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| Investment Objective/Strategy -
First Trust Enhanced Equity Income Fund is a diversified, closed-end management investment company. The Fund's investment objective is to provide a high level of current income and gains and, to a lesser extent, capital appreciation. The Fund pursues its investment objective by investing in a diversified portfolio of equity securities. Under normal market conditions, the Fund pursues an integrated investment strategy in which the Fund invests substantially all of its managed assets in a diversified portfolio of common stocks of U.S. corporations and U.S. dollar-denominated equity securities of non-U.S. issuers, in each case that are traded on U.S. securities exchanges, and on an ongoing and consistent basis writes (sells) covered call options on a portion of the Fund's managed assets. |
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| There can be no assurance that the Fund's investment objectives will be achieved. |
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Fund Overview
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| Ticker |
FFA |
| Fund Type |
Equity Income |
| Investment Advisor |
First Trust Advisors L.P. |
| Portfolio Manager/Sub-Advisor |
Chartwell Investment Partners |
| Investor Servicing Agent |
PNC Global Investment Servicing (U.S.) Inc. |
| CUSIP |
337318109 |
| Fiscal Year-End |
12/31 |
| Exchange |
NYSE |
| Inception |
8/26/2004 |
| Inception Price |
$20.00 |
| Inception NAV |
$19.10 |
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| Share Price and NAV History (Since Inception) |
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Past performance is not indicative of future results.
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Current Fund Data (as of 2/8/2010)
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| Closing Share Price |
$11.19 |
| Closing NAV |
$11.81 |
| Discount to NAV |
5.25% |
| Total Net Assets |
$235,894,060 |
| Common Shares Outstanding |
19,973,164 |
| Dividend Frequency |
Quarterly |
| Dividend per Share Amt1 |
$0.2200 |
| Distribution Rate2 |
7.86% |
| Daily Volume |
91,749 |
| Average 30-Day Daily Volume |
120,864 |
| Closing Share Price 52-Week High/Low |
$12.18 / $6.71 |
| Closing NAV 52-Week High/Low |
$12.66 / $9.06 |
| Expense Ratios (as of 6/30/2009) |
| Expense Ratio (Net Assets) |
1.40% |
| Leverage Information
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| The Fund currently has no outstanding leverage. |
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| Portfolio Composition (as of 9/30/2009) |
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Sector |
Percent (%) |
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Financials |
15.70 |
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Information Technology |
15.60 |
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Energy |
14.30 |
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Industrials |
13.20 |
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Health Care |
9.60 |
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Consumer Discretionary |
9.40 |
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Consumer Staples |
8.10 |
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Telecommunication Services |
5.50 |
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Materials |
3.70 |
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Utilities |
2.70 |
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Exchange-Traded Funds |
2.20 |
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| Portfolio Information (as of 9/30/2009) |
| % of Portfolio with Call Options |
55.79% |
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| Top Holdings (as of 9/30/2009) |
| Holding |
Percent (%) |
| Bristol-Myers Squibb Company |
3.90 |
| Intel Corp. |
3.90 |
| Exxon Mobil Corp. |
3.60 |
| Occidental Petroleum Corp. |
3.60 |
| Emerson Electric Company |
3.10 |
| Cisco Systems, Inc. |
3.00 |
| MFA Mortgage Investments, Inc. |
3.00 |
| Limited Brands, Inc. |
2.90 |
| JPMorgan Chase & Company |
2.80 |
| SPDR KBW Bank ETF |
2.70 |
| Cumulative Total Returns
(as of 1/31/2010)3
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| Period |
Share Price (%) |
NAV (%) |
| 3 Months |
12.09 |
5.03 |
| 1 Year |
39.98 |
25.31 |
| 3 Years |
-16.69 |
-12.40 |
| 5 Years |
-10.80 |
-0.01 |
| Year to Date |
-6.24 |
-3.00 |
| Inception to date |
-7.14 |
5.93 |
| Calendar Year Returns
(as of 12/31/2009)3
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| Period |
Share Price (%) |
NAV (%) |
| 2005 |
-6.85 |
3.48 |
| 2006 |
17.26 |
7.09 |
| 2007 |
-3.76 |
8.19 |
| 2008 |
-37.22 |
-30.54 |
| 2009 |
46.26 |
22.24 |
| Average Annual Returns
(as of 1/31/2010)3
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| Period |
Share Price (%) |
NAV (%) |
| 3 Years |
-5.90 |
-4.32 |
| 5 Years |
-2.26 |
0.00 |
| Inception to date |
-1.35 |
1.07 |
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| Footnotes
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| 1 |
Most recent distribution paid or declared through today's date. Subject to change in the future. |
| 2 |
Distribution rates are calculated by annualizing the most recent distribution paid or declaration through today's date and then dividing by the most recent market price. Any distribution adjustment will not be reflected until after the declaration date for the next distribution. The distribution rate may include realized short-term capital gains and/or a return of capital. Final determination of the source and tax status of all distributions paid in the current year will be made after year-end. |
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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 does not reflect sales load. Past performance is not indicative of future results. |
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Risk Considerations
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The Fund is subject to various risks, including: Investment and Market Risk, Management Risk, Common Stock Risk, Option Risk, Investment Companies Risk, Industry and Sector Risk, Income Risk, Portfolio Turnover Risk, Non-U.S. Equity Securities Risk, Illiquid Securities Risk, Tax Risk, Derivatives Risk, Interest Rate Risk, Market Disruption Risk, Inflation Risk, Certain Affiliations, Anti-Takeover Provisions, Market Discount from Net Asset Value.
The Fund may write (sell) covered call options on all or a portion of the equity securities held in the Fund's portfolio as determined to be appropriate by the Fund's investment sub-advisor, consistent with the Fund's investment objective. The ability to successfully implement the Fund's investment strategy depends on the investment sub-advisor's ability to predict pertinent market movements, which cannot be assured. Thus, the use of options may require the Fund to sell portfolio securities at inopportune times or for prices other than current market values, may limit the amount of appreciation the Fund can realize on an investment, or may cause the Fund to hold an equity security that it might otherwise sell. There can be no assurance that a liquid market for the options will exist when the Fund seeks to close out an option position. Additionally, to the extent that the Fund purchases options pursuant to a hedging strategy, the Fund will be subject to additional risks.
Covered call option premiums will be treated by the Fund as either short-term or long-term capital gain or loss, depending whether the call option expires, is exercised or cancelled pursuant to a covering transaction, and the timing of such transaction. Thus, The fund cannot assure you as to any level of any regular quarterly distributions of net investment income (income other than net long-term capital gain) that will be treated as ordinary income, cannot assure you as to any level of capital gain distributions and cannot assure you as to any ratio of regular quarterly distributions to capital gain distributions.
The risks of investing in the Fund are spelled out in the prospectus, shareholder report and other regulatory filings.
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