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First Trust Latin America AlphaDEX® Fund (FLN)
Investment Objective/Strategy - The First Trust Latin America AlphaDEX® Fund 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 the Fund's fees and expenses, of an equity index called the NASDAQ AlphaDEX® Latin America Index.
There can be no assurance that the Fund's investment objectives will be achieved.
  • The NASDAQ AlphaDEX® Latin America Index is an "enhanced" index created and administered by Nasdaq, Inc. ("Nasdaq") which employs the AlphaDEX® stock selection methodology to select stocks from the NASDAQ Latin America Index that meet certain criteria.
  • To construct the Index, Nasdaq ranks the eligible stocks 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 the best style rank from the previous step as its selection score.
  • The top 50 stocks 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 and the top ranked quintiles receive a higher weight within the index. The stocks are equally weighted within each quintile.
  • Each stock is then tested in order of its selection score rank to check if the weight assigned to that stock is outside the country/sector weighting constraints, which are set at 15% above the benchmark weight.
    • If the weight assigned to the stock, when added with the weight assigned to all higher ranking stocks in its country/sector, is greater than the constraint, then the stock's weight is lowered to the highest rank in the next quintile. Stocks previously lower in rank then move up one rank. Such stocks in the lowest quintile that violate a constraint are removed from the portfolio and replaced by the highest scoring stock not originally selected, subject to country/sector constraints. This process continues until all the country/sector weightings meet the constraint.
  • The index is reconstituted and rebalanced semi-annually.
Fund Overview
TickerFLN
Fund TypeInternational Equity
Investment AdvisorFirst Trust Advisors L.P.
Investor Servicing AgentBrown Brothers Harriman
CUSIP33737J125
ISINUS33737J1253
Intraday NAVFLNIV
Fiscal Year-End12/31
ExchangeNasdaq
Inception4/18/2011
Inception Price$29.70
Inception NAV$29.70
Rebalance FrequencySemi-Annual
Expense Ratio0.80%
Current Fund Data (as of 7/23/2021)
Closing NAV1$19.43
Closing Market Price2$19.33
Bid/Ask Midpoint$19.34
Bid/Ask Discount0.46%
30-Day Median Bid/Ask Spread31.02%
Total Net Assets$9,712,777
Outstanding Shares500,002
Daily Volume824
Average 30-Day Daily Volume1,596
Closing Market Price 52-Week High/Low$21.08 / $14.65
Closing NAV 52-Week High/Low$21.06 / $14.63
Number of Holdings (excluding cash)50
Top Holdings (as of 7/23/2021)*
Holding Percent
Braskem SA (Preference A) 5.02%
Centrais Eletricas Brasileiras S.A. (Electrobras) 4.17%
Companhia Siderurgica Nacional S.A. (CSN) 4.08%
Itausa-Investimentos Itau SA (Preference Shares) 3.63%
CEMEX, S.A.B. de C.V. (Unit) 3.59%
JBS SA 3.48%
Gerdau S.A. (Preferred Shares) 3.44%
TIM SA (Brazil) 3.15%
Vale S.A. 3.15%
Arca Continental, S.A.B. de C.V. 3.05%

* Excluding cash.  Holdings are subject to change.

NAV History (Since Inception)
Past performance is not indicative of future results.
Overall Morningstar RatingTM (as of 6/30/2021)4

Among 22 funds in the Latin America Stock category. This fund was rated 3 stars/22 funds (3 years), 4 stars/19 funds (5 years), 4 stars/18 funds (10 years) based on risk adjusted returns.
Distribution Information
Dividend per Share Amt (as of 7/26/2021)5$0.1877
30-Day SEC Yield (as of 6/30/2021)61.50%
12-Month Distribution Rate (as of 6/30/2021)71.51%
Index Yield (as of 6/30/2021)82.82%
Fund Characteristics (as of 6/30/2021)10
Maximum Market Cap.$115,841
Median Market Cap.$10,731
Minimum Market Cap.$4,127
Price/Earnings11.44
Price/Book1.65
Price/Cash Flow7.71
Price/Sales1.29
Top Country Exposure (as of 7/23/2021)
Country Percent
Brazil 56.57%
Mexico 29.43%
Chile 12.21%
Colombia 1.79%
Bid/Ask Premium/Discount (as of 7/23/2021)
  2020 Q1 2021 Q2 2021 Q3 2021
Days Traded at Premium 92 11 7 0
Days Traded at Discount 161 50 56 16
Top Sector Exposure (as of 7/23/2021)
Materials 28.34%
Financials 18.39%
Consumer Staples 16.16%
Utilities 14.67%
Communication Services 6.82%
Energy 5.88%
Industrials 3.43%
Real Estate 2.88%
Consumer Discretionary 2.10%
Health Care 1.33%
Hypothetical Growth of $10,000 Since Inception (as of 7/23/2021) *


Month End Performance (as of 6/30/2021)
  3 Month YTD 1 Year 3 Year 5 Year 10 Year Since
Fund
Inception11
Fund Performance *
Net Asset Value (NAV) 12.36% 5.47% 41.41% 6.68% 8.16% -0.68% -0.56%
After Tax Held 11.94% 4.96% 40.45% 5.69% 6.49% -2.00% -1.85%
After Tax Sold 7.32% 3.23% 24.46% 4.69% 5.60% -1.10% -1.00%
Market Price 12.36% 5.12% 40.50% 6.70% 8.11% -0.79% -0.60%
Index Performance **
NASDAQ AlphaDEX® Latin America Index 12.48% 5.75% 43.70% 8.00% 9.74% N/A N/A
MSCI EM Latin America Index 15.01% 8.89% 44.92% 5.05% 5.89% -2.45% -2.37%
NASDAQ Latin America Index 16.76% 9.08% 46.76% 6.65% 6.54% N/A N/A
Quarter End Performance (as of 6/30/2021)
  3 Month YTD 1 Year 3 Year 5 Year 10 Year Since
Fund
Inception11
Fund Performance *
Net Asset Value (NAV) 12.36% 5.47% 41.41% 6.68% 8.16% -0.68% -0.56%
After Tax Held 11.94% 4.96% 40.45% 5.69% 6.49% -2.00% -1.85%
After Tax Sold 7.32% 3.23% 24.46% 4.69% 5.60% -1.10% -1.00%
Market Price 12.36% 5.12% 40.50% 6.70% 8.11% -0.79% -0.60%
Index Performance **
NASDAQ AlphaDEX® Latin America Index 12.48% 5.75% 43.70% 8.00% 9.74% N/A N/A
MSCI EM Latin America Index 15.01% 8.89% 44.92% 5.05% 5.89% -2.45% -2.37%
NASDAQ Latin America Index 16.76% 9.08% 46.76% 6.65% 6.54% N/A N/A
3-Year Statistics (as of 6/30/2021)
  Standard Deviation Alpha Beta Sharpe Ratio Correlation
FLN 32.93% 0.44 0.96 0.34 0.98
MSCI EM Latin America Index 32.62% -1.57 0.97 0.28 1.00
NASDAQ Latin America Index 33.60% --- 1.00 0.33 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 the NASDAQ AlphaDEX® Latin America 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 October 13, 2015, the fund's underlying index changed from the Defined Latin America Index to the NASDAQ AlphaDEX® Latin America 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.

MSCI EM Latin America Index - The Index is a free float-adjusted market capitalization-weighted index that is designed to measure the equity market performance of emerging markets in Latin America.

NASDAQ Latin America Index - The Index is a float adjusted market capitalization-weighted index that is designed to measure equity market performance of securities in countries located in Latin America.

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 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.
8 Index yield represents the weighted average trailing 12-month dividend of the constituents of the NASDAQ AlphaDEX® Latin America Index.
9 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.
10 All market capitalization numbers are in USD$ Millions.
11 Inception Date is 4/18/2011

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.

Risk Considerations

A fund's return may not match the return of its underlying index. A fund invests in securities included in the index regardless of investment merit and the securities held by a 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 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 discount to a fund's net asset value and possibly face delisting.

A fund's shares will change in value, and you could lose money by investing in a fund. One of the principal risks of investing in a fund is market risk. Market risk is the risk that a particular stock owned by a fund, fund shares or stocks in general may fall in value. There can be no assurance that a 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. While the development of vaccines has slowed the spread of the virus and allowed for the resumption of "reasonably" normal business activity in the United States, many countries continue to impose lockdown measures in an attempt to slow the spread. Additionally, there is no guarantee that vaccines will be effective against emerging variants of the disease.

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

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.

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

Depositary receipts may be less liquid than the underlying shares in their primary trading market.

Stocks with growth characteristics tend to be more volatile than certain other stocks and their prices may fluctuate more dramatically than the overall stock market.

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.

There is no assurance that the index provider or its agents will compile or maintain the index accurately.

The value of fund shares may be adversely affected by political, economic, and social instability, inadequate investor protection, changes in laws or regulations of countries within Latin America, international relations with other nations, natural disasters, corruption and military activity. The economies of many Latin American countries differ from the economies of more developed countries in many respects. Certain Latin American countries are highly dependent upon and may be affected by developments in the U.S., Europe and other Latin American economies.

Securities of non-U.S. issuers are 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. These risks may be heightened for securities of companies located in, or with significant operations in, emerging market countries.

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.

High portfolio turnover may result in higher levels of transaction costs and may generate greater tax liabilities for shareholders.

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.

Securities of small- and mid-capitalization companies may experience greater price volatility and be less liquid than larger, more established companies.

Trading on the exchange may be halted due to market conditions or other reasons. There can be no assurance that the requirements to maintain the listing of a fund on the exchange will continue to be met or be unchanged.

Value stocks are subject to the risk that valuations never improve or that the returns on value stocks are less than returns on other styles of investing or the overall stock market.

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® Latin America 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.

©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
 
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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