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First Trust Nasdaq Oil & Gas ETF (FTXN)
Investment Objective/Strategy - The First Trust Nasdaq Oil & Gas ETF 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 index called the Nasdaq US Smart Oil & Gas Index. The Fund seeks to replicate the holdings and weightings of the Nasdaq US Smart Oil & Gas Index so as to generate performance results 95% correlated to that of the Nasdaq US Smart Oil & Gas Index.
There can be no assurance that the Fund's investment objectives will be achieved.
  • The Nasdaq US Smart Oil & Gas Index is a modified factor weighted index created and administered by Nasdaq, Inc. ("Nasdaq") designed to provide exposure to US companies within the oil and gas industry.
  • Nasdaq selects the 50 most liquid eligible oil and gas securities from the NASDAQ US Benchmark Index and then ranks those securities based on three factors:
    • Volatility – trailing 12-month price fluctuation.
    • Value – cash flow to price.
    • Growth – the 3-, 6-, 9-, and 12-month average price appreciation.
  • The securities are weighted based on their score on the three factors.
  • The index weighting methodology includes caps to prevent high concentrations among single stocks.
  • The index is reconstituted annually and rebalanced quarterly.
Fund Overview
Fund TypeEnergy
Investment AdvisorFirst Trust Advisors L.P.
Investor Servicing AgentBrown Brothers Harriman
Fiscal Year-End03/31
Inception Price$19.84
Inception NAV$19.84
Rebalance FrequencyQuarterly
Expense Ratio0.60%
Current Fund Data (as of 9/17/2020)
Closing NAV1$10.51
Closing Market Price2$10.46
Bid/Ask Midpoint$10.51
Bid/Ask Discount0.02%
Total Net Assets$17,861,957
Outstanding Shares1,700,002
Daily Volume2,212
Average 30-Day Daily Volume5,899
Closing Market Price 52-Week High/Low$16.67 / $6.66
Closing NAV 52-Week High/Low$16.66 / $6.75
Number of Holdings (excluding cash)46
Fund Characteristics (as of 8/31/2020)8
Maximum Market Cap.$168,876
Median Market Cap.$4,553
Minimum Market Cap.$264
Price/Cash Flow4.54
Top Holdings (as of 9/18/2020)*
Holding Percent
Range Resources Corporation 8.78%
Cabot Oil & Gas Corporation 8.60%
Cheniere Energy, Inc. 8.17%
EQT Corporation 7.25%
Exxon Mobil Corporation 7.00%
CNX Resources Corporation 4.37%
The Williams Companies, Inc. 4.20%
Kinder Morgan, Inc. 3.98%
Chevron Corporation 3.92%
Equitrans Midstream Corporation 3.78%

* Excluding cash.  Holdings are subject to change.

NAV History (Since Inception)
Past performance is not indicative of future results.
Overall Morningstar RatingTM (as of 8/31/2020)3

Among 78 funds in the Equity Energy category. This fund was rated 4 stars/78 funds (3 years) based on risk adjusted returns.
Distribution Information
Dividend per Share Amt (as of 9/20/2020)4$0.0886
30-Day SEC Yield (as of 8/31/2020)54.38%
12-Month Distribution Rate (as of 8/31/2020)62.81%
Index Yield (as of 8/31/2020)73.59%
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 62 0 0 0
3/31/2020 34 1 1 0
12/31/2019 31 0 0 0
9/30/2019 35 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 1 0 0 0
3/31/2020 25 1 0 0
12/31/2019 33 0 0 0
9/30/2019 29 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 Industry Exposure (as of 9/18/2020)
Exploration & Production 58.57%
Pipelines 23.19%
Integrated Oil & Gas 14.33%
Oil Equipment & Services 3.91%
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) -0.79% -32.52% -25.51% -11.92% N/A N/A -12.06%
After Tax Held -1.12% -32.80% -26.20% -12.69% N/A N/A -12.76%
After Tax Sold -0.47% -19.26% -15.02% -8.96% N/A N/A -8.89%
Market Price -1.14% -32.40% -25.46% -11.94% N/A N/A -12.06%
Index Performance **
Nasdaq US Smart Oil & Gas Index -0.82% -32.43% -25.20% -11.41% N/A N/A -11.56%
Nasdaq US Benchmark Oil & Gas Index -4.86% -37.74% -31.67% -13.36% N/A N/A -11.37%
NASDAQ US Benchmark Index 16.13% 9.88% 21.87% 14.16% N/A N/A 15.25%
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) 34.55% -34.16% -36.94% -13.52% N/A N/A -13.14%
After Tax Held 34.10% -34.44% -37.53% -14.27% N/A N/A -13.85%
After Tax Sold 20.45% -20.23% -21.79% -10.07% N/A N/A -9.65%
Market Price 35.01% -33.98% -36.84% -13.51% N/A N/A -13.12%
Index Performance **
Nasdaq US Smart Oil & Gas Index 34.81% -34.08% -36.63% -12.98% N/A N/A -12.62%
Nasdaq US Benchmark Oil & Gas Index 33.09% -34.98% -36.17% -12.98% N/A N/A -10.83%
NASDAQ US Benchmark Index 22.14% -3.14% 6.96% 10.21% N/A N/A 12.17%
3-Year Statistics (as of 8/31/2020)
  Standard Deviation Alpha Beta Sharpe Ratio Correlation
FTXN 40.26% -29.95 1.79 -0.16 0.82
Nasdaq US Benchmark Oil & Gas Index 36.10% -31.13 1.66 -0.26 0.84
NASDAQ US Benchmark Index 18.26% --- 1.00 0.71 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.

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 US Smart Oil & Gas 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.

Nasdaq US Benchmark Oil & Gas Index - The Index is a float adjusted market capitalization-weighted index which includes securities in the US Benchmark Index that are classified in the Oil & Gas Industry according to the Industry Classification Benchmark.

NASDAQ US Benchmark Index - The Index is a float adjusted market capitalization-weighted index designed to track the performance of securities assigned to the United States.

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).
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.
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 Index yield represents the weighted average trailing 12-month dividend of the constituents of the Nasdaq US Smart Oil & Gas Index.
8 All market capitalization numbers are in USD$ Millions.
9 Inception Date is 9/20/2016

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 US Smart Oil & Gas Index.  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.

The fund is concentrated in securities of the oil and gas industry. General problems of the oil & gas industry include volatile fluctuations in price and supply of energy fuels, international politics, terrorist attacks, reduced demand as a result of increases in energy efficiency and energy conservation, the success of exploration projects, clean-up and litigation costs relating to oil spills and environmental damage, and tax and other regulatory policies of various governments. Oil production and refining companies are subject to extensive federal, state and local environmental laws and regulations regarding air emissions and the disposal of hazardous materials. Friction with certain oil producing countries, and between the governments of the United States and other major exporters of oil to the United States, or policy shifts by governmental entities and intergovernmental entities such as OPEC, could put oil exports at risk. In addition, falling oil and gas prices may negatively impact the profitability and business prospects of certain energy companies. Further, global concerns of civil unrest in foreign countries may also affect the flow of oil from such countries.

The fund currently has fewer assets than larger funds, and like other relatively new funds, large inflows and outflows may impact a fund's market exposure for limited periods of time.

The fund is classified as "non-diversified" and may invest a relatively high percentage of its assets in a limited number of issuers. As a result, the 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.

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 US Smart Oil & Gas 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. 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.

©2020 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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