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First Trust Indxx Medical Devices ETF (MDEV)
Investment Objective/Strategy - The First Trust Indxx Medical Devices ETF (the "Fund") seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of an index called the Indxx Global Medical Equipment Index (the "Index"). The Fund will normally invest at least 80% of its net assets (including net assets plus any borrowings for investment purposes) in the common stocks and depositary receipts that comprise the Index. The Fund, using an indexing investment approach, attempts to replicate, before fees and expenses, the performance of the Index. The Index is developed, maintained and sponsored by Indxx, Inc. (the "Index Provider").
There can be no assurance that the Fund's investment objectives will be achieved.
Index Description According to the Index Provider
  • The Indxx Global Medical Equipment Index (the “index”) is designed to track the performance of companies that are trading in the medical devices industry. The index begins with a universe of common stocks and depositary receipts of companies listed on a global securities exchange and issued by companies operating in both developed and emerging market countries.
  • To be considered for the index, companies must meet the following criteria:
    • Minimum market capitalization of $500 million;
    • Six-month average daily turnover value of at least $2 million;
    • Traded on at least 90% of the eligible trading days in the last 6 months or in the past 3 months for a security recently issued in an initial public offering;
    • Minimum free float of 10% of shares outstanding;
    • A share price of less than $10,000 for new index constituents.
  • Eligible securities from medical device companies that derive a minimum of 50% of their total revenue from business activities associated with medical equipment are ranked based upon their market capitalization.
    • The top 50 companies are selected.
  • Securities selected for inclusion in the index are weighted equally.
  • The index is rebalanced semi-annually and reconstituted annually.
Fund Overview
TickerMDEV
Fund TypeHealth Care
Investment AdvisorFirst Trust Advisors L.P.
Investor Servicing AgentBank of New York Mellon Corp
CUSIP33738R639
ISINUS33738R6392
Intraday NAVMDEVIV
Fiscal Year-End03/31
ExchangeCboe BZX
Inception6/22/2021
Inception Price$25.17
Inception NAV$25.17
Rebalance FrequencySemi-Annual
Expense Ratio*0.70%
* As of 8/1/2023
Current Fund Data (as of 6/21/2024)
Closing NAV1$19.99
Closing Market Price2$20.01
Bid/Ask Midpoint$19.99
Bid/Ask Premium0.00%
30-Day Median Bid/Ask Spread30.30%
Total Net Assets$2,998,676
Outstanding Shares150,002
Daily Volume1,043
Average 30-Day Daily Volume678
Closing Market Price 52-Week High/Low$21.51 / $16.37
Closing NAV 52-Week High/Low$21.49 / $16.32
Number of Holdings (excluding cash)50
NAV History (Since Inception)
Past performance is not indicative of future results.
Distribution Information
30-Day SEC Yield (as of 5/31/2024)40.14%
Index Yield (as of 5/31/2024)50.85%
Fund Characteristics (as of 5/31/2024)6
Maximum Market Cap.$216,807
Median Market Cap.$19,363
Minimum Market Cap.$6,609
Price/Earnings39.74
Price/Book3.61
Price/Cash Flow22.24
Price/Sales3.98
Top Holdings (as of 6/21/2024)*
Holding Percent
Koninklijke Philips N.V. 2.71%
Globus Medical, Inc. (Class A) 2.68%
Fisher & Paykel Healthcare Corporation Limited 2.47%
Insulet Corporation 2.42%
Mettler-Toledo International Inc. 2.39%
Boston Scientific Corporation 2.37%
Intuitive Surgical, Inc. 2.34%
Olympus Corporation 2.34%
Hoya Corporation 2.30%
ResMed Inc. 2.30%

* Excluding cash.  Holdings are subject to change.

Bid/Ask Premium/Discount (as of 6/21/2024)
  2023 Q1 2024 Q2 2024 Q3 2024
Days Traded at Premium 193 60 58 ---
Days Traded at Discount 57 1 0 ---
Top Industry Exposure (as of 6/21/2024)
Health Care Equipment & Supplies 76.91%
Life Sciences Tools & Services 19.60%
Health Care Providers & Services 2.21%
Biotechnology 1.28%
Hypothetical Growth of $10,000 Since Inception (as of 6/20/2024) *
Tracking Index: Indxx Global Medical Equipment Index

Month End Performance (as of 5/31/2024)
  3 Month YTD 1 Year 3 Year 5 Year 10 Year Since
Fund
Inception7
Fund Performance *
Net Asset Value (NAV) -1.36% 0.89% 3.30% N/A N/A N/A -6.98%
After Tax Held -1.36% 0.89% 3.30% N/A N/A N/A -6.98%
After Tax Sold -0.80% 0.53% 1.95% N/A N/A N/A -5.22%
Market Price -1.31% 0.89% 3.35% N/A N/A N/A -6.93%
Index Performance **
Indxx Global Medical Equipment Index -1.43% 0.96% 3.79% N/A N/A N/A -6.47%
MSCI World Health Care Index 0.93% 5.98% 12.58% N/A N/A N/A 4.54%
MSCI World Index 3.82% 9.52% 24.92% N/A N/A N/A 6.48%
Quarter End Performance (as of 3/28/2024)
  3 Month YTD 1 Year 3 Year 5 Year 10 Year Since
Fund
Inception7
Fund Performance *
Net Asset Value (NAV) 5.70% 5.70% 4.56% N/A N/A N/A -5.81%
After Tax Held 5.70% 5.70% 4.56% N/A N/A N/A -5.81%
After Tax Sold 3.38% 3.38% 2.70% N/A N/A N/A -4.37%
Market Price 5.79% 5.79% 4.91% N/A N/A N/A -5.73%
Index Performance **
Indxx Global Medical Equipment Index 5.88% 5.88% 5.31% N/A N/A N/A -5.23%
MSCI World Health Care Index 7.48% 7.48% 13.33% N/A N/A N/A 5.35%
MSCI World Index 8.85% 8.85% 25.07% N/A N/A N/A 6.65%

*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.

MSCI World Health Care Index - The index is designed to capture the large and mid cap segments of the Health Care sector across Developed Markets (DM) countries.

MSCI World Index - The Index is a free float-adjusted market capitalization-weighted index that is designed to measure the equity market performance of 23 developed markets around the world.

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 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 Index yield represents the weighted average trailing 12-month dividend of the constituents of the Indxx Global Medical Equipment Index.
6 All market capitalization numbers are in USD$ Millions.
7 Inception Date is 6/22/2021

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 Statement of Additional Information 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.

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.

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.

Current market conditions risk is the risk that a particular investment, or shares of the fund in general, may fall in value due to current market conditions. As a means to fight inflation, the Federal Reserve and certain foreign central banks have raised interest rates and expect to continue to do so, and the Federal Reserve has announced that it intends to reverse previously implemented quantitative easing. Recent and potential future bank failures could result in disruption to the broader banking industry or markets generally and reduce confidence in financial institutions and the economy as a whole, which may also heighten market volatility and reduce liquidity. Ongoing armed conflicts between Russia and Ukraine in Europe and among Israel, Hamas and other militant groups in the Middle East, have caused and could continue to cause significant market disruptions and volatility within the markets in Russia, Europe, the Middle East and the United States. The hostilities and sanctions resulting from those hostilities have and could continue to have a significant impact on certain fund investments as well as fund performance and liquidity. The COVID-19 global pandemic, or any future public health crisis, and the ensuing policies enacted by governments and central banks have caused and may continue to cause significant volatility and uncertainty in global financial markets, negatively impacting global growth prospects.

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.

Depositary receipts may be less liquid than the underlying shares in their primary trading market and distributions may be subject to a fee. Holders may have limited voting rights, and investment restrictions in certain countries may adversely impact their value.

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

Equity securities may decline significantly in price over short or extended periods of time, and such declines may occur in the equity market as a whole, or they may occur in only a particular country, company, industry or sector of the market.

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.

Health care companies may be affected by government regulations and government health care programs, increases or decreases in the cost of medical products and services and product liability claims, among other factors. Many health care companies are heavily dependent on patent protection, and the expiration of a company's patent may adversely affect that company's profitability. Health care companies are also subject to competitive forces that may result in price discounting, may be thinly capitalized and susceptible to product obsolescence.

An index fund will be concentrated in an industry or a group of industries to the extent that the index is so concentrated. A fund with significant exposure to a single asset class, or the securities of issuers within the same country, state, region, industry, or sector may have its value more affected by an adverse economic, business or political development than a broadly diversified fund.

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. Losses or costs associated with any index provider errors generally will be borne by a fund and its shareholders.

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, natural disasters or other events could have significant negative impact on a fund.

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.

An index fund's return may not match the return of the index for a number of reasons including operating expenses, costs of buying and selling securities to reflect changes in the index, and the fact that a fund's portfolio holdings may not exactly replicate the index.

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.

A fund that invests in securities included in or representative of an index will hold those securities regardless of investment merit and the fund generally will not take defensive positions in declining markets.

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.

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

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.

First Trust Advisors L.P. (FTA) is the adviser to the First Trust fund(s). FTA is an affiliate of First Trust Portfolios L.P., the distributor of the fund(s).

Indxx and Indxx Global Medical Equipment Index ("Index") are trademarks of Indxx, Inc. ("Indxx") and have been licensed for use for certain purposes by First Trust. The Fund is not sponsored, endorsed, sold or promoted by Indxx and Indxx makes no representation regarding the advisability of trading in such product. The Index is determined, composed and calculated by Indxx without regard to First Trust or the Fund.

CUSIP identifiers have been provided by CUSIP Global Services, managed on behalf of the American Bankers Association by FactSet Research Systems Inc. and are not for use or dissemination in a manner that would serve as a substitute for any CUSIP service. The CUSIP Database, ©2024 CUSIP Global Services. "CUSIP" is a registered trademark of the American Bankers Association.

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.
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