First Trust Multi Cap Growth AlphaDEX® Fund (FAD)
Investment Objective/Strategy - The First Trust Multi Cap Growth AlphaDEX® 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 NASDAQ AlphaDEX® Multi Cap Growth Index.
There can be no assurance that the Fund's investment objectives will be achieved.
  • The NASDAQ AlphaDEX® Multi Cap Growth Index is an "enhanced" index created and administered by Nasdaq, Inc. ("Nasdaq") which employs the AlphaDEX® stock selection methodology to select stocks that meet certain criteria from the three indices – NASDAQ US 500 Large Cap Index, NASDAQ US 600 Mid Cap Index and NASDAQ US 700 Small Cap Index.
  • Nasdaq constructs the NASDAQ AlphaDEX® Multi Cap Growth Index by ranking the eligible stocks within each index on growth factors including 3-, 6- and 12- month price appreciation, sales to price and one year sales growth, and separately on value factors including book value to price, cash flow to price and return on assets. All stocks are ranked on the sum of ranks for the growth factors and, separately, all stocks are ranked on the sum of ranks for the value factors. A stock must have data for all growth and/or value factors to receive a rank for that style.
  • Each stock receives either its growth or value score as its selection score based on its style designation as determined by Nasdaq.
  • The top 187 stocks from the NASDAQ US 500 Large Cap Growth Index, 225 stocks from the NASDAQ US 600 Mid Cap Growth Index and 262 stocks from the NASDAQ US 700 Small Cap Growth Index based on the selection score determined in the previous step comprise the "selected stocks".
  • The selected stocks are divided into quintiles based on their rankings within their size class and the top ranked quintiles receive a higher weight within the index.
  • The NASDAQ AlphaDEX® Multi Cap Growth Index is comprised of the selected stocks in the following weights: the stocks selected from the NASDAQ US 500 Large Cap Growth Index comprise 50%, the stocks selected from the NASDAQ US 600 Mid Cap Growth Index comprise 30%, and the stocks selected from the NASDAQ US 700 Small Cap Growth Index comprise 20%.
  • The index is reconstituted and rebalanced quarterly.
Fund Overview
TickerFAD
Fund TypeMulti Cap Growth
Investment AdvisorFirst Trust Advisors L.P.
Investor Servicing AgentBank of New York Mellon
CUSIP33733F101
ISINUS33733F1012
Intraday NAVFADIV
Fiscal Year-End07/31
ExchangeNasdaq
Inception5/8/2007
Inception Price$30.00
Inception NAV$30.00
Rebalance FrequencyQuarterly
Gross Expense Ratio*0.66%
Net Expense Ratio*0.66%
* As of 12/2/2019
Expenses are capped contractually at 0.70% per year, at least until November 30, 2020.
Current Fund Data (as of 8/12/2020)
Closing NAV1$84.76
Closing Market Price2$84.70
Bid/Ask Midpoint$84.74
Bid/Ask Discount0.02%
Total Net Assets$173,755,290
Outstanding Shares2,050,002
Daily Volume4,120
Average 30-Day Daily Volume4,537
Closing Market Price 52-Week High/Low$85.65 / $52.24
Closing NAV 52-Week High/Low$85.62 / $52.10
Number of Holdings (excluding cash)674
Fund Characteristics (as of 7/31/2020)8
Maximum Market Cap.$1,817,315
Median Market Cap.$4,625
Minimum Market Cap.$288
Price/Earnings30.22
Price/Book5.61
Price/Cash Flow20.59
Price/Sales3.39
Top Holdings (as of 8/12/2020)*
Holding Percent
Tesla, Inc. 0.60%
Square, Inc. (Class A) 0.55%
Advanced Micro Devices, Inc. 0.52%
QUALCOMM Incorporated 0.52%
Apple Inc. 0.51%
EPAM Systems, Inc. 0.51%
NVIDIA Corporation 0.50%
West Pharmaceutical Services, Inc. 0.50%
Qorvo, Inc. 0.49%
Amazon.com, Inc. 0.47%

* 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 8/13/2020)3$0.0645
30-Day SEC Yield (as of 7/31/2020)40.14%
Unsubsidized 30-Day SEC Yield (as of 7/31/2020)50.14%
12-Month Distribution Rate (as of 7/31/2020)60.58%
Index Yield (as of 7/31/2020)70.79%
For funds with certain equity strategies, due to the negative economic impact across many industries caused by the recent COVID-19 outbreak, certain of the issuers of the securities included in the fund may elect to reduce the amount of dividends and/or distributions paid in the future. As a result, the "12-Month Distribution Rate," which is based on the fund's trailing 12-month ordinary distributions, will likely be higher, and in some cases significantly higher, than the actual 12-month distribution rate achieved by the fund.
Bid/Ask Midpoint vs. NAV (as of 6/30/2020)
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
6/30/2020 26 0 0 0
3/31/2020 9 0 1 0
12/31/2019 5 0 0 0
9/30/2019 17 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
6/30/2020 37 0 0 0
3/31/2020 52 0 0 0
12/31/2019 59 0 0 0
9/30/2019 47 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 8/12/2020)
Information Technology 32.50%
Health Care 19.22%
Consumer Discretionary 12.93%
Industrials 12.73%
Financials 8.78%
Communication Services 4.80%
Real Estate 3.11%
Materials 2.73%
Consumer Staples 1.91%
Energy 0.70%
Utilities 0.59%
Month End Performance (as of 7/31/2020)
  3 Month YTD 1 Year 3 Year 5 Year 10 Year Since
Fund
Inception9
Fund Performance *
Net Asset Value (NAV) 20.62% 7.72% 10.23% 12.31% 10.22% 13.24% 8.42%
After Tax Held 20.58% 7.59% 9.92% 12.14% 10.03% 13.04% 8.25%
After Tax Sold 12.21% 4.56% 6.03% 9.54% 8.01% 11.02% 6.92%
Market Price 20.06% 7.62% 10.18% 12.26% 10.18% 13.23% 8.40%
Index Performance **
Nasdaq AlphaDEX® Multi Cap Growth Index 20.83% 8.18% 10.99% 13.09% N/A N/A N/A
S&P Composite 1500 Index 12.91% 1.24% 10.40% 11.19% 10.99% 13.60% 8.23%
Nasdaq US Multi Cap Growth Index 18.05% 15.22% 23.00% 17.88% N/A N/A N/A
S&P Composite 1500 Growth Index 17.92% 13.99% 22.66% 17.38% 14.69% 16.28% 10.93%
Quarter End Performance (as of 6/30/2020)
  3 Month YTD 1 Year 3 Year 5 Year 10 Year Since
Fund
Inception9
Fund Performance *
Net Asset Value (NAV) 28.87% 1.02% 5.09% 10.56% 9.31% 13.22% 7.94%
After Tax Held 28.83% 0.90% 4.80% 10.39% 9.12% 13.01% 7.78%
After Tax Sold 17.09% 0.59% 2.99% 8.14% 7.27% 11.00% 6.50%
Market Price 28.82% 0.85% 4.87% 10.49% 9.28% 13.20% 7.93%
Index Performance **
Nasdaq AlphaDEX® Multi Cap Growth Index 29.10% 1.37% 5.82% 11.32% N/A N/A N/A
S&P Composite 1500 Index 20.77% -4.08% 6.08% 9.91% 10.20% 13.75% 7.84%
Nasdaq US Multi Cap Growth Index 26.19% 7.89% 16.96% 16.24% N/A N/A N/A
S&P Composite 1500 Growth Index 26.15% 6.62% 16.06% 15.72% 13.94% 16.28% 10.44%
3-Year Statistics (as of 7/31/2020)
  Standard Deviation Alpha Beta Sharpe Ratio Correlation
FAD 20.77% -6.26 1.16 0.57 0.97
S&P Composite 1500 Index 17.54% -5.27 0.99 0.58 0.98
S&P Composite 1500 Growth Index 17.33% --- 1.00 0.90 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 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.

**Performance information for the Nasdaq AlphaDEX® Multi Cap Growth 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.

On April 8, 2016, the fund's underlying index changed from the Defined Multi Cap Growth Index to the NASDAQ AlphaDEX® Multi Cap Growth Index. Therefore, the fund's performance and historical returns shown for the periods prior to this date are not necessarily indicative of the performance that the fund, based on its current index, would have generated.

S&P Composite 1500 Index - The Index is an unmanaged index representing the large cap, mid cap and small cap segments of the U.S. equity market.

Nasdaq US Multi Cap Growth Index - The Index is a float modified market capitalization weighted index that contains the top 50% of securities with the strongest growth-oriented composite score from the Nasdaq US Select Index Family.

S&P Composite 1500 Growth Index - The Index contains those securities with growth characteristics from the S&P 1500 Index.

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 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 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 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 Nasdaq AlphaDEX® Multi Cap Growth Index.
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 Nasdaq Stock Market LLC.

The fund's return may not match the return of the Nasdaq AlphaDEX® Multi Cap Growth 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. 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. There can be no assurance that the fund's investment objective will be achieved. The outbreak of the respiratory disease designated as COVID-19 in December 2019 has caused significant volatility and declines in global financial markets, which have caused losses for investors. The impact of this COVID-19 pandemic may be short term or may last for an extended period of time, and in either case could result in a substantial economic downturn or recession.

The fund may invest in securities issued by companies concentrated in a particular sector which involves additional risks including limited diversification. The fund may invest in small capitalization and mid capitalization companies. Such companies may experience greater price volatility than larger, more established companies.

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® and NASDAQ AlphaDEX® Multi Cap Growth Index are registered trademarks and service marks of Nasdaq, Inc. (together with its affiliates hereinafter referred to as the “Corporations”) and are licensed for use by First Trust. AlphaDEX® is a registered trademark owned by First Trust that has been licensed to Nasdaq, Inc. for use in the name of the Index. 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 CORPORATIONS MAKE NO WARRANTIES AND BEAR NO LIABILITY WITH RESPECT TO THE FUND.

"AlphaDEX®" is a registered trademark of First Trust Portfolios L.P. First Trust Portfolios L.P. has obtained a patent for the AlphaDEX® stock selection methodology from the United States Patent and Trademark Office.

Not FDIC Insured • Not Bank Guaranteed • May Lose Value