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First Trust Indxx Metaverse ETF (ARVR)
Investment Objective/Strategy - The First Trust Indxx Metaverse ETF (the "Fund") seeks investment results that correspond generally to the price and yield, before fees and expenses, of an equity index called the Indxx Metaverse Index (the "Index"). Under normal market conditions, the Fund will invest at least 80% of its net assets (plus any borrowings for investment purposes) in the common stocks and depositary receipts that comprise the Index.
There can be no assurance that the Fund's investment objectives will be achieved.
Index Description According to the Index Provider
  • The index begins with a universe of common stocks and depositary receipts issued by U.S. and non-U.S. Metaverse companies listed in a developed or emerging market, as defined by the index provider.*
  • To be eligible for the index, a security must meet the following criteria:
    • Minimum market capitalization of $1 billion;
    • Six-month average daily turnover value of greater than or equal to $5 million;
    • Minimum free float of 10% of shares outstanding in order to meet the index provider's market capitalization and liquidity requirements.
  • All eligible companies considered for inclusion in the index must be involved in business activities associated with the following sub-themes:
    • Internet Protocol (IP) and Contents
    • Platforms
    • Payment
    • Optics & Display
    • Semiconductor, Hardware and 5G
  • Only companies that derive at least 50% of revenues from, or devote 50% of assets to, one of the Metaverse sub-themes will be eligible for inclusion in the index.
  • A total of 50 will be selected based on market capitalization and equally weighted.
    • Each company with a market capitalization less than $10 billion will have its weight halved, with the remaining weight equally allocated among other components in the index.
  • The index is rebalanced quarterly and reconstituted semi-annually.
*Depositary receipts issued by Chinese companies are not eligible for inclusion in the index. The index does include non-Chinese variable interest entities (“VIEs”) in order to gain exposure to Chinese companies.

Fund Overview
Fund TypeTechnology
Investment AdvisorFirst Trust Advisors L.P.
Investor Servicing AgentBank of New York Mellon Corp
Fiscal Year-End09/30
Inception Price$30.21
Inception NAV$30.21
Rebalance FrequencyQuarterly
Expense Ratio*0.70%
* As of 2/1/2023
The Investment Advisor has implemented fee breakpoints, which reduce the fund's investment management fee at certain assets levels. Please see the fund's Statement of Additional Information for full details.
Current Fund Data (as of 9/29/2023)
Closing NAV1$29.10
Closing Market Price2$29.15
Bid/Ask Midpoint$29.15
Bid/Ask Premium0.17%
30-Day Median Bid/Ask Spread30.36%
Total Net Assets$1,454,868
Outstanding Shares50,002
Daily Volume0
Average 30-Day Daily Volume206
Closing Market Price 52-Week High/Low$33.17 / $21.78
Closing NAV 52-Week High/Low$33.07 / $21.75
Number of Holdings (excluding cash)41
Top Holdings (as of 9/29/2023)*
Holding Percent
Xiaomi Corporation (Class B) 3.47%
Micron Technology, Inc. 3.41%
Intel Corporation 3.40%
Activision Blizzard, Inc. 3.39%
Synopsys, Inc. 3.31%
Adobe Incorporated 3.19%
Amphenol Corporation 3.18%
Zoom Video Communications, Inc. (Class A) 3.18%
NetEase, Inc. 3.14%
Meta Platforms Inc. (Class A) 3.10%

* Excluding cash.  Holdings are subject to change.

NAV History (Since Inception)
Past performance is not indicative of future results.
Distribution Information
Dividend per Share Amt (as of 10/1/2023)4$0.0134
30-Day SEC Yield (as of 8/31/2023)51.11%
12-Month Distribution Rate (as of 8/31/2023)60.26%
Index Yield (as of 8/31/2023)71.08%
Fund Characteristics (as of 8/31/2023)8
Maximum Market Cap.$2,937,203
Median Market Cap.$43,123
Minimum Market Cap.$987
Price/Cash Flow19.41
Top Country Exposure (as of 9/29/2023)
Country Percent
United States 62.62%
Japan 15.27%
China 11.80%
France 4.20%
Taiwan 3.80%
Ireland 1.17%
South Korea 1.14%
Bid/Ask Premium/Discount (as of 9/29/2023)
  2022 Q1 2023 Q2 2023 Q3 2023
Days Traded at Premium 171 58 61 62
Days Traded at Discount 6 4 1 1
Top Industry Exposure (as of 9/29/2023)
Entertainment 32.47%
Semiconductors & Semiconductor Equipment 26.57%
Software 14.87%
Interactive Media & Services 8.21%
Electronic Equipment, Instruments & Components 6.54%
Technology Hardware, Storage & Peripherals 6.39%
Household Durables 2.78%
IT Services 1.17%
Health Care Technology 1.00%
Hypothetical Growth of $10,000 Since Inception (as of 9/28/2023) *
Tracking Index: Indxx Metaverse Index

Month End Performance (as of 8/31/2023)
  3 Month YTD 1 Year 3 Year 5 Year 10 Year Since
Fund Performance *
Net Asset Value (NAV) 3.56% 25.53% 18.95% N/A N/A N/A 1.24%
After Tax Held 3.54% 25.51% 18.80% N/A N/A N/A 1.15%
After Tax Sold 2.11% 15.12% 11.20% N/A N/A N/A 0.90%
Market Price 3.51% 25.93% 19.24% N/A N/A N/A 1.51%
Index Performance **
Indxx Metaverse Index 3.78% 26.34% 19.72% N/A N/A N/A 2.15%
MSCI ACWI Index 6.61% 14.80% 13.95% N/A N/A N/A 1.03%
Quarter End Performance (as of 6/30/2023)
  3 Month YTD 1 Year 3 Year 5 Year 10 Year Since
Fund Performance *
Net Asset Value (NAV) 6.85% 28.65% 24.02% N/A N/A N/A 3.52%
After Tax Held 6.83% 28.63% 23.86% N/A N/A N/A 3.41%
After Tax Sold 4.06% 16.96% 14.20% N/A N/A N/A 2.63%
Market Price 7.01% 29.05% 23.86% N/A N/A N/A 3.82%
Index Performance **
Indxx Metaverse Index 7.04% 29.19% 24.98% N/A N/A N/A 4.38%
MSCI ACWI Index 6.18% 13.93% 16.53% N/A N/A N/A 0.54%

*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 determined by using the midpoint of the national best bid offer price ("NBBO") 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.

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 each listed 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.

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

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 market 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 median bid-ask spread is calculated by identifying the national best bid and national best offer ("NBBO") for the fund as of the end of each 10 second interval during each trading day of the last 30 calendar days and dividing the difference between each such bid and offer by the midpoint of the NBBO. The median of those values is identified and that value is expressed as a percentage rounded to the nearest hundredth.
4 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.
5 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.
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 Indxx Metaverse Index.
8 All market capitalization numbers are in USD$ Millions.
9 Inception Date is 4/19/2022

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.

Risk Considerations

You could lose money by investing in a fund. An investment in a fund is not a deposit of a bank and is not insured or guaranteed. There can be no assurance that a fund's objective(s) will be achieved. Investors buying or selling shares on the secondary market may incur customary brokerage commissions. Please refer to each fund's prospectus and Statement of Additional Information for additional details on a fund's risks. The order of the below risk factors does not indicate the significance of any particular risk factor.

Some Asian economies are highly dependent on trade with other countries and there is a high concentration of market capitalization and trading volume in a small number of Asian issuers as well as a high concentration of investors and financial intermediaries. Certain Asian countries experience expropriation and nationalization of assets, confiscatory taxation, currency manipulation, political instability, armed conflict and social instability as a result of religious, ethnic, socio-economic and/or political unrest. In particular, escalated tensions involving North Korea could have severe adverse effect on Asian economies. Recent developments between the U.S. and China have heightened concerns of increased tariffs and restrictions on trade.

Unlike mutual funds, shares of the fund may only be redeemed directly from a fund by authorized participants in very large creation/redemption units. If a 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 premium or discount to a fund's net asset value and possibly face delisting and the bid/ask spread may widen.

Communication services companies are subject to certain risks, which may include 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, often unpredictable changes in consumer tastes and frequent new product introductions. Such companies are particularly vulnerable to domestic and international government regulation, rely heavily on intellectual property rights, and may be adversely affected by the loss or impairment of those rights.

Changes in currency exchange rates and the relative value of non-US currencies may affect the value of a fund's investments and the value of a fund's shares.

Current market conditions risk is the risk that a particular investment, or shares of the fund in general, may fall in value due to current market conditions. As a means to fight inflation, the Federal Reserve and certain foreign central banks have raised interest rates and expect to continue to do so, and the Federal Reserve has announced that it intends to reverse previously implemented quantitative easing. Recent and potential future bank failures could result in disruption to the broader banking industry or markets generally and reduce confidence in financial institutions and the economy as a whole, which may also heighten market volatility and reduce liquidity. In February 2022, Russia invaded Ukraine which has caused and could continue to cause significant market disruptions and volatility within the markets in Russia, Europe, and the United States. The hostilities and sanctions resulting from those hostilities have and could continue to have a significant impact on certain fund investments as well as fund performance and liquidity. The COVID-19 global pandemic, or any future public health crisis, and the ensuing policies enacted by governments and central banks have caused and may continue to cause significant volatility and uncertainty in global financial markets, negatively impacting global growth prospects.

A fund is susceptible to operational risks through breaches in cyber security. Such events could cause a fund to incur regulatory penalties, reputational damage, additional compliance costs associated with corrective measures and/or financial loss.

Depositary receipts may be less liquid than the underlying shares in their primary trading market and distributions may be subject to a fee. Holders may have limited voting rights, and investment restrictions in certain countries may adversely impact their value.

Investments in emerging market securities are generally considered speculative and involve additional risks relating to political, economic and regulatory conditions.

Equity securities may decline significantly in price over short or extended periods of time, and such declines may occur in the equity market as a whole, or they may occur in only a particular country, company, industry or sector of the market.

An index fund will be concentrated in an industry or a group of industries to the extent that the index is so concentrated. A fund with significant exposure to a single asset class, or the securities of issuers within the same country, state, region, industry, or sector may have its value more affected by an adverse economic, business or political development than a broadly diversified fund.

A fund may be a constituent of one or more indices or models which could greatly affect a fund's trading activity, size and volatility.

There is no assurance that the index provider or its agents will compile or maintain the index accurately. Losses or costs associated with any index provider errors generally will be borne by a fund and its shareholders.

Information technology companies 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 regulation and frequent new product introductions.

Large capitalization companies may grow at a slower rate than the overall market.

Market risk is the risk that a particular security, or shares of a fund in general may fall in value. Securities are subject to market fluctuations caused by such factors as general economic conditions, political events, regulatory or market developments, changes in interest rates and perceived trends in securities prices. Shares of a fund could decline in value or underperform other investments as a result. In addition, local, regional or global events such as war, acts of terrorism, spread of infectious disease or other public health issues, recessions, natural disasters or other events could have significant negative impact on a fund.

A fund faces numerous market trading risks, including the potential lack of an active market for fund shares due to a limited number of market makers. Decisions by market makers or authorized participants to reduce their role or step away in times of market stress could inhibit the effectiveness of the arbitrage process in maintaining the relationship between the underlying values of a fund's portfolio securities and a fund's market price.

Metaverse is a new and developing technology, the consequences of which have not been fully explored. The risks associated with the Metaverse may not emerge until the technology is widely used. The risks may include, but not be limited to, small or limited markets for their securities, changes in business cycles, world economic growth, technological progress, rapid obsolescence, fierce competition, loss of patent, copyright, trademark and trade secret protection and government regulation. Metaverse companies, especially smaller, start-up companies, tend to be more volatile than securities of companies that do not rely heavily on technology. There is no guarantee that the products or services produced by companies in Metaverse-related businesses will be successful.

An index fund's return may not match the return of the index for a number of reasons including operating expenses, costs of buying and selling securities to reflect changes in the index, and the fact that a fund's portfolio holdings may not exactly replicate the index.

A fund classified as "non-diversified" may invest a relatively high percentage of its assets in a limited number of issuers. As a result, a 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.

Securities of non-U.S. issuers are subject to additional risks, including currency fluctuations, political risks, withholding, lack of liquidity, lack of adequate financial information, and exchange control restrictions impacting non-U.S. issuers.

A fund and a fund's advisor may seek to reduce various operational risks through controls and procedures, but it is not possible to completely protect against such risks. The fund also relies on third parties for a range of services, including custody, and any delay or failure related to those services may affect the fund's ability to meet its objective.

A fund that invests in securities included in or representative of an index will hold those securities regardless of investment merit and the fund generally will not take defensive positions in declining markets.

High portfolio turnover may result in higher levels of transaction costs and may generate greater tax liabilities for shareholders.

The market price of a fund's shares will generally fluctuate in accordance with changes in the fund's net asset value ("NAV") as well as the relative supply of and demand for shares on the exchange, and a fund's investment advisor cannot predict whether shares will trade below, at or above their NAV.

Securities of small capitalization companies may experience greater price volatility and be less liquid than larger, more established companies.

Trading on an exchange may be halted due to market conditions or other reasons. There can be no assurance that a fund's requirements to maintain the exchange listing will continue to be met or be unchanged.

In China, direct ownership of companies in certain sectors by foreign individuals and entities is prohibited. In order to allow for foreign investment in these businesses, many Chinese companies have created variable interest entities ("VIEs") structures to enable indirect foreign ownership. VIEs are not formally recognized under Chinese law. Intervention by the Chinese government with respect to VIEs could significantly affect the Chinese company's performance and the enforceability of the VIE's contractual arrangements that establish the links between the Chinese company and the shell company in which the Fund invests. VIEs are also subject to the investment risks associated with the underlying Chinese issuer or operating company. Chinese companies are not subject to the same degree of regulatory requirements or accounting standards and oversight as companies in more developed countries. As a result, information about the Chinese securities and VIEs in which the Fund invests may be less reliable and incomplete.

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.

Indxx and Indxx Metaverse Index ("Index") are trademarks of Indxx, Inc. ("Indxx") and have been licensed for use for certain purposes by First Trust. The Fund is not sponsored, endorsed, sold or promoted by Indxx and Indxx makes no representation regarding the advisability of trading in such product. The Index is determined, composed and calculated by Indxx without regard to First Trust or the Fund.

CUSIP identifiers have been provided by CUSIP Global Services, managed on behalf of the American Bankers Association by FactSet Research Systems Inc. and are not for use or dissemination in a manner that would serve as a substitute for any CUSIP service. The CUSIP Database, ©2023 CUSIP Global Services. "CUSIP" is a registered trademark of the American Bankers Association.

Not FDIC Insured • Not Bank Guaranteed • May Lose Value
The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. By providing this information, First Trust is not undertaking to give advice in any fiduciary capacity within the meaning of ERISA, the Internal Revenue Code or any other regulatory framework. Financial professionals are responsible for evaluating investment risks independently and for exercising independent judgment in determining whether investments are appropriate for their clients.
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