This information should be read in conjunction with the financial statements and notes to the financial statements included with this Quarterly Report on Form 10-Q. The discussion and analysis that follows may contain statements that relate to future events or future performance. In some cases, such forward-looking statements can be identified by terminology such as "will," "may," "should," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential" or the negative of these terms or other comparable terminology. None of the Trust, the Sponsor or the Trustee (as each term is defined below) assumes responsibility for the accuracy or completeness of any forward-looking statements. Except as expressly required by federal securities laws, none of the Trust, the Sponsor or the Trustee is under a duty to update any of the forward-looking statements to conform such statements to actual results or to a change in expectations or predictions.

Introduction

ProShares Trust II (formerly known as the Commodities and Currencies Trust) (the "Trust") is a Delaware statutory trust formed on October 9, 2007 and currently organized into separate series (each, a "Fund" and collectively, the "Funds"). The following eighteen series of the Trust: (i) ProShares Ultra DJ-UBS Commodity, ProShares UltraShort DJ-UBS Commodity, ProShares Ultra DJ-UBS Crude Oil, ProShares UltraShort DJ-UBS Crude Oil, ProShares Ultra DJ-UBS Natural Gas, ProShares UltraShort DJ-UBS Natural Gas, ProShares Ultra Gold, ProShares UltraShort Gold, ProShares Ultra Silver, ProShares UltraShort Silver, ProShares Ultra Euro, ProShares UltraShort Euro, ProShares Ultra Yen and ProShares UltraShort Yen (each, a "Leveraged Fund" and collectively, the "Leveraged Funds"); (ii) ProShares Ultra VIX Short-Term Futures ETF and ProShares Short VIX Short-Term Futures ETF (each, a "Geared VIX Fund" and collectively, the "Geared VIX Funds"); and (iii) ProShares VIX Short-Term Futures ETF and ProShares VIX Mid-Term Futures ETF (each, a "Matching VIX Fund" and collectively, the "Matching VIX Funds"), issue common units of beneficial interest ("Shares"), which represent units of fractional undivided beneficial interest in and ownership of only that Leveraged Fund, Geared VIX Fund or Matching VIX Fund. The Shares of each Leveraged Fund, Geared VIX Fund and Matching VIX Fund are listed on the New York Stock Exchange Archipelago ("NYSE Arca"), as further described below.

The Trust has also registered shares for thirty-five additional series:
(i) ProShares Short DJ-UBS Natural Gas and ProShares Short Gold (each, a "Short Fund" and collectively, the "Short Funds"); (ii) ProShares UltraShort VIX Short-Term Futures ETF, ProShares Ultra VIX Mid-Term Futures ETF, ProShares Short VIX Mid-Term Futures ETF and ProShares UltraShort VIX Mid-Term Futures ETF (each, a "New Geared VIX Fund" and collectively, the "New Geared VIX Funds");
(iii) ProShares Managed Futures Strategy, ProShares Commodity Managed Futures Strategy and ProShares Financial Managed Futures Strategy (each, a "Managed Futures Fund" and collectively, the "Managed Futures Funds"); (iv) ProShares UltraPro Australian Dollar, ProShares Ultra Australian Dollar, ProShares Short Australian Dollar, ProShares UltraShort Australian Dollar, ProShares UltraPro Short Australian Dollar, ProShares UltraPro Canadian Dollar, ProShares Ultra Canadian Dollar, ProShares Short Canadian Dollar, ProShares UltraShort Canadian Dollar, ProShares UltraPro Short Canadian Dollar, ProShares UltraPro Euro, ProShares Short Euro, ProShares UltraPro Short Euro, ProShares UltraPro Swiss Franc, ProShares Ultra Swiss Franc, ProShares Short Swiss Franc, ProShares UltraShort Swiss Franc, ProShares UltraPro Short Swiss Franc, ProShares UltraPro Yen, ProShares Short Yen and ProShares UltraPro Short Yen (each, a "New Currency Fund" and collectively, the "New Currency Funds"); and (v) ProShares UltraPro U.S. Dollar, ProShares Ultra U.S. Dollar, ProShares Short U.S. Dollar, ProShares UltraShort U.S. Dollar and ProShares UltraPro Short U.S. Dollar (each, a "Currency Index Fund" and collectively, the "Currency Index Funds"). The Short Funds, the New Geared VIX Funds, the Managed Futures Funds and the New Currency Funds are collectively referred to as the "New Funds" in this Quarterly Report on Form 10-Q. The Geared VIX Funds, the New Geared VIX Funds and the Matching VIX Funds are collectively referred to as the "VIX Funds" in this Quarterly Report on Form 10-Q. The Leveraged Funds, the Short Funds, the Geared VIX Funds, the New Geared VIX Funds and the New Currency Funds, are collectively referred to as the "Geared Funds" in this Quarterly Report on Form 10-Q.

As of March 31, 2012, each of the New Funds had seed capital, but none of the New Funds had commenced investment operations; therefore, this Quarterly Report on Form 10-Q does not include Schedules of Investments, Statements of Operations, Statements of Changes in Shareholders' Equity, Statements of Cash Flows, results of operations or any other financial information for the New Funds.

The Trust had no operations prior to November 24, 2008 other than matters relating to its organization, the registration of each series under the Securities Act of 1933, as amended, and the sale and issuance to ProShare Capital Management LLC (the "Sponsor") of fourteen Shares of each Leveraged Fund at an aggregate purchase price of $350 in each of the following Funds: ProShares Ultra DJ-UBS Commodity, ProShares UltraShort DJ-UBS Commodity, ProShares Ultra DJ-UBS Crude Oil, ProShares UltraShort DJ-UBS Crude Oil, ProShares Ultra Gold, ProShares UltraShort Gold, ProShares Ultra Silver, ProShares UltraShort Silver, ProShares Ultra Euro, ProShares UltraShort Euro, ProShares Ultra Yen and ProShares UltraShort Yen.

Eight of the Funds, ProShares Ultra DJ-UBS Commodity, ProShares UltraShort DJ-UBS Commodity, ProShares Ultra DJ-UBS Crude Oil, ProShares UltraShort DJ-UBS Crude Oil, ProShares Ultra Euro, ProShares UltraShort Euro, ProShares Ultra Yen and ProShares UltraShort Yen, commenced trading on the NYSE Arca on November 25, 2008. Four of the Funds, ProShares Ultra Gold, ProShares UltraShort Gold, ProShares Ultra Silver and ProShares UltraShort Silver, commenced trading on the NYSE Arca on December 3, 2008. ProShares VIX Short-Term Futures ETF and ProShares VIX Mid-Term Futures ETF commenced trading on the NYSE Arca on January 3, 2011. Two of the Funds, ProShares Ultra VIX Short-Term Futures ETF and ProShares Short VIX Short-Term Futures ETF, commenced trading on the NYSE Arca on October 3, 2011. Two of the Funds, ProShares Ultra DJ-UBS Natural Gas and ProShares UltraShort DJ-UBS Natural Gas, commenced trading on the NYSE Arca on October 4, 2011.

ProShare Capital Management LLC serves as the Trust's Sponsor (the "Sponsor"), commodity pool operator and commodity trading advisor. Wilmington Trust Company serves as the Trustee of the Trust (the "Trustee"). The Funds are commodity pools, as defined under the Commodity Exchange Act and the applicable regulations of the Commodity Futures Trading Commission (the "CFTC") and are operated by the Sponsor, a commodity pool operator registered with the CFTC. The Trust is not an investment company registered under the Investment Company Act of 1940, as amended.

Groups of Funds are collectively referred to in this Quarterly Report on Form 10-Q in several different ways. References to "UltraPro Funds" "Ultra Funds," "Short Funds", "UltraShort Funds" and "UltraPro Short Funds" refer to the different Funds based upon their investment objectives, but without distinguishing among the Funds' benchmarks. References to "Commodity Index Funds", "Commodity Funds," "Currency Index Funds" and "Currency Funds" refer to the different Funds according to their general benchmark categories without distinguishing among the Funds' investment objectives or Fund-specific benchmarks. References to "VIX Funds" refer to the different Funds based upon their investment objective and their general benchmark categories. References to "Managed Futures Funds" refer to the different Funds according to which index the Fund intends to gain exposure.

Each "UltraPro" Fund will seek daily investment results (before fees and expenses) that correspond to three times (3x) the daily performance of its corresponding benchmark. Each "Ultra" Fund seeks or will seek daily investment results (before fees and expenses) that correspond to twice (2x) the daily performance of its corresponding benchmark. Each "Short" Fund will seek daily investment results (before fees and expenses) that correspond to the inverse
(-1x) of the daily performance of its corresponding benchmark. Each "UltraShort" Fund seeks or will seek daily investment results (before fees and expenses) that correspond to twice the inverse (-2x) of the daily performance of its corresponding benchmark. Each "UltraPro Short" Fund will seek daily investment results (before fees and expenses) that correspond to three times the inverse
(-3x) of the daily performance of its corresponding benchmark. Daily performance is measured from the calculation of one NAV to the next.

Each of the Geared Funds generally invests or will invest in Financial Instruments (i.e., commodity-based, currency-based or equity market volatility-based instruments whose value is derived from the value of an underlying asset, rate or index, including futures contracts and options on futures contracts, swap agreements, forward contracts and other commodity-based or currency-based options contracts) as a substitute for investing directly in commodities, currencies or equity market volatility products in order to gain exposure to the commodity index, currency benchmark, commodity, currency or to an equity market volatility index. The Financial Instruments in which ProShares Short DJ-UBS Natural Gas will invest are limited to futures contracts. Financial Instruments also are used to produce economically "leveraged" or "inverse" investment results for the Funds. Each "Matching VIX Fund" seeks daily investment results (before fees and expenses) that match the performance of a benchmark. Each "Geared VIX Fund" and each "New Geared VIX Fund" seeks or will seek daily investment results (before fees and expenses)

that correspond to a multiple, the inverse of inverse multiple of the daily performance of a benchmark. Each VIX Fund intends to obtain exposure to its benchmark by investing in futures contracts ("VIX futures contracts") based on the Chicago Board Options Exchange ("CBOE") Volatility Index (the "VIX"). The Managed Futures Funds will seek to provide investment results (before fees and expenses) that correspond to the performance of the S&P Dynamic Futures Index ("DFI"), the S&P Dynamic Commodities Futures Index ("DCFI") or the S&P Dynamic Financial Futures Index ("DFFI"). Each Managed Futures Fund intends to obtain exposure to the DFI, DCFI or the DFFI, as applicable, by primarily investing in unleveraged positions in Commodities Futures Contracts or Financials Futures Contracts.

Each Geared Fund seeks investment results for a single day only, not for longer periods. A "single day" is measured from the time a Fund calculates its respective net asset value per Share ("NAV") to the time of the Fund's next NAV calculation. This is different from most exchange-traded funds and means that the return of such Fund for a period longer than a single trading day will be the result of each day's returns compounded over the period, which will very likely differ from 3x, 2x, -1x, -2x or -3x of the return of the index to which such Fund is benchmarked for that period. In periods of higher market volatility, the volatility of the benchmark may be at least as important to a Geared Fund's return for the period as the return of the benchmark. Geared Funds are riskier than similarly benchmarked exchange-traded funds that are not geared. Accordingly, these funds may not be suitable for all investors and should be used only by knowledgeable investors who understand the potential consequences of seeking daily inverse investment results. Shareholders should actively monitor their investments. The Geared VIX Funds do not seek to achieve their stated objective over a period greater than one day. The Matching VIX Funds seek to achieve their stated investment objective both over a single day and over time. The Managed Futures Funds seek to achieve their stated investment objective over time.

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

Each Geared Fund and Managed Futures Fund continuously offers and redeems or will offer and redeem its Shares in blocks of 50,000 Shares and each Matching VIX Fund continuously offers and redeems its Shares in blocks of 25,000 Shares (each such block a "Creation Unit"). Only Authorized Participants may purchase and redeem Shares from a Fund and then only in Creation Units. An Authorized Participant is an entity that has entered into an Authorized Participant Agreement with one or more of the Funds. Shares of the Funds are offered to Authorized Participants in Creation Units at each Fund's respective NAV. Authorized Participants may then offer to the public, from time to time, Shares from any Creation Unit they create at a per-Share market price that varies depending on, among other factors, the trading price of the Shares of each Fund on the NYSE Arca, the NAV and the supply of and demand for the Shares at the time of the offer. Shares from the same Creation Unit may be offered at different times and may have different offering prices based upon the above factors. The form of Authorized Participant Agreement and related Authorized Participant Handbook set forth the terms and conditions under which an Authorized Participant may purchase or redeem a Creation Unit. Authorized Participants do not receive from any Fund, the Sponsor, or any of their affiliates, any underwriting fees or compensation in connection with their sale of Shares to the public.

Liquidity and Capital Resources

In order to collateralize derivatives positions in indices, commodities or currencies, a significant portion of the NAV of each Fund is held in cash and/or U.S. Treasury Securities, agency securities, or other high credit quality short-term fixed-income or similar securities (such as shares of money market funds, bank deposits, bank money market accounts, certain variable rate-demand notes and repurchase agreements collateralized by government securities, whether denominated in U.S. dollars or the applicable foreign currency with respect to a Currency Fund). A portion of these investments may be posted as collateral in connection with swap agreements and each Fund's trading in futures and forward contracts. The percentage that U.S. Treasury bills and other short-term fixed-income securities bear to the shareholders' equity of each Fund varies from period to period as the market values of the underlying swaps, futures contracts and forward contracts change. During the three months ended March 31, 2012 and 2011, each of the Funds earned interest income as follows:

                                             Interest Income Three       Interest Income Three
                                                  Months Ended               Months Ended
Fund                                             March 31, 2012             March 31, 2011
ProShares Ultra DJ-UBS Commodity             $                  525     $                 5,859
ProShares UltraShort DJ-UBS Commodity                           681                         740
ProShares Ultra DJ-UBS Crude Oil                             13,088                      98,318
ProShares UltraShort DJ-UBS Crude Oil                        10,125                      36,450
ProShares Ultra DJ-UBS Natural Gas                            2,119                          -
ProShares UltraShort DJ-UBS Natural Gas                         863                          -
ProShares Ultra Gold                                         27,391                      71,784
ProShares UltraShort Gold                                     6,919                      31,276
ProShares Ultra Silver                                       51,735                     186,095
ProShares UltraShort Silver                                  15,324                      46,897
ProShares Ultra Euro                                            488                       2,411
ProShares UltraShort Euro                                    47,729                     144,361
ProShares Ultra Yen                                             372                       1,025
ProShares UltraShort Yen                                     20,571                      88,611
ProShares Ultra VIX Short-Term Futures ETF                    2,915                          -
ProShares VIX Short-Term Futures ETF                          6,804                       3,020
ProShares Short VIX Short-Term Futures ETF                      894                          -
ProShares VIX Mid-Term Futures ETF                            6,086                       1,277

Each Fund's underlying swaps, futures and forward contracts, as applicable, may be subject to periods of illiquidity because of market conditions, regulatory considerations and other reasons. For example, swaps and forward contracts are not traded on an exchange, do not have uniform terms and conditions, and in general are not transferable without the consent of the counterparty. In the case of futures contracts, commodity exchanges may limit fluctuations in certain futures contract prices during a single day by regulations referred to as "daily limits." During a single day, no futures trades may be executed at prices beyond the daily limit. Once the price of a futures contract has increased or decreased by an amount equal to the daily limit, positions in such futures contracts can neither be taken nor liquidated unless the traders are willing to effect trades at or within the limit. Futures contract prices have occasionally moved the daily limit for several consecutive days with little or no trading. Such market conditions could prevent a Fund from promptly liquidating its futures positions.

Entry into swap agreements or forward contracts may further impact liquidity because these contractual agreements are executed "off-exchange" between private parties and, therefore, the time required to offset or "unwind" these positions may be greater than that for exchange-traded instruments. This potential delay could be exacerbated to the extent a counterparty is not a United States person.

The large size of the positions in which a Fund may acquire increases the risk of illiquidity by both making their positions more difficult to liquidate and increasing the losses incurred while trying to do so. Any type of disruption or illiquidity will potentially be exacerbated due to the fact that the Funds will typically invest in Financial Investments related to one benchmark, which in many cases is highly concentrated.

Because each Fund may enter into swaps and may trade futures and forward contracts, its capital is at risk due to changes in the value of these contracts (market risk) or the inability of counterparties to perform under the terms of the contracts (credit risk).

Results of Operations for the Three Months Ended March 31, 2012 Compared to the
Three Months Ended March 31, 2011

ProShares Ultra DJ-UBS Commodity

Fund Performance

The following table provides summary performance information for the Fund for
the three months ended March 31, 2012 and 2011:



                                              Three Months           Three Months
                                            Ended March  31,        Ended March 31,
                                                  2012                   2011
 NAV beginning of period                   $        9,058,529      $      18,186,658
 NAV end of period                         $        9,135,820      $      21,701,886
 Percentage change in NAV                                 0.9 %                 19.3 %
 Shares outstanding beginning of period               350,014                500,014
 Shares outstanding end of period                     350,014                550,014
 Percentage change in shares outstanding                  0.0 %                 10.0 %
 Shares created                                            -                  50,000
 Shares redeemed                                           -                      -
 Per share NAV beginning of period         $            25.88      $           36.37
 Per share NAV end of period               $            26.10      $           39.46
 Percentage change in per share NAV                       0.9 %                  8.5 %
 Percentage change in benchmark                           0.9 %                  4.5 %
 Benchmark annualized volatility                         12.9 %                 15.9 %

During the three months ended March 31, 2012, there was no net change in the Fund's outstanding Shares. The increase in the Fund's NAV resulted from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of the Dow Jones-UBS Commodity Index. By comparison, during the three months ended March 31, 2011, the increase in the Fund's NAV resulted from an increase from 500,014 outstanding Shares at December 31, 2010 to 550,014 outstanding Shares at March 31, 2011. The increase in the Fund's NAV also resulted in part from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the daily performance of the Dow Jones-UBS Commodity Index.

For the three months ended March 31, 2012 and 2011, the Fund's daily performance had a statistical correlation over 0.99 to 2x of the daily performance of its benchmark. The Fund's per share NAV increase of 0.9% for the period ended March 31, 2012, as compared to the increase of 8.5% for the period ended March 31, 2011, was primarily due to a relatively lower appreciation in the value of the assets of the Fund during the three months ended March 31, 2012.

During the three months ended March 31, 2012, the Fund's per share NAV reached its high for the period on February 24, 2012 at $29.02 per Share and reached its low for the period on March 29, 2012 at $25.39 per Share. By comparison, during the three months ended March 31, 2011, the Fund's per share NAV reached its high for the period on March 31, 2011 at $39.46 per Share and reached its low for the period on March 15, 2011 at $33.84 per Share.

The benchmark's rise of 0.9% for the three months ended March 31, 2012, as compared to the benchmark's rise of 4.5% for the three months ended March 31, 2011, can be attributed to a relatively lower appreciation of the underlying components of the index during the three months ended March 31, 2012.

Net Income/Loss

The following table provides summary income information for the Fund for the
three months ended March 31, 2012 and 2011:



                                                  Three Months                Three Months
                                                 Ended March 31,             Ended March 31,
                                                      2012                        2011
Net investment income (loss)                    $         (22,013 )         $         (40,254 )
Management fee                                             22,538                      46,113
Net realized gain (loss)                                 (322,448 )                 3,204,121
Change in net unrealized
appreciation/depreciation                                 421,752                  (1,431,394 )
Net income (loss)                               $          77,291           $       1,732,473

The Fund's net income decreased for the three months ended March 31, 2012, as compared to the three months ended March 31, 2011, primarily due to a lesser increase in the Fund's benchmark index and a decrease in shares outstanding from the three months ended March 31, 2011 to the three months ended March 31, 2012.

ProShares UltraShort DJ-UBS Commodity*

Fund Performance

The following table provides summary performance information for the Fund for
the three months ended March 31, 2012 and 2011:



                                            Three Months            Three Months
                                           Ended March 31,         Ended March 31,
                                                2012                    2011
NAV beginning of period                   $       9,107,146       $       1,440,073
NAV end of period                         $       8,801,218       $       2,560,673
Percentage change in NAV                               (3.4 )%                 77.8 %
Shares outstanding beginning of period              159,997                  30,003
Shares outstanding end of period                    159,997                  59,997
Percentage change in shares outstanding                 0.0 %                 100.0 %
Shares created                                           -                   30,000
Shares redeemed                                          -                        6
Per share NAV beginning of period         $           56.92       $           48.00
Per share NAV end of period               $           55.01       $           42.68
Percentage change in per share NAV                     (3.4 )%                (11.1 )%
Percentage change in benchmark                          0.9 %                   4.5 %
Benchmark annualized volatility                        12.9 %                  15.9 %

During the three months ended March 31, 2012, there was no net change in the Fund's outstanding Shares. The decrease in the Fund's NAV resulted from the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of the Dow Jones-UBS Commodity Index. By comparison, during the three months ended March 31, 2011, the increase in the Fund's NAV resulted primarily from an increase from 30,003 outstanding Shares at December 31, 2010 to 59,997 outstanding Shares at March 31, 2011. The increase in the Fund's NAV was offset by the cumulative effect of the Fund seeking daily investment results (before fees and expenses) that correspond to 2x of the inverse of the daily performance of the Dow Jones-UBS Commodity Index.

For the three months ended March 31, 2012 and 2011, the Fund's daily performance . . .