Fund	Management Fee
First Trust Dorsey Wright Dynamic Focus 5 ETF	0.30%
First Trust Dorsey Wright Focus 5 ETF	0.30%
First Trust Dorsey Wright International Focus 5 ETF	0.30%
First Trust Rising Dividend Achievers ETF	0.50%
First Trust NASDAQ Technology Dividend Index Fund	0.50%
First Trust RBA American Industrial Renaissance ® ETF	0.70%
First Trust RBA Quality Income ETF	0.70%
International Multi-Asset Diversified Income Index Fund	0.70%
Multi-Asset Diversified Income Index Fund	0.60%

Pursuant to a contractual agreement between the Trust, on behalf of the Multi-Asset Diversified Income Index Fund, and First Trust, the management fees paid by the Multi-Asset Diversified Income Index Fund to First Trust will be reduced by the proportional amount of the management fees earned by the Fund on assets invested in other investment companies advised by First Trust. This contractual agreement shall continue until the earliest of (i) January 31, 2019, (ii) its termination at the direction of the Trust’s Board of Trustees or (iii) upon the termination of the Investment Management Agreement by and between the Multi-Asset Diversified Income Index Fund, the Trust and First Trust.

A discussion regarding the Board’s approval of the continuation of the Investment Management Agreements for the Funds is available in the Funds’ Annual Report to Shareholders for the year ended September 30, 2017.

How to Buy and Sell Shares

Most investors buy and sell shares of the Funds in secondary market transactions through brokers. Shares of the Funds are listed for trading on the secondary market on Nasdaq. Shares can be bought and sold throughout the trading day like other publicly traded shares. There is no minimum investment when buying shares on Nasdaq. Although shares are generally purchased and sold in “round lots” of 100 shares, brokerage firms typically permit investors to purchase or sell shares in smaller “odd lots,” at no per-share price differential. When buying or selling shares through a broker, investors should expect to incur customary brokerage commissions, investors may receive less than the net asset value of the shares because shares are bought and sold at market prices rather than at net asset value, and investors may pay some or all of the spread between the bid and the offer price in the secondary market on each leg of a round trip (purchase and sale) transaction. Share prices are reported in dollars and cents per share.

For purposes of the 1940 Act, each Fund is treated as a registered investment company, and the acquisition of shares by other registered investment companies is subject to the restrictions of Section 12(d)(1) of the 1940 Act. The Trust, on behalf of the Funds, has received an exemptive order from the Securities and Exchange Commission that permits certain registered investment companies to invest in a Fund beyond the limits set forth in Section 12(d)(1), subject to certain terms and conditions, including that any such investment companies enter into an agreement with a Fund regarding the terms of any investment.

First Trust Dorsey Wright Dynamic Focus 5 ETF, First Trust Dorsey Wright Focus 5 ETF, First Trust Dorsey Wright International Focus 5 ETF, International Multi-Asset Diversified Income Index Fund and Multi-Asset Diversified Income Index Fund intend to rely on Section 12(d)(1)(G) of the 1940 Act and/or exemptive relief that the Securities and Exchange Commission has issued to the Trust to invest in certain ETFs beyond the limits set forth in the 1940 Act, subject to certain terms and conditions. Consequently, the exemptive relief discussed in the paragraph above is not available for investments by other registered investment companies in such Funds.

Book Entry

Shares are held in book-entry form, which means that no share certificates are issued. The Depository Trust Company (“ DTC ”) or its nominee is the record owner of all outstanding shares of the Funds and is recognized as the owner of all shares for all purposes.

Investors owning shares are beneficial owners as shown on the records of DTC or its participants. DTC serves as the securities depository for all shares. Participants in DTC include securities brokers and dealers, banks, trust companies, clearing corporations and other institutions that directly or indirectly maintain a custodial relationship with DTC. As a beneficial owner

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of shares, you are not entitled to receive physical delivery of share certificates or to have shares registered in your name, and you are not considered a registered owner of shares. Therefore, to exercise any right as an owner of shares, you must rely upon the procedures of DTC and its participants. These procedures are the same as those that apply to any other stocks that you hold in book-entry or “street name” form.

Share Trading Prices

The trading price of shares of a Fund on Nasdaq is based on market price and may differ from such Fund’s daily net asset value and can be affected by market forces of supply and demand, economic conditions and other factors.

Information regarding the intra-day value of the shares of a Fund, also referred to as the “indicative optimized portfolio value” (“ IOPV ”), is disseminated every 15 seconds throughout such Fund’s trading day by the national securities exchange on which the shares are listed or by market data vendors or other information providers. The IOPV should not be viewed as a “real-time” update of the net asset value per share of a Fund because the IOPV may not be calculated in the same manner as the net asset value, which is computed once a day, generally at the end of the business day. The price of a non-U.S. security that is primarily traded on a non-U.S. exchange shall be updated, using the last sale price, every 15 seconds throughout the trading day, provided, that upon the closing of such non-U.S. exchange, the closing price of the security, after being converted to U.S. dollars, will be used. Furthermore, in calculating the IOPV of a Fund’s shares, exchange rates may be used throughout the day (9:00 a.m. to 4:15 p.m., Eastern Time) that may differ from those used to calculate the net asset value per share of such Fund and consequently may result in differences between the net asset value and the IOPV. A Fund is not involved in, or responsible for, the calculation or dissemination of the IOPV of shares of such Fund and such Fund does not make any warranty as to its accuracy.

Frequent Purchases and Redemptions of the Funds’ Shares

The Funds impose no restrictions on the frequency of purchases and redemptions (“ market timing ”). In determining not to approve a written, established policy, the Board evaluated the risks of market timing activities by the Funds’ shareholders. The Board considered that the Funds’ shares can only be purchased and redeemed directly from a Fund in Creation Units by broker-dealers and large institutional investors that have entered into participation agreements ( i.e. , authorized participants (“ APs ”)) and that the vast majority of trading in the Funds’ shares occurs on the secondary market. Because the secondary market trades do not involve the Funds directly, it is unlikely those trades would cause many of the harmful effects of market timing, including dilution, disruption of portfolio management, increases in the Funds’ trading costs and the realization of capital gains. With respect to trades directly with the Funds, to the extent effected in-kind ( i.e. , for securities), those trades do not cause any of the harmful effects that may result from frequent cash trades. To the extent that the Funds may effect the purchase or redemption of Creation Units in exchange wholly or partially for cash, the Board noted that such trades could result in dilution to the Funds and increased transaction costs, which could negatively impact the Funds’ ability to achieve their investment objectives. However, the Board noted that direct trading by APs is critical to ensuring that the shares trade at or close to net asset value. In addition, a Fund imposes fixed and variable transaction fees on purchases and redemptions of Creation Units to cover the custodial and other costs incurred by the Funds in effecting trades. Finally, the Advisor monitors purchase and redemption orders from APs for patterns of abusive trading and the Funds reserve the right to not accept orders from APs that the Advisor has determined may be disruptive to the management of such Fund, or otherwise not in such Fund’s best interests.

Dividends, Distributions and Taxes

Dividends from net investment income, if any, are declared and paid quarterly by First Trust Dorsey Wright Dynamic Focus 5 ETF, First Trust Dorsey Wright Focus 5 ETF, First Trust Dorsey Wright International Focus 5 ETF, First Trust Rising Dividend Achievers ETF, First Trust NASDAQ Technology Dividend Index Fund, First Trust RBA American Industrial Renaissance ^® ETF, First Trust RBA Quality Income ETF, and monthly by International Multi-Asset Diversified Income Index Fund and Multi-Asset Diversified Income Index Fund. Each Fund distributes its net realized capital gains, if any, to shareholders at least annually.

Distributions in cash may be reinvested automatically in additional whole shares only if the broker through whom you purchased shares makes such option available. Such shares will generally be reinvested by the broker based upon the market price of those shares and investors may be subject to customary brokerage commissions charged by the broker.

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Federal Tax Matters

This section summarizes some of the main U.S. federal income tax consequences of owning shares of the Funds. This section is current as of the date of this prospectus. Tax laws and interpretations change frequently, and these summaries do not describe all of the tax consequences to all taxpayers. For example, these summaries generally do not describe your situation if you are a corporation, a non-U.S. person, a broker-dealer, or other investor with special circumstances. In addition, this section does not describe your state, local or non-U.S. tax consequences.

This federal income tax summary is based in part on the advice of counsel to the Funds. The Internal Revenue Service could disagree with any conclusions set forth in this section. In addition, counsel to the Funds was not asked to review, and has not reached a conclusion with respect to, the federal income tax treatment of the assets to be included in the Funds. This may not be sufficient for you to use for the purpose of avoiding penalties under federal tax law.

As with any investment, you should seek advice based on your individual circumstances from your own tax advisor.

Fund Status

Each Fund intends to continue to qualify as a “regulated investment company” under the federal tax laws. If a Fund qualifies as a regulated investment company and distributes its income as required by the tax law, the Fund generally will not pay federal income taxes. An adverse federal income tax audit of a partnership that a Fund invests in could result in the Fund being required to pay federal income tax or pay a deficiency dividend (without having received additional cash).

Distributions

The Funds’ distributions are generally taxable. After the end of each year, you will receive a tax statement that separates the distributions of a Fund into two categories, ordinary income distributions and capital gain dividends. Ordinary income distributions are generally taxed at your ordinary tax rate, however, as further discussed below, certain ordinary income distributions received from the Fund may be taxed at the capital gains tax rates. Generally, you will treat all capital gain dividends as long-term capital gains regardless of how long you have owned your shares. To determine your actual tax liability for your capital gain dividends, you must calculate your total net capital gain or loss for the tax year after considering all of your other taxable transactions, as described below. In addition, the Funds may make distributions that represent a return of capital for tax purposes and thus will generally not be taxable to you; however, such distributions may reduce your tax basis in your shares, which could result in you having to pay higher taxes in the future when shares are sold, even if you sell the shares at a loss from your original investment. The tax status of your distributions from a Fund is not affected by whether you reinvest your distributions in additional shares or receive them in cash. The income from a Fund that you must take into account for federal income tax purposes is not reduced by amounts used to pay a deferred sales fee, if any. The tax laws may require you to treat distributions made to you in January as if you had received them on December 31 of the previous year.

Income from a Fund may also be subject to a 3.8% “Medicare tax.” This tax generally applies to your net investment income if your adjusted gross income exceeds certain threshold amounts, which are $250,000 in the case of married couples filing joint returns and $200,000 in the case of single individuals.

Dividends Received Deduction

A corporation that owns shares generally will not be entitled to the dividends received deduction with respect to dividends received from the Fund because the dividends received deduction is generally not available for distributions from regulated investment companies. However, certain ordinary income dividends on shares that are attributable to qualifying dividends received by a Fund from certain corporations may be reported by the Fund as being eligible for the dividends received deduction.

Capital Gains and Losses and Certain Ordinary Income Dividends

If you are an individual, the maximum marginal stated federal tax rate for net capital gain is generally 20% (15% or 0% for taxpayers with taxable income below certain thresholds). Some portion of your capital gain dividends may be taxed at a higher maximum stated tax rate. Some portion of your capital gain dividends may be attributable to your Fund’s interest in a master limited partnership which may be subject to a maximum marginal stated federal tax rate of 28%, rather than the rates set forth above. In addition, capital gain received from assets held for more than one year that is considered “unrecaptured section 1250 gain” (which may be the case, for example, with some capital gains attributable to equity interests in real estate investment trusts that constitute interests in entities treated as real estate investment trusts for federal income tax purposes) is taxed at a maximum marginal stated federal tax rate of 25%. In the case of capital gain dividends, the determination of which portion

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of the capital gain dividend, if any, is subject to the 28% tax rate or the 25% tax rate, will be made based on rules prescribed by the United States Treasury. Capital gains may also be subject to the Medicare tax described above.

Net capital gain equals net long-term capital gain minus net short-term capital loss for the taxable year. Capital gain or loss is long-term if the holding period for the asset is more than one year and is short-term if the holding period for the asset is one year or less. You must exclude the date you purchase your shares to determine your holding period. However, if you receive a capital gain dividend from a Fund and sell your shares at a loss after holding it for six months or less, the loss will be recharacterized as long-term capital loss to the extent of the capital gain dividend received. The tax rates for capital gains realized from assets held for one year or less are generally the same as for ordinary income. The Internal Revenue Code of 1986, as amended, treats certain capital gains as ordinary income in special situations.

Ordinary income dividends received by an individual shareholder from a regulated investment company such as the Funds are generally taxed at the same rates that apply to net capital gain (as discussed above), provided certain holding period requirements are satisfied and provided the dividends are attributable to qualifying dividends received by the Funds themselves. Dividends from REITS are qualified dividends only in limited circumstances. Each Fund will provide notice to its shareholders of the amount of any distribution which may be taken into account as a dividend which is eligible for the capital gains tax rates.

Sale of Shares

If you sell or redeem your shares, you will generally recognize a taxable gain or loss. To determine the amount of this gain or loss, you must subtract your tax basis in your shares from the amount you receive in the transaction. Your tax basis in your shares is generally equal to the cost of your shares, generally including sales charges. In some cases, however, you may have to adjust your tax basis after you purchase your shares.

Taxes on Purchase and Redemption of Creation Units

If you exchange securities for Creation Units you will generally recognize a gain or a loss. The gain or loss will be equal to the difference between the market value of the Creation Units at the time and your aggregate basis in the securities surrendered and the cash component paid. If you exchange Creation Units for securities, you will generally recognize a gain or loss equal to the difference between your basis in the Creation Units and the aggregate market value of the securities received and the cash redemption amount. The Internal Revenue Service, however, may assert that a loss realized upon an exchange of securities for Creation Units or Creation Units for securities cannot be deducted currently under the rules governing “wash sales,” or on the basis that there has been no significant change in economic position.

Treatment of Fund Expenses

Expenses incurred and deducted by the Funds will generally not be treated as income taxable to you. In some cases, however, you may be required to treat your portion of these Fund expenses as income. You may not be able to deduct some or all of these expenses.

Non-U.S. Tax Credit

Because a Fund may invest in non-U.S. securities, the tax statement that you receive may include an item showing non-U.S. taxes a Fund paid to other countries. In this case, dividends taxed to you will include your share of the taxes such Fund paid to other countries. You may be able to deduct or receive a tax credit for your share of these taxes.

Non-U.S. Investors

If you are a non-U.S. investor ( i.e. , an investor other than a U.S. citizen or resident or a U.S. corporation, partnership, estate or trust), you should be aware that, generally, subject to applicable tax treaties, distributions from a Fund will be characterized as dividends for federal income tax purposes (other than dividends which a Fund properly reports as capital gain dividends) and will be subject to U.S. federal income taxes, including withholding taxes, subject to certain exceptions described below. However, distributions received by a non-U.S. investor from a Fund that are properly reported by such Fund as capital gain dividends may not be subject to U.S. federal income taxes, including withholding taxes, provided that a Fund makes certain elections and certain other conditions are met. Distributions from a Fund that are properly reported by such Fund as an interest-related dividend attributable to certain interest income received by the Fund or as a short-term capital gain dividend attributable to certain net short-term capital gain income received by such Fund may not be subject to U.S. federal income taxes, including withholding taxes when received by certain non-U.S. investors, provided that a Fund makes certain elections and certain other conditions are met.

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Distributions may be subject to a U.S. withholding tax of 30% in the case of distributions to (i) certain non-U.S. financial institutions that have not entered into an agreement with the U.S. Treasury to collect and disclose certain information and are not resident in a jurisdiction that has entered into such an agreement with the U.S. Treasury and (ii) certain other non-U.S. entities that do not provide certain certifications and information about the entity’s U.S. owners. Dispositions of shares by such persons may be subject to such withholding after December 31, 2018.

Investments in Certain Non-U.S. Corporations

If a Fund holds an equity interest in any PFICs, which are generally certain non-U.S. corporations that receive at least 75% of their annual gross income from passive sources (such as interest, dividends, certain rents and royalties or capital gains) or that hold at least 50% of their assets in investments producing such passive income, a Fund could be subject to U.S. federal income tax and additional interest charges on gains and certain distributions with respect to those equity interests, even if all the income or gain is timely distributed to its shareholders. A Fund will not be able to pass through to its shareholders any credit or deduction for such taxes. A Fund may be able to make an election that could ameliorate these adverse tax consequences. In this case, a Fund would recognize as ordinary income any increase in the value of such PFIC shares, and as ordinary loss any decrease in such value to the extent it did not exceed prior increases included in income. Under this election, a Fund might be required to recognize in a year income in excess of its distributions from PFICs and its proceeds from dispositions of PFIC stock during that year, and such income would nevertheless be subject to the distribution requirement and would be taken into account for purposes of the 4% excise tax. Dividends paid by PFICs are not treated as qualified dividend income.

Distribution Plan

FTP serves as the distributor of Creation Units for the Funds on an agency basis. FTP does not maintain a secondary market in shares.

The Board has adopted a Distribution and Service Plan pursuant to Rule 12b-1 under the 1940 Act. In accordance with the Rule 12b-1 plan, the Funds are authorized to pay an amount up to 0.25% of their average daily net assets each year to reimburse FTP for amounts expended to finance activities primarily intended to result in the sale of Creation Units or the provision of investor services. FTP may also use this amount to compensate securities dealers or other persons that are APs for providing distribution assistance, including broker-dealer and shareholder support and educational and promotional services.

The Funds do not currently pay 12b-1 fees, and pursuant to a contractual arrangement, the Funds will not pay 12b-1 fees any time before January 31, 2019. However, in the event 12b-1 fees are charged in the future, because these fees are paid out of the Funds' assets, over time these fees will increase the cost of your investment and may cost you more than certain other types of sales charges.

Net Asset Value

Each Fund’s net asset value is determined as of the close of trading (normally 4:00 p.m., Eastern time) on each day the New York Stock Exchange is open for business. Net asset value is calculated for a Fund by taking the market price of the Fund’s total assets, including interest or dividends accrued but not yet collected, less all liabilities, and dividing such amount by the total number of shares outstanding. The result, rounded to the nearest cent, is the net asset value per share. All valuations are subject to review by the Board or its delegate.

Each Fund’s investments are valued daily at market value or, in the absence of market value with respect to any portfolio securities, at fair value, in accordance with valuation procedures adopted by the Board and in accordance with the 1940 Act. Portfolio securities listed on any exchange other than Nasdaq and the London Stock Exchange Alternative Investment Market (“ AIM ”) are valued at the last sale price on the business day as of which such value is being determined. Securities listed on the Nasdaq or the AIM are valued at the official closing price on the business day as of which such value is being determined. If there has been no sale on such day, or no official closing price in the case of securities traded on Nasdaq or the AIM, the securities are fair valued at the mean of the most recent bid and ask prices on such day. Portfolio securities traded on more than one securities exchange are valued at the last sale price or official closing price, as applicable, on the business day as of which such value is being determined at the close of the exchange representing the principal market for such securities. Portfolio securities traded in the over-the-counter market, but excluding securities trading on Nasdaq or the AIM, are fair valued at the mean of the most recent bid and asked price, if available, and otherwise at the closing bid price. Short-term investments that mature in less than 60 days when purchased are fair valued at cost adjusted for amortization of premiums and accretion of discount, provided the Advisor’s Pricing Committee has determined that the use of amortized cost is an appropriate reflection

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of fair value given market and issuer-specific conditions existing at the time of determination. Net asset value may change on days when investors may not sell or redeem Fund shares.

With respect to First Trust Dorsey Wright Dynamic Focus 5 ETF, certain securities in which the Fund may invest are not listed on any securities exchange or board of trade. Such securities are typically bought and sold by institutional investors in individually negotiated private transactions that function in many respects like an over-the-counter secondary market, although typically no formal market makers exist. Certain securities, particularly debt securities, have few or no trades, or trade infrequently, and information regarding a specific security may not be widely available or may be incomplete. Accordingly, determinations of the fair value of debt securities may be based on infrequent and dated information. Because there is less reliable, objective data available, elements of judgment may play a greater role in valuation of debt securities than for other types of securities. Typically, debt securities are valued using information provided by a third-party pricing service. The third-party pricing service primarily uses broker quotes to value such securities.

Certain securities may not be able to be priced by pre-established pricing methods. Such securities may be valued by the Board or its delegate, the Advisor’s Pricing Committee, at fair value. The use of fair value pricing by a Fund is governed by valuation procedures adopted by the Board and in accordance with the provisions of the 1940 Act. These securities generally include, but are not limited to, certain restricted securities (securities which may not be publicly sold without registration under the Securities Act) for which a pricing service is unable to provide a market price; securities whose trading has been formally suspended; a security whose market or fair value price is not available from a pre-established pricing source; a security with respect to which an event has occurred that is likely to materially affect the value of the security after the market has closed but before the calculation of a Fund’s net asset value or make it difficult or impossible to obtain a reliable market quotation; and a security whose price, as provided by the pricing service, does not reflect the security’s fair value. As a general principle, the current fair value of a security would appear to be the amount which the owner might reasonably expect to receive for the security upon its current sale. When fair value prices are used generally they will differ from the current market quotations or official closing prices on the applicable exchange. A variety of factors may be considered in determining the fair value of such securities. See the Funds’ SAI for details.

Because foreign securities exchanges may be open on different days than the days during which an investor may purchase or sell shares of a Fund, the value of the Fund’s securities may change on days when investors are not able to purchase or sell shares of the Fund. The value of securities denominated in foreign currencies is converted into U.S. dollars at the exchange rates in effect at the time of valuation. Any use of a different rate from the rates used by the Index may adversely affect a Fund’s ability to track the Index.

Fund Service Providers

Brown Brothers Harriman & Co., 50 Post Office Square, Boston, Massachusetts 02110, acts as the administrator, accounting agent, custodian and transfer agent for the Funds. Chapman and Cutler LLP, 111 West Monroe Street, Chicago, Illinois 60603, serves as legal counsel to the Funds. First Trust serves as the fund reporting agent for the Funds.

Index Providers

The applicable Index that each Fund seeks to track is compiled by the Index Provider. The Index Provider is not affiliated with the Funds, First Trust or FTP. Each Fund is entitled to use the Index pursuant to a sublicensing arrangement with First Trust, which in turn has a licensing agreement with the Index Provider. The Index Provider or its agent also serves as calculation agent for the Index (the “Index Calculation Agent” ). The Index Calculation Agent is responsible for the management of the day-to-day operations of the Index, including calculating the value of the Index every 15 seconds, widely disseminating the Index values every 15 seconds and tracking corporate actions, some of which result in Index adjustments.

Disclaimers

First Trust does not guarantee the accuracy and/or the completeness of the Indices or any data included therein, and First Trust shall have no liability for any errors, omissions or interruptions therein. First Trust makes no warranty, express or implied, as to results to be obtained by the Funds, owners of the shares of the Funds or any other person or entity from the use of the Indices or any data included therein. First Trust makes no express or implied warranties, and expressly disclaims all warranties of merchantability or fitness for a particular purpose or use with respect to the Indices or any data included therein. Without limiting any of the foregoing, in no event shall First Trust have any liability for any special, punitive, direct, indirect or

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consequential damages (including lost profits) arising out of matters relating to the use of the Indices, even if notified of the possibility of such damages.

First Trust Rising Dividend Achievers ETF
First Trust NASDAQ Technology Dividend Index Fund
International Multi-Asset Diversified Income Index Fund
Multi-Asset Diversified Income Index Fund

The Funds are not sponsored, endorsed, sold or promoted by Nasdaq, Inc. or its affiliates (Nasdaq, Inc., with its affiliates, are referred to as the “Corporations”). The Corporations have not passed on the legality or suitability of, or the accuracy or adequacy of descriptions and disclosures relating to, the Funds. The Corporations make no representation or warranty, express or implied to the owners of the Funds or any member of the public regarding the advisability of investing in securities generally or in the Funds particularly, or the ability of the Funds to track general stock market performance. The Corporations’ only relationship to First Trust is in the licensing of the Nasdaq, Nasdaq, Inc., NASDAQ US Rising Dividend Achievers Index, NASDAQ Technology Dividend Index ^SM , NASDAQ International Multi-Asset Diversified Income Index ^SM and NASDAQ Multi-Asset Diversified Income Index ^SM registered trademarks, trade names and service marks of the Corporations and the use of the Indices which are determined, composed and calculated by Nasdaq, Inc. without regard to Licensee or the Funds. Nasdaq, Inc. has no obligation to take the needs of the Licensee or the owners of the Funds into consideration in determining, composing or calculating the Indices. The Corporations are not responsible for and have not participated in the determination of the timing of, prices at, or quantities of the Funds to be issued or in the determination or calculation of the equation by which a Fund is to be converted into cash. The Corporations have no liability in connection with the administration, marketing or trading of the Funds.

THE CORPORATIONS DO NOT GUARANTEE THE ACCURACY AND/OR UNINTERRUPTED CALCULATION OF THE INDICES OR ANY DATA INCLUDED THEREIN. THE CORPORATIONS MAKE NO WARRANTY, EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED BY LICENSEE, OWNERS OF THE FUNDS, OR ANY OTHER PERSON OR ENTITY FROM THE USE OF THE INDICES OR ANY DATA INCLUDED THEREIN. THE CORPORATIONS MAKE NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIM ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE INDICES OR ANY DATA INCLUDED THEREIN. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL THE CORPORATIONS HAVE ANY LIABILITY FOR ANY LOST PROFITS OR SPECIAL, INCIDENTAL, PUNITIVE, INDIRECT, OR CONSEQUENTIAL DAMAGES, EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES.

First Trust Dorsey Wright Dynamic Focus 5 ETF
First Trust Dorsey Wright Focus 5 ETF
First Trust Dorsey Wright International Focus 5 ETF

The Funds are not sponsored, endorsed, sold or promoted by the Dorsey Wright & Associates LLC or its affiliates (Dorsey Wright & Associates LLC and its affiliates, are referred to as “ Dorsey Wright ”). Dorsey Wright makes no representation or warranty, express or implied, to the owners of the Funds or any member of the public regarding the advisability of trading in the Funds. Dorsey Wright’s only relationship to First Trust is the licensing of certain trademarks and trade names of Dorsey Wright and of the Indices which are determined, composed and calculated by Dorsey Wright, or its agent, without regard to First Trust or the Funds. Dorsey Wright has no obligation to take the needs of First Trust or the owners of the Funds into consideration in determining, composing or calculating the Indices. Dorsey Wright is not responsible for and has not participated in the determination of the timing of, prices at, or quantities of the Funds to be listed or in the determination or calculation of the equation by which the Funds are to be converted into cash. Dorsey Wright has no obligation or liability in connection with the administration, marketing or trading of the Funds.

DORSEY WRIGHT DOES NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF THE INDICES OR ANY DATA INCLUDED THEREIN AND DORSEY WRIGHT SHALL HAVE NO LIABILITY FOR ANY ERRORS, OMISSIONS, OR INTERRUPTIONS THEREIN. DORSEY WRIGHT MAKES NO WARRANTY, EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED BY FIRST TRUST, OWNERS OF THE FUNDS, OR ANY OTHER PERSON OR ENTITY FROM THE USE OF THE INDICES OR ANY DATA INCLUDED THEREIN. DORSEY WRIGHT MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND EXPRESSLY DISCLAIMS ALL WARRANTIES, OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE INDICES OR ANY DATA INCLUDED THEREIN, WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL DORSEY WRIGHT HAVE ANY LIABILITY FOR ANY LOST PROFITS OR INDIRECT, PUNITIVE, SPECIAL OR CONSEQUENTIAL DAMAGES (INCLUDING LOST PROFITS), EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES. THERE ARE NO THIRD PARTY BENEFICIARIES OF ANY AGREEMENTS OR ARRANGEMENTS BETWEEN DORSEY WRIGHT AND FIRST TRUST.

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First Trust RBA American Industrial Renaissance ^® ETF
First Trust RBA Quality Income ETF

The Funds are not sponsored, endorsed, sold or promoted by RBA. RBA makes no representation or warranty, express or implied, to the owners of the Funds or any member of the public regarding the advisability of trading in the Funds. RBA’s only relationship to First Trust is the licensing of certain trademarks and trade names of RBA and of the Indices which are determined, composed and calculated by RBA without regard to First Trust or the Funds. RBA has no obligation to take the needs of First Trust or the owners of the Funds into consideration in determining, composing or calculating the Indices. RBA is not responsible for and has not participated in the determination of the timing of, prices at, or quantities of the Funds to be listed or in the determination or calculation of the equation by which shares of the Funds are to be converted into cash. RBA has no obligation or liability in connection with the administration, marketing or trading of the Funds.

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(i)	On a daily basis, the Index computes the ratio of the closing price of each First Trust sector and industry-based ETF to the closing price of each other First Trust sector and industry-based ETF. For example: Relative Strength Reading = (ETF 1 Closing Price ÷ ETF 2 Closing Price) x 100

(ii)

As a result of such on-going calculations, a Point and Figure Relative Strength chart is created for each relationship within the inventory. A Point and Figure Relative Strength chart is a variation of a Point and Figure chart but its input value is computed in the previous step, instead of individual security prices.

(iii)

In instances where the relative strength begins to diminish among more than one-third of the potential First Trust sector and industry-based ETFs relative to the Cash Index, the Index allocates to the Cash Index.

First Trust Dorsey Wright Focus 5 ETF

Index Description

The Dorsey Wright Focus Five Index is designed to provide targeted exposure to the five First Trust sector-based ETFs that the Index Provider believes offer the greatest potential to outperform the other First Trust sector-based ETFs. The Index is constructed pursuant to the Index Provider’s proprietary methodology, which takes into account the performance of each of the First Trust sector-based ETFs relative to one another. The Index began on February 4, 2014 at a base value of 1000.

Index Calculation

The Index Provider uses relative strength to measure the price performance of a security versus a market average, another security or a universe of securities. A security’s relative strength can improve if it rises more than the market in an uptrend or goes down less than the market in a downtrend. Relative strength is a momentum technique that relies on unbiased, unemotional and objective data, rather than biased forecasting and subjective research. Relative strength is a way of recording historic performance patterns, and the Index Provider uses relative strength signals as a trend indicator for current momentum and future performance trends of a security versus another one.

The Index Provider builds relative strength charts for each First Trust ETF using the following process:

(i)	On a daily basis, the Index Provider computes the ratio of the closing price of each First Trust ETF to the closing price of each other First Trust ETF. For example: Relative Strength Reading = (ETF 1 Closing Price ÷ ETF 2 Closing Price) x 100

(ii)

As a result of such on-going calculations, a Point and Figure Relative Strength chart is created for each relationship within the inventory. A Point and Figure Relative Strength chart is a variation of a Point and Figure chart but its input value is computed in the previous step, instead of individual security prices.

First Trust Dorsey Wright International Focus 5 ETF

Index Description

The Dorsey Wright International Focus Five Index is designed to provide targeted exposure to the five First Trust country/region-based ETFs that the Index Provider believes offer the greatest potential to outperform the other ETFs in the selection universe. The Index is constructed pursuant to the Index Provider’s proprietary methodology, which takes into account the performance of certain First Trust country/region-based ETFs relative to one another. The Index began on July 17, 2014 at a base value of 1000.

Index Calculation

The Index Provider uses relative strength to measure the price performance of a security versus a market average, another security or universe of securities. A security’s relative strength can improve if it rises more than the market in an uptrend or goes down less than the market in a downtrend. Relative strength is a momentum technique that relies on unbiased, unemotional and objective data, rather than biased forecasting and subjective research. Relative strength is a way of recording historic performance patterns, and the Index Provider uses relative strength signals as a trend indicator for current momentum and future performance trends of a security versus another one.

The Index Provider builds relative strength charts for each First Trust ETF using the following process:

(i)	On a daily basis, the Index Provider computes the ratio of the closing price of each First Trust ETF within the Index’s potential inventory to the closing price of each other First Trust ETF within the Index’s potential

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inventory. For example: Relative Strength Reading = (ETF 1 Closing Price ÷ ETF 2 Closing Price) x 100

(ii)

As a result of such on-going calculations, a Point and Figure Relative Strength chart is created for each relationship within the inventory. A Point and Figure Relative Strength chart is a variation of a Point and Figure chart but its input value is computed in the previous step, instead of individual security prices.

First Trust Rising Dividend Achievers ETF

Index Description

The NASDAQ US Rising Dividend Achievers Index is designed to provide exposure to U.S. companies that have a history of raising their dividends and exhibit characteristics suggesting they may continue to do so into the future. The Index is designed to provide access to a diversified portfolio of large capitalization income producing securities, which are composed of dividend-paying, U.S. equity securities.

The Index began on October 21, 2013 at a base value of 1,000.

Index Calculation

The Index is comprised of 50 equity securities issued by U.S. companies. To be eligible for inclusion in the Index, a security must meet the following criteria:

•	be a member of the NASDAQ US Benchmark Index (NQUSB);
•	not be classified as Real Estate Investment Trust (ICB: 8670) by the ICB;
•	rank in top 500 by market capitalization;
•	have a minimum three-month average daily dollar trading value of $5 million;
•	have paid a dividend in the trailing 12 months greater than the dividend paid in the trailing 12-month period three and five years prior;
•	having earnings per share in the most recent fiscal year greater than the earnings per share the three fiscal years prior;
•	have a cash-to-debt ratio greater than 50%; and
•	have a trailing 12-month payout ratio no greater than 65%.

Index Rebalancing

The Index is rebalanced quarterly to maintain its equally weighted asset allocation by measuring the dividend yield of each security as compared to the dividend yield of all Index Securities as of the last trading day in March, June, September and December. The reference dates for the data used in the rebalancing are at the close of trading on the last trading day in February, May, August and November, respectively. The Advisor will reweight and rebalance the portfolio based on the following:

•	The eligible securities are ranked by a combined factor of dollar dividend increase over the previous 5-year period, current dividend yield, and payout ratio.
•	The resulting ranks are aggregated into a single score with the 50 securities with the lowest aggregated rank selected for the index. In the case of multiple securities having the same aggregated score, the security with the highest yield will be selected.
•	The index is reconstituted annually and rebalanced quarterly such that all securities will be given an equal weight.
•	If an industry has a weight greater than 30%, the highest-ranking security by volatility will be removed and replaced with the next eligible security ( e.g. the 51st ranked by volatility) from a different industry. This process is repeated until no industry has a weight greater than 30%.

Additionally, if at any time during the year other than the rebalancing, an Index security no longer meets the Eligibility Criteria, or is otherwise determined to have become ineligible for inclusion in the Index, the security is removed from the Index and is replaced. Ordinarily, a security will be removed from the Index at its last sale price. If, however, at the time of its removal the Index security is halted from trading on its primary listing market and an official closing price cannot readily be determined, the Index security may, in the Index Provider’s discretion, be removed at a zero price. The Index Provider removes securities from the Index at a zero price if there is no recognizable market price for this security. The zero price will be applied to the

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Index security after the close of the market but prior to the time the official closing value of the Index is disseminated, which is ordinarily 5:16 p.m. Eastern time.

First Trust NASDAQ Technology Dividend Index Fund

Index Description

The NASDAQ Technology Dividend Index Fund ^SM includes up to 100 technology and telecommunications companies that pay a regular or common dividend. To be selected for the Index, a company must be classified as a technology or telecommunications company under the Industry Classification Benchmark ( “ICB” ) and have a minimum market capitalization of $500 million, as described below. The Index is calculated and maintained by the Index Provider.

Index Calculation

The Index employs a modified market cap weighting methodology in which larger companies receive a larger index weighting. The index weighting methodology includes caps to prevent high concentrations among larger stocks. This methodology is applied to the dividend value of each Index security. The dividend value is calculated by multiplying dividends paid per share within the past 12 months by the current shares outstanding. At each quarter, the Index is rebalanced such that the technology securities are given a collective weight of 80% and the telecommunications securities are given a collective weight of 20%.

The maximum weight of any technology constituent will not exceed 8%, and no more than 5 securities are at that cap. The excess weight of any capped security is distributed proportionally across the remaining Index Securities. If after redistribution, any of the 5 highest ranked Index Securities are weighted below 8%, these securities are not capped. Any remaining Index Securities in excess of 4% are capped at 4%, and the excess weight will be redistributed proportionally across the remaining Index Securities. The process is repeated, if necessary, to derive the final weights. For the telecommunications constituents, at each quarterly rebalance no security weight will exceed 2%. The excess weight of any capped security is distributed proportionally across the remaining telecommunications securities.

The Index began on June 20, 2012 at a base value of 1000.

Eligibility

Index eligibility is limited to specific security types only. The security types eligible for the Index are common stocks and depositary receipts.

Eligibility Criteria

To be eligible for inclusion in the Index, a security must meet the following criteria:

•	be listed on The Nasdaq Stock Market LLC, The New York Stock Exchange or NYSE Amex;
•	the issuer of the security must be classified as a technology or telecommunications company under the Industry Classification Benchmark ( “ICB” );
•	have a minimum three-month average daily dollar trading volume of $1 million; codes 6000 and 9000;
•	have a minimum market capitalization of $500 million;
•	have paid a regular or common dividend within past 12 months;
•	have a yield of at least .5%;
•	have not had a decrease in common dividends per share paid within past 12 months;
•	may not be issued by an issuer currently in bankruptcy proceedings;
•	the issuer of the security may not have entered into a definitive agreement or other arrangement which would likely result in the security no longer being Index eligible; and
•	the issuer of the security may not have annual financial statements with an audit opinion that is currently withdrawn.

For the purposes of Index eligibility criteria, if the security is a depositary receipt representing a security of a non-U.S. issuer, then references to the “issuer” are references to the issuer of the underlying security.

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Index Evaluation

The Index securities are evaluated semi-annually in March and September. In the evaluation, the above Eligibility Criteria are applied using market data through the end of January and July. Securities meeting the criteria are included in the Index. Security additions and deletions are made effective after the close of trading on the third Friday in March and September.

Additionally, if at any time during the year other than the time of evaluation, an Index security no longer meets the Eligibility Criteria, or is otherwise determined to have become ineligible for inclusion in the Index, the security is removed from the Index and is not replaced. Ordinarily, a security will be removed from the Index at its Last Sale Price. If, however, at the time of its removal the Index security is halted from trading on its primary listing market and an official closing price cannot readily be determined, the Index security may, in Nasdaq’s discretion, be removed at a zero price. The zero price will be applied to the Index security after the close of the market but prior to the time the official closing value of the Index is disseminated, which is ordinarily 17:16:00 ET.

Index Maintenance

Changes in the price and/or Index shares driven by corporate events such as stock dividends, stock splits and certain spin-offs and rights issuances are adjusted on the ex-date. If the change in total shares outstanding arising from other corporate actions is greater than or equal to 10%, the change is made as soon as practicable. Otherwise, if the change in total shares outstanding is less than 10%, then all such changes are accumulated and made effective at one time on a quarterly basis after the close of trading on the third Friday in each of March, June, September and December. The Index shares are derived from the security’s total shares outstanding. The Index shares are adjusted by the same percentage amount by which the total shares outstanding have changed.

A special cash dividend announced by the listing exchange, will result in an adjustment to the Last Sale Price of an Index security prior to market open on the ex-date for the special amount distributed. A special dividend may also be referred to as unusual, extraordinary, one-time, non-recurring etc.

Ordinarily, whenever there is a change in Index shares, a change in an Index security or a change to the price of an Index security due to spin-off, rights issuances or special cash dividends as mentioned above, the divisor is adjusted to ensure that there is no discontinuity in the value of the Index which might otherwise be caused by any such change. All changes are announced in advance and are reflected in the Index prior to market open on the Index effective date.

Index Rebalancing

The Index employs a modified market capitalization weighting methodology. At each Evaluation, the Index securities are classified technology or telecommunications based on their ICB classification. The technology securities are given a collective weight of 80% and the telecommunications securities are given a collective weight of 20% in the Index.

Within the technology sector, the Index securities are ranked by dividend value. At each quarter, the Index is rebalanced such that the maximum weight of any technology Index security does not exceed 8% and no more than 5 securities are at the cap. The excess weight of any capped security is distributed proportionally across the remaining Index securities in the technology sector. If after redistribution, any of the 5 highest ranked technology Index securities are weighted below 8%, they are not capped. Next, any remaining technology Index securities in excess of 4% are capped at 4% and the excess weight is redistributed proportionally across the remaining technology Index securities. The process is repeated, if necessary, to derive the final weights for the technology sector.

Within the telecommunications sector, the Index securities are ranked by dividend value. At each quarter, the Index is rebalanced such that the maximum weight of any telecommunications security does not exceed 2%. The excess weight of any capped security is distributed proportionally across the remaining Index securities in the telecommunications sector. The process is repeated, if necessary, to derive the final weights for the telecommunications sector.

The modified market capitalization-weighting methodology is applied to the dividend value of each Index security. The dividend value is calculated by multiplying dividends paid within the past 12 months by the current shares outstanding. Index shares are then calculated multiplying the weight of the security derived above by the total dividend market value of the Index and dividing the modified market capitalization for each Index security by its corresponding Last Sale Price. The changes are effective after trading on the third Friday in March, June, September and December.

Nasdaq, Inc. may, from time to time, exercise reasonable discretion as it deems appropriate in order to ensure Index integrity.

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First Trust RBA American Industrial Renaissance ^® ETF

Index Description

The Richard Bernstein Advisors American Industrial Renaissance ^® Index is designed to measure the performance of small and mid cap U.S. companies in the industrial and community banking sectors. The Index provides exposure to companies directly involved in manufacturing, related infrastructure and banking. Banks will be chosen from states considered to be traditional manufacturing hubs. To be eligible for inclusion in the Index, a company must: (i) be traded on a U.S. securities exchange, (ii) have a market capitalization of at least $200 million as of the Index’s latest rebalancing date (iii) source the majority of its revenue from within the U.S.

RBA places no limit on the number of constituents included in the Index. A proprietary portfolio optimization method is used by RBA to weight each individual constituent company. Constituent companies are added to the Index at the quarterly rebalancing. If a constituent company is no longer is eligible to be included in the Index, RBA will remove it.

The Index began on February 19, 2014 at a base value of 972.

Index Construction

The Index is comprised of U.S. equity securities that are selected by the Index Provider as follows:

•	Begin with a universe of U.S. exchange-traded equities including depositary receipts and eliminate companies not directly related to manufacturing and related infrastructure, and banking. Banks will be chosen from states considered to be traditional manufacturing hubs; and
•	Screen to exclude companies with non-U.S. sales greater than or equal to 25%; and
•	Screen for positive 12-month forward earnings estimates.

RBA’s Proprietary Portfolio Optimization method is then used to weight the securities. No position will exceed approximately 3% of the total portfolio at each quarterly rebalance. Bank securities will be limited to a maximum of approximately 10% of the portfolio at each quarterly rebalance. Other portfolio criteria include: $6 minimum share price; $200 million minimum market cap; and liquidity of at least $500,000 trading volume on average each day.

Index Rebalancing

At each quarter the Index is rebalanced such that each segment of the Index will be capped at its predetermined weight. Rebalancing is effective as of the market close of the third Friday in April, July, October and January. The reference dates for the data used in the rebalancing are at the close of trading on the last trading day in March, June, September and December, respectively.

Additionally, if at any time during the year other than the rebalancing, an Index security no longer meets the eligibility criteria, or is otherwise determined to have become ineligible for inclusion in the Index, the security is removed from the Index and is not replaced. Ordinarily, a security will be removed from the Index at its Last Sale Price. If, however, at the time of its removal the Index security is halted from trading on its primary listing market and an official closing price cannot readily be determined, the Index security may, in Nasdaq’s discretion, be removed at a zero price. The zero price will be applied to the Index security after the close of the market but prior to the time the official closing value of the Index is disseminated, which is ordinarily 17:16:00 ET.

First Trust RBA Quality Income ETF

Index Description

The Richard Bernstein Advisors Quality Income Index is designed to provide access to a diversified portfolio of small, mid and large capitalization income producing securities.

RBA places no limit on the number of constituents included in the Index. All companies that meet the eligibility requirements are included. A proprietary portfolio optimization method is used by RBA to weight each individual constituent company. Constituent companies are added to the Index at the quarterly rebalancing. If a constituent company is no longer is eligible to be included in the Index, RBA will remove it.

The Index began on February 19, 2014 at a base value of 995.

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Index Construction

The Index is comprised of U.S. and non-U.S. equity securities that are selected by the Index Provider as follows:

•	Begin with all equity securities in the global high dividend yield universe; and
•	Screen for debt levels and consistency of earnings/cash flow to potentially eliminate companies headed for a dividend cut or omission.

RBA’s proprietary portfolio optimization method is then used to weight the securities. Portfolio optimization analyzes numerous possible security combinations and weightings in an effort to find the portfolio that maximizes RBA’s return expectations while minimizing all other observable global market risk factors. An optimal portfolio has an expected return greater than any other with the same or greater risk, or less risk than any other portfolio with the same or lesser return. No position will exceed approximately 3% of the total portfolio at each quarterly rebalance. Other portfolio criteria include: $6 minimum share price; $200 million minimum market cap; and liquidity of at least $1,000,000 trading volume on average each day.

Index Rebalancing

At each quarter the Index is rebalanced such that each segment of the Index will be capped at its predetermined weight. Rebalancing is effective as of the market close of the third Friday in April, July, October and January. The reference dates for the data used in the rebalancing are at the close of trading on the last trading day in March, June, September and December, respectively.

Additionally, if at any time during the year other than the rebalancing, an Index security no longer meets the eligibility criteria, or is otherwise determined to have become ineligible for inclusion in the Index, the security is removed from the Index and is not replaced. Ordinarily, a security will be removed from the Index at its Last Sale Price. If, however, at the time of its removal the Index security is halted from trading on its primary listing market and an official closing price cannot readily be determined, the Index security may, in Nasdaq’s discretion, be removed at a zero price. The Index Provider removes securities from the Index at a zero price if there is no recognizable market price for this security. The zero price will be applied to the Index security after the close of the market but prior to the time the official closing value of the Index is disseminated, which is ordinarily 17:16:00 ET.

International Multi-Asset Diversified Income Index Fund

Index Description

The NASDAQ International Multi-Asset Diversified Income Index ^SM is designed to provide exposure to multiple asset segments, each selected to result in a consistent and high yield for the Index. The Index is designed to provide access to a diversified portfolio of small, mid and large capitalization income producing securities, which are composed of dividend-paying, non-U.S. securities, non-U.S. REITs, non-U.S. preferred securities, infrastructure companies and an index-based ETF that invests in non-U.S. fixed income securities.

The Index began on August 8, 2013 at a base value of 1,000.

Index Construction

The Index is comprised of the five types of securities listed below and selected from each of these categories of securities as follows:

Non-U.S. Dividend-Paying Equities

To be eligible for inclusion in the dividend-paying equity segment of the Index, a security must meet the following criteria:

•	be a member of the NASDAQ Global Ex-United States Index ( “NQGXUS” );
•	not be classified as Real Estate Investment Trust (ICB: 8670) or Utility (ICB: 7000) by the ICB;
•	have a minimum market capitalization of $500 million;
•	have a minimum three-month average daily dollar trading value of $2.5 million;
•	have paid a regular dividend for each of the last three consecutive years;
•	have positive total earnings over the trailing 12-month period;
•	have a dividend payout ratio less than or equal to 80%; and
•	have one-year realized volatility less than the NQGXUS one-year realized volatility + 15%.

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Of the eligible companies, 50 securities will be selected and weighted by yield. If less than 50 securities remain after the screens, securities will be added back based on the volatility screen such that the securities which were next eligible based on that screen will be added. If 50 securities are still not eligible, the process will be repeated with each of the previous eligibility criterion until 50 securities are achieved. Within this segment, no single security can have a weight greater than 8%.

Dividend-paying equities comprise 20% of the Index.

Non-U.S. REITs

To be eligible for inclusion in the REIT segment of the Index, a security must meet the following criteria:

•	be a member of the NQGXUS;
•	must be classified as Real Estate Investment Trust (ICB: 8670) by the ICB;
•	have a minimum market capitalization of $500 million;
•	have a minimum three-month average daily dollar trading value of $2.5 million;
•	have paid a regular dividend for each of the last three consecutive years;
•	have positive total earnings over the trailing 12-month period;
•	have a dividend payout ratio less than or equal to 150%; and
•	have one-year realized volatility less than the NASDAQ Global Real Estate Index ( “NQG8600” ) one-year realized volatility + 15%.

Of the eligible companies, 25 securities will be selected and weighted by yield. If less than 25 securities remain after the screens, securities will be added back based on the volatility screen such that the securities which were next eligible based on that screen will be added. If 25 securities are still not eligible, the process will be repeated with each of the previous eligibility criterion until 25 securities are achieved. Within this segment, no single security can have a weight greater than 8%.

REITs comprise 20% of the Index.

Non-U.S. Preferred Securities

To be eligible for inclusion in the preferred segment of the Index, a security must meet the following criteria:

•	be a member of the NASDAQ Ex-United States Preferred Securities Index ( “NQPFDIN” );
•	have a minimum market capitalization of $250 million;
•	have a minimum three-month average daily dollar trading value of $250,000; and
•	have one-year realized volatility less than the NQPFDIN one-year realized volatility + 15%.

All components of the NQPFDIN classified as equity will be selected. If less than 25 names exist, the remaining debt components will be selected based on the following criteria. Each eligible component will be scored by yield and realized volatility with the highest yielding security scoring 1 and least volatile security 1. The scores are added and the names with the lowest score are selected. If two securities are tied in score, the security with the higher yield will be selected. The 25 remaining Ex-U.S.-listed preferred securities are then weighted by yield.

Preferred securities comprise 20% of the Index.

Infrastructure Companies

To be eligible for inclusion in the infrastructure segment of the Index, a security must meet the following criteria:

•	be classified as Royalty Trust or be a member of NQGXUS and classified as Utilities (ICB: 7000) by the ICB;
•	have a minimum market capitalization of $500 million;
•	have a minimum three-month average daily dollar trading value of $1 million; and
•	have a one-year realized volatility less than the DWA MLP Index one-year realized volatility + 15%.

Each eligible component will be scored by yield and realized volatility with the highest yielding security scoring 1 and least volatile security 1. The scores are added and the 25 names with the lowest score are selected. If two securities are tied in score, the security with the higher yield will be selected. If less than 25 securities remain after the screens, securities will be added back based on the volatility screen such that the securities which were next eligible based on that screen will be added. If 25 securities are still not eligible, the process will be repeated with each of the previous eligibility criterion until 25 securities are achieved. The 25 remaining securities are then weighted by yield.

Infrastructure companies comprise 20% of the Index.

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Non-U.S. Fixed Income ETF

To be eligible for inclusion in the fixed income segment of the Index, a security must meet the following criteria:

•	be a US-Listed ETF tracking a diversified index of non-U.S debt instruments with a portfolio comprised of no more than 30% of its weight from one single country of origin;
•	have a minimum assets under management of $500 million;
•	have a minimum average daily volume of 100,000 shares; and
•	must consistently pay regular scheduled dividends.

Each eligible ETF will be scored by yield and realized volatility with the highest yielding security scoring 1 and least volatile security 1. The ETF with the lowest score will be selected.

The fixed income ETF comprises 20% of the Index.

Index Rebalancing

The Index employs a modified market capitalization weighting methodology. At each quarter the Index is rebalanced such that each segment of the Index will be capped at its predetermined weight. ⁽¹⁾ Rebalancing is effective as of the market close of the third Friday in March, June, September and December. The reference dates for the data used in the rebalancing are at the close of trading on the last trading day in February, May, August and November, respectively.

Additionally, if at any time during the year other than the rebalancing, an Index security no longer meets the Eligibility Criteria, or is otherwise determined to have become ineligible for inclusion in the Index, the security is removed from the Index and is not replaced. Ordinarily, a security will be removed from the Index at its Last Sale Price. If, however, at the time of its removal the Index security is halted from trading on its primary listing market and an official closing price cannot readily be determined, the Index security may, in Nasdaq’s discretion, be removed at a zero price. The zero price will be applied to the Index security after the close of the market but prior to the time the official closing value of the Index is disseminated, which is ordinarily 17:16:00 ET.

Multi-Asset Diversified Income Index Fund

Index Description

The NASDAQ Multi-Asset Diversified Income Index ^SM is designed to provide exposure to five Index Segments, each selected to result in a consistent and high yield for the Index. The Index is designed to provide access to a diversified portfolio of small, mid and large capitalization income producing securities, which are composed of domestic and international dividend-paying stocks, REITs, oil and gas or basic materials MLPs, U.S.-listed preferred securities and an index-based exchange-traded fund that invests in high yield or “junk” bonds.” The Index is comprised of securities classified as U.S.-listed equities, U.S.-listed REITs, U.S.-listed preferred securities, U.S.-listed MLPs and a high-yield corporate bond ETF.

The Index employs a modified market cap weighting methodology which assigns a pre-set weight to the five Index Segments at each quarterly rebalance. Each Index Segment has a set of separate and distinct eligibility rules and weighting procedures as described below. The Index began on June 20, 2012 at a base value of 1000.

Index Construction

The Index is comprised of the five types of securities listed above and selected from each of these categories of securities as follows:

Dividend-Paying Equities

To be eligible for inclusion in the U.S.-listed equity segment of the Index, a security must meet the following criteria:

•	be a member of the NASDAQ ® US Benchmark Index (NQUSB);
•	not be classified as Real Estate Investment Trust (ICB: 8670) by the Industry Classification Benchmark (ICB);
•	have a minimum market capitalization of $1 billion;
•	have a minimum three-month average daily dollar trading value of $5 million;

(1)

The non-U.S. preferred segment of NQMAXUS is reviewed on an annual basis in June of each year. A replacement pool of securities will be created at the annual reconstitution and the next eligible names will be added at each subsequent quarterly rebalance to ensure the non-U.S. preferred securities Index Segment contains 25 securities.

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•	have paid a regular dividend for each of the last three consecutive years;
•	have positive total earnings over the trailing 12-month period;
•	have a dividend payout ratio less than or equal to 80%; and
•	have-one year realized volatility less than the NQUSB one-year realized volatility + 15%.

Of the eligible companies, 50 securities will be selected and weighted by yield. If less than 50 securities remain after the screens, securities will be added back based on the volatility screen such that the securities which were next eligible based on that screen will be added. If 50 securities are still not eligible, the process will be repeated with each of the previous eligibility criterion until 50 securities are achieved. Within the US Equity segment, no single security can have a weight greater than 8%.

Dividend-paying equities comprise 20% of the Index.

REITS

To be eligible for inclusion in the U.S.-listed REIT segment of the Index, a security must meet the following criteria:

•	be a member of the NASDAQ ® US Benchmark Index (NQUSB);
•	must be classified as Real Estate Investment Trust (ICB: 8670) by the Industry Classification Benchmark (ICB);
•	have a minimum market capitalization of $1 billion;
•	have a minimum three-month average daily dollar trading value of $5 million;
•	have paid a regular dividend for each of the last three consecutive years;
•	have positive total earnings over the trailing 12-month period;
•	have a dividend payout ratio less than or equal to 150%; and
•	have one-year realized volatility less than the REIT segment of the NQUSB one-year realized volatility + 15%.

Of the eligible companies, 25 securities will be selected and weighted by yield. If less than 25 securities remain after the screens, securities will be added back based on the volatility screen such that the securities which were next eligible based on that screen will be added. If 25 securities are still not eligible, the process will be repeated with each of the previous eligibility criterion until 25 securities are achieved. Within the U.S.-listed REIT segment, no single security can have a weight greater than 8%.

REITs comprise 20% of the Index.

Preferred Securities

To be eligible for inclusion in the U.S.-listed preferred segment of the Index, a security must meet the following criteria:

•	be a member of the NASDAQ ® US Preferred Security Index (NQPFDUS);
•	have a minimum market capitalization of $250 million;
•	have a minimum three-month average daily dollar trading value of $250 thousand; and
•	have one-year realized volatility less than the NQPFDUS one-year realized volatility + 15%.

All components of the NQPFDUS classified as equity will be selected. If less than 25 names exist, the remaining debt components will be selected based on the following criteria. Each eligible component will be scored by yield and realized volatility with the highest yielding security scoring 1 and least volatile security a 1. The scores are added and the names with the lowest score are selected. If two securities are tied in score, the security with the higher yield will be selected. The 25 remaining U.S.-listed preferred securities are then weighted by yield. No more than 40% of the US Preferred segment can be in securities classified as debt based on the yield weighting. If the securities classified as debt are greater than 50%, the weight will be capped at 40% and excess weight will be redistributed to the remaining equity securities.

Preferred Securities comprise 20% of the Index.

MLPs

To be eligible for inclusion in the U.S.-listed MLP segment of the index, a security must meet the following criteria:

•	be classified as a limited partnership;
•	be classified as Oil & Gas (0001) or Basic Materials (2000) by the Industry Classification Benchmark (ICB);
•	have a minimum market capitalization of $500 million;
•	have a minimum three-month average daily dollar trading value of $500 thousand: and

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•	have a one-year realized volatility less than the DWA MLP Index one-year realized volatility + 15%.

Each eligible component will be scored by yield and realized volatility with the highest yielding security scoring 1 and least volatile security a 1. The scores are added and the 25 names with the lowest score are selected. If two securities are tied in score, the security with the higher yield will be selected. If less than 25 securities remain after the screens, securities will be added back based on the volatility screen such that the securities which were next eligible based on that screen will be added. If 25 securities are still not eligible, the process will be repeated with each of the previous eligibility criterion until 25 securities are achieved. The 25 remaining U.S.-listed MLP securities are then weighted by yield.

MLPs comprise 20% of the Index.

High Yield Bond ETF

To be eligible for inclusion in the high-yield corporate bond ETF segment of the Index, a security must meet the following criteria:

•	be a U.S.-listed ETF sponsored by FTP, tracking a high yield corporate debt strategy.

If there is no eligible ETF based on the criteria above, the following U.S. high yield corporate bond criteria will be used:

•	be a U.S.-listed ETF tracking a high yield corporate bond index; and
•	have a minimum assets under management of $100 million.

The ETF will comprise 20% of the Index.

Index Rebalancing

The Index employs a modified market capitalization weighting methodology. At each quarter the Index is rebalanced such that each segment of the Index will be capped at its predetermined weight (the preferred segment of the NASDAQ ^® US Multi-Asset Income Index ( “NQMAUS” ) is reviewed on an annual basis in June of each year). Rebalancing is effective as of the market close of the third Friday in March, June, September and December. The reference dates for the data used in the rebalancing are at the close of trading on the last trading day in January, April, July and October, respectively.

Additionally, if at any time during the year other than the rebalancing, an Index security no longer meets the Eligibility Criteria, or is otherwise determined to have become ineligible for inclusion in the Index, the security is removed from the Index and is not replaced. Ordinarily, a security will be removed from the Index at its Last Sale Price. If, however, at the time of its removal the Index security is halted from trading on its primary listing market and an official closing price cannot readily be determined, the Index security may, in Nasdaq’s discretion, be removed at a zero price. The zero price will be applied to the Index security after the close of the market but prior to the time the official closing value of the Index is disseminated, which is ordinarily 17:16:00 ET.

Premium/Discount Information

The tables that follow present information about the differences between each Fund’s daily market price on the applicable Exchange and its net asset value. The “Market Price” of a Fund generally is determined using the midpoint between the highest bid and lowest offer on the Exchange, as of the time a Fund’s net asset value is calculated. A Fund’s Market Price may be at, above, or below its net asset value. The net asset value of a Fund will fluctuate with changes in the market value of its portfolio holdings. The Market Price of a Fund will fluctuate in accordance with changes in its net asset value, as well as market supply and demand.

Premiums or discounts are the differences (generally expressed as a percentage) between the net asset value and Market Price of a Fund on a given day, generally at the time net asset value is calculated. A premium is the amount that a Fund is trading above the reported net asset value. A discount is the amount that a Fund is trading below the reported net asset value.

The following information shows the frequency distribution of premiums and discounts of the daily bid/ask price of each Fund against its net asset value. The information shown for each Fund is for the periods indicated. Shareholders may pay more than net asset value when they buy Fund shares and receive less than net asset value when they sell those shares because shares are bought and sold at current market price. All data presented here represents past performance, which cannot be used to predict future results. Information about the premiums and discounts at which the Funds’ shares have traded is available on the Funds’ website at www.ftportfolios.com.

88

First Trust Dorsey Wright Dynamic Focus 5 ETF (FVC)
Bid/Ask Midpoint vs. Net Asset Value

Number of Days Bid/Ask Midpoint At/Above Net Asset Value

	0.00% – 0.49%	0.50% – 0.99%	1.00% – 1.99%	>=2.00%
12 Months Ended 12/31/2017	165	0	0	0

Number of Days Bid/Ask Midpoint Below Net Asset Value

	0.00% – 0.49%	0.50% – 0.99%	1.00% – 1.99%	>=2.00%
12 Months Ended 12/31/2017	86	0	0	0

First Trust Dorsey Wright Focus 5 ETF (FV)
Bid/Ask Midpoint vs. Net Asset Value

Number of Days Bid/Ask Midpoint At/Above Net Asset Value

	0.00% – 0.49%	0.50% – 0.99%	1.00% – 1.99%	>=2.00%
12 Months Ended 12/31/2017	72	0	0	0

Number of Days Bid/Ask Midpoint Below Net Asset Value

	0.00% – 0.49%	0.50% – 0.99%	1.00% – 1.99%	>=2.00%
12 Months Ended 12/31/2017	179	0	0	0

First Trust Dorsey Wright International Focus 5 ETF (IFV)
Bid/Ask Midpoint vs. Net Asset Value

Number of Days Bid/Ask Midpoint At/Above Net Asset Value

	0.00% – 0.49%	0.50% – 0.99%	1.00% – 1.99%	>=2.00%
12 Months Ended 12/31/2017	133	0	0	0

Number of Days Bid/Ask Midpoint Below Net Asset Value

	0.00% – 0.49%	0.50% – 0.99%	1.00% – 1.99%	>=2.00%
12 Months Ended 12/31/2017	118	0	0	0

First Trust RBA American Industrial Renaissance ^® ETF (AIRR)
Bid/Ask Midpoint vs. Net Asset Value

Number of Days Bid/Ask Midpoint At/Above Net Asset Value

	0.00% – 0.49%	0.50% – 0.99%	1.00% – 1.99%	>=2.00%
12 Months Ended 12/31/2017	114	0	0	0

Number of Days Bid/Ask Midpoint Below Net Asset Value

	0.00% – 0.49%	0.50% – 0.99%	1.00% – 1.99%	>=2.00%
12 Months Ended 12/31/2017	137	0	0	0

89

First Trust RBA Quality Income ETF (QINC)
Bid/Ask Midpoint vs. Net Asset Value

Number of Days Bid/Ask Midpoint At/Above Net Asset Value

	0.00% – 0.49%	0.50% – 0.99%	1.00% – 1.99%	>=2.00%
12 Months Ended 12/31/2017	140	0	0	0

Number of Days Bid/Ask Midpoint Below Net Asset Value

	0.00% – 0.49%	0.50% – 0.99%	1.00% – 1.99%	>=2.00%
12 Months Ended 12/31/2017	111	0	0	0

First Trust Rising Dividend Achievers ETF (RDVY)
Bid/Ask Midpoint vs. Net Asset Value

Number of Days Bid/Ask Midpoint At/Above Net Asset Value

	0.00% – 0.49%	0.50% – 0.99%	1.00% – 1.99%	>=2.00%
12 Months Ended 12/31/2017	220	0	0	0

Number of Days Bid/Ask Midpoint Below Net Asset Value

	0.00% – 0.49%	0.50% – 0.99%	1.00% – 1.99%	>=2.00%
12 Months Ended 12/31/2017	31	0	0	0

First Trust NASDAQ Technology Dividend Index Fund (TDIV)
Bid/Ask Midpoint vs. Net Asset Value

Number of Days Bid/Ask Midpoint At/Above Net Asset Value

	0.00% – 0.49%	0.50% – 0.99%	1.00% – 1.99%	>=2.00%
12 Months Ended 12/31/2017	159	0	0	0

Number of Days Bid/Ask Midpoint Below Net Asset Value

	0.00% – 0.49%	0.50% – 0.99%	1.00% – 1.99%	>=2.00%
12 Months Ended 12/31/2017	92	0	0	0

International Multi-Asset Diversified Income Index Fund (YDIV)
Bid/Ask Midpoint vs. Net Asset Value

Number of Days Bid/Ask Midpoint At/Above Net Asset Value

	0.00% – 0.49%	0.50% – 0.99%	1.00% – 1.99%	>=2.00%
12 Months Ended 12/31/2017	79	46	0	0

Number of Days Bid/Ask Midpoint Below Net Asset Value

	0.00% – 0.49%	0.50% – 0.99%	1.00% – 1.99%	>=2.00%
12 Months Ended 12/31/2017	41	76	8	1

90

Multi-Asset Diversified Income Index Fund (MDIV)
Bid/Ask Midpoint vs. Net Asset Value

Number of Days Bid/Ask Midpoint At/Above Net Asset Value

	0.00% – 0.49%	0.50% – 0.99%	1.00% – 1.99%	>=2.00%
12 Months Ended 12/31/2017	124	0	0	0

Number of Days Bid/Ask Midpoint Below Net Asset Value

	0.00% – 0.49%	0.50% – 0.99%	1.00% – 1.99%	>=2.00%
12 Months Ended 12/31/2017	127	0	0	0

Total Return Information

The tables below compare the total return of each Fund to the total return of the Index on which it is based and each Fund's benchmark indices. The information presented for each Fund is for the period indicated. The total returns would have been lower if certain fees had not been waived and expenses reimbursed by First Trust.

“Average annual total returns” represent the average annual change in the value of an investment over the period indicated. “Cumulative total returns” represent the total change in value of an investment over the period indicated. The net asset value per share of a Fund is the value of one share of a Fund and is computed by dividing the value of all assets of the Fund (including accrued interest and dividends), less liabilities (including accrued expenses and dividends declared but unpaid), by the total number of outstanding shares. The net asset value return is based on the net asset value per share of a Fund, and the market return is based on the market price per share of a Fund. The price used to calculate market return ( “Market Price” ) generally is determined by using the midpoint between the highest bid and the lowest offer on Nasdaq on which the shares of a Fund are listed for trading, as of the time that a Fund's net asset value is calculated. Since the shares of each Fund typically do not trade in the secondary market until several days after a Fund's inception, for the period from inception to the first day of secondary market trading in shares of a Fund, the net asset value of a Fund is used as a proxy for the secondary market trading price to calculate market returns. Market and net asset value returns assume that all distributions have been reinvested in a Fund at Market Price and net asset value, respectively. An index is a statistical composite that tracks a specified financial market or sector. Unlike each Fund, an index does not actually hold a portfolio of securities and therefore does not incur the expenses incurred by a Fund. These expenses negatively impact the performance of each Fund. Also, market returns do not include brokerage commissions that may be payable on secondary market transactions. If brokerage commissions were included, market returns would be lower. The total returns reflect the reinvestment of dividends on securities in the index. The returns shown in the table below do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of shares of a Fund. The investment return and principal value of shares of a Fund will vary with changes in market conditions. Shares of a Fund may be worth more or less than their original cost when they are redeemed or sold in the market. A Fund's past performance is no guarantee of future results.

First Trust Dorsey Wright Dynamic Focus 5 ETF (FVC)
Total Returns as of September 30, 2017

		Average Annual		Cumulative
	1 Year	Inception (3/17/2016)		Inception (3/17/2016)
Fund Performance
Net Asset Value	15.13%	14.28%		22.82%
Market Price	15.13%	14.31%		22.87%
Index Performance
Dorsey Wright Dynamic Focus Five Index	15.52%	14.71%		23.53%
S&P 500 ® Index	18.61%	17.06%		27.45%

  

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92

  

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Financial Highlights

The financial highlights table is intended to help you understand each Fund's financial performance for the periods shown. Certain information reflects financial results for a single share of each Fund. The total returns represent the rate that an investor would have earned (or lost) on an investment in a Fund (assuming reinvestment of all dividends and distributions). The information for the periods indicated has been derived from financial statements audited by Deloitte & Touche LLP, whose report, along with each Fund's financial statements, is included in the Annual Report to Shareholders dated September 30, 2017 and is incorporated by reference in each Fund's SAI, which is available upon request.

(a)	Inception date is consistent with the commencement of investment operations and is the date the initial creation units were established.

(b)	Total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all distributions at net asset value during the period, and redemption at net asset value on the last day of the period. The returns presented do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption or sale of Fund shares. Total return is calculated for the time period presented and is not annualized for periods of less than a year.
(c)	Annualized.
(d)	Portfolio turnover is calculated for the time period presented and is not annualized for periods of less than a year and does not include securities received or delivered from processing creations or redemptions and in-kind transactions.

95

First Trust Exchange-Traded Fund VI

96

First Trust Exchange-Traded Fund VI

97

First Trust Exchange-Traded Fund VI

98

First Trust Exchange-Traded Fund VI

99

First Trust Exchange-Traded Fund VI

100