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First Trust NASDAQ® Clean Edge® Green Energy Index Fund (QCLN)
  • 2014 Estimated Capital Gain Distributions
    The First Trust Exchange-Traded Funds are not expecting to pay long-term capital gain distributions during the remainder of 2014.  Short-term capital gain distributions, if any, are expected to be nominal and are taxed like ordinary income.  Final determination of the source and tax status of all distributions paid in the current year are to be made after year-end and could differ from the expectations indicated above.
Investment Objective/Strategy - The First Trust NASDAQ® Clean Edge® Green Energy Index Fund is an exchange-traded index fund. The 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 NASDAQ® Clean Edge® Green Energy IndexSM.
There can be no assurance that the Fund's investment objectives will be achieved.
  • The index is a modified market capitalization weighted index designed to track the performance of clean energy companies that are publicly traded in the United States and includes companies engaged in manufacturing, development, distribution and installation of emerging clean-energy technologies including, but not limited to, solar photovoltaics, biofuels and advanced batteries.
  • The NASDAQ® Clean Edge® Green Energy IndexSM is a modified market cap weighted index in which larger companies receive a larger index weighting. The index weighting methodology includes caps to prevent high concentrations among larger alternative energy stocks.
  • The index is reconstituted twice a year in March and September and rebalanced quarterly.
Fund Overview
TickerQCLN
Fund TypeAlternative Energy
Investment AdvisorFirst Trust Advisors L.P.
Investor Servicing AgentBank of New York Mellon
CUSIP33733E500
Intraday NAVQCLNIV
Fiscal Year-End12/31
ExchangeNASDAQ Stock Market
Inception2/8/2007
Inception Price$20.00
Inception NAV$20.00
Rebalance FrequencyQuarterly
Gross Expense Ratio*0.64%
Net Expense Ratio*0.60%
* As of 6/30/2014
Expenses are capped contractually at 0.60% per year, at least until April 30, 2015.
Current Fund Data (as of 12/19/2014)
Closing NAV1$17.20
Closing Share Price2$17.19
Bid/Ask Midpoint$17.20
Bid/Ask Discount0.01%
Total Net Assets$90,281,693
Outstanding Shares5,250,002
Daily Volume26,339
Average 30-Day Daily Volume59,665
Closing Share Price 52-Week High/Low$21.37 / $15.81
Closing NAV 52-Week High/Low$21.37 / $15.83
Number of Holdings48
Fund Characteristics (as of 11/28/2014)3
Median Market Cap.$730
Maximum Market Cap.$27,756
Minimum Market Cap.$123
Price/Earnings19.33
Price/Book2.47
Price/Cash Flow13.95
Price/Sales1.64
Top Holdings (as of 12/19/2014)
Holding Percent
Linear Technology Corporation 8.22%
ITC Holdings Corp. 8.16%
Tesla Motors, Inc. 7.39%
SunEdison, Inc. 7.04%
SolarCity Corporation 6.96%
ON Semiconductor Corporation 4.60%
Microsemi Corporation 4.20%
Hexcel Corporation 3.89%
AVX Corporation 3.86%
First Solar, Inc. 3.80%

Holdings are subject to change.

NAV History (Since Inception)
Past performance is not indicative of future results.
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 35 0 0 0
6/30/2014 27 0 0 0
3/31/2014 34 0 0 0
12/31/2013 43 2 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 29 0 0 0
6/30/2014 35 1 0 0
3/31/2014 26 1 0 0
12/31/2013 19 0 0 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.

Top Sector Exposure (as of 12/19/2014)
Technology 37.13%
Oil & Gas 20.88%
Industrials 18.83%
Utilities 8.17%
Consumer Goods 7.40%
Consumer Services 6.97%
Month End Performance (as of 11/28/2014)
  3 Mos YTD 1 Year 3 Year 5 Year 10 Year Since
Fund
Inception4
Fund Performance *
NAV -14.96% -0.24% 3.82% 20.66% 4.87% N/A -1.21%
After Tax Held -15.03% -0.43% 3.60% 20.31% 4.69% N/A -1.32%
After Tax Sold -8.46% -0.12% 2.17% 16.20% 3.70% N/A -0.97%
Market Price -14.97% -0.30% 3.76% 20.79% 4.88% N/A -1.22%
Index Performance **
NASDAQ® Clean Edge® Green Energy Index -15.04% -0.37% 3.73% 20.19% 4.92% N/A -0.93%
Russell 2000® Index 0.23% 1.99% 3.99% 18.36% 16.69% N/A 6.20%
Quarter End Performance (as of 9/30/2014)
  3 Mos YTD 1 Year 3 Year 5 Year 10 Year Since
Fund
Inception4
Fund Performance *
NAV -6.92% 7.05% 17.99% 24.95% 4.87% N/A -0.32%
After Tax Held -7.00% 6.85% 17.74% 24.60% 4.69% N/A -0.44%
After Tax Sold -3.92% 4.00% 10.19% 19.72% 3.70% N/A -0.30%
Market Price -6.87% 7.11% 17.48% 25.06% 4.87% N/A -0.32%
Index Performance **
NASDAQ® Clean Edge® Green Energy Index -7.01% 6.97% 17.93% 24.54% 4.95% N/A -0.03%
Russell 2000® Index -7.36% -4.41% 3.93% 21.26% 14.29% N/A 5.45%
3-Year Statistics (as of 11/28/2014)
  Standard Deviation Alpha Beta Sharpe Ratio Correlation
QCLN 25.22% -3.36 1.43 0.86 0.75
Russell 2000® Index 13.29% --- 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 NASDAQ® Clean Edge® Green Energy 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 gross expense ratio for this fund is 0.64%. Expenses are capped contractually at 0.60% per year, at least until April 30, 2015.

The Russell 2000® Index is comprised of the smallest 2000 companies in the Russell 3000 Index.

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 All market capitalization numbers are in USD$ Millions.
4 Inception Date is 2/8/2007

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 NASDAQ® Clean Edge® Green Energy 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 securities issued by companies concentrated in a particular industry. The fund may invest in small capitalization and mid capitalization companies. Such companies may experience greater price volatility than larger, more established companies.

Renewable and alternative energy companies can be significantly affected by obsolescence of existing technology, short product cycles, legislation resulting in more strict government regulations and enforcement policies, fluctuations in energy prices and supply and demand of alternative energy fuels, energy conservation, the success of exploration projects, the supply of and demand for oil and gas, world events and economic conditions. Shares of clean energy companies have been significantly more volatile than shares of companies operating in other more established industries. This industry is relatively nascent and under-researched in comparison to more established and mature sectors.

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.

NASDAQ®,NASDAQ OMX®, and Clean Edge® are the registered trademarks (the "Marks") of The NASDAQ OMX Group, Inc. ("NASDAQ OMX") and Clean Edge, Inc. ("Clean Edge") respectively. NASDAQ OMX® and Clean Edge® are, collectively with their affiliates, the "Corporations". The Marks are licensed for use by First Trust Advisors L.P. The fund has not been passed on by the Corporations as to its legality or suitability. The fund is not issued, endorsed, sold or promoted by the Corporations. The fund should not be construed in any way as investment advice by the Corporations. THE CORPORATIONS MAKE NO WARRANTIES AND BEAR NO LIABILITY WITH RESPECT TO THE FUND.

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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