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First Trust NASDAQ® ABA Community Bank Index Fund (QABA)
Investment Objective/Strategy - The First Trust NASDAQ® ABA Community Bank Index Fund is an exchange-traded fund. The objective of the Fund is to seek investment results that correspond generally to the price and yield, before the Fund's fees and expenses, of an equity index called the NASDAQ OMX® ABA Community Bank IndexSM.
There can be no assurance that the Fund's investment objectives will be achieved.
  • The index is a market capitalization-weighted index that includes the common stock of all Nasdaq® listed banks and thrifts or their holding companies that are designated as banks by the Industry Classification Benchmark (or that which the American Bankers Association determines should be classified as such), but excluding:
    • Any of the 50 largest banks or thrifts and their holding companies based on asset size as determined by the most recently available call report data as compiled by the FDIC.
    • Any banks or thrifts classified as having an "international specialization" or a "credit-card specialization" as determined by the most recently available call report data as compiled by the FDIC, provided that such institutions constitute the majority of assets if in a holding company.
  • A security must have a market capitalization of at least $200 million and a three-month average daily dollar trading volume of at least $500 thousand.
  • In addition, a security must meet certain operating history, solvency, and financial statement requirements to remain eligible for inclusion in the index.
  • The index is rebalanced quarterly and reconstituted semi-annually.
Fund Overview
Fund TypeCommunity Bank
Investment AdvisorFirst Trust Advisors L.P.
Investor Servicing AgentBank of New York Mellon
Fiscal Year-End12/31
Inception Price$20.00
Inception NAV$20.00
Rebalance FrequencyQuarterly
Gross Expense Ratio*0.60%
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 9/25/2020)
Closing NAV1$30.87
Closing Market Price2$30.85
Bid/Ask Midpoint$30.86
Bid/Ask Discount0.04%
Total Net Assets$55,571,763
Outstanding Shares1,800,002
Daily Volume10,038
Average 30-Day Daily Volume14,157
Closing Market Price 52-Week High/Low$52.47 / $28.57
Closing NAV 52-Week High/Low$52.54 / $28.64
Number of Holdings (excluding cash)162
Fund Characteristics (as of 8/31/2020)8
Maximum Market Cap.$6,644
Median Market Cap.$589
Minimum Market Cap.$183
Price/Cash Flow10.15
Top Holdings (as of 9/25/2020)*
Holding Percent
Commerce Bancshares, Inc. 3.96%
TFS Financial Corporation 2.65%
First Financial Bankshares, Inc. 2.55%
BOK Financial Corporation 2.31%
South State Corporation 2.18%
Glacier Bancorp, Inc. 1.96%
Popular, Inc. 1.95%
First Citizens BancShares, Inc. (Class A) 1.80%
United Bankshares, Inc. 1.79%
Valley National Bancorp 1.79%

* 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 9/26/2020)3$0.2565
30-Day SEC Yield (as of 8/31/2020)43.02%
Unsubsidized 30-Day SEC Yield (as of 8/31/2020)52.95%
12-Month Distribution Rate (as of 8/31/2020)63.46%
Index Yield (as of 8/31/2020)73.72%
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
Basis Points
Basis Points
Basis Points
6/30/2020 16 0 0 0
3/31/2020 6 0 0 0
12/31/2019 13 0 0 0
9/30/2019 14 0 0 0
Number of Days Bid/Ask Midpoint Below NAV
Quarter Ended 0-49
Basis Points
Basis Points
Basis Points
Basis Points
6/30/2020 47 0 0 0
3/31/2020 56 0 0 0
12/31/2019 51 0 0 0
9/30/2019 50 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 State Exposure (as of 8/31/2020)
State Percent
California 9.17%
Texas 7.15%
Missouri 6.63%
Indiana 4.70%
New York 4.53%
Arkansas 4.39%
Ohio 4.28%
Illinois 3.92%
New Jersey 3.91%
Washington 3.74%
Month End Performance (as of 8/31/2020)
  3 Month YTD 1 Year 3 Year 5 Year 10 Year Since
Fund Performance *
Net Asset Value (NAV) -0.57% -31.64% -21.40% -8.33% 0.25% 7.19% 6.78%
After Tax Held -0.95% -32.13% -22.34% -9.12% -0.51% 6.48% 6.11%
After Tax Sold -0.33% -18.74% -12.59% -6.45% -0.07% 5.51% 5.22%
Market Price -0.54% -31.58% -21.30% -8.30% 0.26% 7.19% 6.79%
Index Performance **
NASDAQ OMX ABA Community Bank IndexSM -0.35% -31.32% -20.84% -7.75% 0.88% 7.88% 7.47%
Russell 3000® Index 15.93% 9.39% 21.44% 13.95% 13.86% 14.94% 14.88%
S&P Composite 1500 Financials Index 7.57% -18.01% -5.74% 2.20% 7.70% 10.63% 10.93%
Quarter End Performance (as of 6/30/2020)
  3 Month YTD 1 Year 3 Year 5 Year 10 Year Since
Fund Performance *
Net Asset Value (NAV) 8.95% -30.64% -24.10% -9.39% -0.47% 6.33% 7.03%
After Tax Held 8.53% -31.13% -25.01% -10.17% -1.22% 5.63% 6.35%
After Tax Sold 5.30% -18.15% -14.20% -7.21% -0.61% 4.79% 5.41%
Market Price 9.19% -30.64% -24.11% -9.38% -0.48% 6.30% 7.03%
Index Performance **
NASDAQ OMX ABA Community Bank IndexSM 9.18% -30.40% -23.60% -8.82% 0.15% 7.01% 7.72%
Russell 3000® Index 22.03% -3.48% 6.53% 10.04% 10.03% 13.72% 13.82%
S&P Composite 1500 Financials Index 12.23% -23.82% -14.69% -0.35% 5.29% 9.69% 10.37%
3-Year Statistics (as of 8/31/2020)
  Standard Deviation Alpha Beta Sharpe Ratio Correlation
QABA 24.73% -10.25 1.04 -0.29 0.92
S&P Composite 1500 Financials Index 21.77% --- 1.00 0.13 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 OMX ABA Community Bank 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 3000® Index - The Index is comprised of the 3000 largest and most liquid stocks based and traded in the U.S.

S&P Composite 1500 Financials Index - The Index is a capitalization-weighted index of companies classified by GICS as financials within the S&P Composite 1500 Index.

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 OMX ABA Community Bank Index(SM).
8 All market capitalization numbers are in USD$ Millions.
9 Inception Date is 6/29/2009

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 OMX ABA Community Bank 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 small capitalization and mid capitalization companies. Such companies may experience greater price volatility than larger, more established companies.

Community banks were significantly impacted by the decline in the subprime mortgage lending market in the U.S. which brought about legislative and regulatory changes, changes in short-term and long-term interest rates, inflation and changes in government monetary and fiscal policies. Unlike larger national or other regional banks that are more geographically diversified, a community bank's financial performance may be highly dependent upon the business environment in certain geographic regions of the U.S. and may be adversely impacted by any downturn or unfavorable economic or employment developments in its local market and the U.S. as a whole.

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® , NASDAQ OMX®, OMX®, American Bankers Association®, ABA® and the NASDAQ OMX ® ABA® Community Bank IndexSM are registered trademarks and service marks of Nasdaq, Inc. and American Bankers Association (together with its affiliates hereinafter referred to as the “Corporations”) and are licensed for use by First Trust. 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.

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.
First Trust Portfolios L.P.  Member SIPC and FINRA. (Form CRS)   •  First Trust Advisors L.P. (Form CRS)
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