First Trust Enhanced Short Maturity ETF Approves Investment Management Fee Waiver and Reverse Share Split
October 29 2014 - 4:56PM
Business Wire
First Trust Advisors L.P. (“First Trust”) announced today that
the Board of Trustees (“Board”) of First Trust Exchange-Traded Fund
IV (the “Trust”), on behalf of First Trust Enhanced Short Maturity
ETF (the “Fund”), an actively-managed exchange-traded fund (NASDAQ:
FTSM), has approved an additional waiver of the Fund’s management
fees in the amount of 0.10% of the Fund’s average daily net assets
for a period of one year beginning October 29, 2014. First Trust
serves as the investment advisor to the Fund. The Board has also
approved a one-for-two reverse share split for the Fund.
With the additional fee waiver, the Fund’s total annual fund
operating expenses after fee waivers and offsets will be 0.25% of
the Fund’s average daily net assets. The Fund’s annual unitary
management fee is 0.45% of the Fund’s average daily net assets.
First Trust previously agreed to waive management fees in the
amount of 0.10% of the Fund’s average daily net assets until August
6, 2015 and to reduce management fees by the proportional amount of
the Fund’s acquired fund fees and expenses for the Fund’s
investment in other investment companies managed by First Trust.
Please see the Fund’s prospectus, as supplemented, for more
information.
The reverse share split will result in every two outstanding
shares being converted into one share, thereby reducing the number
of shares outstanding. Once the reverse share split is complete,
each shareholder’s account will reflect one-half fewer shares with
a net asset value per share that reflects the combined shares. The
Fund’s shares will continue to trade under the same ticker symbol,
FTSM, and the Fund will be assigned a new CUSIP number, 33739Q408.
First Trust currently anticipates the reverse share split will be
effective as of the opening of business on The NASDAQ Stock Market,
LLC on or about November 10, 2014, subject to all regulatory
requirements and other conditions being satisfied.
The Fund launched on August 6, 2014. The Fund’s investment
objective is to seek current income, consistent with preservation
of capital and daily liquidity. The Fund seeks to achieve its
investment objective by investing, under normal conditions, at
least 80% of its net assets in a portfolio of U.S.
dollar-denominated fixed- and variable-rate instruments issued by
U.S. and non-U.S. public and private sector entities. These will
include the following types of fixed- and variable–rate debt
instruments: corporate and government bonds and notes; agency
securities; instruments of non-U.S. issuers in developed markets;
privately issued securities; asset-backed securities;
mortgage-related securities; municipal bonds; and money market
securities.
First Trust, along with its affiliate First Trust Portfolios
L.P., are privately-held companies which provide a variety of
investment services, including asset management and financial
advisory services, with collective assets under management or
supervision of approximately $99 billion as of September 30, 2014
through unit investment trusts, exchange-traded funds, closed-end
funds, mutual funds and separate managed accounts. First Trust is
based in Wheaton, Illinois.
You should consider the investment objective, risk, charges and
expenses of the Fund before investing. The prospectus for the Fund
contains this and other important information and is available free
of charge by calling toll-free 1-800-621-1675 or visiting
http://www.ftportfolios.com. The prospectus should be read
carefully before investing.
This press release is not intended to, and shall not, constitute
an offer to purchase or sell shares of the Fund. Past performance
is no assurance of future results. The Fund’s shares will change in
value, and you could lose money by investing in the Fund. An
investment in the Fund is not a deposit of a bank and is not
insured or guaranteed by the Federal Deposit Insurance Corporation
or any other governmental agency. There can be no assurance that
the Fund’s investment objective will be achieved. An investment in
the Fund involves risks similar to those of investing in a
portfolio of securities traded on exchanges. The risks of investing
in the Fund are spelled out in its prospectus, shareholder report,
and other regulatory filings.
An actively-managed exchange-traded fund is subject to
management risk because it is an actively managed portfolio. In
managing the Fund’s investment portfolio, the portfolio managers
will apply investment techniques and risk analyses that may not
have the desired result. The Fund is subject to risk associated
with investing in mortgage-related and other asset-backed
securities, interest rate risk, prepayment risk, credit risk, call
risk, cash transaction risk, fixed income securities risk, floating
rate loan risk, income risk, investment company risk, new fund
risk, non-U.S. securities risk, and volatility risk.
Investors buying or selling Fund shares on the secondary market
may incur brokerage commissions. Investors who sell Fund shares may
receive less than the share’s net asset value. Unlike shares of
open-end funds, investors are generally not able to purchase Fund
shares directly from the Fund and individual shares are not
redeemable. However, specified large blocks of shares called
“creation units” can be purchased from, or redeemed to, the
Fund.
First Trust Advisors L.P.Press Inquiries: Ryan Issakainen,
630-765-8689Broker Inquiries: Sales Team, 866-848-9727Analyst
Inquiries: Stan Ueland, 630-517-7633
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