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First Trust NYSE® Arca® Biotechnology Index Fund (FBT)
Investment Objective/Strategy - The First Trust NYSE® Arca® Biotechnology Index Fund is an exchange-traded index fund. The investment objective of the Fund is to replicate as closely as possible, before fees and expenses, the price and yield of the NYSE® Arca® Biotechnology Index.
There can be no assurance that the Fund's investment objectives will be achieved.
Index Description According to the Index Provider
  • The NYSE® Arca® Biotechnology Index (“index”) is an equal dollar weighted index designed to measure the performance of 30 leading biotechnology companies classified within the Biotechnology sub-industry group of the ICE Uniform Sector Classification schema.
  • The Biotechnology sub-industry group includes:
    • The Biotech Therapeutics Sub-Industry: Companies engaged in the research and development of therapeutic treatments (including companies in the trial phase of therapeutic development), but are not focused on the commercialization and mass production of pharmaceutical drugs.
    • The Biotech Tools & Diagnostics Sub-Industry: Companies engaged in the production and provisioning of tools, systems or processes that enable biotechnology practices (including companies that provide assaying equipment, sequencing techniques or systems, DNA processing, or cellular processing).
  • To be included in the index, a common stock or depositary receipt must be listed on a qualifying U.S. securities exchange, and meet the size and liquidity standards of the index.
  • Eligible securities are then ranked in descending order based on the following factors. These three distinct ranks are then combined to yield one comprehensive rank based on their respective weights:
    • 50%: Net sales (revenue) over the last 12 months.
    • 25%: Ratio of net sales (revenue) to R&D (research and development) expenditures over the last 12 months.
    • 25%: Percentage change in R&D expenditures (over the last 12 months) from those three years prior.
  • The highest ranked 30 securities are selected for inclusion in the index.
    • Additionally, the total number of index constituents classified to the Biotech Tools & Diagnostics sub-industry is capped at 6 constituents. If the limit is reached, the lowest ranked Biotech Tools & Diagnostics constituents are replaced with the next highest ranked Biotech Therapeutics non-constituents until this rule is met.
  • The securities selected for inclusion in the index are equally weighted. Index composition changes during scheduled reconstitutions are also subject to certain buffers designed to limit turnover.
  • The index is reconstituted and rebalanced quarterly in January, April, July and October.
Fund Overview
TickerFBT
Fund TypeBiotechnology
Investment AdvisorFirst Trust Advisors L.P.
Investor Servicing AgentBank of New York Mellon Corp
CUSIP33733E203
ISINUS33733E2037
Intraday NAVFBTIV
Fiscal Year-End12/31
ExchangeNYSE Arca
Inception6/19/2006
Inception Price$20.00
Inception NAV$20.00
Rebalance FrequencyQuarterly
Total Expense Ratio*0.56%
Net Expense Ratio*0.56%
* As of 5/1/2024
Expenses are capped contractually at 0.60% per year, at least through April 30, 2025.
Current Fund Data (as of 10/29/2024)
Closing NAV1$169.96
Closing Market Price2$170.01
Bid/Ask Midpoint$169.83
Bid/Ask Discount0.08%
30-Day Median Bid/Ask Spread30.15%
Total Net Assets$1,164,208,015
Outstanding Shares6,850,002
Daily Volume159,757
Average 30-Day Daily Volume34,545
Closing Market Price 52-Week High/Low$173.05 / $132.56
Closing NAV 52-Week High/Low$173.11 / $132.65
Number of Holdings (excluding cash)30
NAV History (Since Inception)
Past performance is not indicative of future results.
Fund Characteristics (as of 9/30/2024)4
Maximum Market Cap.$173,133
Median Market Cap.$15,544
Minimum Market Cap.$2,360
Price/Book4.43
Price/Cash Flow27.90
Price/Sales5.81
Top Holdings (as of 10/29/2024)*
Holding Percent
Incyte Corporation 3.76%
Exelixis, Inc. 3.70%
Catalyst Pharmaceuticals, Inc. 3.64%
Corcept Therapeutics Incorporated 3.58%
Sarepta Therapeutics, Inc. 3.53%
Gilead Sciences, Inc. 3.50%
argenx SE (ADR) 3.48%
Intra-Cellular Therapies, Inc. 3.42%
Neurocrine Biosciences, Inc. 3.40%
Illumina, Inc. 3.39%

* Excluding cash.  Holdings are subject to change.

Bid/Ask Premium/Discount (as of 10/29/2024)
  2023 Q1 2024 Q2 2024 Q3 2024
Days Traded at Premium 119 37 36 38
Days Traded at Discount 131 24 27 26
Hypothetical Growth of $10,000 Since Inception (as of 10/29/2024) *
Tracking Index: NYSE® Arca® Biotechnology Index

Month End Performance (as of 9/30/2024)
  3 Month YTD 1 Year 3 Year 5 Year 10 Year Since
Fund
Inception5
Fund Performance *
Net Asset Value (NAV) 11.93% 9.04% 17.72% 1.24% 6.82% 6.53% 12.58%
After Tax Held 11.93% 9.04% 17.72% 1.24% 6.82% 6.52% 12.55%
After Tax Sold 7.06% 5.35% 10.49% 0.94% 5.35% 5.27% 11.11%
Market Price 11.94% 9.13% 17.80% 1.27% 6.85% 6.53% 12.59%
Index Performance **
NYSE® Arca® Biotechnology Index 12.08% 9.50% 18.39% 1.67% 7.34% 7.03% 13.17%
Nasdaq Biotechnology™ Index 5.09% 9.79% 21.59% -1.30% 9.61% 5.87% 11.36%
S&P Composite 1500® Health Care Index 6.08% 14.01% 21.46% 7.44% 12.91% 11.15% 11.53%
S&P 500® Index 5.89% 22.08% 36.35% 11.91% 15.98% 13.38% 10.93%
Quarter End Performance (as of 9/30/2024)
  3 Month YTD 1 Year 3 Year 5 Year 10 Year Since
Fund
Inception5
Fund Performance *
Net Asset Value (NAV) 11.93% 9.04% 17.72% 1.24% 6.82% 6.53% 12.58%
After Tax Held 11.93% 9.04% 17.72% 1.24% 6.82% 6.52% 12.55%
After Tax Sold 7.06% 5.35% 10.49% 0.94% 5.35% 5.27% 11.11%
Market Price 11.94% 9.13% 17.80% 1.27% 6.85% 6.53% 12.59%
Index Performance **
NYSE® Arca® Biotechnology Index 12.08% 9.50% 18.39% 1.67% 7.34% 7.03% 13.17%
Nasdaq Biotechnology™ Index 5.09% 9.79% 21.59% -1.30% 9.61% 5.87% 11.36%
S&P Composite 1500® Health Care Index 6.08% 14.01% 21.46% 7.44% 12.91% 11.15% 11.53%
S&P 500® Index 5.89% 22.08% 36.35% 11.91% 15.98% 13.38% 10.93%
3-Year Statistics (as of 9/30/2024)
  Standard Deviation Alpha Beta Sharpe Ratio Correlation
FBT 17.71% -7.14 0.69 -0.04 0.69
Nasdaq Biotechnology™ Index 17.45% -9.45 0.66 -0.19 0.67
S&P Composite 1500® Health Care Index 14.61% -1.42 0.66 0.33 0.79
S&P 500® Index 17.53% --- 1.00 0.54 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. The fund's performance reflects fee waivers and expense reimbursements, absent which performance would have been lower.

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.

Nasdaq Biotechnology™ Index - The Index includes securities of NASDAQ-listed companies classified as either Biotechnology or Pharmaceuticals which also meet other eligibility criteria.

S&P Composite 1500® Health Care Index - The Index is a capitalization-weighted index of companies classified by GICS as health care within the S&P Composite 1500 Index.

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

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 All market capitalization numbers are in USD$ Millions.
5 Inception Date is 6/19/2006

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.

Biotechnology and pharmaceutical companies are subject to changing government regulation which could have a negative effect on the price, profitability and availability of their products and services. Biotechnology and pharmaceutical companies face increasing competition from generic drugs, termination of their patent protection and technological advances which render their products or services obsolete. The research and development costs required to bring a drug to market are substantial and may include a lengthy review by the government, with no guarantee that the product will ever be brought to market or show a profit. Many of these companies may not offer certain drugs or products for several years, and as a result, may have significant losses of revenue and earnings.

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; however, the Federal Reserve has recently lowered interest rates and may continue to do so. 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.

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.

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.

Large capitalization companies may grow at a slower rate than the overall market.

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.

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.

Pharmaceutical companies are subject to changing government regulation which could have a negative effect on the price, profitability and availability of their products and services. Regulations have been proposed to increase the availability and affordability of prescription drugs including proposals to increase access to generic drugs and to increase the rebates paid by drug manufacturers in exchange for Medicaid coverage of their products. Whether such proposals will be adopted cannot be predicted. In addition, such companies face increasing competition from existing generic drugs, the termination of their patent protection for certain drugs and technological advances which render their products or services obsolete. The research and development costs required to bring a drug to market are substantial and may include a lengthy review by the government, with no guarantee that the product will ever be brought to market or show a profit. In addition, the potential for an increased amount of required disclosure of proprietary scientific information could negatively impact the competitive position of these companies. Many of these companies may not offer certain drugs or products for several years, and as a result, may have significant losses of revenue and earnings.

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

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).

Source ICE Data Indices, LLC ("ICE DATA"), is used with permission. "NYSE®" and "NYSE® Arca®" are service/trade marks of ICE Data Indices, LLC or its affiliates. These trademarks have been licensed, along with the NYSE® Arca® Biotechnology Index ("Index") for use by First Trust Advisors L.P. in connection with the First Trust NYSE® Arca® Biotechnology Index Fund (the "Product"). Neither First Trust Advisors L.P., First Trust Exchange Traded Fund (the "Trust") nor the Product, as applicable, is sponsored, endorsed, sold or promoted by ICE Data Indices, LLC, its affiliates or its Third Party Suppliers ("ICE Data and its Suppliers"). ICE Data and its Suppliers make no representations or warranties regarding the advisability of investing in securities generally, in the Product particularly, the Trust or the ability of the Index to track general market performance. Past performance of an Index is not an indicator of or a guarantee of future results. See the prospectus for a full copy of the disclaimer.

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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