Home   Logon   Mobile Site   Research and Commentary   About Us   Call 1.800.621.1675 or Email Us       Follow First Trust: 

Search by Ticker, Keyword or CUSIP       
 
 
First Trust Dow Jones Internet Index Fund (FDN)
  • 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 Dow Jones Internet Index Fund is an exchange-traded index fund. The Fund seeks investment results that correspond generally to the price and yield , before the Fund's fees and expenses, of an equity index called the Dow Jones Internet Composite IndexSM.
There can be no assurance that the Fund's investment objectives will be achieved.
  • For a stock to be included in the selection universe for the index, a company must generate at least 50% of its annual sales/revenues from the Internet.
  • To be eligible for the Dow Jones Internet Composite IndexSM, a stock issued through an initial public offering must have a minimum of three months’ trading history. Spinoffs will require this history only if the parent stock has itself been trading for less than three months. An index-eligible stock also must have:
    • A three-month average market capitalization of at least $100 million;
    • A three-month average closing price above $10 if it is not currently in the index;
    • Sufficient trading activity to pass liquidity tests.
  • Index components are selected from the eligible universe using a combination of three-month average float-adjusted market capitalization and three-month average share volume with a goal of capturing 80% of the float-adjusted selection universe.
  • The index composition is reviewed each quarter. Rebalancing takes effect after the close of trading on the third Friday of March, June, September and December.
Fund Overview
TickerFDN
Fund TypeInternet
Investment AdvisorFirst Trust Advisors L.P.
Investor Servicing AgentBank of New York Mellon
CUSIP33733E302
Intraday NAVFDNIV
Fiscal Year-End12/31
ExchangeNYSE Arca
Inception6/19/2006
Inception Price$20.00
Inception NAV$20.00
Rebalance FrequencyQuarterly
Gross Expense Ratio*0.54%
Net Expense Ratio*0.54%
* 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 11/20/2014)
Closing NAV1$61.12
Closing Share Price2$61.14
Bid/Ask Midpoint$61.11
Bid/Ask Discount0.01%
Total Net Assets$1,885,430,878
Outstanding Shares30,850,002
Daily Volume243,669
Average 30-Day Daily Volume326,682
Closing Share Price 52-Week High/Low$65.52 / $52.73
Closing NAV 52-Week High/Low$65.51 / $52.74
Number of Holdings42
Fund Characteristics (as of 10/31/2014)4
Median Market Cap.$5,644
Maximum Market Cap.$382,002
Minimum Market Cap.$159
Price/Earnings33.25
Price/Book4.07
Price/Cash Flow21.82
Price/Sales3.80
Top Holdings (as of 11/21/2014)
Holding Percent
Facebook, Inc. (Class A) 9.56%
Amazon.com, Inc. 8.60%
eBay Inc. 6.19%
The Priceline Group Inc. 5.85%
Yahoo! Inc. 5.85%
Google Inc. (Class A) 4.70%
Google Inc. (Class C) 4.63%
salesforce.com, Inc. 4.34%
LinkedIn Corporation (Class A) 3.55%
Netflix Inc. 3.07%

Holdings are subject to change.

NAV History (Since Inception)
Past performance is not indicative of future results.
Overall Morningstar RatingTM (as of 10/31/2014)3

Among 195 funds in the Technology category. This fund was rated 4 stars/195 funds (3 years), 5 stars/186 funds (5 years).
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 0 0 0
6/30/2014 35 0 0 0
3/31/2014 42 0 0 0
12/31/2013 54 0 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 37 0 0 0
6/30/2014 28 0 0 0
3/31/2014 19 0 0 0
12/31/2013 10 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 11/21/2014)
Information Technology 71.63%
Consumer Discretionary 22.96%
Financials 4.38%
Health Care 1.03%
Month End Performance (as of 10/31/2014)
  3 Mos YTD 1 Year 3 Year 5 Year 10 Year Since
Fund
Inception5
Fund Performance *
NAV 3.67% 2.06% 11.95% 22.21% 22.06% N/A 14.33%
After Tax Held 3.67% 2.06% 11.95% 22.21% 22.05% N/A 14.31%
After Tax Sold 2.08% 1.16% 6.77% 17.66% 18.14% N/A 11.95%
Market Price 3.65% 2.04% 11.93% 22.19% 22.06% N/A 14.33%
Index Performance **
Dow Jones Internet Composite IndexSM 3.77% 2.36% 12.47% 22.94% 22.74% 14.12% 14.96%
S&P Composite 1500 Information Technology Index 4.97% 14.74% 24.21% 18.22% 16.46% 9.36% 10.84%
S&P 500 Index 5.05% 10.99% 17.27% 19.77% 16.69% 8.20% 8.27%
Quarter End Performance (as of 9/30/2014)
  3 Mos YTD 1 Year 3 Year 5 Year 10 Year Since
Fund
Inception5
Fund Performance *
NAV 2.25% 1.75% 13.41% 27.58% 21.53% N/A 14.45%
After Tax Held 2.25% 1.75% 13.41% 27.58% 21.51% N/A 14.43%
After Tax Sold 1.27% 0.99% 7.59% 22.10% 17.68% N/A 12.05%
Market Price 2.28% 1.77% 13.36% 27.61% 21.56% N/A 14.45%
Index Performance **
Dow Jones Internet Composite IndexSM 2.32% 2.01% 13.95% 28.34% 22.20% 15.10% 15.07%
S&P Composite 1500 Information Technology Index 3.83% 12.60% 27.00% 22.04% 15.78% 9.70% 10.71%
S&P 500 Index 1.13% 8.34% 19.73% 22.99% 15.70% 8.11% 8.05%
3-Year Statistics (as of 10/31/2014)
  Standard Deviation Alpha Beta Sharpe Ratio Correlation
FDN 14.86% 0.05 1.15 1.41 0.70
S&P Composite 1500 Information Technology Index 11.79% -3.08 1.11 1.46 0.86
S&P 500 Index 9.08% --- 1.00 2.01 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 Dow Jones Internet Composite IndexSM 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 0.57%. Expenses are capped contractually at 0.60% per year, at least until April 30, 2015.

The S&P Composite 1500 Information Technology Index is a capitalization-weighted index of companies classified by GICS as information technology within the S&P Composite 1500 Index.

The S&P 500 Index is an unmanaged index of 500 stocks used to measure large-cap U.S. stock market performance.

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
The Morningstar RatingTM is provided for those exchange-traded funds ("ETFs") with at least a three-year history. Ratings are based on the ETF's Morningstar Risk-Adjusted Return measure which accounts for variation in monthly performance, placing more emphasis on downward variations and rewarding consistent performance. An ETF's risk-adjusted return includes a brokerage commission estimate. This estimate is intended to reflect what an average investor would pay when buying or selling an ETF. PLEASE NOTE, this estimate is subject to change and the actual brokerage commission an investor pays may be higher or lower than this estimate. Morningstar compares each ETF's risk-adjusted return to the open-end mutual fund rating breakpoints for that category. Consistent with the open-end mutual fund ratings, the top 10% of ETFs in each category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars and the bottom 10% receive 1 star. The overall rating for an ETF is based on a weighted average of the time-period ratings (e.g., the ETF's 3,5, and 10 year rating). The determination of an ETF's rating does not affect the retail open end mutual fund data published by Morningstar. Past performance is no guarantee of future results.
4 All market capitalization numbers are in USD$ Millions.
5 Inception Date is 6/19/2006

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 NYSE Arca, Inc.

The fund's return may not match the return of the Dow Jones Internet Composite IndexSM.  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.

The fund invests in information technology companies, which are subject to certain risks, including rapidly changing technologies, short product life cycles, fierce competition, aggressive pricing and reduced profit margins, loss of patent, copyright and trademark protections, cyclical market patterns, evolving industry standards and frequent new product introductions. Certain companies may be smaller and less experienced companies, with limited product lines, markets or financial resources. Information technology company stocks, especially those which are Internet related, have experienced extreme price and volume fluctuations that are often unrelated to their operating performance.

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 Dow Jones Internet Composite IndexSM, is a product of Dow Jones Indexes, a licensed trademark of CME Group Index Services LLC ("CME"), and has been licensed for use. "Dow Jones®", "Dow Jones Internet Composite IndexSM", and "Dow Jones Indexes" are service marks of Dow Jones Trademark Holdings, LLC ("Dow Jones"), and have been licensed to CME and have been sublicensed for use for certain purposes by First Trust. First Trust's ETF, based on the Dow Jones Internet Composite IndexSM, is not sponsored, endorsed, sold or promoted by Dow Jones, CME or their respective affiliates and none of them makes any representation regarding the advisability of investing in such products.

©2014 Morningstar, Inc. All Rights Reserved. The Morningstar RatingTM information contained herein: (1) is proprietary to Morningstar; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.

Not FDIC Insured • Not Bank Guaranteed • May Lose Value
 
First Trust Portfolios L.P.  Member SIPC and FINRA.
First Trust Advisors L.P.
Home |  Important Legal Information |  Privacy Policy |  Business Continuity Plan
Copyright © 2014 All rights reserved.