An actively managed ETF that seeks to capture the growth of technology related companies

First Trust Advisors L.P. (“First Trust”) a leading exchange-traded fund (“ETF”) provider and asset manager, announced today that it has launched the First Trust Expanded Technology ETF (NYSE Arca: XPND) (“the fund”). The fund seeks to provide long-term capital appreciation by investing at least 80% of its net assets (plus any borrowings for investment purposes) in common stocks of companies identified by the fund’s investment advisor as either information technology companies or consumer discretionary and communication services companies whose operations are principally derived from and/or dependent upon technology (collectively “expanded technology companies”).

“Technological innovation doesn’t follow the constraints of traditional sector classifications,” said Ryan Issakainen, CFA, Senior Vice President and ETF Strategist at First Trust. “We believe XPND will appeal to investment professionals seeking exposure to an expanded universe of technology-driven stocks.” The fund seeks to capture the growth of technology related companies without being constrained to the traditional information technology sector designated by the Global Industry Classification Standard (GICS).¹ By expanding sector selection across the information technology, communications services and consumer discretionary sectors, the fund provides broader access to today’s technology and related industries.

The fund is managed by First Trust Advisors L.P., with selection and portfolio decisions made by a team of portfolio managers. The securities included in the portfolio are chosen using a quantitatively driven approach and leveraging the knowledge of First Trust’s equity research and portfolio management teams who understand the drivers of risk-adjusted returns. In selecting securities for the portfolio, the investment advisor considers a range of quantitative attributes including, but not limited to, operating metrics and financial metrics, such as return on equity, momentum, and free cash flow growth. The portfolio will consist of approximately 50 large-cap focused U.S. listed companies.

For more information about First Trust, please contact Ryan Issakainen at (630) 765-8689 or RIssakainen@FTAdvisors.com.

About First Trust

First Trust is a federally registered investment advisor and serves as the fund’s investment advisor. First Trust and its affiliate First Trust Portfolios L.P. (“FTP”), a FINRA registered broker-dealer, are privately held companies that provide a variety of investment services. First Trust has collective assets under management or supervision of approximately $199 billion as of May 28, 2021 through unit investment trusts, exchange-traded funds, closed-end funds, mutual funds and separate managed accounts. First Trust is the supervisor of the First Trust unit investment trusts, while FTP is the sponsor. FTP is also a distributor of mutual fund shares and exchange-traded fund creation units. First Trust and FTP are based in Wheaton, Illinois. For more information, visit http://www.ftportfolios.com.

You should consider the fund’s investment objectives, risks, and charges and expenses carefully before investing. Contact First Trust Portfolios L.P. at 1-800-621-1675 or visit www.ftportfolios.com to obtain 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 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. The impact of this COVID-19 pandemic may last for an extended period of time and will continue to impact the economy for the foreseeable future.

In managing the fund’s investment portfolio, the portfolio managers will apply investment techniques and risk analyses that may not have the desired result.

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.

Information technology companies are subject to certain risks, including rapidly changing technologies, short product life cycles, fierce competition, aggressive pricing and reduced profit margins, loss of patent, copyright and trademark protections, cyclical market patterns, evolving industry standards and frequent new product introductions. Certain companies may be smaller and less experienced companies, with limited product lines, markets or financial resources. Information technology company stocks, especially those which are Internet related, have experienced extreme price and volume fluctuations that are often unrelated to their operating performance.

To the extent the fund has significant exposure to a single asset class, industry, or sector, it may be more affected by an adverse economic or political development than a broadly diversified fund.

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

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.

The fund may be a constituent of one or more indices or models which could greatly affect the fund’s trading activity, size and volatility.

The 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.

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 the fund on the exchange will continue to be met or be unchanged.

Large inflows and outflows may impact a new fund’s market exposure for limited periods of time.

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

The success of consumer discretionary companies is tied closely to the performance of the overall U.S. and international economies, interest rates, competition, consumer confidence, disposable household income and consumer spending. Changes in demographics and consumer tastes can also affect the demand for consumer discretionary products.

Communication services companies may be subject to risks including but not limited to, legislative or regulatory changes, adverse market conditions, intellectual property use, increased competition, product obsolescence, and cybersecurity breaches.

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

The utilization of quantitative models entails the risks that a model may be limited or incorrect, the data on which a model relies may be incorrect or incomplete and the portfolio managers may not be successful in selecting companies for investment or determining the weighting of particular stocks in a fund’s portfolio. Any of these factors could cause a fund to underperform funds that do not rely on models.

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.

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..

¹GICS is a four-tiered, hierarchical industry classification system that consists of 11 sectors, 24 industry groups, 69 industries and 158 sub-industries. The GICS methodology is widely accepted as an industry analytical framework for investment research, portfolio management and asset allocation.

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