2000 through November 2004. Mr. Rubin holds the
Chartered Financial Analyst (CFA) designation. Mr. Rubin received a master’s
degree in Finance from George Washington University. He also holds a bachelor’s
degree in economics from Wharton School of Finance, University of Pennsylvania.
additional information concerning First Trust and the Sub-Advisor, including a
description of the services provided to the Fund, see the Fund’s
SAI. Additional information about the portfolio managers’ compensation, other
accounts managed by the portfolio managers and ownership by the portfolio
managers of shares of the Fund is provided in the SAI.
to an investment management agreement between First Trust and the Trust, on
behalf of the Fund (the "Investment
Management Agreement"), First Trust
oversees the Sub-Advisor’s management of the Fund’s assets and pays the
Sub-Advisor for its services as Sub-Advisor. First Trust is paid an annual
unitary management fee by the Fund equal to 0.90% of the Fund's average daily
net assets and is responsible for the Fund’s expenses, including the cost of
transfer agency, sub-advisory, custody, fund administration, legal, audit and
other services, but excluding fee payments under the Investment Management
Agreement, interest, taxes, brokerage commissions and other expenses connected
with the execution of portfolio transactions, distribution and service fees
payable pursuant to a 12b-1 plan, if any, and extraordinary expenses.
regarding the Board’s approval of the Investment Management Agreement and
Investment Sub-Advisory Agreement is available in the Fund’s
Semi-Annual Report to shareholders for the fiscal period ended February 28,
to Buy and Sell Shares
investors buy and sell shares of the Fund in secondary market transactions
through brokers. Shares of the Fund are listed for trading on the
secondary market on one or more national securities exchanges. Shares can be
bought and sold throughout the trading day like other publicly traded shares.
There is no minimum investment when buying shares on the Exchange. 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 pay 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 bid-ask spread for each transaction (purchase or sale) of
Fund shares. Share prices are reported in dollars and cents per share.
circumstances, the Fund will pay out redemption proceeds to a redeeming
authorized participant within two days after the authorized
participant’s redemption request is received, in accordance with the process set
forth in the Fund’s SAI and in the agreement between the authorized participant
and the Fund’s distributor. However, the Fund reserves the right, including
under stressed market conditions, to take up to seven days after the receipt of
a redemption request to pay an authorized participant, all as permitted by the
purposes of the 1940 Act, the Fund is treated as a registered investment
company, and, absent an available exemption or exemptive relief,
the acquisition of shares by other registered investment companies and companies
relying on Sections 3(c)(1) and 3(c)(7) of the 1940 Act is subject to the
restrictions of Section 12(d)(1) of the 1940 Act. The Trust, on behalf of the
Fund, has received an exemptive order from the Securities and Exchange
Commission that permits certain registered investment companies to invest in the
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
agreements with the Fund regarding the terms of any investment.
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 Fund and is recognized as the
owner of all shares for all purposes.
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 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.