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First Trust TCW Opportunistic Fixed Income ETF (FIXD)
Investment Objective/Strategy - The First Trust TCW Opportunistic Fixed Income ETF is an actively managed exchange-traded fund. The Fund's investment objective is to seek to maximize long-term total return. Under normal market conditions, the Fund pursues its objective by investing at least 80% of its net assets (including investment borrowings) in fixed income securities.
There can be no assurance that the Fund's investment objectives will be achieved.
Fund Overview
TickerFIXD
Fund TypeIntermediate Term Bond
Investment AdvisorFirst Trust Advisors L.P.
Investment Advisor/Portfolio ManagerTCW Investment Management Company LLC
Investor Servicing AgentBNY Mellon Investment Servicing (US) Inc.
Sub-AdvisorTCW Investment Management Company LLC
CUSIP33740F805
ISINUS33740F8059
Intraday NAVFIXDIV
Fiscal Year-End08/31
ExchangeNasdaq
Inception2/14/2017
Inception Price$50.00
Inception NAV$50.00
Gross Expense Ratio*0.65%
Net Expense Ratio*0.55%
* As of 2/14/2017
First Trust has contractually agreed to waive management fees of 0.10% of average daily net assets until February 13, 2018.
Current Fund Data (as of 4/27/2017)
Closing NAV1$50.41
Closing Share Price2$50.45
Bid/Ask Midpoint$50.48
Bid/Ask Premium0.13%
Total Net Assets$50,411,401
Outstanding Shares1,000,002
Daily Volume43,127
Average 30-Day Daily Volume16,849
Closing Share Price 52-Week High/Low$50.63 / $49.73
Closing NAV 52-Week High/Low$50.72 / $49.69
Number of Holdings196
Fund Characteristics (as of 3/31/2017)
Weighted Average Effective Duration75.63 Years
Weighted Average Maturity7.92 Years
Top Holdings (as of 4/27/2017)
Holding Percent
U.S. Treasury Note, 1.875%, due 03/31/2022 13.22%
US 2YR NOTE (CBT) Jun17 6.46%
U.S. Treasury Bond, 3%, due 02/15/2047 5.71%
Fannie Mae TBA, 4.50%, due 11/01/2040 4.50%
U.S. Treasury Note, 1.25%, due 03/31/2019 4.48%
JAPAN TREASURY DISC BILL 0%, due 06/19/2017 2.86%
U.S. Treasury Note, 2.25%, due 02/15/2027 2.86%
Fannie Mae TBA 3% May 1.98%
Fannie Mae TBA 3.50% May 1.80%
JPMORGAN CHASE & CO 1.70%, due 03/01/2018 1.49%

Holdings are subject to change.

NAV History (Since Inception)
Past performance is not indicative of future results.
Maturity Exposure (as of 3/31/2017)
Years Percent
0-1 Year -0.04%
1-3 Years 19.88%
3-5 Years 21.37%
5-7 Years 15.91%
7-10 Years 25.95%
10-20 Years 7.49%
>20 Years 9.44%
Distribution Information
Dividend per Share Amt3$0.0904
30-Day SEC Yield (as of 3/31/2017)41.84%
Unsubsidized 30-Day SEC Yield (as of 3/31/2017)51.74%
Distribution Rate (as of 3/31/2017)62.16%
Bid/Ask Midpoint vs. NAV (as of 3/31/2017)
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
3/31/2017 20 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
3/31/2017 12 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.

Fund Composition (as of 3/31/2017)
Percent
Investment Grade Credit 29.85%
US Government/Agency 28.53%
Agency MBS 24.62%
CMBS 6.98%
Non-Agency MBS 6.60%
ABS 6.19%
High Yield Credit 3.37%
Emerging Market Credit 1.51%
Other 0.02%
Cash & Equivalents -7.67%
Credit Quality (as of 3/31/2017)
AAA 8.17%
AA+ 3.39%
AA 0.99%
AA- 1.76%
A+ 0.95%
A 1.90%
A- 2.58%
BBB+ 10.51%
BBB 6.83%
BBB- 5.64%
Below IG 9.33%
Cash & Equivalents -7.67%
Government/Agency 55.62%
The ratings are by Standard & Poor's. 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. 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 creditworthiness of the issuers of the underlying securities in the fund, and not to the fund or its shares. U.S. Treasury, U.S. Agency and U.S. Agency mortgage-backed securities appear under "Government". Credit ratings are subject to change.
Month End Performance (as of 3/31/2017)
  3 Mos YTD 1 Year 3 Year 5 Year 10 Year Since
Fund
Inception8
Fund Performance *
Net Asset Value (NAV) N/A N/A N/A N/A N/A N/A 0.58%
After Tax Held N/A N/A N/A N/A N/A N/A 0.49%
After Tax Sold N/A N/A N/A N/A N/A N/A 0.33%
Market Price N/A N/A N/A N/A N/A N/A 0.52%
Index Performance
Bloomberg Barclays U.S. Aggregate Bond Index N/A N/A N/A N/A N/A N/A 0.60%
Quarter End Performance (as of 3/31/2017)
  3 Mos YTD 1 Year 3 Year 5 Year 10 Year Since
Fund
Inception8
Fund Performance *
Net Asset Value (NAV) N/A N/A N/A N/A N/A N/A 0.58%
After Tax Held N/A N/A N/A N/A N/A N/A 0.49%
After Tax Sold N/A N/A N/A N/A N/A N/A 0.33%
Market Price N/A N/A N/A N/A N/A N/A 0.52%
Index Performance
Bloomberg Barclays U.S. Aggregate Bond Index N/A N/A N/A N/A N/A N/A 0.60%

*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 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. 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.

Indexes do 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 0.65%. Expenses are capped contractually at 0.55% per year, at least until February 13, 2018.

Bloomberg Barclays U.S. Aggregate Bond Index - The Index covers the investment-grade, U.S. dollar-denominated, fixed-rate taxable bond market, including Treasuries, government-related and corporate securities, MBS, ABS, and CMBS.

Footnotes
1 The NAV represents the fund's net assets (assets less liabilities) divided by the fund's outstanding shares .
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 to today's date. Subject to change in the future. There is no guarantee that the fund will declare dividends.
4 The 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 and includes the effects of fee waivers and expense reimbursements, if applicable.
5 The unsubsidized 30-day SEC yield is calculated the same as the 30-day SEC yield, however it excludes contractual fee waivers and expense reimbursements.
6 Distribution Rate is calculated by dividing the fund's most recent ordinary distribution paid or declared, on an annualized basis, by the NAV price. Distribution rates may vary.
7 A measure of a bond's sensitivity to interest rate changes that reflects the change in a bond's price given a change in yield. It accounts for the likelihood of changes in the timing of cash flows in response to interest rate movements.
8 Inception Date is 2/14/2017

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.

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. If the fund's authorized participants are unable to proceed with creation/redemption orders and no other authorized participant is able to step forward to create or redeem, fund shares may trade at a discount to the fund's net asset value and possibly face delisting.

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 security owned by the fund, fund shares or securities in general may fall in value.

The fund is subject to credit risk, call risk, income risk, interest rate risk and prepayment risk. 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 is heightened for the floating rate loans in which the fund invests because companies that issue such loans tend to be highly leveraged and thus are more susceptible to the risks of interest deferral, default and/or bankruptcy. Call risk is the risk that if an issuer calls higher-yielding debt instruments held by the fund, performance could be adversely impacted. Income risk is the risk that income from the fund's fixed income investments could decline during periods of falling interest rates. Interest rate risk is the risk that the value of the fixed income securities in the fund will decline because of rising market interest rates. Prepayment risk is the risk that during periods of falling interest rates, an issuer may exercise its right to pay principal on an obligation earlier than expected. This may result in a decline in the fund's income.

Certain of the fixed-income securities in the fund may not have the benefit of covenants which could reduce the ability of the issuer to meet its payment obligations and might result in increased credit risk.

High-yield securities, or "junk" bonds, are subject to greater market fluctuations and risk of loss than securities with higher ratings, and therefore, may be highly speculative. These securities are issued by companies that may have limited operating history, narrowly focused operations, and/or other impediments to the timely payment of periodic interest and principal at maturity. Lower quality debt tends to be less liquid than higher quality debt.

The risks associated with senior loans are similar to the risks of high-yield fixed income instruments. The loans are usually rated below investment grade but may also be unrated. Upon a prepayment, either in part or in full, 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.

Mortgage-related securities, including mortgage-backed securities, are more susceptible to adverse economic, political or regulatory events that affect the value of real estate. Mortgage-related securities are subject to the risk that the rate of mortgage prepayments decreases, which extends the average life of a security and increases the interest rate exposure.

In a falling inflationary environment, both interest payments and the value of Treasury Inflation Protected Securities ("TIPS") will decline.

Securities issued or guaranteed by federal agencies and U.S. government sponsored instrumentalities may or may not be backed by the full faith and credit of the U.S. government.

Collateralized loan obligations ("CLOs") carry additional risks, including, the possibility that distributions from collateral securities will not be adequate to make interest or other payments, the quality of the collateral may decline in value or default, the possibility that the investments in CLOs are subordinate to other classes or tranches, and the complex structure of the security may not be fully understood at the time of investment and may produce disputes with the issuer or unexpected investment results.

The use of options and other derivatives can lead to losses because of adverse movements in the price or value of the underlying asset, index or rate, which may be magnified by certain features of the derivatives. These risks are heightened when the fund's portfolio managers use derivatives to enhance the fund's returns or as a substitute for a position or security, rather than solely to hedge (or offset) the risk of a position or security held by the fund.

If a counterparty defaults on its payment obligations, the fund will lose money and the value of an investment in fund shares may decrease.

As the use of Internet technology has become more prevalent in the course of business, the fund has become more susceptible to potential operational risks through breaches in cyber security.

Non-U.S. securities are subject to higher volatility than securities of domestic issuers due to possible adverse political, social or economic developments; restrictions on foreign investment or exchange of securities; lack of liquidity; currency exchange rates; excessive taxation; government seizure of assets; different legal or accounting standards and less government supervision and regulation of exchanges in foreign countries. These risks may be heightened for securities of companies located in, or with significant operations in, emerging market countries. Changes in currency exchange rates and the relative value of non-U.S. currencies will affect the value of the fund's investment and the value of fund shares. Because the fund's net asset value is determined on the basis of U.S. dollars, you may lose money if the local currency of a foreign market depreciates against the U.S. dollar.

Investments in sovereign bonds involve special risks because the governmental authority that controls the repayment of the debt may be unwilling or unable to repay the principal and/or interest when due. In times of economic uncertainty, the prices of these securities may be more volatile than those of corporate debt obligations or of other government debt obligations.

Illiquid securities involve the risk that the securities will not be able to be sold at the time desired by the fund or at prices approximately the value at which the fund is carrying the securities on its books.

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.

The fund currently intends to effect a portion of creations and redemptions, in whole or in part for cash, rather than in kind securities. As a result, the fund may be less tax efficient.

The fund currently has fewer assets than larger, more established funds, and like other relatively new funds, large inflows and outflows may impact the fund's market exposure for limited periods of time.

The fund is subject to management risk because it is an actively managed portfolio. In managing the fund's investment portfolio, the sub-advisor will apply investment techniques and risk analyses that may not have the desired result. There can be no guarantee that the fund will meet its investment objectives.

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.

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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