First Trust Advisors Announces Monthly Distributions for Select Exchange-Traded Funds
First Trust Advisors L.P. a leading U.S. investment management firm, has announced the declaration of monthly distributions for a number of its exchange-traded funds (ETFs). These distributions reflect income generated within the respective funds and are paid out to shareholders as part of FTA’s ongoing commitment to structured and transparent investment management.
FTA serves as the investment advisor to the affected funds and is a federally registered investment advisor with decades of experience managing diverse portfolios across asset classes. Together with its affiliate, First Trust Portfolios L.P. (“FTP”), the firms provide a broad range of investment products and services to financial professionals and individual investors. FTP, which is a FINRA-registered broker-dealer, is responsible for distributing ETF creation units and mutual fund shares, as well as sponsoring First Trust’s unit investment trusts.
As of September 30, 2025, First Trust collectively manages or supervises approximately $299 billion in assets across its investment vehicles. These include exchange-traded funds, closed-end funds, mutual funds, separately managed accounts, and unit investment trusts. Both FTA and FTP are headquartered in Wheaton, Illinois, where they continue to support a model built on financial innovation, portfolio transparency, and disciplined investment research.
Investor Considerations and Access to Fund Information
Before investing in any First Trust fund, investors are encouraged to carefully review the fund’s prospectus, which outlines its investment objectives, associated risks, fees, and expenses. This document is designed to help investors make informed decisions based on their risk tolerance, financial goals, and market outlook. Prospectuses can be accessed at https://www.ftportfolios.com or requested by phone at 1-800-621-1675 at no cost.
Understanding what a fund aims to achieve—and the risks it may confront—is essential. Market conditions, sector exposures, portfolio composition, and investment strategy all influence how a fund performs and distributes income.
Key Risk Considerations for Investors
Investment in ETFs and other fund products involves risk, and there is no guarantee that any fund will meet its stated objective. Investors should be aware of the following considerations:
General Market Risk
The value of fund shares can rise or fall depending on changing market conditions, economic developments, geopolitical events, and investor sentiment. Market downturns, interest rate changes, inflation, or disruptions such as global conflicts or public health events can negatively affect performance.
Share Trading and Liquidity
ETF shares are bought and sold on the secondary market. Investors may pay brokerage fees when trading, and shares may sometimes trade at a discount to the fund’s net asset value. Only large institutional trading firms known as authorized participants may redeem shares directly with the fund — and only in sizeable blocks.
Fund Strategy and Portfolio Concentration
Some funds may hold securities within a specific sector, region, or asset class. A concentrated investment approach may deliver strong performance during favorable conditions but also increases vulnerability when that segment of the market experiences volatility or downturns.
Funds classified as non-diversified may invest a larger portion of assets in fewer holdings, which can increase exposure to performance swings tied to just a few companies or industries.
Company Size Exposure
Funds that invest in small- or mid-capitalization companies may encounter heightened volatility, as these firms can be more sensitive to economic changes and may trade less frequently. Conversely, large-cap companies may offer more stability but may grow at a slower rate than smaller peers.
Income Distributions
A fund’s monthly or quarterly distributions depend on income earned from its investments. If income declines, distributions may also decrease. At times, distributions may be classified as return of capital, meaning shareholders are receiving back part of their initial investment rather than earnings generated by the fund.
Operational and Cybersecurity Risk
Like all modern financial institutions, funds and their service providers rely on technology. Cybersecurity breaches or operational disruptions could result in financial losses, regulatory penalties, or reputational harm.
Use of Derivatives
Some funds employ derivatives such as futures, swaps, or options to achieve investment objectives. While derivatives can help manage exposure or target specific outcomes, they also carry the risk of amplified losses if markets move unexpectedly.
Special Note on Target Outcome Funds and FLEX Options
Certain First Trust ETFs use Flexible Exchange Options® (“FLEX Options”) to target specific performance outcomes within defined time periods. These funds aim to provide returns that correspond to the movement of a reference asset—such as a market index or ETF—subject to an upper performance cap and a level of downside protection.
However, these benefits only apply under specific conditions:
- The shareholder must purchase shares on the first day of the fund’s defined outcome period.
- Shares must be held through the end of the outcome period to benefit fully from the strategy.
- Investors entering or exiting the position mid-period may experience different returns and reduced downside protection.
- Certain FLEX Option contracts may expire without value.
These strategies may involve risk and are not suitable for all investors. Prospective shareholders should ensure they fully understand how Target Outcome strategies work before investing.
Commodity, Interest Rate, and Credit-Related Risks
Some funds may hold securities linked to commodity markets or fixed-income instruments. Commodity assets can experience sharp price swings, influenced by supply disruptions, geopolitical dynamics, and global demand patterns. Likewise, bond and credit markets can be affected by interest rate changes, issuer credit quality, inflation, and prepayment trends.
Funds designed with exposure to these markets may therefore experience performance variability that does not align with broader equity trends.
Regulatory and Structural Notes
FTA is registered as both a commodity pool operator and commodity trading advisor, and is a member of the National Futures Association. Certain funds may hold investments through offshore subsidiaries—which are not registered under the Investment Company Act of 1940—subjecting them to different oversight structures and regulatory risks.
Additionally, several funds reference well-known benchmarks such as the SPDR® S&P 500® ETF Trust or SPDR® Gold Trust, though these funds are not sponsored or endorsed by those benchmark providers. The respective index and trust organizations have no role in fund management or decision-making.
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