FT Diversified Target Income Portfolio, Series 5

The FT Diversified Target Income Portfolio is a unit investment trust (UIT) which invests in exchange-trade funds (ETFs) whose investments combine a U.S. equity stock portfolio with an options strategy that seeks to increase total income for investors while providing the potential for capital appreciation. The ETFs are advised by First Trust Advisors L.P., an affiliate of the trust’s sponsor.

What is an Options Overwrite Strategy?

This strategy consists of ETFs writing (selling) call options that correspond to a common stock or equity index holding. A call option is a contractual obligation which gives the buyer of the option the right to purchase a certain number of shares of common stock from the writer (seller) of the option at a predetermined price (referred to as the “strike price” or the “exercise price”). If the strike price is reached, the buyer has the right to exercise the option at the option’s expiration date or at any time up until the option’s expiration.

You should be aware that a product which includes writing call options may not be suitable for all investors. It may not be appropriate for investors seeking above-average capital appreciation. Before investing, you should make sure you understand the risks of this type of product, and whether it suits your current financial objectives.

Portfolio Objective

This UIT seeks current monthly income, with capital appreciation as a secondary objective. There is, however, no assurance that the objectives of the portfolio will be achieved.

Underlying ETF Descriptions

First Trust BuyWrite Income ETF (“FTHI”) seeks to provide current income with a secondary objective of capital appreciation. The fund invests primarily in equity securities listed on U.S. exchanges and utilizes an “option strategy” consisting of writing (selling) U.S. exchange-traded call options on the S&P 500^® Index in order to seek additional cash flow in the form of premiums on the options.

First Trust Nasdaq BuyWrite Income ETF (“FTQI”) seeks to provide current income. The fund invests primarily in equity securities listed on U.S. exchanges and utilizes an “option strategy” consisting of writing (selling) U.S. exchange-traded call options on the Nasdaq-100 Index in order to seek additional cash flow in the form of premiums on the options.

FT Vest Rising Dividend Achievers Target Income ETF (“RDVI”) seeks to provide current income with a secondary objective of providing capital appreciation. The fund invests primarily in U.S. exchange-traded equity securities contained in the Nasdaq US Rising Dividend Achievers™ Index and utilizes an “option strategy” consisting of writing (selling) U.S. exchange-traded call options on the S&P 500^® Index or ETFs that track the S&P 500^® Index.

FT Vest S&P 500^® Dividend Aristocrats Target Income ETF^® (“KNG”) seeks investment results that correspond generally to the price and yield of an equity index called the S&P 500^® Dividend Aristocrats Target Income Index Monthly Series (“KNG Index”). The index is designed with the primary goal of generating an annualized level of income from stock dividends and option premiums with a secondary goal of generating capital appreciation based on the price returns of the equity securities contained in the KNG Index.

An option is a contractual obligation between a buyer and a seller. The buyer of a call option has the right, but not the obligation, to purchase an agreed upon quantity of an underlying asset from the writer (seller) of the option at a predetermined price (the strike price) within a certain window of time (until the option’s expiration).

A premium is the income received by an investor who sells the option contract to another party.

The S&P 500^® Index is an unmanaged index of 500 companies used to measure large-cap U.S. stock market performance.

The S&P 500^® Dividend Aristocrats Index generally includes companies in the S&P 500^® Index that have increased dividend payments each year for at least 25 consecutive years and meet certain market capitalization and liquidity requirements.

The Nasdaq-100 Index includes 100 of the largest domestic and international non-financial companies listed on the Nasdaq Stock Market based on market capitalization.

The Nasdaq US Rising Dividend Achievers^TM Index is comprised of 50 companies with a history of raising their dividends. These companies also exhibit the characteristics to continue to do so in the future.

You should consider the portfolio's investment objectives, risks, and charges and expenses carefully before investing. Contact your financial professional or call First Trust Portfolios L.P. at 1.800.621.1675 to request a prospectus, which contains this and other information about the portfolio. Read it carefully before you invest.

Risk Considerations
An investment in this unmanaged unit investment trust should be made with an understanding of the risks associated with an investment in a portfolio of ETFs which invest in common stocks.

ETFs are subject to various risks, including management’s ability to meet the fund’s investment objective, and to manage the fund’s portfolio when the underlying securities are redeemed or sold, during periods of market turmoil and as investors’ perceptions regarding ETFs or their underlying investments change. Unlike open-end funds, which trade at prices based on a current determination of the fund’s net asset value, ETFs frequently trade at a discount from their net asset value in the secondary market.

Common stocks are subject to certain risks, such as an economic recession and the possible deterioration of either the financial condition of the issuers of the equity securities or the general condition of the stock market.

Options are subject to various risks including that their value may be adversely affected if the market for the option becomes less liquid or smaller. In addition, options will be affected by changes in the value and dividend rates of the stock subject to the option, an increase in interest rates, a change in the actual and perceived volatility of the stock market and the common stock and the remaining time to expiration.

As the use of Internet technology has become more prevalent in the course of business, the trust has become more susceptible to potential operational risks through breaches in cybersecurity.

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 could have a significant impact on certain investments as well as performance.

The ongoing effects of the COVID-19 global pandemic, or the potential impacts of any future public health crisis, may cause significant volatility and uncertainty in global financial markets. While vaccines have been developed, there is no guarantee that vaccines will be effective against future variants of the disease.

It is important to note that an investment can be made in the underlying funds directly rather than through the trust. These direct investments can be made without paying the trust’s sales charge, operating expenses and organization costs.

The value of the securities held by the trust may be subject to steep declines or increased volatility due to changes in performance or perception of the issuers.

This UIT is a buy and hold strategy and investors should consider their ability to hold the trust until maturity. There may be tax consequences unless units are purchased in an IRA or other qualified plan.

For a discussion of additional risks of investing in the trust see the “Risk Factors” section of the prospectus.

Nasdaq^®, Nasdaq US Rising Dividend Achievers^TM Index, and Nasdaq Composite 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 First Trust Nasdaq BuyWrite Income ETF and FT Vest Rising Dividend Achievers Target Income ETF have not been passed on by the Corporations as to its legality or suitability. The funds are not issued, endorsed, sold or promoted by the Corporations. THE CORPORATIONS MAKE NO WARRANTIES AND BEAR NO LIABILITY WITH RESPECT TO THE FUND.

S&P^® is a registered trademark of Standard & Poor’s Financial Services LLC (“S&P”), a division of S&P Global; Cboe^® is a registered trademark of Cboe. The Index, S&P, and Cboe trademarks have been licensed for use by the Sub-Advisor, and in turn, sub-licensed by the Advisor, including for use by the FT Vest S&P 500^® Dividend Aristocrats Target Income ETF^®. The fund is not sponsored, endorsed, sold, or promoted by Cboe and/or its affiliates (the “Cboe Group”), or S&P and/or its affiliates (together, the “S&P Group”). Neither the Cboe Group nor the S&P Group make any representation regarding the advisability of investing in the fund and shall have no liability whatsoever in connection with the fund.