First Trust Dow Jones Select MicroCap Index Fund (FDM)
Investment Objective/Strategy - The First Trust Dow Jones Select MicroCap Index Fund is an exchange-traded index fund. The investment objective of the Fund is to replicate as closely as possible, before fees and expenses, the price and yield of the Dow Jones Select Microcap IndexSM.
There can be no assurance that the Fund's investment objectives will be achieved.
  • This index is designed to represent microcap stocks trading on the New York Stock Exchange ("NYSE"), NYSE Amex and Nasdaq that are comparatively liquid and have strong fundamentals relative to the microcap segment as a whole.
  • Covers securities whose market capitalizations fall within a range defined by the bottom two deciles of NYSE stocks.
  • Stocks are screened based on market capitalization, trading volume, and financial indicators that include trailing price/earnings ratio, trailing price/sales ratio, per-share profit change for the previous quarter, operating profit margin and six-month total return.
Fund Overview
TickerFDM
Fund TypeMicro Cap
Investment AdvisorFirst Trust Advisors L.P.
Investor Servicing AgentBank of New York Mellon
CUSIP33718M105
ISINUS33718M1053
Intraday NAVFDMIV
Fiscal Year-End12/31
ExchangeNYSE Arca
Inception9/27/2005
Inception Price$20.00
Inception NAV$20.00
Rebalance FrequencyQuarterly
Gross Expense Ratio*0.70%
Net Expense Ratio*0.60%
* As of 5/1/2020
Expenses are capped contractually at 0.60% per year, at least until April 30, 2021.
Current Fund Data (as of 4/15/2021)
Closing NAV1$59.37
Closing Market Price2$59.32
Bid/Ask Midpoint$59.36
Bid/Ask Discount0.02%
30-Day Median Bid/Ask Spread30.20%
Total Net Assets$163,560,862
Outstanding Shares2,755,000
Daily Volume8,530
Average 30-Day Daily Volume29,070
Closing Market Price 52-Week High/Low$63.65 / $30.83
Closing NAV 52-Week High/Low$63.68 / $30.79
Number of Holdings (excluding cash)151
Top Holdings (as of 4/15/2021)*
Holding Percent
Silvergate Capital Corporation (Class A) 4.20%
Clean Energy Fuels Corp. 2.02%
Enova International, Inc. 1.89%
Dime Community Bancshares Inc. 1.81%
U.S. Concrete, Inc. 1.63%
IES Holdings, Inc. 1.62%
Donnelley Financial Solutions, Inc. 1.36%
Anavex Life Sciences Corp. 1.33%
Hyster-Yale Materials Handling, Inc. 1.31%
HarborOne Bancorp, Inc. 1.25%

* Excluding cash.  Holdings are subject to change.

NAV History (Since Inception)
Past performance is not indicative of future results.
Overall Morningstar RatingTM (as of 3/31/2021)4

Among 402 funds in the Small Value category. This fund was rated 3 stars/402 funds (3 years), 4 stars/372 funds (5 years), 4 stars/269 funds (10 years) based on risk adjusted returns.
Distribution Information
Dividend per Share Amt (as of 4/16/2021)5$0.0868
30-Day SEC Yield (as of 3/31/2021)60.50%
Unsubsidized 30-Day SEC Yield (as of 3/31/2021)70.42%
12-Month Distribution Rate (as of 3/31/2021)81.16%
Index Yield (as of 3/31/2021)91.47%
For funds with certain equity strategies, due to the negative economic impact across many industries caused by the 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.
Fund Characteristics (as of 3/31/2021)11
Maximum Market Cap.$3,278
Median Market Cap.$466
Minimum Market Cap.$49
Price/Earnings12.91
Price/Book1.71
Price/Cash Flow9.63
Price/Sales0.87
Bid/Ask Premium/Discount (as of 4/15/2021)
  2020 Q1 2021 Q2 2021 Q3 2021
Days Traded at Premium 132 29 8 ---
Days Traded at Discount 121 32 2 ---
Top Sector Exposure (as of 4/15/2021)
Financials 32.79%
Industrials 20.32%
Health Care 12.54%
Consumer Discretionary 9.35%
Information Technology 6.66%
Energy 6.30%
Communication Services 3.08%
Materials 3.02%
Real Estate 2.93%
Consumer Staples 2.27%
Utilities 0.74%
Month End Performance (as of 3/31/2021)
  3 Month YTD 1 Year 3 Year 5 Year 10 Year Since
Fund
Inception12
Fund Performance *
Net Asset Value (NAV) 25.27% 25.27% 94.13% 9.96% 14.24% 11.11% 8.45%
After Tax Held 25.20% 25.20% 92.92% 9.27% 13.58% 10.53% 8.01%
After Tax Sold 14.96% 14.96% 55.55% 7.36% 11.06% 8.86% 6.84%
Market Price 25.24% 25.24% 94.26% 10.02% 14.24% 11.11% 8.45%
Index Performance **
Dow Jones Select MicroCap IndexSM 25.38% 25.38% 96.82% 10.86% 15.06% 11.85% 9.20%
Russell 2000® Index 12.70% 12.70% 94.85% 14.76% 16.35% 11.68% 9.63%
Quarter End Performance (as of 3/31/2021)
  3 Month YTD 1 Year 3 Year 5 Year 10 Year Since
Fund
Inception12
Fund Performance *
Net Asset Value (NAV) 25.27% 25.27% 94.13% 9.96% 14.24% 11.11% 8.45%
After Tax Held 25.20% 25.20% 92.92% 9.27% 13.58% 10.53% 8.01%
After Tax Sold 14.96% 14.96% 55.55% 7.36% 11.06% 8.86% 6.84%
Market Price 25.24% 25.24% 94.26% 10.02% 14.24% 11.11% 8.45%
Index Performance **
Dow Jones Select MicroCap IndexSM 25.38% 25.38% 96.82% 10.86% 15.06% 11.85% 9.20%
Russell 2000® Index 12.70% 12.70% 94.85% 14.76% 16.35% 11.68% 9.63%
3-Year Statistics (as of 3/31/2021)
  Standard Deviation Alpha Beta Sharpe Ratio Correlation
FDM 28.33% -4.32 1.05 0.43 0.95
Russell 2000® Index 25.70% --- 1.00 0.61 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 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. 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 Select MicroCap IndexSM 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.

Russell 2000® Index - The Index is comprised of the smallest 2000 companies in the Russell 3000 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 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
The Morningstar RatingTM for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The Morningstar Rating does not include any adjustment for sales loads. The top 10% of products in each product 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 Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.
5 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.
6 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.
7 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.
8 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.
9 Index yield represents the weighted average trailing 12-month dividend of the constituents of the Dow Jones Select MicroCap Index(SM).
10 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.
11 All market capitalization numbers are in USD$ Millions.
12 Inception Date is 9/27/2005

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 Select MicroCap 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. 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 COVID-19 pandemic may last for an extended period of time, and will continue to impact the economy for the foreseeable future.

The fund may invest in securities issued by companies concentrated in a particular industry. The fund invests in micro-capitalization companies which may be more vulnerable to adverse general market or economic developments, may be less liquid, and 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.

The Dow Jones Select Microcap Index℠ (“Index”) is a product of S&P Dow Jones Indices LLC or its affiliates (“SPDJI”) and has been licensed for use by First Trust. Standard & Poor’s® and S&P® are registered trademarks of Standard & Poor’s Financial Services LLC (“S&P”); Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”); and these trademarks have been licensed for use by SPDJI and sublicensed for certain purposes by First Trust. The Fund is not sponsored, endorsed, sold or promoted by SPDJI, Dow Jones, S&P, or their respective affiliates and none of such parties make any representation regarding the advisability of investing in such product nor do they have any liability for any errors, omissions, or interruptions of the Index.

©2021 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