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First Trust ISE Water Index Fund (FIW)
Investment Objective/Strategy - The First Trust ISE Water Index Fund is an exchange-traded fund. The investment objective of the Fund is to seek investment results that correspond generally to the price and yield, before fees and expenses, of an equity index called the ISE Water Index™.
There can be no assurance that the Fund's investment objectives will be achieved.
  • The ISE Water IndexTM is a modified market capitalization-weighted index comprised of exchange-listed companies that derive a substantial portion of their revenues from the potable and wastewater industry.
  • The Index begins by establishing the total population of stocks in the potable and wastewater industry and eliminates stocks which do not meet the Index’s baseline eligibility requirements.
  • To meet Index eligibility, a stock must satisfy market capitalization, liquidity and weighting concentration requirements.
  • The Index selects the top 36 stocks in the industry by market capitalization.
  • The Index is rebalanced on the application of the above model on a semi-annual basis.
Fund Overview
Fund TypeSector - Water
Investment AdvisorFirst Trust Advisors L.P.
Investor Servicing AgentBank of New York Mellon
Fiscal Year-End12/31
ExchangeNYSE Arca
Inception Price$20.00
Inception NAV$20.00
Rebalance FrequencySemi-Annual
Gross Expense Ratio*0.59%
Net Expense Ratio*0.59%
* As of 5/1/2015
Expenses are capped contractually at 0.60% per year, at least until April 30, 2016.
Current Fund Data (as of 10/8/2015)
Closing NAV1$29.30
Closing Share Price2$29.28
Bid/Ask Midpoint$29.28
Bid/Ask Discount0.09%
Total Net Assets$108,414,976
Outstanding Shares3,700,002
Daily Volume5,895
Average 30-Day Daily Volume18,303
Closing Share Price 52-Week High/Low$34.23 / $27.15
Closing NAV 52-Week High/Low$34.22 / $27.18
Number of Holdings36
Fund Characteristics (as of 9/30/2015)8
Maximum Market Cap.$58,240
Median Market Cap.$1,686
Minimum Market Cap.$112
Price/Cash Flow13.68
Top Holdings (as of 10/8/2015)
Holding Percent
Danaher Corporation 7.85%
American Water Works Company, Inc. 4.87%
Watts Water Technologies, Inc. 4.62%
Aqua America, Inc. 4.61%
Xylem Inc. 4.14%
California Water Service Group 4.12%
Badger Meter, Inc. 4.05%
Pentair Plc 4.01%
Lindsay Corporation 3.88%
Companhia de Saneamento Basico do Estado de Sao Paulo-SABESP (ADR) 3.54%

Holdings are subject to change.

NAV History (Since Inception)
Past performance is not indicative of future results.
Distribution Information
Dividend per Share Amt3$0.0560
30-Day SEC Yield (as of 9/30/2015)40.87%
Unsubsidized 30-Day SEC Yield (as of 9/30/2015)50.87%
12-Month Distribution Rate (as of 9/30/2015)60.81%
Index Yield (as of 9/30/2015)71.39%
Bid/Ask Midpoint vs. NAV (as of 9/30/2015)
Number of Days Bid/Ask Midpoint Above NAV
Quarter Ended 0-49
Basis Points
Basis Points
Basis Points
Basis Points
9/30/2015 22 0 0 0
6/30/2015 44 0 0 0
3/31/2015 44 0 0 0
12/31/2014 49 0 0 0
Number of Days Bid/Ask Midpoint Below NAV
Quarter Ended 0-49
Basis Points
Basis Points
Basis Points
Basis Points
9/30/2015 42 0 0 0
6/30/2015 19 0 0 0
3/31/2015 17 0 0 0
12/31/2014 15 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 10/8/2015)
Industrials 58.67%
Utilities 25.58%
Information Technology 5.35%
Materials 5.06%
Health Care 4.40%
Financials 0.94%
Month End Performance (as of 9/30/2015)
  3 Mos YTD 1 Year 3 Year 5 Year 10 Year Since
Fund Performance *
Net Asset Value (NAV) -11.67% -17.52% -12.27% 4.98% 8.50% N/A 4.74%
After Tax Held -11.75% -17.72% -12.55% 4.65% 8.15% N/A 4.43%
After Tax Sold -6.61% -9.90% -6.93% 3.70% 6.56% N/A 3.61%
Market Price -11.64% -17.49% -12.35% 4.98% 8.51% N/A 4.74%
Index Performance **
ISE Water Index™ -11.54% -17.14% -11.71% 5.66% 9.25% N/A 5.45%
Russell 3000® Index -7.25% -5.45% -0.49% 12.53% 13.28% N/A 5.29%
Quarter End Performance (as of 9/30/2015)
  3 Mos YTD 1 Year 3 Year 5 Year 10 Year Since
Fund Performance *
Net Asset Value (NAV) -11.67% -17.52% -12.27% 4.98% 8.50% N/A 4.74%
After Tax Held -11.75% -17.72% -12.55% 4.65% 8.15% N/A 4.43%
After Tax Sold -6.61% -9.90% -6.93% 3.70% 6.56% N/A 3.61%
Market Price -11.64% -17.49% -12.35% 4.98% 8.51% N/A 4.74%
Index Performance **
ISE Water Index™ -11.54% -17.14% -11.71% 5.66% 9.25% N/A 5.45%
Russell 3000® Index -7.25% -5.45% -0.49% 12.53% 13.28% N/A 5.29%
3-Year Statistics (as of 9/30/2015)
  Standard Deviation Alpha Beta Sharpe Ratio Correlation
FIW 14.74% -9.07 1.22 0.38 0.82
Russell 3000® Index 9.93% --- 1.00 1.21 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 Water Index™ is for illustrative purposes only and does not represent actual fund performance.
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 0.59%. Expenses are capped contractually at 0.60% per year, at least until April 30, 2016.

Russell 3000® Index - The Index is comprised of the 3000 largest and most liquid stocks based and traded in the U.S.

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. 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 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.
7 Index yield represents the weighted average trailing 12-month dividend of the constituents of the ISE Water Index(TM).
8 All market capitalization numbers are in USD$ Millions.
9 Inception Date is 5/8/2007

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 NYSE Arca, Inc.

The fund's return may not match the return of the ISE Water 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.

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.

Adverse developments in the potable water and wastewater business may significantly affect the value of the shares of the fund. Companies involved in the potable water and wastewater business are subject to environmental considerations, taxes, government regulation, price and supply fluctuations, competition and conservation.

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 Water 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 Water IndexTM 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
First Trust Portfolios L.P.  Member SIPC and FINRA.
First Trust Advisors L.P.
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