Home   Logon   Mobile Site   Research and Commentary   About Us   Call 1.800.621.1675 or Email Us       Follow Us: 

Search by Ticker, Keyword or CUSIP       
First Trust Preferred Securities and Income Fund (FPERX)
Investment Objective/Strategy - The First Trust Preferred Securities and Income Fund seeks to provide current income and total return by investing, under normal market conditions, at least 80% of its net assets (including investment borrowings) in preferred securities and other securities with similar economic characteristics.
There can be no assurance that the Fund's investment objectives will be achieved. The Fund may not be appropriate for all investors.
Fund Overview
Fund TypePreferred Income
Investment AdvisorFirst Trust Advisors L.P.
Portfolio Manager/Sub-AdvisorStonebridge Advisors LLC
Share ClassClass R3
Fiscal Year-End10/31
Inception Date3/2/2011
Gross Expense Ratio*4.01%
Net Expense Ratio*1.65%
* As of 3/1/2019
Pursuant to contract, First Trust has agreed to waive fees and/or pay fund expenses to prevent the net expense ratio of any class of shares of the fund from exceeding 1.15% per year, excluding 12b-1 distribution and service fees, acquired fund fees and expenses and certain other expenses as described in the prospectus, through 2/28/2020, and to not exceed 1.50% per year from 3/01/2020 through 2/28/2029. Net expense ratio shown above includes acquired fund fees and certain other expenses as described in the prospectus.
Current Fund Data (as of 10/15/2019)
Net Asset Value1$21.91
Total Net Assets$277,654,150
Outstanding Shares34,594
NAV 52-Week High/Low$21.91 / $20.03
Top 10 Holdings (as of 9/30/2019)9
Holding Percent
US Dollars 5.03%
Emera, Inc., 6.75%, 6/15/76 3.08%
Enel S.p.A., 8.75%, 9/24/73 2.20%
NiSource, Inc., 5.65% 1.89%
Credit Agricole S.A., 7.88% 1.83%
Royal Bank of Scotland Group PLC, 8.63% 1.70%
ING Groep NV, 6.88% 1.65%
Barclays PLC, 7.88% 1.51%
Catlin Insurance Co. Ltd., 5.28% 1.46%
Credit Agricole S.A., 8.13% 1.46%
To download all holdings, click here.
Industry Breakdown (as of 9/30/2019)9
Industry Percent
Banks 45.97%
Insurance 14.72%
Capital Markets 6.33%
Electric Utilities 5.94%
Multi-Utilities 5.18%
Oil, Gas & Consumable Fuels 4.69%
Food Products 4.42%
Energy Equipment & Services 2.31%
Real Estate Investment Trusts (REITs) 1.95%
Mortgage Real Estate Investment Trusts (REITs) 1.69%
Diversified Financial Services 1.42%
Diversified Telecommunication Services 1.33%
Transportation Infrastructure 1.04%
Metals & Mining 1.01%
Gas Utilities 0.56%
Trading Companies & Distributors 0.50%
Consumer Finance 0.47%
Real Estate Management & Development 0.26%
Thrifts & Mortgage Finance 0.21%
Security Type Breakdown (as of 9/30/2019)9
Security Percent
Fixed-to-Floating Rate and Fixed-to-Variable Rate Securities 79.29%
Fixed Rate Securities 12.50%
Floating Rate Securities 7.99%
Step-up Rate Securities 0.22%
Fund Characteristics (as of 9/30/2019)9
Weighted Average Effective Duration63.77 Years
% Institutional Securities (e.g. $1000 par)783.37%
% Retail Securities (e.g. $25 par)816.63%
NAV History (Since Inception)
Past performance is not indicative of future results.
Distribution Information
Dividend FrequencyMonthly
Dividend per Share Amt (as of 10/16/2019)2$0.0909
30-Day SEC Yield (as of 9/30/2019)34.30%
Unsubsidized 30-Day SEC Yield (as of 9/30/2019)41.38%
Distribution Rate (as of 9/30/2019)55.00%
Credit Quality Breakdown (as of 9/30/2019)9
  Credit Quality Percent
A- 2.72%
BBB+ 8.60%
BBB 16.16%
BBB- 27.80%
BB+ 24.47%
BB 10.82%
BB- 3.64%
B+ 1.25%
B 0.16%
NR 4.38%
The credit quality and ratings information presented above reflect the ratings assigned by one or more nationally recognized statistical rating organizations (NRSROs), including Standard & Poor's Rating Group, a division of the McGraw Hill Companies, Inc., Moody's Investors Service, Inc., Fitch Ratings, or a comparably rated NRSRO. For situations in which a security is rated by more than one NRSRO and the ratings are not equivalent, the highest ratings are used. Sub-investment grade ratings are those rated BB+/Ba1 or lower. Investment grade ratings are those rated BBB-/Baa3 or higher. 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. Credit ratings are subject to change.
Country Breakdown (as of 9/30/2019)9
Country Percent
United States 43.63%
United Kingdom 10.14%
Canada 9.05%
France 8.39%
Italy 4.67%
Switzerland 4.22%
Netherlands 4.14%
Bermuda 3.99%
Australia 3.70%
Japan 2.50%
Spain 1.51%
Mexico 1.45%
Finland 1.13%
Denmark 0.87%
Sweden 0.61%
Month End Performance (as of 9/30/2019)
  3 Month YTD 1 Year 3 Year 5 Year 10 Year Since
Fund Performance *
Fund Performance 2.87% 12.90% 8.52% 5.62% 5.90% N/A 6.17%
Index Performance **
ICE BofAML Fixed Rate Preferred Securities Index 3.06% 15.40% 10.15% 5.50% 6.66% N/A 6.59%
ICE BofAML U.S. Capital Securities Index 3.46% 14.94% 12.04% 5.86% 5.34% N/A 6.74%
Blended Benchmark 3.26% 15.18% 11.10% 5.69% 6.01% N/A 6.68%
Quarter End Performance (as of 9/30/2019)
  3 Month YTD 1 Year 3 Year 5 Year 10 Year Since
Fund Performance *
Fund Performance 2.87% 12.90% 8.52% 5.62% 5.90% N/A 6.17%
Index Performance **
ICE BofAML Fixed Rate Preferred Securities Index 3.06% 15.40% 10.15% 5.50% 6.66% N/A 6.59%
ICE BofAML U.S. Capital Securities Index 3.46% 14.94% 12.04% 5.86% 5.34% N/A 6.74%
Blended Benchmark 3.26% 15.18% 11.10% 5.69% 6.01% N/A 6.68%

*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. Returns are average annualized total returns, except those for periods of less than one year, which are cumulative.

**Index performance information is for illustrative purposes only. Indexes do not charge management fees or brokerage expenses and no such fees or expenses were deducted from the performance shown. All Index returns assume that dividends are reinvested when they are received. Indexes are unmanaged and an investor cannot invest directly in an index.

ICE BofAML Fixed Rate Preferred Securities Index - The Index tracks the performance of fixed rate US dollar denominated preferred securities issued in the US domestic market.

ICE BofAML U.S. Capital Securities Index - The Index is a subset of the ICE BofAML U.S. Corporate Index including all fixed-to-floating rate, perpetual callable and capital securities.

Blended Benchmark - The Benchmark consists of a 50/50 blend of the ICE BofAML Fixed Rate Preferred Securities Index and the ICE BofAML U.S. Capital Securities Index. The Blended Benchmark was added to reflect the diverse allocation of institutional preferred and hybrid securities in the fund's portfolio.

1 The NAV represents the fund's net assets (assets less liabilities) divided by the fund's outstanding shares .
2 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.
3 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.
4 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.
5 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.
6 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.
7 Institutional Securities are predominantly $1000 par securities and only trade over-the-counter.
8 Retail Securities are predominantly $25 par securities but also include exchange-traded $20, $50, and $100 par securities.
9 Market value information used in calculating the percentages is based upon trade date plus one recording of transactions, which can differ from regulatory financial reports (Forms N-CSR and N-PORT Part F) that are based on trade date recording of security transactions. Holdings are subject to change.
10 Inception Date is 3/2/2011

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.

The Fund is subject to the following risks:

You could lose money by investing in the Fund. An investment in the Fund is not a deposit of a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other governmental agency.

A mutual fund's share price and investment return will vary with market conditions, and the principal value of an investment when you sell your shares may be more or less than the original cost.

The Fund is subject to call risk, credit risk, income risk, interest rate risk, inflation risk, prepayment risk and extension risk. Call risk is the risk that, during periods of falling interest rates, performance could be adversely impacted if an issuer calls higher-yielding debt instruments earlier than their scheduled maturity. Credit risk is the risk that an issuer may default on its obligation to make principal and/or interest payments when due. Credit risk is heightened for high-yield securities. 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 debt securities will decline because of rising interest rates. Inflation risk is the risk that the value of assets or income from investments will be less in the future. 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. Extension risk is the risk that when interest rates rise, certain obligations will be paid off by the issuer (or obligor) more slowly than anticipated, causing the value of these securities to fall. Each of these risks may have an adverse effect on the Fund's total return.

From time to time, spreads (i.e., the difference in yield between debt securities that have different credit qualities or other differences) may increase, which may reduce the market value of some of the Fund's debt securities.

Fund transactions involving a counterparty are subject to the risk that the counterparty will not fulfill its obligation to the Fund.

The use of leveraged derivatives can magnify potential for gain or loss and, therefore, amplify the effects of market volatility on share price.

Securities with a floating or variable interest rate component can be less sensitive to interest rate changes than securities with fixed interest rates but may decline in value if their interest rates do not rise as much, or as quickly, as interest rates in general.

Claims of holders of hybrid capital securities of an issuer are generally subordinated to those of holders of traditional debt securities in bankruptcy, and thus hybrid capital securities may be more volatile and subject to greater risks than traditional debt securities.

The Fund is subject to market risk which is the risk that a particular security owned by the Fund or shares of the Fund in general may fall in value.

The Fund may invest in securities issued by companies concentrated in a particular industry, sector or geographical location which involves additional risks including limited diversification.

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.

The Fund may invest in depositary receipts which may be less liquid than the underlying shares in their primary trading market.

Actively managed funds are subject to the risk that the advisor or sub-advisor will apply investment techniques that may not have the desired result.

Changes in currency exchange rates and the relative value of non-U.S. currencies may affect the value of the Fund's investments and the value of the Fund's shares.

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

High-yield securities or "junk" bonds are subject to greater market fluctuations and risk of loss than securities with higher ratings, and therefore, are considered to 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 or principal at maturity.

The Fund may hold certain investments that may be subject to restrictions on resale, trade over-the-counter or in limited volume, or lack an active trading market. The Fund may not be able to sell or close out of such investments at favorable times or prices (or at all). Illiquid securities may trade at a discount than more liquid investments and may be subject to wide fluctuations in market value.

A convertible security tends to perform more like a stock when the underlying stock price is high relative to the conversion price and more like a debt security when the underlying stock price is low relative to the conversion price.

Contingent convertible securities ("CoCos") may provide for mandatory conversion into common stock of the issuer under certain circumstances. Since the common stock of the issuer may not pay a dividend, investors in these instruments could experience a reduced income rate, potentially to zero; and conversion would deepen the subordination of the investor, hence worsening standing in a bankruptcy.

Preferred securities are typically subordinated to bonds and other debt instruments in a company's capital structure, in terms of priority to corporate income, and therefore will be subject to greater credit risk than those debt instruments.

Real estate investment trusts (REITs) and other real estate related companies are subject to certain risks, including changes in the real estate market, vacancy rates and competition, volatile interest rates and economic recession.

There is no central place or exchange for trading most debt securities. Debt securities generally trade on an "over-the-counter" market and therefore, the valuation of debt securities may carry more uncertainty and risk than that of publicly traded securities.

The Fund may be unable to sell a restricted security on short notice or may be able to sell them only at a price below current value.

Please see the Fund's prospectus for a complete description of the risks of investing in the Fund.

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 advisors are responsible for evaluating investment risks independently and for exercising independent judgment in determining whether investments are appropriate for their clients.
First Trust Portfolios L.P.  Member SIPC and FINRA.
First Trust Advisors L.P.
Home |  Important Legal Information |  Privacy Policy |  Business Continuity Plan |  FINRA BrokerCheck
Copyright © 2019 All rights reserved.