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 Emerging Markets Local Currency Bond ETF (FEMB)
Investment Objective/Strategy - The investment objective of the Fund is to seek maximum total return and current income. Under normal market conditions, the Fund seeks to achieve its investment objective by investing at least 80% of its net assets (including investment borrowings) in bonds, notes and bills issued or guaranteed by issuers in emerging market countries ("Debt Instruments") that are denominated in the local currency of the issuer.
There can be no assurance that the Fund's investment objectives will be achieved.
Fund Overview
TickerFEMB
Fund TypeEmerging Market Bonds
Investment AdvisorFirst Trust Advisors L.P.
Investor Servicing AgentBrown Brothers Harriman
Portfolio Manager/Sub-AdvisorFirst Trust Global Portfolios Limited
CUSIP33739P202
ISINUS33739P2020
Intraday NAVFEMBIV
Fiscal Year-End10/31
ExchangeNasdaq
Inception11/4/2014
Inception Price$50.00
Inception NAV$50.00
Expense Ratio0.85%
Current Fund Data (as of 6/27/2022)
Closing NAV1$27.00
Closing Market Price2$26.80
Bid/Ask Midpoint$26.86
Bid/Ask Discount0.54%
30-Day Median Bid/Ask Spread30.52%
Total Net Assets$213,279,020
Outstanding Shares7,900,002
Daily Volume16,855
Average 30-Day Daily Volume53,144
Closing Market Price 52-Week High/Low$35.10 / $26.73
Closing NAV 52-Week High/Low$35.12 / $27.00
Number of Holdings (excluding cash)56
Top Holdings (as of 6/27/2022)*
Holding Percent
REPUBLIC OF SOUTH AFRICA N/C, 10.50%, due 12/21/2026 5.21%
NOTA DO TESOURO NACIONAL N/C, 10%, due 01/01/2027 4.20%
INDONESIA GOVERNMENT N/C, 8.375%, due 09/15/2026 4.18%
MEX BONOS DESARR FIX RT N/C, 7.50%, due 06/03/2027 4.18%
NOTA DO TESOURO NACIONAL 10%, due 01/01/2025 3.97%
INDONESIA GOVERNMENT 9%, due 03/15/2029 3.80%
ASIAN DEVELOPMENT BANK N/C, 6.20%, due 10/06/2026 3.75%
TITULOS DE TESORERIA B N/C, 7.50%, due 08/26/2026 3.68%
ROMANIA GOVERNMENT BOND N/C, 4.50%, due 06/17/2024 3.62%
MALAYSIA GOVERNMENT N/C, 3.885%, due 08/15/2029 3.46%

* Excluding cash.  Holdings are subject to change.

Top Country Exposure (as of 6/27/2022)
Country Percent
Indonesia 13.52%
South Africa 11.16%
Brazil 10.29%
Colombia 8.56%
Malaysia 7.41%
Mexico 6.53%
Philippines 6.40%
Thailand 6.32%
Poland 5.85%
Romania 5.62%
NAV History (Since Inception)
Past performance is not indicative of future results.
Distribution Information
Dividend per Share Amt (as of 6/28/2022)4$0.1400
30-Day SEC Yield (as of 5/31/2022)56.96%
12-Month Distribution Rate (as of 5/31/2022)66.39%
Distribution Rate (as of 5/31/2022)75.88%
Fund Characteristics (as of 5/31/2022)
Weighted Average Effective Duration84.36 Years
Weighted Average Maturity5.97 Years
Weighted Average Coupon6.78%
Maturity Exposure (as of 5/31/2022)
Years Percent
0 - 3 Years 16.96%
3 - 5 Years 33.19%
5 - 7 Years 16.25%
7 - 10 Years 17.06%
10 - 15 Years 9.78%
15+ Years 3.15%
Cash 3.61%
Currency Exposure (as of 5/31/2022)
Exposure Percent
IDR 13.80%
BRL 12.93%
ZAR 11.74%
MXN 10.12%
COP 8.83%
INR 7.20%
THB 5.98%
PEN 5.97%
MYR 5.68%
PLN 5.13%
HUF 4.67%
RON 4.42%
PHP 4.09%
CLP 3.06%
KRW 1.93%
CNH 1.77%
CZK 1.32%
TRY 0.45%
ILS 0.07%
USD -9.16%
Bid/Ask Premium/Discount (as of 6/27/2022)
  2021 Q1 2022 Q2 2022 Q3 2022
Days Traded at Premium 149 42 5 ---
Days Traded at Discount 103 20 54 ---
Credit Quality (as of 5/31/2022)
Cash 3.61%
AAA 6.48%
AA 1.32%
AA- 0.59%
A+ 3.30%
A 10.81%
A- 5.39%
BBB+ 14.01%
BBB 15.84%
BBB- 13.83%
BB 11.39%
BB- 12.93%
B 0.50%
The ratings are by Standard & Poor's except where otherwise indicated. A credit rating is an assessment provided by a nationally recognized statistical rating organization (NRSRO) of the creditworthiness of an issuer with respect to debt obligations except for those debt obligations that are only privately rated. Ratings are measured on a scale that generally ranges from AAA (highest) to D (lowest). Investment grade is defined as those issuers that have a long-term credit rating of BBB- or higher. "NR" indicates no rating. 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.
Hypothetical Growth of $10,000 Since Inception (as of 6/27/2022) *


Month End Performance (as of 5/31/2022)
  3 Month YTD 1 Year 3 Year 5 Year 10 Year Since
Fund
Inception9
Fund Performance *
Net Asset Value (NAV) -4.45% -6.10% -14.84% -3.14% -2.16% N/A -1.84%
After Tax Held -5.04% -7.03% -16.82% -5.34% -4.45% N/A -4.09%
After Tax Sold -2.63% -3.60% -8.70% -3.16% -2.45% N/A -2.21%
Market Price -6.30% -6.45% -15.24% -3.43% -2.32% N/A -1.91%
Index Performance **
Bloomberg Emerging Markets Local Currency Government - 10% Country Capped Index -6.89% -8.87% -13.78% -1.38% -0.25% N/A -0.44%
JP Morgan GBI-EM Global Diversified Index -5.83% -10.55% -16.36% -2.63% -1.32% N/A -1.40%
Quarter End Performance (as of 3/31/2022)
  3 Month YTD 1 Year 3 Year 5 Year 10 Year Since
Fund
Inception9
Fund Performance *
Net Asset Value (NAV) -1.68% -1.68% -7.01% -1.67% -0.81% N/A -1.27%
After Tax Held -2.25% -2.25% -9.15% -3.89% -3.13% N/A -3.53%
After Tax Sold -0.99% -0.99% -4.08% -2.10% -1.50% N/A -1.84%
Market Price -1.67% -1.67% -7.01% -1.82% -0.92% N/A -1.29%
Index Performance **
Bloomberg Emerging Markets Local Currency Government - 10% Country Capped Index -4.60% -4.60% -5.99% 0.03% 1.23% N/A 0.17%
JP Morgan GBI-EM Global Diversified Index -6.46% -6.46% -8.53% -1.13% 0.18% N/A -0.84%
3-Year Statistics (as of 5/31/2022)
  Standard Deviation Alpha Beta Sharpe Ratio Correlation
FEMB 12.62% -0.38 1.02 -0.24 0.97
JP Morgan GBI-EM Global Diversified Index 12.01% --- 1.00 -0.22 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.

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.

Bloomberg Emerging Markets Local Currency Government - 10% Country Capped Index - The Index measures the performance of local currency Emerging Markets debt but caps country exposure to a maximum of 10%.

JP Morgan GBI-EM Global Diversified Index - The Index is an unmanaged, market-capitalization weighted, total-return index tracking the traded market for U.S.-dollar-denominated Brady bonds, Eurobonds, traded loans, and local market debt instruments issued by sovereign and quasi-sovereign entities.

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 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 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.
8 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.
9 Inception Date is 11/4/2014

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 SAI 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.

During periods of falling interest rates if an issuer calls higher-yielding debt instruments, a fund may be forced to invest the proceeds at lower interest rates, likely resulting in a decline in the fund's income.

A fund that effects all or a portion of its creations and redemptions for cash rather than in-kind may be less tax-efficient.

A fund may be subject to the risk that a counterparty will not fulfill its obligations which may result in significant financial loss to a fund.

An issuer or other obligated party of a debt security may be unable or unwilling to make dividend, interest and/or principal payments when due and the value of a security may decline as a result.

Ratings assigned by a credit rating agency are opinions of such entities, not absolute standards of credit quality and they do not evaluate risks of securities. Any shortcomings or inefficiencies in the process of determining credit ratings may adversely affect the credit ratings of the securities held by a fund and their perceived or actual credit risk.

The differences in yield between debt securities of different credit quality may increase which may reduce the market value of a fund's debt securities.

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.

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.

Investments in debt securities subject the holder to the credit risk of the issuer and the value of debt securities will generally change inversely with changes in interest rates. In addition, debt securities generally do not trade on a securities exchange making them less liquid and more difficult to value.

The use of derivatives instruments involves different and possibly greater risks than investing directly in securities including counterparty risk, valuation risk, volatility risk, and liquidity risk. Further, losses because of adverse movements in the price or value of the underlying asset, index or rate may be magnified by certain features of the derivatives.

Distressed securities are speculative and often illiquid or trade in low volumes and thus may be more difficult to value and pose a substantial risk of default.

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

Political or economic disruptions in European countries, even in countries in which a fund is not invested, may adversely affect security values and thus the fund's holdings. A significant number of countries in Europe are member states in the European Union, and the member states no longer control their own monetary policies. In these member states, the authority to direct monetary policies, including money supply and official interest rates for the Euro, is exercised by the European Central Bank. The implications of the United Kingdom's withdrawal from the European Union are difficult to gauge and cannot yet be fully known.

Extension risk is the risk that, when interest rates rise, certain obligations will be paid off by the issuer (or other obligated party) more slowly than anticipated, causing the value of these debt securities to fall. Rising interest rates tend to extend the duration of debt securities, making their market value more sensitive to changes in interest rates.

The market for forward contracts is substantially unregulated and can experience lengthy periods of illiquidity, unusually high trading volume and other negative impacts, such as political intervention. Forward contracts can increase a fund's risk exposure to underlying references and their attendant risks, such as credit risk, currency risk, market risk, and interest rate risk, while also exposing a fund to counterparty risk, liquidity risk and valuation risk, among others.

Forward foreign currency exchange contracts involve certain risks, including the risk of failure of the counterparty to perform its obligations under the contract and the risk that the use of forward contracts may not serve as a complete hedge because of an imperfect correlation between movements in the prices of the contracts and the prices of the currencies hedged.

The risk of a position in a futures contract may be very large compared to the relatively low level of margin a fund is required to deposit and a relatively small price movement in a futures contract may result in immediate and substantial loss relative to the size of margin deposit.

A Global Depositary Note ("GDN"), a form of depositary receipt, involves further risks due to certain features of GDNs. Certain investment restrictions in certain countries may limit the ability to convert bonds into GDNs and vice versa which may cause the bonds of the underlying issuer to trade at a discount or premium to the market price of the GDN. Distributions paid to holders of GDNs are usually subject to a fee.

High yield securities, or "junk" bonds, are less liquid and are subject to greater market fluctuations and risk of loss than securities with higher ratings, and therefore, are considered to be highly speculative.

A fund's income may decline when interest rates fall or if there are defaults in its portfolio.

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.

As inflation increases, the present value of a fund's assets and distributions may decline.

Interest rate risk is the risk that the value of the debt securities in a fund's portfolio will decline because of rising interest rates. Interest rate risk is generally lower for shorter term debt securities and higher for longer-term debt securities.

The economies of Latin American countries have in the past experienced considerable difficulties, including high inflation rates, high interest rates, high unemployment, government overspending and political instability. International economic conditions, particularly those in the United States, Europe and Asia, as well as world prices for oil and other commodities may also influence the development of Latin American economies. Many Latin American countries are highly reliant on the exportation of commodities and their economies may be significantly impacted by fluctuations in commodity prices and the global demand for certain commodities.

Certain fund investments may be subject to restrictions on resale, trade over-the-counter or in limited volume, or lack an active trading market. Illiquid securities may trade at a discount and may be subject to wide fluctuations in market value.

The portfolio managers of an actively managed portfolio will apply investment techniques and risk analyses that may not have the desired result.

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, or other events could have significant negative impact on a fund. 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 could have a significant impact on certain fund investments as well as fund performance. The COVID-19 global pandemic has caused and may continue to cause significant volatility and declines in global financial markets. While the U.S. has resumed "reasonably" normal business activity, many countries continue to impose lockdown measures. Additionally, there is no guarantee that vaccines will be effective against emerging variants of the disease.

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.

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.

The prices of options are volatile and the effective use of options depends on a fund's ability to terminate option positions at times deemed desirable to do so. There is no assurance that a fund will be able to effect closing transactions at any particular time or at an acceptable price.

Because OTC derivatives do not trade on an exchange, the parties to an OTC derivative face heightened levels of counterparty risk, liquidity risk and valuation risk.

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.

Prepayment risk is the risk that the issuer of a debt security will repay principal prior to the scheduled maturity date. Debt securities allowing prepayment may offer less potential for gains during a period of declining interest rates, as a fund may be required to reinvest the proceeds of any prepayment at lower interest rates.

A fund with significant exposure to a single asset class, country, region, industry, or sector may be more affected by an adverse economic or political development than a broadly diversified fund.

Investments in sovereign bonds involve special risks because the governmental authority that controls the repayment of the debt may be unwilling or unable to repay the principal and/or interest when due. In times of economic uncertainty, the prices of these securities may be more volatile than those of corporate debt or other government debt obligations.

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.

A fund may hold securities or other assets that may be valued on the basis of factors other than market quotations. This may occur because the asset or security does not trade on a centralized exchange, or in times of market turmoil or reduced liquidity. Portfolio holdings that are valued using techniques other than market quotations, including "fair valued" assets or securities, may be subject to greater fluctuation in their valuations from one day to the next than if market quotations were used. There is no assurance that a fund could sell or close out a portfolio position for the value established for it at any time.

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.

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)
Home |  Important Legal Information |  Privacy Policy |  California Privacy Policy |  Business Continuity Plan |  FINRA BrokerCheck
Copyright © 2022 All rights reserved.