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First Trust ISE Global Copper Index Fund (CU)
Investment Objective/Strategy - The First Trust ISE Global Copper Index Fund is an exchange-trade fund. The investment objective of the Fund is to seek investment results that correspond generally to the price and yield, before the Fund's fees and expenses, of an equity index called the ISE Global Copper™ Index.
There can be no assurance that the Fund's investment objectives will be achieved.
  • The ISE Global Copper™ Index is designed to provide a benchmark for investors interested in tracking public companies that are active in the copper mining industry based on analysis of revenue derived from the sale of copper.
  • Issuers of component securities of the index must be actively engaged in some aspect of the copper mining industry, such as copper mining, refining or exploration.
  • Each component security must have a market capitalization of at least $75 million.
  • The index uses a modified linear weighted methodology adjusted by revenue exposure to copper production, where component securities are grouped into linearly weighted quartiles and then equally weighted within each quartile. The resulting distribution allows smaller, more copper focused companies to be adequately represented in the index.
  • Index components are reviewed quarterly for eligibility and any changes in component securities of the index are made after the market close on the third Friday of each March, June, September and December.
Fund Overview
TickerCU
Fund TypeNatural Resources
Investment AdvisorFirst Trust Advisors L.P.
Investor Servicing AgentBank of New York Mellon
CUSIP33733J103
Intraday NAVCUIV
Fiscal Year-End09/30
ExchangeNASDAQ Stock Market
Inception3/11/2010
Inception Price$30.00
Inception NAV$30.00
Rebalance FrequencyQuarterly
Expense Ratio0.71%
Current Fund Data (as of 10/17/2014)
Closing NAV1$19.81
Closing Share Price2$19.76
Bid/Ask Midpoint$19.79
Bid/Ask Discount0.13%
Total Net Assets$23,772,735
Outstanding Shares1,200,002
Daily Volume11,149
Average 30-Day Daily Volume13,307
Closing Share Price 52-Week High/Low$26.20 / $19.41
Closing NAV 52-Week High/Low$26.15 / $19.58
Number of Holdings23
Fund Characteristics (as of 9/30/2014)7
Median Market Cap.$2,796
Maximum Market Cap.$90,679
Minimum Market Cap.$48
Price/Earnings16.92
Price/Book1.09
Price/Cash Flow6.04
Price/Sales1.12
Top Holdings (as of 10/17/2014)
Holding Percent
Rio Tinto Plc (ADR) 8.26%
Southern Copper Corporation 7.81%
Freeport-McMoRan Inc. (Class B) 7.67%
Antofagasta Plc 7.65%
First Quantum Minerals Ltd. 6.47%
Jiangxi Copper Company Ltd. (Class H) 6.35%
Lundin Mining Corporation 5.62%
KGHM Polska Miedz SA 5.28%
Kazakhmys Plc 4.82%
MMC Norilsk Nickel JSC (ADR) 4.82%

Holdings are subject to change.

Top Country Exposure (as of 10/17/2014)
Country Percent
Canada 33.68%
United Kingdom 20.79%
United States 15.53%
China 6.37%
Poland 5.30%
Australia 4.97%
Russia 4.83%
India 4.04%
Turkey 3.22%
Peru 1.27%
NAV History (Since Inception)
Past performance is not indicative of future results.
Distribution Information
Dividend per Share Amt3$0.2155
30-Day SEC Yield (as of 9/30/2014)42.52%
12-Month Distribution Rate (as of 9/30/2014)52.16%
Index Yield (as of 9/30/2014)62.73%
Bid/Ask Midpoint vs. NAV (as of 9/30/2014)
Number of Days Bid/Ask Midpoint Above NAV
Quarter Ended 0-49
Basis Points
50-99
Basis Points
100-199
Basis Points
>=200
Basis Points
9/30/2014 27 1 0 0
6/30/2014 33 0 0 0
3/31/2014 12 2 0 0
12/31/2013 10 4 0 0
Number of Days Bid/Ask Midpoint Below NAV
Quarter Ended 0-49
Basis Points
50-99
Basis Points
100-199
Basis Points
>=200
Basis Points
9/30/2014 35 1 0 0
6/30/2014 23 7 0 0
3/31/2014 40 6 1 0
12/31/2013 37 11 2 0

The price used to calculate market return is determined by using the midpoint between the highest bid and the lowest offer on the stock exchange, on which shares of the Fund are listed for trading, as of the time that the Fund's NAV is calculated.

Month End Performance (as of 9/30/2014)
  3 Mos YTD 1 Year 3 Year 5 Year 10 Year Since
Fund
Inception8
Fund Performance *
NAV -11.03% -3.27% -2.38% -3.96% N/A N/A -5.06%
After Tax Held -11.42% -4.07% -3.25% -5.12% N/A N/A -5.93%
After Tax Sold -6.24% -1.83% -1.33% -3.34% N/A N/A -3.99%
Market Price -11.06% -3.62% -2.34% -3.88% N/A N/A -5.11%
Index Performance **
ISE Global Copper™ Index -10.86% -2.51% -1.53% -3.12% N/A N/A -3.94%
MSCI All Country World Materials Index -6.90% -1.89% 2.01% 4.26% N/A N/A 0.67%
MSCI All Country World Index -2.30% 3.73% 11.32% 16.61% N/A N/A 9.67%
Quarter End Performance (as of 9/30/2014)
  3 Mos YTD 1 Year 3 Year 5 Year 10 Year Since
Fund
Inception8
Fund Performance *
NAV -11.03% -3.27% -2.38% -3.96% N/A N/A -5.06%
After Tax Held -11.42% -4.07% -3.25% -5.12% N/A N/A -5.93%
After Tax Sold -6.24% -1.83% -1.33% -3.34% N/A N/A -3.99%
Market Price -11.06% -3.62% -2.34% -3.88% N/A N/A -5.11%
Index Performance **
ISE Global Copper™ Index -10.86% -2.51% -1.53% -3.12% N/A N/A -3.94%
MSCI All Country World Materials Index -6.90% -1.89% 2.01% 4.26% N/A N/A 0.67%
MSCI All Country World Index -2.30% 3.73% 11.32% 16.61% N/A N/A 9.67%
3-Year Statistics (as of 9/30/2014)
  Standard Deviation Alpha Beta Sharpe Ratio Correlation
CU 28.92% -28.14 1.76 -0.02 0.73
MSCI All Country World Materials Index 17.85% -15.11 1.29 0.30 0.88
MSCI All Country World Index 12.14% --- 1.00 1.31 1.00
Standard Deviation is a measure of price variability (risk). Alpha is an indication of how much an investment outperforms or underperforms on a risk-adjusted basis relative to its benchmark.Beta is a measure of price variability relative to the market. Sharpe Ratio is a measure of excess reward per unit of volatility. Correlation is a measure of the similarity of performance.

*Performance data quoted represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate and shares when sold or redeemed, may be worth more or less than their original cost.

After Tax Held returns represent return after taxes on distributions. Assumes shares have not been sold. After Tax Sold returns represent the return after taxes on distributions and the sale of fund shares. Returns do not represent the returns you would receive if you traded shares at other times. Market Price returns are based on the midpoint of the bid/ask spread. Returns are average annualized total returns, except those for periods of less than one year, which are cumulative. The fund's performance reflects fee waivers and expense reimbursements, absent which performance would have been lower.

After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on the investor’s tax situation and may differ from those shown. The after-tax returns shown are not relevant to investors who hold their fund shares through tax-deferred arrangements such as 401(k) plans or individual retirement accounts.

**Performance information for the ISE Global Copper™ Index is for illustrative purposes only and does not represent actual fund performance. The Index does not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the performance shown. Indexes are unmanaged and an investor cannot invest directly in an index.

The expense ratio for this fund is 0.71%.

The MSCI All Country World Index is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed and emerging markets.

The MSCI World Index is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of 23 developed markets around the world.

Footnotes
1 The NAV represents the fund's net assets (assets less liabilities) divided by the fund's 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 30-day SEC yield is calculated by dividing the net investment income per share earned during the most recent 30-day period by the maximum offering price per share on the last day of the period.
5 12-Month Distribution Rate is calculated by dividing the sum of the fund's trailing 12-month ordinary distributions paid or declared by the NAV price. Distribution rates may vary.
6 Index yield represents the weighted average trailing 12-month dividend of the constituents of the ISE Global Copper(TM) Index
7 All market capitalization numbers are in USD$ Millions.
8 Inception Date is 3/11/2010

You should consider the fund's investment objectives, risks, and charges and expenses carefully before investing. You can download a prospectus or summary prospectus, or contact First Trust Portfolios L.P. at 1-800-621-1675 to request a prospectus or summary prospectus which contains this and other information about the fund. The prospectus or summary prospectus should be read carefully before investing.

ETF Characteristics

The fund lists and principally trades its shares on the NASDAQ Stock Market LLC.

The fund's return may not match the return of the ISE Global Copper™ Index.  Securities held by the fund will generally not be bought or sold in response to market fluctuations.

Investors buying or selling fund shares on the secondary market may incur customary brokerage commissions. Market prices may differ to some degree from the net asset value of the shares. Investors who sell fund shares may receive less than the share's net asset value. Shares may be sold throughout the day on the exchange through any brokerage account. However, unlike mutual funds, shares may only be redeemed directly from the fund by authorized participants, in very large creation/redemption units.

Risk Considerations

The fund's shares will change in value, and you could lose money by investing in the fund. One of the principal risks of investing in the fund is market risk. Market risk is the risk that a particular stock owned by the fund, fund shares or stocks in general may fall in value. There can be no assurance that the fund's investment objective will be achieved.

The fund may invest in small capitalization and mid capitalization companies. Such companies may experience greater price volatility than larger, more established companies.

An investment in a fund containing securities of non-U.S. issuers is subject to additional risks, including currency fluctuations, political risks, withholding, the lack of adequate financial information, and exchange control restrictions impacting non-U.S. issuers. These risks may be heightened for securities of companies located in, or with significant operations in, emerging market countries. The fund may invest in depositary receipts which may be less liquid than the underlying shares in their primary trading market.

Securities in the fund may be significantly impacted by competitive pressures in the copper mining industry and the price of copper. Because more than half of the world's copper production occurs in U.S., Chile, Canada, Russia and Zambia, the fund's share price may be particularly sensitive to any adverse political or economic developments affecting these countries. The fund's shares may experience volatility because the price of copper may fluctuate substantially over short periods of time. Moreover, the index tracks companies involved in the copper mining industry and not the price of copper. The securities of companies involved in the copper mining industry may under- or over-perform the price of copper over the short-term or the long-term.

As an industrial metal, the demand for and price of copper may be negatively impacted by a decreased level of industrial activity using copper. Other factors include the availability of substitutes, disruptions in the supply chain, adjustments to inventory, variations in production costs, and changes in industrial, government and consumer demand.

The fund invests significantly in companies involved in the materials sector. Risks of the materials sector include the general state of the economy, consolidation, domestic and international politics, excess capacity, volatility of commodity prices, import controls, and depletion of resources.

The fund is classified as "non-diversified" and may invest a relatively high percentage of its assets in a limited number of issuers. As a result, the fund may be more susceptible to a single adverse economic or regulatory occurrence affecting one or more of these issuers, experience increased volatility and be highly concentrated in certain issuers.

First Trust Advisors L.P. is the adviser to the fund. First Trust Advisors L.P. is an affiliate of First Trust Portfolios L.P., the fund's distributor.

The First Trust ISE Global Copper Index Fund is not sponsored, endorsed, sold or promoted by the International Securities Exchange (ISE). ISE makes no representation or warranty, express or implied, to the owners of the fund or any member of the public regarding the advisability of trading in the fund. ISE's only relationship to First Trust is the licensing of certain trademarks and trade names of the ISE and of the ISE Global CopperTM Index which is determined, composed and calculated by ISE without regard to First Trust or the fund.

Not FDIC Insured • Not Bank Guaranteed • May Lose Value
 
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