	$1.38	$1.38	$24.77	$15.43
November 15, 2010	254.46	2.80%	$0.050	$0.050	27.23%	2.33%	$25.24	$14.76	$0.12	$0.07	$1.47	$1.47	$25.36	$14.83
February 15, 2011	259.52	2.70%	$0.050	$0.050	29.76%	1.99%	$25.69	$14.31	$0.12	$0.06	$1.56	$1.56	$25.81	$14.37
May 15, 2011	264.14	2.60%	$0.050	$0.050	32.07%	1.78%	$26.05	$13.95	$0.11	$0.06	$1.65	$1.65	$26.16	$14.01
August 15, 2011	268.90	2.50%	$0.050	$0.050	34.45%	1.80%	$26.42	$13.58	$0.11	$0.05	$1.73	$1.73	$26.53	$13.63
November 15, 2011	274.26	2.40%	$0.050	$0.050	37.13%	1.99%	$26.89	$13.11	$0.10	$0.05	$1.80	$1.80	$26.99	$13.16
February 15, 2012	279.91	2.30%	$0.050	$0.050	39.96%	2.06%	$27.39	$12.61	$0.10	$0.04	$1.87	$1.87	$27.48	$12.66
May 15, 2012	283.78	2.20%	$0.050	$0.050	41.89%	1.38%	$27.57	$12.43	$0.09	$0.04	$1.94	$1.94	$27.66	$12.47
August 15, 2012	287.65	2.10%	$0.050	$0.050	43.82%	1.36%	$27.75	$12.25	$0.08	$0.04	$2.00	$2.00	$27.83	$12.29

(1) “Value” refers to the hypothetical value of the Applicable Reference Value of Medical Inflation.

(2) “Three-Month Treasury Yield” is the hypothetical annualized yield associated with the treasuries that mature on or prior to the next distribution date for each quarterly period.

(3) “Total Fees” are calculated by multiplying the initial underlying value amount by the annualized fee accrual rate equal to 1.00% prorated for the quarterly period over a 365 day year at 91.25 days per quarter.

(4) “Calculated Value” is the “levered rate of change” applied to the closing date value of $20. It is the value of the Up MacroShare or Down MacroShare before allocating income less fees that are applied to the “Underlying Value”.

(5) “Income Distributions” is calculated by multiplying the cumulative percent change in price since the initial period by income net of fees, which is calculated by multiplying the quarterly three-month treasury bill rate by the initial underlying value less quarterly fees.

(6) “Cumulative Income Less Fees” are calculated by adding the income distributions since the initial date to the applicable distribution date.

(7) “Underlying Value” is calculated by adding the Calculated Value of the relevant trust for the applicable distribution date (see related columns above) to the Cumulative Income Less Fees for the related three month period (see related columns above).

The hypothetical scenarios included in this offering document have been prepared by, and are the responsibility of, the Trust’s management. [                                  ] has neither examined nor compiled the accompanying hypothetical scenarios and accordingly, [                                  ] does not express an opinion or any other form of assurances with respect thereto. The [                                  ] report included in this offering document relates to the Trust’s historical financial information. It does not extend to the hypothetical scenarios and should not be read to do so. The hypothetical information shown in this Appendix was not prepared with a view toward compliance with published guidelines of the Securities and Exchange Commission or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information.

A-17

Appendix A

Hypothetical Table 15: Value of medical inflation is volatile with a net change below 4% annually and interest rates remain constant
The following table illustrates the hypothetical scenario in which the Applicable Reference Value of Medical Inflation has experienced volatility with a net change above 4% annually interest rate on the treasuries held in the paired trusts remains constant from the closing date through the final scheduled termination date.
		Three-Month Treasury Yield (2)	Total Fees (3)		Total Value Change	Change in Value Since the Most Recent Period	Calculated Value (4)		Income Distributions		Cumulative Income Less Fees (5)		Underlying Value (6)
Quarter Ended	Value (1)		Up MacroShare	Down MacroShare			Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare
November 15, 2007	200.00	4.00%					$20.00	$20.00			-	-	$20.00	$20.00
February 15, 2008	203.72	4.00%	$0.050	$0.050	1.86%	1.86%	$20.35	$19.65	$0.15	$0.15	$0.15	$0.15	$20.50	$19.80
May 15, 2008	207.29	4.00%	$0.050	$0.050	3.65%	1.75%	$20.65	$19.35	$0.15	$0.15	$0.30	$0.30	$20.81	$19.49
August 15, 2008	210.12	4.00%	$0.050	$0.050	5.06%	1.36%	$20.81	$19.19	$0.16	$0.14	$0.45	$0.45	$20.96	$19.34
November 15, 2008	213.99	4.00%	$0.050	$0.050	6.99%	1.84%	$21.15	$18.85	$0.16	$0.14	$0.60	$0.60	$21.31	$18.99
February 15, 2009	218.45	4.00%	$0.050	$0.050	9.23%	2.09%	$21.60	$18.40	$0.16	$0.14	$0.75	$0.75	$21.76	$18.54
May 15, 2009	222.77	4.00%	$0.050	$0.050	11.38%	1.98%	$22.01	$17.99	$0.17	$0.13	$0.90	$0.90	$22.17	$18.13
August 15, 2009	227.23	4.00%	$0.050	$0.050	13.62%	2.00%	$22.43	$17.57	$0.17	$0.13	$1.05	$1.05	$22.60	$17.70
November 15, 2009	231.99	4.00%	$0.050	$0.050	16.00%	2.10%	$22.90	$17.10	$0.17	$0.13	$1.20	$1.20	$23.07	$17.23
February 15, 2010	237.80	4.00%	$0.050	$0.050	18.90%	2.50%	$23.54	$16.46	$0.18	$0.12	$1.35	$1.35	$23.72	$16.58
May 15, 2010	243.30	4.00%	$0.050	$0.050	21.65%	2.32%	$24.12	$15.88	$0.18	$0.12	$1.50	$1.50	$24.30	$16.00
August 15, 2010	248.66	4.00%	$0.050	$0.050	24.33%	2.20%	$24.65	$15.35	$0.18	$0.12	$1.65	$1.65	$24.83	$15.47
November 15, 2010	254.46	4.00%	$0.050	$0.050	27.23%	2.33%	$25.24	$14.76	$0.19	$0.11	$1.80	$1.80	$25.43	$14.87
February 15, 2011	259.52	4.00%	$0.050	$0.050	29.76%	1.99%	$25.69	$14.31	$0.19	$0.11	$1.95	$1.95	$25.89	$14.41
May 15, 2011	264.14	4.00%	$0.050	$0.050	32.07%	1.78%	$26.05	$13.95	$0.20	$0.10	$2.10	$2.10	$26.25	$14.05
August 15, 2011	268.90	4.00%	$0.050	$0.050	34.45%	1.80%	$26.42	$13.58	$0.20	$0.10	$2.25	$2.25	$26.62	$13.68
November 15, 2011	274.26	4.00%	$0.050	$0.050	37.13%	1.99%	$26.89	$13.11	$0.20	$0.10	$2.40	$2.40	$27.09	$13.21
February 15, 2012	279.91	4.00%	$0.050	$0.050	39.96%	2.06%	$27.39	$12.61	$0.21	$0.09	$2.55	$2.55	$27.59	$12.71
May 15, 2012	283.78	4.00%	$0.050	$0.050	41.89%	1.38%	$27.57	$12.43	$0.21	$0.09	$2.70	$2.70	$27.78	$12.52
August 15, 2012	287.65	4.00%	$0.050	$0.050	43.82%	1.36%	$27.75	$12.25	$0.21	$0.09	$2.85	$2.85	$27.96	$12.34

(1) “Value” refers to the hypothetical value of the Applicable Reference Value of Medical Inflation.

(2) “Three-Month Treasury Yield” is the hypothetical annualized yield associated with the treasuries that mature on or prior to the next distribution date for each quarterly period.

(3) “Total Fees” are calculated by multiplying the initial underlying value amount by the annualized fee accrual rate equal to 1.00% prorated for the quarterly period over a 365 day year at 91.25 days per quarter.

(4) “Calculated Value” is the “levered rate of change” applied to the closing date value of $20. It is the value of the Up MacroShare or Down MacroShare before allocating income less fees that are applied to the “Underlying Value”.

(5) “Income Distributions” is calculated by multiplying the cumulative percent change in price since the initial period by income net of fees, which is calculated by multiplying the quarterly three-month treasury bill rate by the initial underlying value less quarterly fees.

(6) “Cumulative Income Less Fees” are calculated by adding the income distributions since the initial date to the applicable distribution date.

(7) “Underlying Value” is calculated by adding the Calculated Value of the relevant trust for the applicable distribution date (see related columns above) to the Cumulative Income Less Fees for the related three month period (see related columns above).

The hypothetical scenarios included in this offering document have been prepared by, and are the responsibility of, the Trust’s management. [                                  ] has neither examined nor compiled the accompanying hypothetical scenarios and accordingly, [                                  ] does not express an opinion or any other form of assurances with respect thereto. The [                                  ] report included in this offering document relates to the Trust’s historical financial information. It does not extend to the hypothetical scenarios and should not be read to do so. The hypothetical information shown in this Appendix was not prepared with a view toward compliance with published guidelines of the Securities and Exchange Commission or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information.

A-18

Appendix A

Hypothetical Table X: Value of medical inflation increases less than 4% annually and interest rates rise
The following table illustrates the hypothetical scenario in which the Applicable Reference Value of Medical Inflation increases at a rate less than 4% annually and the interest rate on the treasuries held in the paired trusts increase from the closing date through the final scheduled termination date.
		Three-Month Treasury Yield (2)	Total Fees (3)		Total Value Change	Change in Value Since the Most Recent Period	Calculated Value (4)		Income Distributions		Cumulative Income Less Fees (5)		Underlying Value (6)
Quarter Ended	Value (1)		Up MacroShare	Down MacroShare			Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare
November 15, 2007	200.00	4.00%					$20.00	$20.00			-	-	$20.00	$20.00
February 15, 2008	201.00	4.10%	$0.050	$0.050	0.50%	0.50%	$19.81	$20.19	$0.15	$0.15	$0.15	$0.15	$19.96	$20.34
May 15, 2008	202.01	4.20%	$0.050	$0.050	1.00%	0.50%	$19.62	$20.38	$0.15	$0.16	$0.31	$0.31	$19.77	$20.54
August 15, 2008	203.02	4.30%	$0.050	$0.050	1.51%	0.50%	$19.43	$20.57	$0.16	$0.16	$0.47	$0.47	$19.58	$20.74
November 15, 2008	204.03	4.40%	$0.050	$0.050	2.02%	0.50%	$19.24	$20.76	$0.16	$0.17	$0.63	$0.63	$19.40	$20.93
February 15, 2009	205.05	4.50%	$0.050	$0.050	2.53%	0.50%	$19.05	$20.95	$0.16	$0.18	$0.80	$0.80	$19.21	$21.13
May 15, 2009	206.08	4.60%	$0.050	$0.050	3.04%	0.50%	$18.86	$21.14	$0.17	$0.18	$0.98	$0.98	$19.03	$21.32
August 15, 2009	207.11	4.70%	$0.050	$0.050	3.55%	0.50%	$18.67	$21.33	$0.17	$0.19	$1.16	$1.16	$18.84	$21.52
November 15, 2009	208.14	4.80%	$0.050	$0.050	4.07%	0.50%	$18.49	$21.51	$0.17	$0.20	$1.34	$1.34	$18.66	$21.71
February 15, 2010	209.18	4.90%	$0.050	$0.050	4.59%	0.50%	$18.30	$21.70	$0.17	$0.21	$1.53	$1.53	$18.48	$21.90
May 15, 2010	210.23	5.00%	$0.050	$0.050	5.11%	0.50%	$18.12	$21.88	$0.18	$0.21	$1.73	$1.73	$18.30	$22.09
August 15, 2010	211.28	5.10%	$0.050	$0.050	5.64%	0.50%	$17.94	$22.06	$0.18	$0.22	$1.93	$1.93	$18.11	$22.29
November 15, 2010	212.34	5.20%	$0.050	$0.050	6.17%	0.50%	$17.75	$22.25	$0.18	$0.23	$2.13	$2.13	$17.94	$22.47
February 15, 2011	213.40	5.30%	$0.050	$0.050	6.70%	0.50%	$17.57	$22.43	$0.18	$0.24	$2.34	$2.34	$17.76	$22.66
May 15, 2011	214.46	5.40%	$0.050	$0.050	7.23%	0.50%	$17.39	$22.61	$0.19	$0.24	$2.56	$2.56	$17.58	$22.85
August 15, 2011	215.54	5.50%	$0.050	$0.050	7.77%	0.50%	$17.21	$22.79	$0.19	$0.25	$2.78	$2.78	$17.40	$23.04
November 15, 2011	216.61	5.60%	$0.050	$0.050	8.31%	0.50%	$17.03	$22.97	$0.19	$0.26	$3.00	$3.00	$17.22	$23.23
February 15, 2012	217.70	5.70%	$0.050	$0.050	8.85%	0.50%	$16.85	$23.15	$0.19	$0.27	$3.23	$3.23	$17.05	$23.41
May 15, 2012	218.79	5.80%	$0.050	$0.050	9.39%	0.50%	$16.68	$23.32	$0.20	$0.27	$3.47	$3.47	$16.87	$23.60
August 15, 2012	219.88	5.90%	$0.050	$0.050	9.94%	0.50%	$16.50	$23.50	$0.20	$0.28	$3.71	$3.71	$16.70	$23.78

(1) “Value” refers to the hypothetical value of the Applicable Reference Value of Medical Inflation.

(2) “Three-Month Treasury Yield” is the hypothetical annualized yield associated with the treasuries that mature on or prior to the next distribution date for each quarterly period.

(3) “Total Fees” are calculated by multiplying the initial underlying value amount by the annualized fee accrual rate equal to 1.00% prorated for the quarterly period over a 365 day year at 91.25 days per quarter.

(4) “Calculated Value” is the “levered rate of change” applied to the closing date value of $20. It is the value of the Up MacroShare or Down MacroShare before allocating income less fees that are applied to the “Underlying Value”.

(5) “Income Distributions” is calculated by multiplying the cumulative percent change in price since the initial period by income net of fees, which is calculated by multiplying the quarterly three-month treasury bill rate by the initial underlying value less quarterly fees.

(6) “Cumulative Income Less Fees” are calculated by adding the income distributions since the initial date to the applicable distribution date.

(7) “Underlying Value” is calculated by adding the Calculated Value of the relevant trust for the applicable distribution date (see related columns above) to the Cumulative Income Less Fees for the related three month period (see related columns above).

The hypothetical scenarios included in this offering document have been prepared by, and are the responsibility of, the Trust’s management. [                                  ] has neither examined nor compiled the accompanying hypothetical scenarios and accordingly, [                                  ] does not express an opinion or any other form of assurances with respect thereto. The [                                  ] report included in this offering document relates to the Trust’s historical financial information. It does not extend to the hypothetical scenarios and should not be read to do so. The hypothetical information shown in this Appendix was not prepared with a view toward compliance with published guidelines of the Securities and Exchange Commission or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information.

A-19

Appendix A

Hypothetical Table Y: Value of medical inflation increases less than 4% annually and interest rates fall
The following table illustrates the hypothetical scenario in which the Applicable Reference Value of Medical Inflation increases at a rate that is less than 4% annually and the interest rate on the treasuries held in the paired trusts decline from the closing date through the final scheduled termination date.
		Three-Month Treasury Yield (2)	Total Fees (3)		Total Value Change	Change in Value Since the Most Recent Period	Calculated Value (4)		Income Distributions		Cumulative Income Less Fees (5)		Underlying Value (6)
Quarter Ended	Value (1)		Up MacroShare	Down MacroShare			Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare
November 15, 2007	200.00	4.00%					$20.00	$20.00			-	-	$20.00	$20.00
February 15, 2008	201.00	3.90%	$0.050	$0.050	0.50%	0.50%	$19.81	$20.19	$0.15	$0.15	$0.15	$0.15	$19.96	$20.34
May 15, 2008	202.01	3.80%	$0.050	$0.050	1.00%	0.50%	$19.62	$20.38	$0.14	$0.15	$0.30	$0.30	$19.76	$20.53
August 15, 2008	203.02	3.70%	$0.050	$0.050	1.51%	0.50%	$19.43	$20.57	$0.14	$0.14	$0.44	$0.44	$19.56	$20.72
November 15, 2008	204.03	3.60%	$0.050	$0.050	2.02%	0.50%	$19.24	$20.76	$0.13	$0.14	$0.57	$0.57	$19.37	$20.90
February 15, 2009	205.05	3.50%	$0.050	$0.050	2.53%	0.50%	$19.05	$20.95	$0.12	$0.14	$0.70	$0.70	$19.17	$21.09
May 15, 2009	206.08	3.40%	$0.050	$0.050	3.04%	0.50%	$18.86	$21.14	$0.12	$0.13	$0.83	$0.83	$18.98	$21.27
August 15, 2009	207.11	3.30%	$0.050	$0.050	3.55%	0.50%	$18.67	$21.33	$0.11	$0.13	$0.95	$0.95	$18.79	$21.45
November 15, 2009	208.14	3.20%	$0.050	$0.050	4.07%	0.50%	$18.49	$21.51	$0.11	$0.12	$1.06	$1.06	$18.59	$21.64
February 15, 2010	209.18	3.10%	$0.050	$0.050	4.59%	0.50%	$18.30	$21.70	$0.10	$0.12	$1.17	$1.17	$18.40	$21.82
May 15, 2010	210.23	3.00%	$0.050	$0.050	5.11%	0.50%	$18.12	$21.88	$0.10	$0.11	$1.28	$1.28	$18.21	$22.00
August 15, 2010	211.28	2.90%	$0.050	$0.050	5.64%	0.50%	$17.94	$22.06	$0.09	$0.11	$1.38	$1.38	$18.03	$22.17
November 15, 2010	212.34	2.80%	$0.050	$0.050	6.17%	0.50%	$17.75	$22.25	$0.08	$0.11	$1.47	$1.47	$17.84	$22.35
February 15, 2011	213.40	2.70%	$0.050	$0.050	6.70%	0.50%	$17.57	$22.43	$0.08	$0.10	$1.56	$1.56	$17.65	$22.53
May 15, 2011	214.46	2.60%	$0.050	$0.050	7.23%	0.50%	$17.39	$22.61	$0.07	$0.10	$1.65	$1.65	$17.47	$22.70
August 15, 2011	215.54	2.50%	$0.050	$0.050	7.77%	0.50%	$17.21	$22.79	$0.07	$0.09	$1.73	$1.73	$17.28	$22.88
November 15, 2011	216.61	2.40%	$0.050	$0.050	8.31%	0.50%	$17.03	$22.97	$0.06	$0.09	$1.80	$1.80	$17.10	$23.05
February 15, 2012	217.70	2.30%	$0.050	$0.050	8.85%	0.50%	$16.85	$23.15	$0.06	$0.08	$1.87	$1.87	$16.91	$23.23
May 15, 2012	218.79	2.20%	$0.050	$0.050	9.39%	0.50%	$16.68	$23.32	$0.05	$0.08	$1.94	$1.94	$16.73	$23.40
August 15, 2012	219.88	2.10%	$0.050	$0.050	9.94%	0.50%	$16.50	$23.50	$0.05	$0.07	$2.00	$2.00	$16.55	$23.57

(1) “Value” refers to the hypothetical value of the Applicable Reference Value of Medical Inflation.

(2) “Three-Month Treasury Yield” is the hypothetical annualized yield associated with the treasuries that mature on or prior to the next distribution date for each quarterly period.

(3) “Total Fees” are calculated by multiplying the initial underlying value amount by the annualized fee accrual rate equal to 1.00% prorated for the quarterly period over a 365 day year at 91.25 days per quarter.

(4) “Calculated Value” is the “levered rate of change” applied to the closing date value of $20. It is the value of the Up MacroShare or Down MacroShare before allocating income less fees that are applied to the “Underlying Value”.

(5) “Income Distributions” is calculated by multiplying the cumulative percent change in price since the initial period by income net of fees, which is calculated by multiplying the quarterly three-month treasury bill rate by the initial underlying value less quarterly fees.

(6) “Cumulative Income Less Fees” are calculated by adding the income distributions since the initial date to the applicable distribution date.

(7) “Underlying Value” is calculated by adding the Calculated Value of the relevant trust for the applicable distribution date (see related columns above) to the Cumulative Income Less Fees for the related three month period (see related columns above).

The hypothetical scenarios included in this offering document have been prepared by, and are the responsibility of, the Trust’s management. [                                  ] has neither examined nor compiled the accompanying hypothetical scenarios and accordingly, [                                  ] does not express an opinion or any other form of assurances with respect thereto. The [                                  ] report included in this offering document relates to the Trust’s historical financial information. It does not extend to the hypothetical scenarios and should not be read to do so. The hypothetical information shown in this Appendix was not prepared with a view toward compliance with published guidelines of the Securities and Exchange Commission or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information.

A-20

Appendix A

Hypothetical Table Z: Value of medical inflation increases less than 4% annually and interest rates remain the same
The following table illustrates the hypothetical scenario in which the Applicable Reference Value of Medical Inflation increases at a rate that is less than 4% annually and the interest rate on the treasuries held in the paired trusts remains constant from the closing date through the final scheduled termination date.
		Three-Month Treasury Yield (2)	Total Fees (3)		Total Value Change	Change in Value Since the Most Recent Period	Calculated Value (4)		Income Distributions		Cumulative Income Less Fees (5)		Underlying Value (6)
Quarter Ended	Value (1)		Up MacroShare	Down MacroShare			Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare	Up MacroShare	Down MacroShare
November 15, 2007	200.00	4.00%					$20.00	$20.00			-	-	$20.00	$20.00
February 15, 2008	201.00	4.00%	$0.050	$0.050	0.50%	0.50%	$19.81	$20.19	$0.15	$0.15	$0.15	$0.15	$19.96	$20.34
May 15, 2008	202.01	4.00%	$0.050	$0.050	1.00%	0.50%	$19.62	$20.38	$0.15	$0.15	$0.30	$0.30	$19.76	$20.54
August 15, 2008	203.02	4.00%	$0.050	$0.050	1.51%	0.50%	$19.43	$20.57	$0.15	$0.15	$0.45	$0.45	$19.57	$20.73
November 15, 2008	204.03	4.00%	$0.050	$0.050	2.02%	0.50%	$19.24	$20.76	$0.14	$0.16	$0.60	$0.60	$19.38	$20.92
February 15, 2009	205.05	4.00%	$0.050	$0.050	2.53%	0.50%	$19.05	$20.95	$0.14	$0.16	$0.75	$0.75	$19.19	$21.11
May 15, 2009	206.08	4.00%	$0.050	$0.050	3.04%	0.50%	$18.86	$21.14	$0.14	$0.16	$0.90	$0.90	$19.00	$21.30
August 15, 2009	207.11	4.00%	$0.050	$0.050	3.55%	0.50%	$18.67	$21.33	$0.14	$0.16	$1.05	$1.05	$18.81	$21.49
November 15, 2009	208.14	4.00%	$0.050	$0.050	4.07%	0.50%	$18.49	$21.51	$0.14	$0.16	$1.20	$1.20	$18.63	$21.67
February 15, 2010	209.18	4.00%	$0.050	$0.050	4.59%	0.50%	$18.30	$21.70	$0.14	$0.16	$1.35	$1.35	$18.44	$21.86
May 15, 2010	210.23	4.00%	$0.050	$0.050	5.11%	0.50%	$18.12	$21.88	$0.14	$0.16	$1.50	$1.50	$18.25	$22.05
August 15, 2010	211.28	4.00%	$0.050	$0.050	5.64%	0.50%	$17.94	$22.06	$0.13	$0.17	$1.65	$1.65	$18.07	$22.23
November 15, 2010	212.34	4.00%	$0.050	$0.050	6.17%	0.50%	$17.75	$22.25	$0.13	$0.17	$1.80	$1.80	$17.89	$22.41
February 15, 2011	213.40	4.00%	$0.050	$0.050	6.70%	0.50%	$17.57	$22.43	$0.13	$0.17	$1.95	$1.95	$17.70	$22.60
May 15, 2011	214.46	4.00%	$0.050	$0.050	7.23%	0.50%	$17.39	$22.61	$0.13	$0.17	$2.10	$2.10	$17.52	$22.78
August 15, 2011	215.54	4.00%	$0.050	$0.050	7.77%	0.50%	$17.21	$22.79	$0.13	$0.17	$2.25	$2.25	$17.34	$22.96
November 15, 2011	216.61	4.00%	$0.050	$0.050	8.31%	0.50%	$17.03	$22.97	$0.13	$0.17	$2.40	$2.40	$17.16	$23.14
February 15, 2012	217.70	4.00%	$0.050	$0.050	8.85%	0.50%	$16.85	$23.15	$0.13	$0.17	$2.55	$2.55	$16.98	$23.32
May 15, 2012	218.79	4.00%	$0.050	$0.050	9.39%	0.50%	$16.68	$23.32	$0.13	$0.17	$2.70	$2.70	$16.80	$23.50
August 15, 2012	219.88	4.00%	$0.050	$0.050	9.94%	0.50%	$16.50	$23.50	$0.12	$0.18	$2.85	$2.85	$16.62	$23.68

(1) “Value” refers to the hypothetical value of the Applicable Reference Value of Medical Inflation.

(2) “Three-Month Treasury Yield” is the hypothetical annualized yield associated with the treasuries that mature on or prior to the next distribution date for each quarterly period.

(3) “Total Fees” are calculated by multiplying the initial underlying value amount by the annualized fee accrual rate equal to 1.00% prorated for the quarterly period over a 365 day year at 91.25 days per quarter.

(4) “Calculated Value” is the “levered rate of change” applied to the closing date value of $20. It is the value of the Up MacroShare or Down MacroShare before allocating income less fees that are applied to the “Underlying Value”.

(5) “Income Distributions” is calculated by multiplying the cumulative percent change in price since the initial period by income net of fees, which is calculated by multiplying the quarterly three-month treasury bill rate by the initial underlying value less quarterly fees.

(6) “Cumulative Income Less Fees” are calculated by adding the income distributions since the initial date to the applicable distribution date.

(7) “Underlying Value” is calculated by adding the Calculated Value of the relevant trust for the applicable distribution date (see related columns above) to the Cumulative Income Less Fees for the related three month period (see related columns above).

The hypothetical scenarios included in this offering document have been prepared by, and are the responsibility of, the Trust’s management. [                                  ] has neither examined nor compiled the accompanying hypothetical scenarios and accordingly, [                                  ] does not express an opinion or any other form of assurances with respect thereto. The [                                  ] report included in this offering document relates to the Trust’s historical financial information. It does not extend to the hypothetical scenarios and should not be read to do so. The hypothetical information shown in this Appendix was not prepared with a view toward compliance with published guidelines of the Securities and Exchange Commission or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information.

A-21

Appendix B

Historical Graph of CPI-U Monthly Major Group Medical Care

The following graphs show the monthly index values released by the BLS for the CPI-U Major Group Medical Care for a 10 year period ending October 2007, and the year over year percent change compared to a 4% rate for the same period. The values have consistently increased by amounts above and below the hurdle rate of 4%. The results shown should not be considered representative of the Applicable Reference Value of Medical Inflation in the future nor should the results be viewed as being indicative of the future performance of the Up MacroShares.

B-1

Appendix B

B-2

Appendix B

Historical Month-End Yield on the 91-day United States Treasury Bill

The following table shows the historical month-end yield on the 91-day United States Treasury bill for the period from October 1997 through October 2007. The yield on the 91-day United States Treasury bill fluctuated widely during this period. The results shown should not be considered representations of the yield on the treasuries held in the Paired Trusts in the future nor should the results be considered a representation of the future distributions on the Up MacroShares.

Month-End Yield on the 91-day United States Treasury Bill

(as reported by Bloomberg)

(on an annualized percentage basis) 

Month Ended	1997	1998	1999	2000	2001	2002	2003	2004	2005	2006	2007
January		5.04%	4.34%	5.32%	5.04%	1.65%	1.17%	0.88%	2.33%	4.24%	4.98%
February		5.09%	4.44%	5.55%	4.77%	1.71%	1.17%	0.93%	2.54%	4.43%	5.03%
March		5.03%	4.29%	5.69%	4.19%	1.76%(1)	1.13%	0.94%	2.74%	4.51%	4.94%
April		4.95%	4.29%	5.66%	3.76%	1.72%	1.13%	0.94%	2.78%	4.60%	4.87%
May		5.00%	4.50%(1)	5.79%	3.58%	1.73%	1.07%	1.02%(1)	2.84%	4.72%	4.73%
June		4.98%	4.57%	5.69%	3.49%	1.70%	0.92%	1.27%	2.97%	4.79%	4.61%
July		4.96%	4.55%	5.96%	3.48%	1.68%	0.90%	1.33%	3.22%	4.95%	4.82%
August		4.90%	4.72%	6.09%	3.36%	1.62%	0.95%	1.48%	3.44%	4.81%	4.20%
September		4.61%	4.68%	6.00%	2.63%	1.63%	0.94%	1.65%	3.42%	4.81%	3.89%
October	4.97%	3.96%	4.86%	6.11%	2.24%	1.58%	0.92%	1.76%	3.71%	4.92%	3.90%
November	5.14%	4.41%	5.07%	6.17%	1.96%	1.23%	0.93%	2.07%	3.88%	4.85%
December	5.16%	4.34%	5.20%	5.77%	1.69%	1.19%	0.90%	2.19%	3.89%	4.85%

(6)   For this month, the historical yield on the 91-day United States Treasury bill for the last Business Day of the month is not available, therefore, the yield on the 91-day United States treasury bill for the second to last Business Day of the month is presented above.

B-3

Appendix B

Hypothetical Historical Performance of a Medical Inflation MACRO

The following table illustrates the hypothetical monthly performance of an Up MacroShare and a Down MacroShare from the 10 year period beginning on October 20, 1997 through October 20, 2007. This hypothetical table uses the historical Applicable Reference Value of Medical Inflation monthly set forth in the table titled “Monthly Medical Inflation - Applicable Reference Values” in the related prospectus and the historical information for three-month treasury yields set forth in the table titled “Month-End Yield on 91-day United States Treasury bill” on page B-3. Furthermore, other than assumptions relating to the Starting Level and the Final Scheduled Termination Date, this table makes each of the assumptions relating to the hypothetical tables set forth in “APPENDIX A — Hypothetical Scenarios.”

Hypothetical Historical Performance of a Medical Inflation MACRO

(unaudited)

			Three-		Total Fees (3)				Total		Change in Value Since the		Calculated Value (4)				Allocated Income After Income Distribution Agreement (5)				Cumulative Income Less Fees (6)				Underlying Value (7)
Date	Applicable Reference Value (1)		Month Treasury Yield (2)		Up MacroShare		Down MacroShare		Price Level Change		Most Recent Period		Up MacroShare		Down MacroShare		Up MacroShare		Down MacroShare		Up MacroShare		Down MacroShare		Up MacroShare		Down MacroShare
October 20, 1997		235.0451613		4.97%									$	20.00	$	20.00		-		-		0		0	$	20.00	$	20.00
November 20, 1997		235.3266667		5.14%	$	0.017	$	0.017		0.12%		0.12%	$	19.92	$	20.08		-		-	$	0.07	$	0.07	$	19.98	$	20.15
December 20, 1997		235.6451613		5.16%	$	0.017	$	0.017		0.26%		0.14%	$	19.84	$	20.16		-		-	$	0.13	$	0.14	$	19.98	$	20.30
January 20, 1998		236.1677419		5.04%	$	0.017	$	0.017		0.48%		0.22%	$	19.80	$	20.20	$	0.20	$	0.21	$	0.20	$	0.21	$	20.00	$	20.41
February 20, 1998		236.875		5.09%	$	0.017	$	0.017		0.78%		0.30%	$	19.79	$	20.21		-		-	$	0.07	$	0.07	$	19.85	$	20.28
March 20, 1998		237.7129032		5.03%	$	0.017	$	0.017		1.13%		0.35%	$	19.80	$	20.20		-		-	$	0.13	$	0.14	$	19.93	$	20.34
April 20, 1998		238.86		4.95%	$	0.017	$	0.017		1.62%		0.48%	$	19.86	$	20.14	$	0.20	$	0.20	$	0.20	$	0.20	$	20.06	$	20.34
May 20, 1998		239.6064516		5.00%	$	0.017	$	0.017		1.94%		0.31%	$	19.85	$	20.15		-		-	$	0.07	$	0.07	$	19.92	$	20.21
June 20, 1998		240.37		4.98%	$	0.017	$	0.017		2.27%		0.32%	$	19.85	$	20.15		-		-	$	0.13	$	0.13	$	19.98	$	20.28
July 20, 1998		241.1290323		4.96%	$	0.017	$	0.017		2.59%		0.32%	$	19.85	$	20.15	$	0.20	$	0.20	$	0.20	$	0.20	$	20.04	$	20.35
August 20, 1998		241.7677419		4.90%	$	0.017	$	0.017		2.86%		0.26%	$	19.82	$	20.18		-		-	$	0.07	$	0.07	$	19.89	$	20.25
September 20, 1998		242.4433333		4.61%	$	0.017	$	0.017		3.15%		0.28%	$	19.80	$	20.20		-		-	$	0.13	$	0.13	$	19.93	$	20.33
October 20, 1998		243.1903226		3.96%	$	0.017	$	0.017		3.47%		0.31%	$	19.79	$	20.21	$	0.19	$	0.19	$	0.19	$	0.19	$	19.98	$	20.40
November 20, 1998		243.7533333		4.41%	$	0.017	$	0.017		3.70%		0.23%	$	19.76	$	20.24		-		-	$	0.05	$	0.05	$	19.81	$	20.29
December 20, 1998		244.1451613		4.34%	$	0.017	$	0.017		3.87%		0.16%	$	19.69	$	20.31		-		-	$	0.10	$	0.11	$	19.80	$	20.42
January 20, 1999		244.5451613		4.34%	$	0.017	$	0.017		4.04%		0.16%	$	19.63	$	20.37	$	0.16	$	0.16	$	0.16	$	0.16	$	19.78	$	20.54

B-4

Appendix B 

			Three-		Total Fees (3)				Total		Change in Value Since the		Calculated Value (4)				Allocated Income After Income Distribution Agreement (5)				Cumulative Income Less Fees (6)				Underlying Value (7)
Date	Applicable Reference Value (1)		Month Treasury Yield (2)		Up MacroShare		Down MacroShare		Price Level Change		Most Recent Period		Up MacroShare		Down MacroShare		Up MacroShare		Down MacroShare		Up MacroShare		Down MacroShare		Up MacroShare		Down MacroShare
February 20, 1999		245.0392857		4.44%	$	0.017	$	0.017		4.25%		0.20%	$	19.58	$	20.42		-		-	$	0.05	$	0.06	$	19.63	$	20.48
March 20, 1999		246.0580645		4.29%	$	0.017	$	0.017		4.69%		0.42%	$	19.61	$	20.39		-		-	$	0.11	$	0.12	$	19.72	$	20.50
April 20, 1999		247.2966667		4.29%	$	0.017	$	0.017		5.21%		0.50%	$	19.68	$	20.32	$	0.16	$	0.17	$	0.16	$	0.17	$	19.85	$	20.49
May 20, 1999		248.0677419		4.50%	$	0.017	$	0.017		5.54%		0.31%	$	19.67	$	20.33		-		-	$	0.05	$	0.06	$	19.73	$	20.38
June 20, 1999		248.8066667		4.57%	$	0.017	$	0.017		5.85%		0.30%	$	19.66	$	20.34		-		-	$	0.11	$	0.12	$	19.77	$	20.45
July 20, 1999		249.3451613		4.55%	$	0.017	$	0.017		6.08%		0.22%	$	19.62	$	20.38	$	0.17	$	0.18	$	0.17	$	0.18	$	19.79	$	20.56
August 20, 1999		249.9290323		4.72%	$	0.017	$	0.017		6.33%		0.23%	$	19.58	$	20.42		-		-	$	0.06	$	0.06	$	19.64	$	20.48
September 20, 1999		250.77		4.68%	$	0.017	$	0.017		6.69%		0.34%	$	19.59	$	20.41		-		-	$	0.12	$	0.12	$	19.70	$	20.54
October 20, 1999		251.5903226		4.86%	$	0.017	$	0.017		7.04%		0.33%	$	19.59	$	20.41	$	0.18	$	0.19	$	0.18	$	0.19	$	19.76	$	20.60
November 20, 1999		252.1533333		5.07%	$	0.017	$	0.017		7.28%		0.22%	$	19.54	$	20.46		-		-	$	0.06	$	0.07	$	19.61	$	20.52
December 20, 1999		252.6064516		5.20%	$	0.017	$	0.017		7.47%		0.18%	$	19.49	$	20.51		-		-	$	0.13	$	0.14	$	19.62	$	20.65
January 20, 2000		253.1064516		5.32%	$	0.017	$	0.017		7.68%		0.20%	$	19.44	$	20.56	$	0.20	$	0.21	$	0.20	$	0.21	$	19.63	$	20.77
February 20, 2000		253.8896552		5.55%	$	0.017	$	0.017		8.02%		0.31%	$	19.43	$	20.57		-		-	$	0.07	$	0.07	$	19.50	$	20.65
March 20, 2000		254.9967742		5.69%	$	0.017	$	0.017		8.49%		0.44%	$	19.47	$	20.53		-		-	$	0.14	$	0.15	$	19.61	$	20.68
April 20, 2000		256.45		5.66%	$	0.017	$	0.017		9.11%		0.57%	$	19.57	$	20.43	$	0.22	$	0.23	$	0.22	$	0.23	$	19.79	$	20.67
May 20, 2000		257.6741935		5.79%	$	0.017	$	0.017		9.63%		0.48%	$	19.63	$	20.37		-		-	$	0.08	$	0.08	$	19.70	$	20.45
June 20, 2000		258.5433333		5.69%	$	0.017	$	0.017		10.00%		0.34%	$	19.63	$	20.37		-		-	$	0.15	$	0.16	$	19.78	$	20.53
July 20, 2000		259.1677419		5.96%	$	0.017	$	0.017		10.26%		0.24%	$	19.60	$	20.40	$	0.23	$	0.24	$	0.23	$	0.24	$	19.83	$	20.64
August 20, 2000		260.0741935		6.09%	$	0.017	$	0.017		10.65%		0.35%	$	19.60	$	20.40		-		-	$	0.08	$	0.08	$	19.69	$	20.48
September 20, 2000		261.07		6.00%	$	0.017	$	0.017		11.07%		0.38%	$	19.63	$	20.37		-		-	$	0.16	$	0.17	$	19.79	$	20.54
October 20, 2000		262.1354839		6.11%	$	0.017	$	0.017		11.53%		0.41%	$	19.66	$	20.34	$	0.25	$	0.26	$	0.25	$	0.26	$	19.90	$	20.60
November 20, 2000		262.9166667		6.17%	$	0.017	$	0.017		11.86%		0.30%	$	19.65	$	20.35		-		-	$	0.08	$	0.09	$	19.73	$	20.44
December 20, 2000		263.4677419		5.77%	$	0.017	$	0.017		12.09%		0.21%	$	19.60	$	20.40		-		-	$	0.17	$	0.17	$	19.77	$	20.57
January 20, 2001		263.9451613		5.04%	$	0.017	$	0.017		12.30%		0.18%	$	19.54	$	20.46	$	0.25	$	0.26	$	0.25	$	0.26	$	19.79	$	20.71
February 20, 2001		264.575		4.77%	$	0.017	$	0.017		12.56%		0.24%	$	19.51	$	20.49		-		-	$	0.07	$	0.07	$	19.57	$	20.56
March 20, 2001		266.2096774		4.19%	$	0.017	$	0.017		13.26%		0.62%	$	19.62	$	20.38		-		-	$	0.13	$	0.13	$	19.75	$	20.51
April 20, 2001		268.24		3.76%	$	0.017	$	0.017		14.12%		0.76%	$	19.79	$	20.21	$	0.18	$	0.19	$	0.18	$	0.19	$	19.97	$	20.39

B-5

Appendix B 

			Three-		Total Fees (3)				Total		Change in Value Since the		Calculated Value (4)				Allocated Income After Income Distribution Agreement (5)				Cumulative Income Less Fees (6)				Underlying Value (7)
Date	Applicable Reference Value (1)		Month Treasury Yield (2)		Up MacroShare		Down MacroShare		Price Level Change		Most Recent Period		Up MacroShare		Down MacroShare		Up MacroShare		Down MacroShare		Up MacroShare		Down MacroShare		Up MacroShare		Down MacroShare
May 20, 2001		269.5741935		3.58%	$	0.017	$	0.017		14.69%		0.50%	$	19.86	$	20.14		-		-	$	0.05	$	0.05	$	19.91	$	20.19
June 20, 2001		270.5066667		3.49%	$	0.017	$	0.017		15.09%		0.35%	$	19.87	$	20.13		-		-	$	0.09	$	0.09	$	19.96	$	20.22
July 20, 2001		271.1677419		3.48%	$	0.017	$	0.017		15.37%		0.24%	$	19.84	$	20.16	$	0.13	$	0.13	$	0.13	$	0.13	$	19.97	$	20.30
August 20, 2001		272.0741935		3.36%	$	0.017	$	0.017		15.75%		0.33%	$	19.84	$	20.16		-		-	$	0.04	$	0.04	$	19.88	$	20.20
September 20, 2001		272.88		2.63%	$	0.017	$	0.017		16.10%		0.30%	$	19.83	$	20.17		-		-	$	0.08	$	0.08	$	19.91	$	20.26
October 20, 2001		273.8967742		2.24%	$	0.017	$	0.017		16.53%		0.37%	$	19.84	$	20.16	$	0.11	$	0.11	$	0.11	$	0.11	$	19.95	$	20.26
November 20, 2001		274.78		1.96%	$	0.017	$	0.017		16.91%		0.32%	$	19.84	$	20.16		-		-	$	0.02	$	0.02	$	19.86	$	20.18
December 20, 2001		275.5516129		1.69%	$	0.017	$	0.017		17.23%		0.28%	$	19.82	$	20.18		-		-	$	0.04	$	0.04	$	19.86	$	20.21
January 20, 2002		276.3903226		1.65%	$	0.017	$	0.017		17.59%		0.30%	$	19.81	$	20.19	$	0.05	$	0.05	$	0.05	$	0.05	$	19.86	$	20.23
February 20, 2002		277.1071429		1.71%	$	0.017	$	0.017		17.90%		0.26%	$	19.79	$	20.21		-		-	$	0.01	$	0.01	$	19.80	$	20.22
March 20, 2002		278.7096774		1.76%	$	0.017	$	0.017		18.58%		0.58%	$	19.89	$	20.11		-		-	$	0.02	$	0.02	$	19.91	$	20.14
April 20, 2002		280.4866667		1.72%	$	0.017	$	0.017		19.33%		0.64%	$	20.01	$	19.99	$	0.04	$	0.04	$	0.04	$	0.04	$	20.05	$	20.03
May 20, 2002		281.6129032		1.73%	$	0.017	$	0.017		19.81%		0.40%	$	20.04	$	19.96		-		-	$	0.01	$	0.01	$	20.05	$	19.97
June 20, 2002		282.76		1.70%	$	0.017	$	0.017		20.30%		0.41%	$	20.07	$	19.93		-		-	$	0.02	$	0.02	$	20.10	$	19.95
July 20, 2002		283.7516129		1.68%	$	0.017	$	0.017		20.72%		0.35%	$	20.08	$	19.92	$	0.04	$	0.04	$	0.04	$	0.04	$	20.12	$	19.95
August 20, 2002		284.4677419		1.62%	$	0.017	$	0.017		21.03%		0.25%	$	20.05	$	19.95		-		-	$	0.01	$	0.01	$	20.06	$	19.96
September 20, 2002		285.9033333		1.63%	$	0.017	$	0.017		21.64%		0.50%	$	20.12	$	19.88		-		-	$	0.02	$	0.02	$	20.14	$	19.90
October 20, 2002		287.0290323		1.58%	$	0.017	$	0.017		22.12%		0.39%	$	20.15	$	19.85	$	0.03	$	0.03	$	0.03	$	0.03	$	20.18	$	19.88
November 20, 2002		287.5533333		1.23%	$	0.017	$	0.017		22.34%		0.18%	$	20.09	$	19.91		-		-	$	0.01	$	0.01	$	20.10	$	19.92
December 20, 2002		288.6193548		1.19%	$	0.017	$	0.017		22.79%		0.37%	$	20.11	$	19.89		-		-	$	0.01	$	0.01	$	20.12	$	19.91
January 20, 2003		289.9967742		1.17%	$	0.017	$	0.017		23.38%		0.48%	$	20.17	$	19.83	$	0.02	$	0.02	$	0.02	$	0.02	$	20.18	$	19.85
February 20, 2003		291.0428571		1.17%	$	0.017	$	0.017		23.82%		0.36%	$	20.18	$	19.82		-		-	$	0.00	$	0.00	$	20.18	$	19.82
March 20, 2003		292.0967742		1.13%	$	0.017	$	0.017		24.27%		0.36%	$	20.19	$	19.81		-		-	$	0.01	$	0.01	$	20.20	$	19.81
April 20, 2003		293.2966667		1.13%	$	0.017	$	0.017		24.78%		0.41%	$	20.23	$	19.77	$	0.01	$	0.01	$	0.01	$	0.01	$	20.24	$	19.78
May 20, 2003		294.0064516		1.07%	$	0.017	$	0.017		25.09%		0.24%	$	20.19	$	19.81		-		-	$	0.00	$	0.00	$	20.20	$	19.81
June 20, 2003		294.4533333		0.92%	$	0.017	$	0.017		25.28%		0.15%	$	20.12	$	19.88		-		-	$	0.00	$	0.00	$	20.13	$	19.88
July 20, 2003		295.1516129		0.90%	$	0.017	$	0.017		25.57%		0.24%	$	20.09	$	19.91	$	0.00	$	0.00	$	0.00	$	0.00	$	20.09	$	19.92

B-6

 

Appendix B

			Three-		Total Fees (3)				Total		Change in Value Since the		Calculated Value (4)				Allocated Income After Income Distribution Agreement (5)				Cumulative Income Less Fees (6)				Underlying Value (7)
Date	Applicable Reference Value (1)		Month Treasury Yield (2)		Up MacroShare		Down MacroShare		Price Level Change		Most Recent Period		Up MacroShare		Down MacroShare		Up MacroShare		Down MacroShare		Up MacroShare		Down MacroShare		Up MacroShare		Down MacroShare
August 20, 2003		295.9903226		0.95%	$	0.017	$	0.017		25.93%		0.28%	$	20.07	$	19.93		-		-	$	0.00	$	0.00	$	20.07	$	19.93
September 20, 2003		297.1233333		0.94%	$	0.017	$	0.017		26.41%		0.38%	$	20.09	$	19.91		-		-	$	0.00	$	0.00	$	20.09	$	19.91
October 20, 2003		298.0903226		0.92%	$	0.017	$	0.017		26.82%		0.33%	$	20.09	$	19.91		-		-	$	0.00	$	0.00	$	20.09	$	19.91
November 20, 2003		298.9066667		0.93%	$	0.017	$	0.017		27.17%		0.27%	$	20.06	$	19.93		-		-	$	0.00	$	0.00	$	20.06	$	19.93
December 20, 2003		299.6290323		0.90%	$	0.017	$	0.017		27.48%		0.24%	$	20.03	$	19.96		-		-	$	0.00	$	0.00	$	20.03	$	19.96
January 20, 2004		300.4516129		0.88%	$	0.017	$	0.017		27.83%		0.27%	$	20.01	$	19.98		-		-	$	0.00	$	0.00	$	20.01	$	19.98
February 20, 2004		301.6517241		0.93%	$	0.017	$	0.017		28.34%		0.40%	$	20.03	$	19.96		-		-	$	0.00	$	0.00	$	20.03	$	19.96
March 20, 2004		303.0193548		0.94%	$	0.017	$	0.017		28.92%		0.45%	$	20.08	$	19.91		-		-	$	0.00	$	0.00	$	20.08	$	19.91
April 20, 2004		305.12		0.94%	$	0.017	$	0.017		29.81%		0.69%	$	20.23	$	19.76		-		-	$	0.00	$	0.00	$	20.23	$	19.76
May 20, 2004		306.9193548		1.02%	$	0.017	$	0.017		30.58%		0.59%	$	20.33	$	19.65		-		-	$	0.00	$	0.00	$	20.33	$	19.65
June 20, 2004		308.0066667		1.27%	$	0.017	$	0.017		31.04%		0.35%	$	20.36	$	19.64		-		-	$	0.00	$	0.00	$	20.36	$	19.64
July 20, 2004		308.7290323		1.33%	$	0.017	$	0.017		31.35%		0.23%	$	20.32	$	19.68	$	0.00	$	0.00	$	0.00	$	0.00	$	20.32	$	19.69
August 20, 2004		309.6129032		1.48%	$	0.017	$	0.017		31.72%		0.29%	$	20.30	$	19.70		-		-	$	0.01	$	0.01	$	20.31	$	19.70
September 20, 2004		310.6333333		1.65%	$	0.017	$	0.017		32.16%		0.33%	$	20.30	$	19.70		-		-	$	0.01	$	0.01	$	20.32	$	19.71
October 20, 2004		311.3677419		1.76%	$	0.017	$	0.017		32.47%		0.24%	$	20.27	$	19.73	$	0.02	$	0.02	$	0.02	$	0.02	$	20.29	$	19.76
November 20, 2004		312.0433333		2.07%	$	0.017	$	0.017		32.76%		0.22%	$	20.22	$	19.78		-		-	$	0.01	$	0.01	$	20.24	$	19.79
December 20, 2004		312.9129032		2.19%	$	0.017	$	0.017		33.13%		0.28%	$	20.20	$	19.80		-		-	$	0.03	$	0.03	$	20.23	$	19.83
January 20, 2005		313.7903226		2.33%	$	0.017	$	0.017		33.50%		0.28%	$	20.18	$	19.82	$	0.05	$	0.05	$	0.05	$	0.05	$	20.24	$	19.87
February 20, 2005		314.6428571		2.54%	$	0.017	$	0.017		33.86%		0.27%	$	20.16	$	19.84		-		-	$	0.02	$	0.02	$	20.18	$	19.86
March 20, 2005		316.0645161		2.74%	$	0.017	$	0.017		34.47%		0.45%	$	20.21	$	19.79		-		-	$	0.05	$	0.05	$	20.26	$	19.84
April 20, 2005		318.3833333		2.78%	$	0.017	$	0.017		35.46%		0.73%	$	20.37	$	19.63	$	0.08	$	0.08	$	0.08	$	0.08	$	20.45	$	19.70
May 20, 2005		320.1580645		2.84%	$	0.017	$	0.017		36.21%		0.56%	$	20.47	$	19.53		-		-	$	0.03	$	0.03	$	20.50	$	19.56
June 20, 2005		321.2066667		2.97%	$	0.017	$	0.017		36.66%		0.33%	$	20.47	$	19.53		-		-	$	0.06	$	0.06	$	20.53	$	19.59
July 20, 2005		321.9290323		3.22%	$	0.017	$	0.017		36.96%		0.22%	$	20.43	$	19.57	$	0.10	$	0.09	$	0.10	$	0.09	$	20.52	$	19.67
August 20, 2005		322.6290323		3.44%	$	0.017	$	0.017		37.26%		0.22%	$	20.38	$	19.62		-		-	$	0.04	$	0.04	$	20.42	$	19.65
September 20, 2005		323.66		3.42%	$	0.017	$	0.017		37.70%		0.32%	$	20.38	$	19.62		-		-	$	0.08	$	0.08	$	20.46	$	19.70
October 20, 2005		323.9774194		3.71%	$	0.017	$	0.017		37.84%		0.10%	$	20.29	$	19.71	$	0.12	$	0.12	$	0.12	$	0.12	$	20.41	$	19.83

B-7

 

Appendix B

			Three-		Total Fees (3)				Total		Change in Value Since the		Calculated Value (4)				Allocated Income After Income Distribution Agreement (5)				Cumulative Income Less Fees (6)				Underlying Value (7)
Date	Applicable Reference Value (1)		Month Treasury Yield (2)		Up MacroShare		Down MacroShare		Price Level Change		Most Recent Period		Up MacroShare		Down MacroShare		Up MacroShare		Down MacroShare		Up MacroShare		Down MacroShare		Up MacroShare		Down MacroShare
November 20, 2005		324.3433333		3.88%	$	0.017	$	0.017		37.99%		0.11%	$	20.20	$	19.80		-		-	$	0.05	$	0.04	$	20.25	$	19.84
December 20, 2005		325.5806452		3.89%	$	0.017	$	0.017		38.52%		0.38%	$	20.22	$	19.78		-		-	$	0.09	$	0.09	$	20.32	$	19.87
January 20, 2006		327.3645161		4.24%	$	0.017	$	0.017		39.28%		0.55%	$	20.31	$	19.69	$	0.14	$	0.14	$	0.14	$	0.14	$	20.45	$	19.83
February 20, 2006		328.3035714		4.43%	$	0.017	$	0.017		39.68%		0.29%	$	20.29	$	19.71		-		-	$	0.05	$	0.05	$	20.35	$	19.76
March 20, 2006		329.0741935		4.51%	$	0.017	$	0.017		40.00%		0.23%	$	20.26	$	19.74		-		-	$	0.11	$	0.11	$	20.37	$	19.85
April 20, 2006		331.1466667		4.60%	$	0.017	$	0.017		40.89%		0.63%	$	20.38	$	19.62	$	0.17	$	0.17	$	0.17	$	0.17	$	20.55	$	19.79
May 20, 2006		333.1419355		4.72%	$	0.017	$	0.017		41.74%		0.60%	$	20.49	$	19.51		-		-	$	0.06	$	0.06	$	20.55	$	19.57
June 20, 2006		334.37		4.79%	$	0.017	$	0.017		42.26%		0.37%	$	20.51	$	19.49		-		-	$	0.13	$	0.12	$	20.63	$	19.61
July 20, 2006		335.2516129		4.95%	$	0.017	$	0.017		42.63%		0.26%	$	20.48	$	19.52	$	0.19	$	0.18	$	0.19	$	0.18	$	20.67	$	19.70
August 20, 2006		335.8451613		4.81%	$	0.017	$	0.017		42.89%		0.18%	$	20.42	$	19.58		-		-	$	0.07	$	0.06	$	20.49	$	19.65
September 20, 2006		336.6333333		4.81%	$	0.017	$	0.017		43.22%		0.23%	$	20.38	$	19.62		-		-	$	0.13	$	0.13	$	20.51	$	19.74
October 20, 2006		337.4290323		4.92%	$	0.017	$	0.017		43.56%		0.24%	$	20.35	$	19.65	$	0.20	$	0.19	$	0.20	$	0.19	$	20.54	$	19.84
November 20, 2006		338.08		4.85%	$	0.017	$	0.017		43.84%		0.19%	$	20.29	$	19.71		-		-	$	0.07	$	0.06	$	20.36	$	19.77
December 20, 2006		338.9129032		4.85%	$	0.017	$	0.017		44.19%		0.25%	$	20.26	$	19.74		-		-	$	0.13	$	0.13	$	20.39	$	19.87
January 20, 2007		339.7903226		4.98%	$	0.017	$	0.017		44.56%		0.26%	$	20.23	$	19.77	$	0.20	$	0.19	$	0.20	$	0.19	$	20.43	$	19.96
February 20, 2007		340.1		5.03%	$	0.017	$	0.017		44.70%		0.09%	$	20.14	$	19.86		-		-	$	0.07	$	0.07	$	20.20	$	19.93
March 20, 2007		342.19		4.94%	$	0.017	$	0.017		45.58%		0.61%	$	20.25	$	19.75		-		-	$	0.13	$	0.13	$	20.39	$	19.88
April 20, 2007		345.3764333		4.87%	$	0.017	$	0.017		46.94%		0.93%	$	20.49	$	19.51	$	0.20	$	0.20	$	0.20	$	0.20	$	20.70	$	19.70
May 20, 2007		346.8952258		4.73%	$	0.017	$	0.017		47.59%		0.44%	$	20.54	$	19.46		-		-	$	0.07	$	0.06	$	20.61	$	19.52
June 20, 2007		347.8389		4.61%	$	0.017	$	0.017		47.99%		0.27%	$	20.52	$	19.48		-		-	$	0.13	$	0.12	$	20.65	$	19.61
July 20, 2007		348.7533226		4.82%	$	0.017	$	0.017		48.38%		0.26%	$	20.49	$	19.51	$	0.19	$	0.18	$	0.19	$	0.18	$	20.68	$	19.69
August 20, 2007		349.3462581		4.20%	$	0.017	$	0.017		48.63%		0.17%	$	20.43	$	19.57		-		-	$	0.07	$	0.06	$	20.49	$	19.64
September 20, 2007		350.8609		3.89%	$	0.017	$	0.017		49.27%		0.43%	$	20.47	$	19.53		-		-	$	0.12	$	0.11	$	20.59	$	19.64
October 20, 2007		352.4508065		3.90%	$	0.017	$	0.017		49.95%		0.45%	$	20.52	$	19.48	$	0.17	$	0.16	$	0.17	$	0.16	$	20.69	$	19.64

Footnotes to the table titled “Hypothetical Historical Performance of a Medical Inflation MACRO”:

(1) “Applicable Reference Value” refers to the hypothetical reference value of medical inflation used to calculate the “underlying value” This value is obtained from a linear interprolation of the CPI level for medical inflation 3 months and 2 months from the existing. This is outlined further in the table titled “Monthly Medical Inflation - Applicable Reference Values” found in the prospectus.

(2) For purposes of this hypothetical, it is assumed the product would generate monthly income based upon an annualized yield equal to the ”Three-Month Treasury Yield” shown on page B-2.

(3) “Total Fees” are the hypothetical fees that may be charged by the Down MacroShare or Up MacroShare, which are shown monthly and collected quarterly. They are calculated by multiplying the initial investment amount, adjusted for any draw from principal in periods where the income did not fully cover the expenses, plus the gross accrued income of the Down MacroShare or Up MacroShare by the annualized fee accrual rate equal to 1.00% prorated for the monthly period.

(4) “Calculated Value” is the “levered rate of change” applied to the closing date value of $20. It is the value of the Up MacroShare or Down MacroShare before allocating income less fees that are applied to the “Underlying value”.

(5) “Cumulative Quarterly Distributions” are calculated by adding the current Quarterly Distribution to all previously distributed amounts.

(6)  “Cumulative Returns” are calculated by adding the Underlying Value of the relevant trust for the applicable distribution date (see related columns above) to the Cumulative Quarterly Distribution for the related three month period (see related columns above).

(7) “Underlying Value” is a concept that is used in the prospectus in relation to the paired trusts. The Underlying Value of the paired trust on any date represents the total amount of assets in both paired trusts to which the first trust is entitled under the settlement contract. For purposes of this table, when we refer to the “underlying value” of a Down MacroShare or of an Up MacroShare, we mean the proportionate share of the underlying value of the Down Trust or Up Trust, as applicable, to which that Down MacroShare or that Up MacroShare is entitled.

The hypothetical scenarios included in this offering document have been prepared by, and are the responsibility of, the Trust’s management. [                                  ] has neither examined nor compiled the accompanying hypothetical scenarios and accordingly, [                                  ] does not express an opinion or any other form of assurances with respect thereto. The [                                  ] report included in this offering document relates to the Trust’s historical financial information. It does not extend to the hypothetical scenarios and should not be read to do so. The hypothetical information shown in this Appendix was not prepared with a view toward compliance with published guidelines of the Securities and Exchange Commission or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information.

B-8

Appendix C

The following is a hypothetical example¹of how Underlying Value of an Up MacroShare is calculated:

Example 1

Assumptions: The Applicable Reference Value of Medical Inflation on the closing day is “the Starting Level” 212; the Up Trust and Down Trust have each raised $120,000,000 and have 6,000,000 shares outstanding at a Stated Par Amount of $20 per share; The Closing date is February 2, 2008 the range for the Up Trust is $20 to $40 and the range for the Down Trust is $0 to $20; the Daily Yield Rate is 4.00% / 365 for all of the Treasuries and the Daily Fee Accrual is 1.00%/365.

Day 1 of calculation period → Applicable Reference Value of Medical Inflation is 212.0366

Using a CPI medical index level of 213.06 for 2 months past and a CPI medical index level of 212 for 3 months past. Since we are determining a reference Medical inflation value for the month of February 08 which has 29 days in it, we determine the reference Medical Inflation value by:

(213.06-212)/29 = .03655, we then multiply by the number of days minus 1 and add to the 212 number. Since we begin on February 2^nd, the number of days in the month is 2. Therefore the Applicable Medical Inflation for February 2^nd (Ending Level) is:

(.03655 *(2-1))+212 = 212.0366

Relevant Variables:

● Daily Fee Accrual for each trust:

Daily fee Accrual Rate	x	Up Asset Amount
(1.0% / 365)	x	$120,000,000	= $3287.67

● Available Income Accrual for each trust:

Daily Yield Rate on the Treasuries	x	Up Investment Amount	-	Daily Fee Accrual
{(4% / 365)	x	$120,000,000
= $13,150.68			-	$3287.67	= $9863.01

● Leveraged Settlement Factor:

1) Determine Inflation Ratio:

212.0366

212

____________________

¹ The hypothetical scenarios included in this offering document have been prepared by, and are the responsibility of, the Trusts' management. [          ] has neither examined nor compiled the accompanying hypothetical scenarios and, accordingly,[          ] does not express an opinion or any other form of assurance with respect thereto. [          ] report included in this offering document relates to the Trusts' historical financial information. It does not extend to the hypothetical scenarios and should not be read to do so. The hypothetical information shown in this Appendix was not prepared with a view toward compliance with published guidelines of the Securities and Exchange Commission or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information.

C-1

Appendix C

2) Years:

Find the amount of years for compounding the hurdle rate - Years:

1 day in 2008 which has 366 days

1/366 = 0.002732 years

3) Calculate the Compounded Hurdle Rate:

(1+.04)^0.002732 =1.000107

4) Take the results from Inflation Ratio and divide by the compounded hurdle rate. Then subrtract 1 and then multiply by the leverage factor. Once this is accomplished, add one back to get the Leveraged Settlement Factor:

((1.000172/1.000107)-1) *2)+1             =1.00013

● Daily Earned Income Accrual for the Up Trust:

(Up Available Income Accrual plus Down Available Income Accrual) x

(Up Underlying Value / sum of Up and Down Underlying Values²)

($9863.01  +  $9863.01) x ($120,000,000/$240,000,000)  =  $9863.01370 

____________________

² Each as of the previous day, other then the first day of issuance in which the Up and Down Underlying Values are equal to one another.

C-2

Appendix C

● Up and Down Investment Amount:

Since no "losses" have been suffered, and the Daily Yield Rate on the Treasuries exceeds the Daily Fee Accrual Rate, the Investment Amount for each trust equals the number of shares x the Stated Par Amount per share, also referred to as the Up or Down Aggregate Par Amount:

6,000,000  x  $20  =  $120,000,000

Underlying Value on Day 1

The Underlying Value of the Up Trust equals, on the basis of the foregoing variables, the following:

Since Ending Level exceeds Starting Level,

· the aggregated Earned Income Accrual to this day including the current day

plus

· the Up Investment Amount multiplied by the Leveraged Settlement Factor

$9,863.01  +  ($120,000,000 x 1.000135)  =  $120,025,520.77

Day 2 of calculation period → Applicable Reference Value of Medical Inflation is at 212.0731

Using a CPI medical index level of 213.06 for 2 months past and a CPI medical index level of 212 for 3 months past. Since we are determining a reference Medical inflation value for the month of February 08 which has 29 days in it, we determine the reference Medical Inflation value by:

(213.06-212)/29 = .03655, we then multiply by the number of days minus 1 and add to the 212 number. Therefore, the Applicable Reference Value of Medical Inflation for February 3^rd (Ending Level) is:

(.03655 *(3-1))+212 = 212.0731

Relevant Variables:

● Daily Fee Accrual for each trust:

Daily Fee Accrual Rate	x	Up Asset Amount
(1.0% / 365)	x	$120,000,000	= $3287.61

● Daily Available Income Accrual for each trust:

Daily yield Rate on the Treasuries	x	Up Investment Amount	-	Daily Fee Accrual
{(4% / 365)	x	$120,000,000}
	= $13150.68		-	$3287.67	= $9863.01

C-3

Appendix C

● Value Percentage Change for Up Trust and the Down Trust:

1) Determine Inflation Ratio:

212.0731 212 =1.000345

2) Years:

find the amount of years for compounding the hurdle rate - Years:

2 days in 2008 which has 366 days

2/366 = 0.005464481 years

3) Calculate the Compounded Hurdle Rate:

(1+.04)^.005464 =1.0002143

4) Take the results from Inflation Ratio and divide by the compounded hurdle rate. Then subtract 1 and then multiply by the leverage factor. Once this is accomplished, add one back to get the Leveraged Settlement Factor:

((1.000345/1.000214344)-1)*2)+1       =  1.000260912

● Earned Income Accrual for the Up Trust:

(Up Available Income Accrual plus Down Available Income Accrual) x

(Up Underlying Value / sum of Up and Down Underlying Values³)

 ($9863.01   +    $9863.01)  x  ($120,025,520.77/$240,019,726.03)          =  $9,864.30

● Up and Down Investment Amount:

Since no "losses" have been suffered, and the Daily Yield Rate on the Treasuries exceeds the Daily Fee Accrual Rate, the Investment Amount for each trust equals the number of shares x Stated Par Amount per share, also referred to as the Up or Down Aggregate Par Amount:

6,000,000  x  $20  =  $120,000,000

____________________

³ Each as of the previous day, other then the first day of issuance in which the Up and Down Underlying Values are equal to one another.

C-4

Appendix C

● Accrual Up and Down Asset Amount =

Investment Amount + Accrual Income Amount = $120,000,000 + $9863.01 + $9863.01 = $120,019,726.03

Underlying Value on Day 2

The Underlying Value of the Up Trust equals, on the basis of the foregoing variables, the following:

Since Ending Level exceeds Starting Level,

· the aggregated Earned Income Accrual to this day including the current day

plus

· the Up Investment Amount multiplied by the Leveraged Settlement Factor

$19,726.03  +  ($120,000,000x 1.000261)     =  $120,051,035.42

C-5

MacroShares Medical Inflation Up Trust Series 2008-1

Issuer

MACRO INFLATION DEPOSITOR, LLC

Depositor

Prospectus

You should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with different information.

We are not offering these shares in any state where the offer is not permitted, and we do not claim the accuracy of the information in this prospectus as of any date other than the date stated on its cover.

PART II—INFORMATION NOT REQUIRED IN PROSPECTUS

TABLE OF CONTENTS

Item 13. Other Expenses of Issuance and Distribution.

The expenses expected to be incurred in connection with the issuance and distribution of the securities being registered, other than underwriting compensation, are as set forth below.

Registration fees for the Up MacroShares	$	[	]
Printing and engraving expenses	$	[	]
Legal fees and expenses	$	[	]
Accounting	$	[	]
Miscellaneous	$	[	]
Total	$	[	]

Item 14. Indemnification of Directors and Officers.

Section 18-108 of the Delaware Limited Liability Company Act, as amended (the "Delaware Act"), grants a Delaware limited liability company the power, subject to such standards and restrictions, if any, as are set forth in its limited liability company agreement, to indemnify and hold harmless any member or manager or other person from and against any and all claims and demands whatsoever. Section 8.1 of the Operating Agreement of the Depositor (the "Agreement") provides that no manager (or affiliate thereof), member or officer of the Depositor shall have any liability to the Depositor for any act or failure to act on behalf of the Depositor unless such act or failure to act resulted from the gross negligence or intentional misconduct of such person or entity. Section 8.2(a) of the Agreement provides that any member, manager, officer, partner, trustee, employee, agent or legal representative of the Depositor shall each be an "Indemnified Party" under the Agreement. In addition, Section 8.2(a) of the Agreement provides that to the fullest extent permitted by applicable law, the Depositor shall indemnify and hold harmless each Indemnified Party from and against any and all expenses, claims, damages, liabilities and losses (including without limitation, judgments, interest on judgments, fines, charges, costs, amounts paid in settlement, expenses and attorneys' fees incurred in investigating, preparing or defending any action, claim suit, inquiry, proceeding, investigation or any appeal taken from the foregoing by or before any court or governmental, administrative or other regulatory agency, body or commission), whether pending or merely threatened, whether or not any Indemnified Party is or may be a party thereto, including interest on any of the foregoing arising out of, or in connection with, the management or conduct of the business and affairs of the Depositor. An Indemnified Party shall not be entitled to indemnification with respect to any claim, issue or matter in which it has engaged in fraud, willful misconduct, bad faith or gross negligence.

Section 18-303 of the Delaware Act provides that except as otherwise provided therein, the debts, obligations and liabilities of a limited liability company, whether arising in contract, tort or otherwise, shall be solely the debts, obligations and liabilities of the limited liability company, and no member or manager of a limited liability company shall be obligated personally for any such debt, obligation or liability of the limited liability company solely by reason of being a member or acting as a manager of the limited liability company. Section 3.3 and Section 4.8 of the Agreement provide that except as otherwise provided by the Delaware Act, the debts, obligations and liabilities of the Depositor, whether existing in contract, tort, or otherwise, shall be obligations and liabilities of the Depositor and no member or manager shall be obligated personally for such debt, obligation or liability of the Depositor solely by means of being a member or manager of the Depositor. Section 8.2(a) provides that any Indemnified Party shall be fully protected from any action or inaction based upon or in accordance with the advice or opinions received from counsel or accountants consulted with respect to the affairs of the Depositor. Notwithstanding any of the foregoing to the contrary, the provisions of Section 8.2 of the Agreement shall not relieve any Indemnified Party of any liability, to the extent that such liability may not be waived, modified or limited under applicable law.

Section 9.3 of the Up Trust Agreement provides that the Depositor and its members, managers, officers, employees, affiliates, and subsidiaries (each, a "Depositor Indemnified Parties") shall be indemnified by the Up Trust and held harmless against any loss, liability or expense incurred hereunder without (1) gross negligence, bad faith, willful misconduct or willful malfeasance on the part of such Depositor Indemnified Party arising out of or in connection with the performance of its obligations hereunder or any actions taken in accordance with the provisions of the Up Trust Agreement or (2) reckless disregard on the part of such Depositor Indemnified Party of its obligations and duties under the Up Trust Agreement. Each Depositor Indemnified Party shall also be indemnified by the Up Trust and held harmless against any loss, liability or expense arising under the Income Distribution Agreement, the Settlement Contracts or any Participants Agreement insofar as such loss, liability or expense arises from any untrue statement or alleged untrue statement of a material fact contained in any written statement provided to the Depositor by any of the Calculation Agent, the Administrative Agent and the Trustee. Such indemnity shall include payment from the Up Trust of the costs and expenses incurred by such Depositor Indemnified Party in defending itself against any such indemnified claim or liability.

Section 9.2 and Section 13.1 of the Up Trust Agreement provide that in the absence of gross negligence, or, with respect to the Trustee, negligence, or willful misconduct on the part of the Depositor, Administrative Agent, Marketing Agents or the Trustee, the Depositor, the Administrative Agent, Marketing Agents and the Trustee shall not be liable for any action taken, suffered or omitted by them in the performance of their duties under the Up Trust Agreement. The Depositor, the Administrative Agent, the Marketing Agents and the Trustee shall not be liable for any error in judgment made in good faith unless such party has been grossly negligent in ascertaining or failing to ascertain the pertinent facts. In no event shall the Depositor, the Administrative Agent, the Marketing Agents or the Trustee be liable for special, consequential or punitive damages or for any failure or delay in the performance of their obligations under the Up Trust Agreement due to forces reasonably beyond the control of the Depositor, the Administrative Agent, the Marketing Agents or the Trustee including, without limitation, strikes, work stoppages, acts of war or terrorism, insurrection, revolution, nuclear or natural catastrophes or acts of God and interruptions, loss or malfunctions of utilities, communications or computer (software or hardware) services including, without limitation, Internet services; it being understood that the Depositor, the Administrative Agent, the Marketing Agents and the Trustee shall each use commercially reasonable efforts which are consistent with accepted practices in its industry to resume performance as soon as practicable under the circumstances.

Capitalized terms used in the preceding two paragraphs shall have the meanings set forth in the MacroShares Inflation Up Trust Agreement, filed as exhibit 4.1 hereto.

Item 15. Recent Sales of Unregistered Securities.

Not applicable.

Item 16. Exhibits and Financial Statement Schedules.

(a) Exhibits

Exhibit Number	Description
3.1	Certificate of Formation of MACRO Inflation Depositor, LLC, dated November 27, 2007**
3.2	Operating Agreement of MACRO Inflation Depositor, LLC, dated November 30, 2007**
4.1	MACROshares Inflation Up Trust Agreement, dated [ ], 2008
4.3	Participants Agreement, dated [ ], 2008*
4.4.1	1992 ISDA Master Agreement, dated [ ], 2008*
4.4.2	Schedule to 1992 ISDA Master Agreement, dated [ ], 2008*
4.5	Income Distribution Agreement, dated [ ], 2008
4.6	Form of Settlement Contract
4.7	MACRO License Agreement, dated [ ], 2008*
5.1	Opinion of Skadden, Arps, Slate, Meagher & Flom LLP regarding legality*
8.1	Opinion of Skadden, Arps, Slate, Meagher & Flom LLP regarding certain tax matters*
10.1	The Depository Trust Company Agreement for the MACROshares Inflation Up Shares, dated [ ], 2008*
23.1	Consents of Accountants*
23.2	Consent of Skadden, Arps, Slate, Meagher & Flom LLP*
24.1	Power of Attorney, dated [ ], 2008*
99.1	MACROshares Inflation Down Shares Prospectus, dated [ ], 2008*

* To be filed by an amendment.

** Filed in prior amendments.

Item 17. Undertakings.

The undersigned Registrant hereby undertakes

(1)To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

(i) To include any prospectus required by section 10(a)(3) of the Securities Act of 1933;

(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Securities and Exchange Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; and

(iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement.

(2)That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

(3)That, for the purpose of determining any liability under the Securities Act of 1933, for any purchaser, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to the purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.

(4)The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

(i) Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424 (§230.424 of this chapter);

(ii) Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;

(iii) The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and

(iv) Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this Amendment No. 1 to the Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of New York, State of New York, on January 25, 2008.

MACRO INFLATION DEPOSITOR, LLC, as Depositor of the MacroShares Medical Inflation Up Trust Series 2008-1,
By:	/s/ Samuel Masucci, III
	Name: Samuel Masucci, III Title: President and Principal Executive Officer

Pursuant to the requirements of the Securities Act of 1933, as amended, this amendment to the registration statement has been signed by the following persons in the capacities and on the dates indicated.

Signature	Capacity	Date
/s/ Samuel Masucci, III Samuel Masucci, III	President and Principal Executive Officer	January 25, 2008
/s/ John Flanagan John Flanagan	Principal Financial Officer and Principal Accounting Officer	January 25, 2008
/s/ Robert Tull Robert Tull	Manager	January 25, 2008

Exhibit Number	Description
3.1	Certificate of Formation of MACRO Inflation Depositor, LLC, dated November 27, 2007**
3.2	Operating Agreement of MACRO Inflation Depositor, LLC, dated November 30, 2007**
4.1	MACROshares Inflation Up Trust Agreement, dated [ ], 2008
4.3	Participants Agreement, dated [ ], 2008*
4.4.1	1992 ISDA Master Agreement, dated [ ], 2008*
4.4.2	Schedule to 1992 ISDA Master Agreement, dated [ ], 2008*
4.5	Income Distribution Agreement, dated [ ], 2008
4.6	Form of Settlement Contract
4.7	MACRO License Agreement, dated [ ], 2008*
5.1	Opinion of Skadden, Arps, Slate, Meagher & Flom LLP regarding legality*
8.1	Opinion of Skadden, Arps, Slate, Meagher & Flom LLP regarding certain tax matters*
10.1	The Depository Trust Company Agreement for the MACROshares Inflation Up Shares, dated [ ], 2008*
23.1	Consents of Accountants*
23.2	Consent of Skadden, Arps, Slate, Meagher & Flom LLP*
24.1	Power of Attorney, dated [ ], 2008*
99.1	MACROshares Inflation Down Shares Prospectus, dated [ ], 2008*

* To be filed by an amendment.

** Filed in prior amendments.