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First Trust Senior Floating Rate Income Fund II (FCT)
Investment Objective/Strategy - The First Trust Senior Floating Rate Income Fund II is a diversified, closed-end management investment company. The Fund's primary investment objective is to seek a high level of current income. As a secondary objective, the Fund will attempt to preserve capital. The Fund will pursue these objectives through investment in a portfolio of senior secured floating rate corporate loans. It is anticipated that at least 80% of the Fund's managed assets will be invested in lower grade debt instruments.
There can be no assurance that the Fund's investment objectives will be achieved.
Fund Overview
TickerFCT
Fund TypeLoan Participation
Investment AdvisorFirst Trust Advisors L.P.
Investor Servicing AgentBNY Mellon Investment Servicing (US) Inc.
CUSIP33733U108
Fiscal Year-End05/31
ExchangeNYSE
Inception5/25/2004
Inception Price$20.00
Inception NAV$19.10
Current Fund Data (as of 11/25/2014)
Closing NAV1$14.67
Closing Share Price2$13.08
Discount to NAV10.84%
Total Managed Assets$564,724,030
Common Shares Outstanding26,696,982
Dividend FrequencyMonthly
Dividend Per Share Amt3$0.0680
Distribution Rate46.24%
Daily Volume93,787
Average 30-Day Daily Volume112,861
Closing Share Price 52-Week High/Low$14.63 / $12.83
Closing NAV 52-Week High/Low$15.07 / $14.38
Cumulative Total Returns (as of 10/31/2014)5
Period Share Price NAV
3 Months -2.81% -0.04%
1 Year -3.23% 3.93%
3 Years 18.20% 25.18%
5 Years 62.42% 44.98%
Year to Date -3.93% 2.76%
Inception to Date 31.07% 51.97%
Calendar Year Returns (as of 12/31/2013)5
Period Share Price NAV
2005 -5.44% 6.25%
2006 16.19% 7.39%
2007 -9.04% -0.11%
2008 -49.44% -47.61%
2009 79.47% 74.18%
2010 22.20% 11.01%
2011 0.81% 2.89%
2012 22.94% 13.04%
2013 1.66% 7.14%
Average Annual Returns (as of 10/31/2014)5
Period Share Price NAV
3 Years 5.73% 7.77%
5 Years 10.19% 7.71%
Inception to Date 2.63% 4.09%
Expense Ratios (as of 5/31/2014)
Annual ExpensesPercent of
Net Assets
Percent of
Managed
Assets
Management Fees1.08%0.75%
Other Expenses
0.28%
0.20%
Total Operating Expenses1.36%0.95%
 
Leverage Costs0.44%0.31%
 
Total Annual Expenses1.80%1.26%
 
Leverage costs include interest, fees and any upfront/offering costs associated with borrowings by the Fund.
Leverage Information (as of 11/25/2014)6
Total Net Assets with Leverage$564,724,030
Amount Attributable to Common Shares$391,724,030
Amount Attributable to Preferred Shares$0
Amount Attributable to Other Borrowings$173,000,000
Leverage (% of Total Net Assets)30.63%
S&P Ratings Breakdown for Sr. Loans (as of 9/30/2014)7
  S&P Rating Percent
BBB- 1.02%
BB+ 3.56%
BB 8.63%
BB- 11.00%
B+ 26.29%
B 31.69%
B- 8.01%
CCC+ 4.11%
CCC 2.40%
CCC- 0.26%
NR (Privately rated securities) 1.66%
NR 1.37%
The ratings are by Standard & Poor's except where otherwise indicated. A credit rating is an assessment provided by a nationally recognized statistical rating organization (NRSRO) of the creditworthiness of an issuer with respect to debt obligations except for those debt obligations that are only privately rated. Ratings are measured on a scale that generally ranges from AAA (highest) to D (lowest). Investment grade is defined as those issuers that have a long-term credit rating of BBB- or higher. "NR" indicates no rating. The credit ratings shown relate to the credit worthiness of the issuers of the underlying securities in the Fund, and not to the Fund or its shares. Credit ratings are subject to change.
Portfolio Charateristics (as of 9/30/2014)7
Percentage of assets with LIBOR floors:91.75
Weighted Average Maturity (Years)5.26
Weighted Average Price98.24
Please note: Weighted average maturity excludes defaulted assets.
Share Price and NAV History (Since Inception)
Past performance is not indicative of future results.
% Premium/Discount (Since Inception)
Top 10 Issuers (as of 9/30/2014)7
Holding Percent
BMC Software Finance, Inc. 2.17%
Caesars Growth Partners LLC 1.94%
Dell, Inc. 1.83%
Asurion LLC 1.75%
BJ's Wholesale Club, Inc. 1.74%
InVentiv Health, Inc. 1.66%
Amaya Gaming Group 1.56%
Ortho-Clinical Diagnostics, Inc. 1.38%
Portillo's Holdings, LLC 1.33%
Albertsons LLC 1.24%
Industry Breakdown (as of 9/30/2014)7
Industry Percent
Hotels, Restaurants & Leisure 10.97%
Media 9.62%
Health Care Providers & Services 7.10%
Software 5.15%
Diversified Financial Services 4.54%
Health Care Equipment & Supplies 4.42%
Life Sciences Tools & Services 3.89%
Diversified Telecommunication Services 3.87%
Food Products 3.61%
Auto Components 3.54%
Chemicals 2.98%
Food & Staples Retailing 2.98%
Insurance 2.93%
Pharmaceuticals 2.64%
Diversified Consumer Services 2.29%
Professional Services 2.10%
Machinery 1.99%
Containers & Packaging 1.87%
Specialty Retail 1.87%
Health Care Technology 1.83%
Technology Hardware, Storage & Peripherals 1.83%
Semiconductors & Semiconductor Equipment 1.70%
Capital Markets 1.66%
IT Services 1.63%
Consumer Finance 1.57%
Commercial Services & Supplies 1.39%
Independent Power and Renewable Electricity Producers 1.35%
Aerospace & Defense 1.28%
Oil, Gas & Consumable Fuels 1.25%
Road & Rail 1.09%
Real Estate Management & Development 1.05%
Building Products 0.75%
Electric Utilities 0.68%
Real Estate Investment Trusts (REITs) 0.63%
Industrial Conglomerates 0.55%
Construction & Engineering 0.36%
Diversified Business Services 0.33%
Personal Products 0.26%
Beverages 0.17%
Wireless Telecommunication Services 0.12%
Communications Equipment 0.07%
Movies & Entertainment 0.05%
Energy Equipment & Services 0.04%
Footnotes
1 The NAV represents the fund's net assets (assets less liabilities) divided by the fund's common shares outstanding.
2 Fund shares are purchased and sold on an exchange at their share price rather than net asset value (NAV), which may cause the shares to trade at a price greater than NAV (premium) or less than NAV (discount).
3 Most recent distribution paid or declared through today's date. Subject to change in the future.
4 Distribution rates are calculated by annualizing the most recent distribution paid or declared through today's date and then dividing by the most recent market price. The distribution consists of the sum of net investment income, net realized short-term capital gains, net realized long-term capital gains, and return of capital. Distribution rates may vary. Any distribution adjustment will not be reflected until after the declaration date for the next distribution. See the fund's 19a-1 Notices, if any, located under the "News & Literature" section of the website for estimates of distribution sources. Final determination of the source and tax status of all distributions paid in the current year will be made after year-end.
5 Total return is the combination of reinvested dividend income and reinvested capital gains distributions, at prices obtained by the Dividend Reinvestment Plan, if any, and changes in the NAV and Share Price. The NAV total return takes into account the fund's total annual expenses and does not reflect sales load. Past performance is not indicative of future results.
6 Leverage is a technique where a closed-end fund's manager borrows assets at one rate and invests the proceeds from the borrowed assets at another rate, seeking to increase yield and total return. Use of leverage can result in additional risk and cost, and can magnify the effect of any losses.
7 Market value information used in calculating the percentages is based upon trade date plus one recording of transactions, which can differ from regulatory financial reports (Forms N-CSR and N-Q) that are based on trade date recording of security transactions. Holdings are subject to change.

Risk Considerations

Investment return and market value of an investment in the fund will fluctuate. Shares, when sold, may be worth more or less than their original cost.

The Senior Loans in which the fund invests are generally considered to be "high-yield securities". High yield securities are subject to greater market fluctuations and risk of loss than securities with higher ratings. Lower-quality debt tends to be less liquid than higher-quality debt.

The fund's portfolio is also subject to credit risk, interest rate risk, and prepayment risk. Interest rate risk is the risk that fixed-income securities will decline in value because of changes in market interest rates. Credit risk is the risk that an issuer of a security will be unable or unwilling to make dividend, interest and/or principal payments when due and that the value of a security may decline as a result. Credit risk may be heightened for the fund because it invests in below investment grade securities. Prepayment risk is the risk that, upon a prepayment, the actual outstanding debt on which the fund derives interest income will be reduced. The fund may not be able to reinvest the proceeds received on terms as favorable as the prepaid loan.

Use of leverage can result in additional risk and cost, and can magnify the effect of any losses.

The risks of investing in the fund are spelled out in the prospectus, shareholder report and other regulatory filings.

Not FDIC Insured • Not Bank Guaranteed • May Lose Value
 
First Trust Portfolios L.P.  Member SIPC and FINRA.
First Trust Advisors L.P.
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