|
1 |
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2 |
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5 |
|
7 |
|
8 |
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14 |
|
15 |
|
16 |
|
17 |
|
18 |
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24 |
|
25 |
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31 |
|
33 |
Performance | |||
Average
Annual Total Returns |
Cumulative Total Returns | ||
1
Year Ended 10/31/21 |
Inception
(8/22/17) to 10/31/21 |
Inception
(8/22/17) to 10/31/21 | |
Fund Performance | |||
NAV | 10.91% | 5.82% | 26.77% |
Market Price | 11.05% | 5.87% | 27.03% |
Index Performance | |||
Blended Benchmark(1) | 8.34% | 6.31% | 29.22% |
ICE BofA US Investment Grade Institutional Capital Securities Index | 6.56% | 5.87% | 27.02% |
(1) | The Blended Benchmark consists of a 45/40/15 blend of the ICE BofA US Investment Grade Institutional Capital Securities Index, the ICE USD Contingent Capital Index and the ICE BofA US High Yield Institutional Capital Securities Index. The Blended Benchmark is intended to reflect the proportional market cap of each segment within the institutional market. On July 6, 2021, the Fund’s benchmark changed from the ICE BofA US Investment Grade Institutional Capital Securities Index to the Blended Benchmark, because the Advisor believes that the Blended Benchmark better reflects the investment strategies of the Fund. The Blended Benchmark returns are calculated by using the monthly returns of the three indices during each period shown above. At the beginning of each month the three indices are rebalanced to a 45/40/15 ratio to account for divergence from that ratio that occurred during the course of each month. The monthly returns are then compounded for each period shown above, giving the performance for the Blended Benchmark for each period shown above. |
(2) | The credit quality and ratings information presented above reflect the ratings assigned by one or more nationally recognized statistical rating organizations (NRSROs), including Standard & Poor’s Ratings Group, a division of the McGraw Hill Companies, Inc., Moody’s Investors Service, Inc., Fitch Ratings or a comparably rated NRSRO. For situations in which a security is rated by more than one NRSRO and the ratings are not equivalent, the highest rating is used. Sub-investment grade ratings are those rated BB+/Ba1 or lower. Investment grade ratings are those rated BBB-/Baa3 or higher. The credit ratings shown relate to the creditworthiness of the issuers of the underlying securities in the Fund, and not to the Fund or its shares. Credit ratings are subject to change. |
Beginning Account Value May 1, 2021 |
Ending Account Value October 31, 2021 |
Annualized Expense Ratio Based on the Six-Month Period |
Expenses
Paid During the Six-Month Period (a) | |
First Trust Institutional Preferred Securities and Income ETF (FPEI) | ||||
Actual | $1,000.00 | $1,026.70 | 0.85% | $4.34 |
Hypothetical (5% return before expenses) | $1,000.00 | $1,020.92 | 0.85% | $4.33 |
(a) | Expenses are equal to the annualized expense ratios as indicated in the table multiplied by the average account value over the period (May 1, 2021 through October 31, 2021), multiplied by 184/365 (to reflect the six-month period). |
Shares | Description | Stated Rate |
Stated Maturity |
Value | ||||
$100 PAR PREFERRED SECURITIES – 0.2% | ||||||||
Food Products – 0.2% | ||||||||
8,000 |
Dairy Farmers of America, Inc. (a)
|
7.88% | (b) | $804,000 | ||||
(Cost $807,000) | ||||||||
$1,000 PAR PREFERRED SECURITIES – 2.3% | ||||||||
Banks – 2.2% | ||||||||
3,142 |
Bank of America Corp., Series L
|
7.25% | (b) | 4,500,035 | ||||
4,205 |
Wells Fargo & Co., Series L
|
7.50% | (b) | 6,391,474 | ||||
10,891,509 | ||||||||
Food Products – 0.1% | ||||||||
400,000 |
Land O’ Lakes, Inc. (c)
|
7.25% | (b) | 434,138 | ||||
Total $1,000 Par Preferred Securities
|
11,325,647 | |||||||
(Cost $10,809,485) | ||||||||
Par Amount |
Description | Stated Rate |
Stated Maturity |
Value | ||||
CAPITAL PREFERRED SECURITIES – 90.5% | ||||||||
Banks – 40.2% | ||||||||
$4,950,000 |
Australia & New Zealand Banking Group Ltd.
(a) (d) (e)
|
6.75% | (b) | 5,697,178 | ||||
1,145,000 |
Australia & New Zealand Banking Group Ltd.
(c) (d) (e)
|
6.75% | (b) | 1,317,832 | ||||
3,600,000 |
Banco Bilbao Vizcaya Argentaria S.A., Series 9
(d) (e)
|
6.50% | (b) | 3,870,000 | ||||
400,000 |
Banco Mercantil del Norte S.A. (c) (d) (e)
|
6.88% | (b) | 406,750 | ||||
900,000 |
Banco Mercantil del Norte S.A. (a) (d) (e)
|
7.50% | (b) | 989,172 | ||||
842,000 |
Banco Mercantil del Norte S.A. (a) (d) (e)
|
7.63% | (b) | 925,796 | ||||
1,400,000 |
Banco Mercantil del Norte S.A. (a) (d) (e)
|
8.38% | (b) | 1,638,504 | ||||
2,000,000 |
Banco Santander S.A. (d) (e)
|
4.75% | (b) | 2,015,340 | ||||
3,600,000 |
Banco Santander S.A. (c) (d) (e)
|
7.50% | (b) | 3,902,533 | ||||
2,400,000 |
Bank of America Corp., Series X (e)
|
6.25% | (b) | 2,617,500 | ||||
3,700,000 |
Bank of Nova Scotia (The) (e)
|
4.90% | (b) | 3,957,816 | ||||
2,300,000 |
Barclays PLC (d) (e)
|
4.38% | (b) | 2,268,490 | ||||
1,450,000 |
Barclays PLC (d) (e)
|
6.13% | (b) | 1,594,551 | ||||
2,000,000 |
Barclays PLC (d) (e)
|
7.75% | (b) | 2,177,100 | ||||
560,000 |
Barclays PLC (c) (d) (e)
|
7.88% | (b) | 572,844 | ||||
10,040,000 |
Barclays PLC (d) (e)
|
8.00% | (b) | 11,200,875 | ||||
700,000 |
BBVA Bancomer S.A. (a) (d) (e)
|
5.88% | 09/13/34 | 762,290 | ||||
2,300,000 |
BNP Paribas S.A. (a) (d) (e)
|
6.63% | (b) | 2,492,625 | ||||
4,000,000 |
BNP Paribas S.A. (a) (d) (e)
|
7.38% | (b) | 4,592,780 | ||||
4,358,000 |
CIT Group, Inc., Series A (e)
|
5.80% | (b) | 4,439,712 | ||||
2,195,000 |
Citigroup, Inc. (e)
|
3.88% | (b) | 2,219,694 | ||||
345,000 |
Citigroup, Inc. (e)
|
5.90% | (b) | 357,938 | ||||
1,281,000 |
Citigroup, Inc. (e)
|
5.95% | (b) | 1,325,835 | ||||
5,740,000 |
Citigroup, Inc., Series D (e)
|
5.35% | (b) | 5,900,720 | ||||
3,414,000 |
Citigroup, Inc., Series P (e)
|
5.95% | (b) | 3,687,120 | ||||
1,000,000 |
Citigroup, Inc., Series V (e)
|
4.70% | (b) | 1,016,250 | ||||
1,049,000 |
Citigroup, Inc., Series W (e)
|
4.00% | (b) | 1,073,914 | ||||
2,979,000 |
Citigroup, Inc., Series Y (e)
|
4.15% | (b) | 2,996,874 | ||||
1,120,000 |
Citizens Financial Group, Inc., Series F
(e)
|
5.65% | (b) | 1,230,600 | ||||
1,170,000 |
Citizens Financial Group, Inc., Series G
(e)
|
4.00% | (b) | 1,181,700 | ||||
1,358,000 |
CoBank ACB, Series I (e)
|
6.25% | (b) | 1,526,053 | ||||
800,000 |
Comerica, Inc. (e)
|
5.63% | (b) | 885,000 | ||||
400,000 |
Commerzbank AG (c) (d) (e)
|
7.00% | (b) | 431,328 | ||||
2,806,000 |
Credit Agricole S.A. (a) (d) (e)
|
6.88% | (b) | 3,098,525 | ||||
1,300,000 |
Credit Agricole S.A. (a) (d) (e)
|
7.88% | (b) | 1,440,693 | ||||
1,000,000 |
Credit Agricole S.A. (c) (d) (e)
|
7.88% | (b) | 1,108,225 |
Par Amount |
Description | Stated Rate |
Stated Maturity |
Value | ||||
CAPITAL PREFERRED SECURITIES (Continued) | ||||||||
Banks (Continued) | ||||||||
$2,200,000 |
Credit Agricole S.A. (a) (d) (e)
|
8.13% | (b) | $2,640,944 | ||||
2,400,000 |
Danske Bank A.S. (c) (d) (e)
|
4.38% | (b) | 2,424,194 | ||||
550,000 |
Danske Bank A.S. (c) (d) (e)
|
6.13% | (b) | 584,031 | ||||
850,000 |
Danske Bank A.S. (c) (d) (e)
|
7.00% | (b) | 948,545 | ||||
800,000 |
Farm Credit Bank of Texas, Series 3 (a) (e)
|
6.20% | (b) | 880,000 | ||||
1,100,000 |
Farm Credit Bank of Texas, Series 4 (a) (e)
|
5.70% | (b) | 1,204,500 | ||||
4,864,000 |
Fifth Third Bancorp, Series H (e)
|
5.10% | (b) | 4,979,520 | ||||
1,100,000 |
Fifth Third Bancorp, Series L (e)
|
4.50% | (b) | 1,186,625 | ||||
400,000 |
HSBC Holdings PLC (d) (e)
|
4.60% | (b) | 398,452 | ||||
2,000,000 |
HSBC Holdings PLC (d) (e)
|
6.00% | (b) | 2,176,240 | ||||
3,070,000 |
HSBC Holdings PLC (d) (e)
|
6.38% | (b) | 3,343,829 | ||||
3,000,000 |
HSBC Holdings PLC (d) (e)
|
6.38% | (b) | 3,236,250 | ||||
2,200,000 |
Huntington Bancshares, Inc., Series G (e)
|
4.45% | (b) | 2,356,750 | ||||
2,950,000 |
ING Groep N.V. (d) (e)
|
5.75% | (b) | 3,205,042 | ||||
1,400,000 |
ING Groep N.V. (d) (e)
|
6.50% | (b) | 1,538,257 | ||||
820,000 |
ING Groep N.V. (c) (d) (e)
|
6.88% | (b) | 840,500 | ||||
1,970,000 |
Intesa Sanpaolo S.p.A. (a) (d) (e)
|
7.70% | (b) | 2,203,937 | ||||
1,700,000 |
JPMorgan Chase & Co., Series I, 3 Mo. LIBOR +
3.47% (f)
|
3.60% | (b) | 1,704,241 | ||||
6,041,000 |
JPMorgan Chase & Co., Series Q (e)
|
5.15% | (b) | 6,217,578 | ||||
605,000 |
JPMorgan Chase & Co., Series R (e)
|
6.00% | (b) | 632,754 | ||||
5,424,000 |
JPMorgan Chase & Co., Series V, 3 Mo. LIBOR +
3.32% (f)
|
3.45% | (b) | 5,426,744 | ||||
475,000 |
JPMorgan Chase & Co., Series Z, 3 Mo. LIBOR +
3.80% (f)
|
3.93% | (b) | 478,080 | ||||
1,550,000 |
Lloyds Banking Group PLC (d) (e)
|
6.75% | (b) | 1,772,557 | ||||
5,638,000 |
Lloyds Banking Group PLC (d) (e)
|
7.50% | (b) | 6,244,085 | ||||
1,000,000 |
M&T Bank Corp. (e)
|
3.50% | (b) | 985,000 | ||||
2,341,000 |
M&T Bank Corp., Series G (e)
|
5.00% | (b) | 2,440,492 | ||||
600,000 |
Natwest Group PLC (d) (e)
|
6.00% | (b) | 664,758 | ||||
1,550,000 |
Natwest Group PLC (d) (e)
|
8.00% | (b) | 1,819,336 | ||||
2,425,000 |
Nordea Bank Abp (a) (d) (e)
|
6.63% | (b) | 2,775,097 | ||||
1,200,000 |
PNC Financial Services Group (The), Inc., Series
T (e)
|
3.40% | (b) | 1,186,500 | ||||
1,000,000 |
Regions Financial Corp., Series D (e)
|
5.75% | (b) | 1,106,250 | ||||
200,000 |
Skandinaviska Enskilda Banken AB (c) (d)
(e)
|
5.13% | (b) | 212,371 | ||||
3,800,000 |
Societe Generale S.A. (a) (d) (e)
|
5.38% | (b) | 4,047,000 | ||||
4,211,000 |
Societe Generale S.A. (a) (d) (e)
|
7.88% | (b) | 4,650,207 | ||||
400,000 |
Societe Generale S.A. (c) (d) (e)
|
7.88% | (b) | 441,720 | ||||
2,639,000 |
Societe Generale S.A. (a) (d) (e)
|
8.00% | (b) | 3,077,087 | ||||
3,800,000 |
Standard Chartered PLC (a) (d) (e)
|
4.30% | (b) | 3,658,526 | ||||
1,500,000 |
Standard Chartered PLC (a) (d) (e)
|
6.00% | (b) | 1,634,250 | ||||
1,400,000 |
SVB Financial Group, Series C (e)
|
4.00% | (b) | 1,403,430 | ||||
3,185,000 |
SVB Financial Group, Series D (e)
|
4.25% | (b) | 3,200,527 | ||||
1,000,000 |
Swedbank AB, Series NC5 (c) (d) (e)
|
5.63% | (b) | 1,078,105 | ||||
463,000 |
Texas Capital Bancshares, Inc. (e)
|
4.00% | 05/06/31 | 482,564 | ||||
7,800,000 |
Truist Financial Corp., Series N (e)
|
4.80% | (b) | 8,112,000 | ||||
1,028,000 |
Truist Financial Corp., Series P (e)
|
4.95% | (b) | 1,118,207 | ||||
3,850,000 |
UniCredit S.p.A. (c) (d) (e)
|
8.00% | (b) | 4,213,998 | ||||
600,000 |
UniCredit S.p.A. (a) (e)
|
7.30% | 04/02/34 | 724,240 | ||||
750,000 |
UniCredit S.p.A. (a) (e)
|
5.46% | 06/30/35 | 821,456 | ||||
1,184,000 |
US Bancorp (e)
|
3.70% | (b) | 1,182,283 | ||||
3,130,000 |
Wells Fargo & Co., Series BB (e)
|
3.90% | (b) | 3,190,644 | ||||
197,769,860 | ||||||||
Capital Markets – 11.1% | ||||||||
4,820,000 |
Apollo Management Holdings L.P. (a) (e)
|
4.95% | 01/14/50 | 4,993,454 | ||||
500,000 |
Bank of New York Mellon (The) Corp., Series G
(e)
|
4.70% | (b) | 545,350 | ||||
2,038,000 |
Charles Schwab (The) Corp., Series G (e)
|
5.38% | (b) | 2,244,348 |
Par Amount |
Description | Stated Rate |
Stated Maturity |
Value | ||||
CAPITAL PREFERRED SECURITIES (Continued) | ||||||||
Capital Markets (Continued) | ||||||||
$3,410,000 |
Charles Schwab (The) Corp., Series I (e)
|
4.00% | (b) | $3,513,664 | ||||
4,170,000 |
Credit Suisse Group AG (a) (d) (e)
|
5.25% | (b) | 4,342,012 | ||||
1,500,000 |
Credit Suisse Group AG (a) (d) (e)
|
6.25% | (b) | 1,617,015 | ||||
3,100,000 |
Credit Suisse Group AG (a) (d) (e)
|
6.38% | (b) | 3,382,875 | ||||
314,000 |
Credit Suisse Group AG (a) (d) (e)
|
7.50% | (b) | 343,045 | ||||
4,150,000 |
Credit Suisse Group AG (a) (d) (e)
|
7.50% | (b) | 4,421,825 | ||||
4,000,000 |
Deutsche Bank AG (d) (e)
|
7.50% | (b) | 4,380,000 | ||||
3,200,000 |
EFG International AG (c) (d) (e)
|
5.50% | (b) | 3,369,440 | ||||
3,000,000 |
Goldman Sachs Group (The), Inc., Series Q
(e)
|
5.50% | (b) | 3,225,900 | ||||
200,000 |
Goldman Sachs Group (The), Inc., Series R
(e)
|
4.95% | (b) | 211,000 | ||||
765,000 |
Goldman Sachs Group (The), Inc., Series T
(e)
|
3.80% | (b) | 766,913 | ||||
970,000 |
Goldman Sachs Group (The), Inc., Series U
(e)
|
3.65% | (b) | 965,150 | ||||
1,593,000 |
Goldman Sachs Group (The), Inc., Series V
(e)
|
4.13% | (b) | 1,599,292 | ||||
2,800,000 |
Morgan Stanley, Series H, 3 Mo. LIBOR + 3.61%
(f)
|
3.73% | (b) | 2,814,451 | ||||
2,204,000 |
Morgan Stanley, Series M (e)
|
5.88% | (b) | 2,521,183 | ||||
3,334,000 |
State Street Corp., Series F (f)
|
3.71% | (b) | 3,340,458 | ||||
2,500,000 |
UBS Group AG (c) (d) (e)
|
6.88% | (b) | 2,826,562 | ||||
1,425,000 |
UBS Group AG (a) (d) (e)
|
7.00% | (b) | 1,541,772 | ||||
1,500,000 |
UBS Group AG (c) (d) (e)
|
7.00% | (b) | 1,622,918 | ||||
54,588,627 | ||||||||
Consumer Finance – 0.9% | ||||||||
2,497,000 |
American Express Co. (e)
|
3.55% | (b) | 2,513,543 | ||||
1,932,000 |
Capital One Financial Corp., Series M (e)
|
3.95% | (b) | 1,968,225 | ||||
4,481,768 | ||||||||
Diversified Financial Services – 2.7% | ||||||||
3,000,000 |
American AgCredit Corp. (a) (e)
|
5.25% | (b) | 3,067,500 | ||||
2,775,000 |
Ares Finance Co., III LLC (a) (e)
|
4.13% | 06/30/51 | 2,853,234 | ||||
2,250,000 |
Capital Farm Credit ACA, Series 1 (a) (e)
|
5.00% | (b) | 2,334,375 | ||||
650,000 |
Compeer Financial ACA (a) (e)
|
4.88% | (b) | 659,750 | ||||
650,000 |
Depository Trust & Clearing (The) Corp.,
Series D (a) (e)
|
3.38% | (b) | 657,718 | ||||
2,712,000 |
Voya Financial, Inc. (e)
|
5.65% | 05/15/53 | 2,843,966 | ||||
755,000 |
Voya Financial, Inc., Series A (e)
|
6.13% | (b) | 804,075 | ||||
13,220,618 | ||||||||
Diversified Telecommunication Services – 0.8% | ||||||||
1,365,000 |
Koninklijke KPN N.V. (a) (e)
|
7.00% | 03/28/73 | 1,449,425 | ||||
2,326,000 |
Koninklijke KPN N.V. (c) (e)
|
7.00% | 03/28/73 | 2,469,863 | ||||
3,919,288 | ||||||||
Electric Utilities – 4.0% | ||||||||
830,000 |
Duke Energy Corp. (e)
|
4.88% | (b) | 883,120 | ||||
6,962,000 |
Emera, Inc., Series 16-A (e)
|
6.75% | 06/15/76 | 8,198,660 | ||||
2,400,000 |
Enel S.p.A. (a) (e)
|
8.75% | 09/24/73 | 2,715,480 | ||||
1,428,000 |
Southern (The) Co., Series 21-A (e)
|
3.75% | 09/15/51 | 1,454,361 | ||||
6,500,000 |
Southern California Edison Co., Series E
(e)
|
6.25% | (b) | 6,542,040 | ||||
19,793,661 | ||||||||
Energy Equipment & Services – 0.4% | ||||||||
276,000 |
Transcanada Trust (e)
|
5.63% | 05/20/75 | 293,940 | ||||
1,600,000 |
Transcanada Trust (e)
|
5.50% | 09/15/79 | 1,750,000 | ||||
2,043,940 |
Par Amount |
Description | Stated Rate |
Stated Maturity |
Value | ||||
CAPITAL PREFERRED SECURITIES (Continued) | ||||||||
Food Products – 2.2% | ||||||||
$700,000 |
Dairy Farmers of America, Inc. (g)
|
7.13% | (b) | $710,500 | ||||
1,400,000 |
Land O’Lakes Capital Trust I (g)
|
7.45% | 03/15/28 | 1,618,610 | ||||
6,146,000 |
Land O’Lakes, Inc. (a)
|
7.00% | (b) | 6,486,489 | ||||
1,490,000 |
Land O’Lakes, Inc. (a)
|
7.25% | (b) | 1,617,164 | ||||
535,000 |
Land O’Lakes, Inc. (a)
|
8.00% | (b) | 580,539 | ||||
11,013,302 | ||||||||
Independent Power & Renewable Electricity Producers – 0.2% | ||||||||
1,100,000 |
AES Andes S.A. (a) (e)
|
6.35% | 10/07/79 | 1,141,492 | ||||
Insurance – 15.7% | ||||||||
1,500,000 |
Allianz SE (a) (e)
|
3.50% | (b) | 1,515,000 | ||||
3,200,000 |
Asahi Mutual Life Insurance Co. (c) (e)
|
6.50% | (b) | 3,430,432 | ||||
3,200,000 |
Asahi Mutual Life Insurance Co. (c) (e)
|
7.25% | (b) | 3,240,950 | ||||
3,858,000 |
Assurant, Inc. (e)
|
7.00% | 03/27/48 | 4,503,713 | ||||
5,300,000 |
Assured Guaranty Municipal Holdings, Inc. (a)
(e)
|
6.40% | 12/15/66 | 5,888,129 | ||||
1,700,000 |
Assured Guaranty Municipal Holdings, Inc. (c)
(e)
|
6.40% | 12/15/66 | 1,890,767 | ||||
4,370,000 |
AXIS Specialty Finance LLC (e)
|
4.90% | 01/15/40 | 4,621,865 | ||||
1,332,000 |
Enstar Finance LLC (e)
|
5.75% | 09/01/40 | 1,406,925 | ||||
5,000,000 |
Global Atlantic Fin Co. (a) (e)
|
4.70% | 10/15/51 | 5,154,712 | ||||
1,464,000 |
Kuvare US Holdings, Inc. (a) (e)
|
7.00% | 02/17/51 | 1,566,237 | ||||
1,000,000 |
La Mondiale SAM (c) (e)
|
5.88% | 01/26/47 | 1,136,353 | ||||
5,250,000 |
Lancashire Holdings Ltd. (c) (e)
|
5.63% | 09/18/41 | 5,706,199 | ||||
1,200,000 |
Liberty Mutual Group, Inc. (a) (e)
|
4.13% | 12/15/51 | 1,231,548 | ||||
4,701,000 |
Markel Corp. (e)
|
6.00% | (b) | 5,176,976 | ||||
2,900,000 |
MetLife, Inc. (a)
|
9.25% | 04/08/38 | 4,381,865 | ||||
500,000 |
MetLife, Inc., Series G (e)
|
3.85% | (b) | 520,000 | ||||
400,000 |
PartnerRe Finance B LLC (e)
|
4.50% | 10/01/50 | 427,587 | ||||
3,200,000 |
Phoenix Group Holdings PLC (c) (e)
|
5.63% | (b) | 3,362,640 | ||||
3,500,000 |
Principal Financial Group, Inc., 3 Mo. LIBOR +
3.04% (f)
|
3.17% | 05/15/55 | 3,484,313 | ||||
7,114,000 |
Progressive (The) Corp., Series B (e)
|
5.38% | (b) | 7,336,313 | ||||
3,000,000 |
Prudential Financial, Inc. (e)
|
5.88% | 09/15/42 | 3,106,230 | ||||
2,200,000 |
QBE Insurance Group Ltd. (a) (e)
|
5.88% | (b) | 2,409,000 | ||||
1,000,000 |
QBE Insurance Group Ltd. (a) (e)
|
7.50% | 11/24/43 | 1,107,500 | ||||
200,000 |
QBE Insurance Group Ltd. (c) (e)
|
7.50% | 11/24/43 | 221,500 | ||||
2,850,000 |
QBE Insurance Group Ltd. (c) (e)
|
6.75% | 12/02/44 | 3,190,076 | ||||
300,000 |
QBE Insurance Group Ltd. (c) (e)
|
5.88% | 06/17/46 | 336,282 | ||||
999,000 |
Reinsurance Group of America, Inc., 3 Mo. LIBOR +
2.67% (f)
|
2.78% | 12/15/65 | 971,829 | ||||
77,324,941 | ||||||||
Multi-Utilities – 2.0% | ||||||||
4,086,000 |
CenterPoint Energy, Inc., Series A (e)
|
6.13% | (b) | 4,319,617 | ||||
948,000 |
CMS Energy Corp. (e)
|
3.75% | 12/01/50 | 945,535 | ||||
180,000 |
Dominion Energy, Inc., Series B (e)
|
4.65% | (b) | 192,150 | ||||
906,000 |
NiSource, Inc. (e)
|
5.65% | (b) | 960,360 | ||||
3,000,000 |
Sempra Energy (e)
|
4.88% | (b) | 3,244,230 | ||||
9,661,892 | ||||||||
Oil, Gas & Consumable Fuels – 6.0% | ||||||||
1,600,000 |
Buckeye Partners L.P. (e)
|
6.38% | 01/22/78 | 1,465,432 | ||||
5,352,000 |
DCP Midstream L.P., Series A (e)
|
7.38% | (b) | 5,378,760 | ||||
2,662,000 |
DCP Midstream Operating L.P. (a) (e)
|
5.85% | 05/21/43 | 2,487,346 | ||||
1,026,000 |
Enbridge, Inc. (e)
|
6.25% | 03/01/78 | 1,133,350 | ||||
7,398,000 |
Enbridge, Inc., Series 16-A (e)
|
6.00% | 01/15/77 | 8,183,520 | ||||
2,000,000 |
Enbridge, Inc., Series 20-A (e)
|
5.75% | 07/15/80 | 2,253,000 |
Par Amount |
Description | Stated Rate |
Stated Maturity |
Value | ||||
CAPITAL PREFERRED SECURITIES (Continued) | ||||||||
Oil, Gas & Consumable Fuels (Continued) | ||||||||
$1,395,000 |
Energy Transfer L.P., 3 Mo. LIBOR + 3.02%
(f)
|
3.14% | 11/01/66 | $1,154,223 | ||||
100,000 |
Energy Transfer L.P., Series B (e)
|
6.63% | (b) | 97,250 | ||||
1,013,000 |
Energy Transfer L.P., Series F (e)
|
6.75% | (b) | 1,042,124 | ||||
948,000 |
Energy Transfer L.P., Series H (e)
|
6.50% | (b) | 983,550 | ||||
4,715,000 |
Enterprise Products Operating LLC, 3 Mo. LIBOR +
2.78% (f)
|
2.90% | 06/01/67 | 4,391,622 | ||||
1,241,000 |
Enterprise Products Operating LLC, Series D
(e)
|
4.88% | 08/16/77 | 1,226,023 | ||||
29,796,200 | ||||||||
Trading Companies & Distributors – 3.0% | ||||||||
9,900,000 |
AerCap Holdings N.V. (e)
|
5.88% | 10/10/79 | 10,342,926 | ||||
1,127,000 |
Air Lease Corp., Series B (e)
|
4.65% | (b) | 1,167,854 | ||||
2,940,000 |
Aircastle Ltd. (a) (e)
|
5.25% | (b) | 3,028,200 | ||||
14,538,980 | ||||||||
Transportation Infrastructure – 1.3% | ||||||||
3,950,000 |
AerCap Global Aviation Trust (a) (e)
|
6.50% | 06/15/45 | 4,242,320 | ||||
2,000,000 |
BNSF Funding Trust I (e)
|
6.61% | 12/15/55 | 2,288,100 | ||||
6,530,420 | ||||||||
Total Capital Preferred Securities
|
445,824,989 | |||||||
(Cost $427,626,875) | ||||||||
Principal Value |
Description | Stated Coupon |
Stated Maturity |
Value | ||||
FOREIGN CORPORATE BONDS AND NOTES – 2.5% | ||||||||
Insurance – 2.5% | ||||||||
11,900,342 |
Highlands Holdings Bond Issuer Ltd./Highlands
Holdings Bond Co-Issuer, Inc. (a) (h)
|
7.63% | 10/15/25 | 12,621,146 | ||||
(Cost $12,655,663) | ||||||||
CORPORATE BONDS AND NOTES – 0.5% | ||||||||
Insurance – 0.5% | ||||||||
2,360,000 |
AmTrust Financial Services, Inc.
|
6.13% | 08/15/23 | 2,384,878 | ||||
(Cost $2,394,336) |
Total Investments – 96.0%
|
472,960,660 | ||
(Cost $454,293,359) (i) | |||
Net Other Assets and Liabilities – 4.0%
|
19,456,997 | ||
Net Assets – 100.0%
|
$492,417,657 |
| |
(a) | This security, sold within the terms of a private placement memorandum, is exempt from registration upon resale under Rule 144A under the Securities Act of 1933, as amended (the “1933 Act”), and may be resold in transactions exempt from registration, normally to qualified institutional buyers. Pursuant to procedures adopted by the Trust’s Board of Trustees, this security has been determined to be liquid by First Trust Advisors L.P., the Fund’s advisor. Although market instability can result in periods of increased overall market illiquidity, liquidity for each security is determined based on security specific factors and assumptions, which require subjective judgment. At October 31, 2021, securities noted as such amounted to $140,596,974 or 28.6% of net assets. |
(b) | Perpetual maturity. |
(c) | This security may be resold to qualified foreign investors and foreign institutional buyers under Regulation S of the 1933 Act. |
(d) | This security is a contingent convertible capital security which may be subject to conversion into common stock of the issuer under certain circumstances. At October 31, 2021, securities noted as such amounted to $140,180,213 or 28.5% of net assets. Of these securities, 3.4% originated in emerging markets, and 96.6% originated in foreign markets. |
(e) | Fixed-to-floating or fixed-to-variable rate security. The interest rate shown reflects the fixed rate in effect at October 31, 2021. At a predetermined date, the fixed rate will change to a floating rate or a variable rate. |
(f) | Floating or variable rate security. |
(g) | This security, sold within the terms of a private placement memorandum, is exempt from registration upon resale under Rule 144A under the 1933 Act, and may be resold in transactions exempt from registration, normally to qualified institutional buyers (see Note 2C - Restricted Securities in the Notes to Financial Statements). |
(h) | These notes are Senior Payment-in-kind (“PIK”) Toggle Notes whereby the issuer may, at its option, elect to pay interest on the notes (1) entirely in cash or (2) entirely in PIK interest. Interest paid in cash will accrue on the notes at a rate of 7.63% per annum (“Cash Interest Rate”) and PIK interest will accrue on the notes at a rate per annum equal to the Cash Interest Rate plus 75 basis points. For the fiscal year ended October 31, 2021, the Fund received a portion of the interest in cash and PIK interest with a principal value of $270,093 for Highlands Holdings Bond Issuer Ltd./Highlands Holdings Bond Co-Issuer, Inc. |
(i) | Aggregate cost for federal income tax purposes was $452,987,321. As of October 31, 2021, the aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost was $20,797,540 and the aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value was $824,201. The net unrealized appreciation was $19,973,339. |
LIBOR | London Interbank Offered Rate |
Total Value at 10/31/2021 |
Level
1 Quoted Prices |
Level
2 Significant Observable Inputs |
Level
3 Significant Unobservable Inputs | |
$100 Par Preferred Securities*
|
$ 804,000 | $ — | $ 804,000 | $ — |
$1,000 Par Preferred Securities*
|
11,325,647 | 11,325,647 | — | — |
Capital Preferred Securities*
|
445,824,989 | — | 445,824,989 | — |
Foreign Corporate Bonds and Notes*
|
12,621,146 | — | 12,621,146 | — |
Corporate Bonds and Notes*
|
2,384,878 | — | 2,384,878 | — |
Total Investments
|
$ 472,960,660 | $ 11,325,647 | $ 461,635,013 | $— |
* | See Portfolio of Investments for industry breakout. |
ASSETS: | |
Investments, at value (Cost $454,293,359)
|
$ 472,960,660 |
Cash
|
12,289,561 |
Receivables: | |
Interest
|
5,531,117 |
Fund shares sold
|
3,082,190 |
Interest reclaims
|
143,336 |
Dividends
|
56,949 |
Total Assets
|
494,063,813 |
LIABILITIES: | |
Payables: | |
Investment securities purchased
|
1,303,038 |
Investment advisory fees
|
343,118 |
Total Liabilities
|
1,646,156 |
NET ASSETS
|
$492,417,657 |
NET ASSETS consist of: | |
Paid-in capital
|
$ 475,762,153 |
Par value
|
240,000 |
Accumulated distributable earnings (loss)
|
16,415,504 |
NET ASSETS
|
$492,417,657 |
NET ASSET VALUE, per share
|
$20.52 |
Number of shares outstanding (unlimited number of
shares authorized, par value $0.01 per share)
|
24,000,002 |
INVESTMENT INCOME: | ||
Interest
|
$ 19,342,471 | |
Dividends
|
368,349 | |
Foreign withholding tax
|
(678) | |
Total investment income
|
19,710,142 | |
EXPENSES: | ||
Investment advisory fees
|
3,073,489 | |
Total expenses
|
3,073,489 | |
NET INVESTMENT INCOME (LOSS)
|
16,636,653 | |
NET REALIZED AND UNREALIZED GAIN (LOSS): | ||
Net realized gain (loss) on investments
|
2,321,122 | |
Net change in unrealized appreciation
(depreciation) on investments
|
14,036,111 | |
NET REALIZED AND UNREALIZED GAIN (LOSS)
|
16,357,233 | |
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM OPERATIONS
|
$ 32,993,886 |
Year Ended 10/31/2021 |
Year Ended 10/31/2020 | ||
OPERATIONS: | |||
Net investment income (loss)
|
$ 16,636,653 | $ 14,552,786 | |
Net realized gain (loss)
|
2,321,122 | (5,869,129) | |
Net change in unrealized appreciation
(depreciation)
|
14,036,111 | (921,636) | |
Net increase (decrease) in net assets resulting
from operations
|
32,993,886 | 7,762,021 | |
DISTRIBUTIONS TO SHAREHOLDERS FROM: | |||
Investment operations
|
(15,669,405) | (14,004,420) | |
Return of capital
|
(847,307) | (507,892) | |
Total distributions to shareholders
|
(16,516,712) | (14,512,312) | |
SHAREHOLDER TRANSACTIONS: | |||
Proceeds from shares sold
|
191,421,574 | 98,406,079 | |
Cost of shares redeemed
|
— | (42,314,739) | |
Net increase (decrease) in net assets resulting
from shareholder transactions
|
191,421,574 | 56,091,340 | |
Total increase (decrease) in net assets
|
207,898,748 | 49,341,049 | |
NET ASSETS: | |||
Beginning of period
|
284,518,909 | 235,177,860 | |
End of period
|
$492,417,657 | $284,518,909 | |
CHANGES IN SHARES OUTSTANDING: | |||
Shares outstanding, beginning of period
|
14,700,002 | 11,850,002 | |
Shares sold
|
9,300,000 | 5,100,000 | |
Shares redeemed
|
— | (2,250,000) | |
Shares outstanding, end of period
|
24,000,002 | 14,700,002 |
Year Ended October 31, | Period Ended 10/31/2017 (a) | ||||||||
2021 | 2020 | 2019 | 2018 | ||||||
Net asset value, beginning of period
|
$ 19.36 | $ 19.85 | $ 18.75 | $ 20.26 | $ 20.00 | ||||
Income from investment operations: | |||||||||
Net investment income (loss)
|
0.90 | 1.01 | 1.01 | 0.99 | 0.18 | ||||
Net realized and unrealized gain (loss)
|
1.19 | (0.50) | 1.12 | (1.47) | 0.22 | ||||
Total from investment operations
|
2.09 | 0.51 | 2.13 | (0.48) | 0.40 | ||||
Distributions paid to shareholders from: | |||||||||
Net investment income
|
(0.88) | (0.97) | (1.00) | (1.03) | (0.14) | ||||
Return of capital
|
(0.05) | (0.03) | (0.03) | — | — | ||||
Total distributions
|
(0.93) | (1.00) | (1.03) | (1.03) | (0.14) | ||||
Net asset value, end of period
|
$20.52 | $19.36 | $19.85 | $18.75 | $20.26 | ||||
Total return
(b)
|
10.91% | 2.76% | 11.75% | (2.42)% | 2.00% | ||||
Ratios to average net assets/supplemental data: | |||||||||
Net assets, end of period (in 000’s)
|
$ 492,418 | $ 284,519 | $ 235,178 | $ 93,757 | $ 24,313 | ||||
Ratio of total expenses to average net
assets
|
0.85% | 0.85% | 0.85% | 0.85% | 0.85% (c) | ||||
Ratio of net investment income (loss) to average
net assets
|
4.60% | 5.22% | 5.39% | 5.36% | 4.93% (c) | ||||
Portfolio turnover rate (d)
|
22% | 48% | 28% | 25% | 13% |
(a) | Inception date is August 22, 2017, which 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. |
1) | benchmark yields; |
2) | reported trades; |
3) | broker/dealer quotes; |
4) | issuer spreads; |
5) | benchmark securities; |
6) | bids and offers; and |
7) | reference data including market research publications. |
1) | the credit conditions in the relevant market and changes thereto; |
2) | the liquidity conditions in the relevant market and changes thereto; |
3) | the interest rate conditions in the relevant market and changes thereto (such as significant changes in interest rates); |
4) | issuer-specific conditions (such as significant credit deterioration); and |
5) | any other market-based data the Advisor’s Pricing Committee considers relevant. In this regard, the Advisor’s Pricing Committee may use last-obtained market-based data to assist it when valuing portfolio securities using amortized cost. |
1) | the type of security; |
2) | the size of the holding; |
3) | the initial cost of the security; |
4) | transactions in comparable securities; |
5) | price quotes from dealers and/or third-party pricing services; |
6) | relationships among various securities; |
7) | information obtained by contacting the issuer, analysts, or the appropriate stock exchange; |
8) | an analysis of the issuer’s financial statements; and |
9) | the existence of merger proposals or tender offers that might affect the value of the security. |
1) | the value of similar foreign securities traded on other foreign markets; |
2) | ADR trading of similar securities; |
3) | closed-end fund or exchange-traded fund trading of similar securities; |
4) | foreign currency exchange activity; |
5) | the trading prices of financial products that are tied to baskets of foreign securities; |
6) | factors relating to the event that precipitated the pricing problem; |
7) | whether the event is likely to recur; and |
8) | whether the effects of the event are isolated or whether they affect entire markets, countries or regions. |
• | Level 1 – Level 1 inputs are quoted prices in active markets for identical investments. An active market is a market in which transactions for the investment occur with sufficient frequency and volume to provide pricing information on an ongoing basis. |
• | Level 2 – Level 2 inputs are observable inputs, either directly or indirectly, and include the following: |
o | Quoted prices for similar investments in active markets. |
o | Quoted prices for identical or similar investments in markets that are non-active. A non-active market is a market where there are few transactions for the investment, the prices are not current, or price quotations vary substantially either over time or among market makers, or in which little information is released publicly. |
o | Inputs other than quoted prices that are observable for the investment (for example, interest rates and yield curves observable at commonly quoted intervals, volatilities, prepayment speeds, loss severities, credit risks, and default rates). |
o | Inputs that are derived principally from or corroborated by observable market data by correlation or other means. |
• | Level 3 – Level 3 inputs are unobservable inputs. Unobservable inputs may reflect the reporting entity’s own assumptions about the assumptions that market participants would use in pricing the investment. |
Security | Acquisition Date |
Par Amount | Current Price | Carrying Cost |
Value | %
of Net Assets | ||
Dairy Farmers of America, Inc., 7.13% | 01/22/21 to 03/22/21 | $700,000 | $101.50 | $700,250 | $710,500 | 0.14 % | ||
Land O’Lakes Capital Trust I, 7.45%, 03/15/28 | 05/04/18 to 07/21/21 | 1,400,000 | 115.61 | 1,555,936 | 1,618,610 | 0.33 | ||
$2,256,186 | $2,329,110 | 0.47 % |
Distributions paid from: | 2021 | 2020 |
Ordinary income
|
$15,669,405 | $14,004,420 |
Capital gains
|
— | — |
Return of capital
|
847,307 | 507,892 |
Undistributed ordinary income
|
$— |
Accumulated capital and other gain (loss)
|
(3,557,835) |
Net unrealized appreciation (depreciation)
|
19,973,339 |
Accumulated Net Investment Income (Loss) |
Accumulated Net Realized Gain (Loss) on Investments |
Paid-in Capital | ||
$(104,067) | $102,307 | $1,760 |
Dividends Received Deduction | Qualified Dividend Income | |
24.68% | 78.77% |
NOT FDIC INSURED | NOT BANK GUARANTEED | MAY LOSE VALUE |
Name, Year of Birth and Position with the Trust | Term of Office and Year First Elected or Appointed | Principal
Occupations During Past 5 Years |
Number of Portfolios in the First Trust Fund Complex Overseen by Trustee | Other Trusteeships or Directorships Held by Trustee During Past 5 Years |
INDEPENDENT TRUSTEES | ||||
Richard
E. Erickson, Trustee (1951) |
• Indefinite
Term • Since Inception |
Physician; Officer, Wheaton Orthopedics; Limited Partner, Gundersen Real Estate Limited Partnership (June 1992 to December 2016) | 215 | None |
Thomas
R. Kadlec, Trustee (1957) |
• Indefinite
Term • Since Inception |
President, ADM Investor Services, Inc. (Futures Commission Merchant) | 215 | Director of ADM Investor Services, Inc., ADM Investor Services International, Futures Industry Association, and National Futures Association |
Robert
F. Keith, Trustee (1956) |
• Indefinite
Term • Since Inception |
President, Hibs Enterprises (Financial and Management Consulting) | 215 | Director of Trust Company of Illinois |
Niel
B. Nielson, Trustee (1954) |
• Indefinite
Term • Since Inception |
Senior Advisor (August 2018 to Present), Managing Director and Chief Operating Officer (January 2015 to August 2018), Pelita Harapan Educational Foundation (Educational Products and Services) | 215 | None |
INTERESTED TRUSTEE | ||||
James
A. Bowen(1),
Trustee and Chairman of the Board (1955) |
• Indefinite
Term • Since Inception |
Chief Executive Officer, First Trust Advisors L.P. and First Trust Portfolios L.P.; Chairman of the Board of Directors, BondWave LLC (Software Development Company) and Stonebridge Advisors LLC (Investment Advisor) | 215 | None |
(1) | Mr. Bowen is deemed an “interested person” of the Trust due to his position as CEO of First Trust Advisors L.P., investment advisor of the Trust. |
Name and Year of Birth | Position and Offices with Trust | Term of Office and Length of Service | Principal
Occupations During Past 5 Years |
OFFICERS(2) | |||
James
M. Dykas (1966) |
President and Chief Executive Officer | • Indefinite
Term • Since January 2016 |
Managing Director and Chief Financial Officer (January 2016 to Present), Controller (January 2011 to January 2016), Senior Vice President (April 2007 to January 2016), First Trust Advisors L.P. and First Trust Portfolios L.P.; Chief Financial Officer (January 2016 to Present), BondWave LLC (Software Development Company) and Stonebridge Advisors LLC (Investment Advisor) |
Donald
P. Swade (1972) |
Treasurer, Chief Financial Officer and Chief Accounting Officer | • Indefinite
Term • Since January 2016 |
Senior Vice President (July 2016 to Present), Vice President (April 2012 to July 2016), First Trust Advisors L.P. and First Trust Portfolios L.P. |
W.
Scott Jardine (1960) |
Secretary and Chief Legal Officer | • Indefinite
Term • Since Inception |
General Counsel, First Trust Advisors L.P. and First Trust Portfolios L.P.; Secretary and General Counsel, BondWave LLC; Secretary, Stonebridge Advisors LLC |
Daniel
J. Lindquist (1970) |
Vice President | • Indefinite
Term • Since Inception |
Managing Director, First Trust Advisors L.P. and First Trust Portfolios L.P. |
Kristi
A. Maher (1966) |
Chief Compliance Officer and Assistant Secretary | • Indefinite
Term • Since Inception |
Deputy General Counsel, First Trust Advisors L.P. and First Trust Portfolios L.P. |
Roger
F. Testin (1966) |
Vice President | • Indefinite
Term • Since Inception |
Senior Vice President, First Trust Advisors L.P. and First Trust Portfolios L.P. |
Stan
Ueland (1970) |
Vice President | • Indefinite
Term • Since Inception |
Senior Vice President, First Trust Advisors L.P. and First Trust Portfolios L.P |
(2) | The term “officer” means the president, vice president, secretary, treasurer, controller or any other officer who performs a policy making function. |
• | Information we receive from you and your broker-dealer, investment professional or financial representative through interviews, applications, agreements or other forms; |
• | Information about your transactions with us, our affiliates or others; |
• | Information we receive from your inquiries by mail, e-mail or telephone; and |
• | Information we collect on our website through the use of “cookies”. For example, we may identify the pages on our website that your browser requests or visits. |
• | In order to provide you with products and services and to effect transactions that you request or authorize, we may disclose your personal information as described above to unaffiliated financial service providers and other companies that perform administrative or other services on our behalf, such as transfer agents, custodians and trustees, or that assist us in the distribution of investor materials such as trustees, banks, financial representatives, proxy services, solicitors and printers. |
• | We may release information we have about you if you direct us to do so, if we are compelled by law to do so, or in other legally limited circumstances (for example to protect your account from fraud). |