ETF Research Center

The First Trust Nasdaq Bank ETF tracks an index composed of 30 U.S. banking companies. Holdings are selected by their liquidity, and weighted based on volatility, value, and growth factors.

FUND BASICS
Category	US Equities
Fund Sponsor	First Trust
Website	www.ftportfolios.com
Inception date	Sep 20, 2016
Assets (mns)	$137
Currency	USD
Expense ratio	60 bp
Distributions	Quarterly

FUND STRUCTURE
Regulation	Open-Ended Fund
Custodian
Weighting	Multi-Factor
Index replication
Uses derivatives	No
Options available	No

SECTOR BREAKDOWN

CONSTITUENT BREAKDOWN
No. of constituents	30
Wgt avg mkt cap (mns)	$114,891
Large cap (>$10bn)	75.2%
Mid cap ($2-10bn)	24.8%
Small cap (<$2bn)	0.0%
Developed mkts	100.0%
Emerging mkts	0.0%

TOP TEN HOLDINGS
Total	59.5 %
CITIGROUP INC	8.5 %
JPMORGAN CHASE & CO	8.3 %
PNC FINANCIAL SERVICES GROUP	7.9 %
US BANCORP	7.3 %
WELLS FARGO & CO	7.1 %
CITIZENS FINANCIAL GROUP, INC.	4.2 %
FIRST HORIZON NATIONAL CORP	4.2 %
BANK OF AMERICA CORP	4.1 %
ZIONS BANCORPORATION	4.0 %
HUNTINGTON BANCSHARES INC	3.9 %

TOP COUNTRY EXPOSURE
	UNITED STATES	99.9 %

HISTORICAL PERFORMANCE info

	Custom date range	Compare to
	thru

Standardized Annual Returns (thru December 31)
Year-to-date	1 year	5 years	10 years	Since Incep.
30.1%	30.1%	--	--	13.4%

Market Correlations
versus...	Beta	R-squared
S&P500	1.40	66%
MSCI EAFE	1.27	44%
MSCI Emg. Mkts.	0.85	34%

Technical Indicators
Recent close	$27.32
30d moving avg.	$27.89
Annualized volatility	20.9%
Short interest (ETF)	0.0%
Relative strength (RSI)	46

Liquidity measures
Avg. volume (thou.)	33
Turnover	0.7%
Bid/Ask (% of price)	0.05%
ADV underlying (mns)	$4,163

Distributions

FINDING ALTERNATIVE FUNDS

Below is a list of 20 potential alternatives to the First Trust Nasdaq Bank ETF based on the alternatives' overlap in portfolio holdings with FTXO. Consider funds with lower expense ratios and/or higher ALTAR Score™ ratings as possible alternatives.

Benchmark ticker:

FTXO

Expense:

60 bp

ALTAR Score™:

7.7%

ALTERNATIVE ETFs BASED ON OVERLAP WITH FTXO
Ticker	Fund Name	Overlap¹ vs FTXO (%)	Expense ratio (bp)	Savings vs FTXO (bp)	ALTAR Score™ (%)	ALTAR vs FTXO (%)
KBWB	Invesco KBW Bank Portfolio	69.7	35	25	7.5	-0.2
IAT	iShares DJ US Regional Banks	52.7	42	18	7.4	-0.3
KBE	KBW Bank ETF	49.0	35	25	8.1	+0.4
KRE	SPDR KBW Regional Banking	47.1	35	25	8.0	+0.3
IYG	iShares DJ US Financial Services	35.7	42	18	6.1	-1.6
XLF	Financials Select Sector SPDR	33.6	13	47	6.7	-1.0
FNCL	Fidelity MSCI Financials	32.1	8	52	7.1	-0.6
RWW	Invesco S&P Financials Revenue	31.4	45	15	7.0	-0.7
VFH	Vanguard Financials	31.4	10	50	7.1	-0.6
IEFN	iShares Evolved U.S. Financials	28.3	18	42	7.1	-0.5
JHMF	John Hancock Multifactor Financials	27.8	40	20	6.3	-1.4
RYF	Invesco S&P Equal Weight Financials	26.4	40	20	7.0	-0.7
DFNL	Davis Select Financial	25.6	64	-4	6.6	-1.1
IYF	iShares DJ US Financials	25.1	42	18	5.8	-1.9
IXG	iShares S&P Global Financial Sector	20.6	46	14	8.1	+0.4
UTRN	Vesper U.S. Large Cap Short-Term Reversal Strategy	20.2	75	-15	7.2	-0.5
KBWR	Invesco KBW Regional Bank	19.8	35	25	8.4	+0.7
FXO	First Trust Financial Alphadex	19.1	63	-3	7.5	-0.1
FOVL	iShares Focused Value Factor	17.7	25	35	8.5	+0.8
SPVU	Invesco S&P 500 Value	16.9	13	47	10.2	+2.5

¹Overlap is the percentage of holdings by weight that are identical. For example, if Fund A has a 2% position in Apple, Inc. (AAPL) and Fund B has a 5% position, their overlapping position in AAPL is 2%.

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RESULTS & ESTIMATES

	2014	2015	2016	2017	2018	2019E	2020E
Sales per share	**	**	**	**	**	**	**
Earnings per share	**	**	**	**	**	**	**
Dividends per share	**	**	**	**	**	**	**
Book value per share	**	**	**	**	**	**	**

Sales per share growth		**%	**%	**%	**%	**%	**%
EPS growth		**%	**%	**%	**%	**%	**%

Sales per share growth		**%	**%	**%	**%	**%	**%
EPS growth		**%	**%	**%	**%	**%	**%

OTHER FUNDAMENTAL METRICS

Long term EPS growth est.	**%		Debt-to-equity	**x
Asset turnover	**%		Assets-to-equity	**x

Return on equity

Revision activity*

*Six months ago = 100

Net margins

Compound annual growth rates

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VALUATION METRICS

	2018	2019E	2020E
Price-to-sales	**	**	**
Price-to-earnings	**	**	**
Price-to-cash flow	**	**	**
Price-to-growth	**	**	**
Price-to-book value	**	**	**
Yield	**	**	**

Historical valuation trends

Forward multiple:	First Trust Nasdaq Bank
Relative to:	S&P500	MSCI EAFE	MSCI Emg. Mkts.	Other ETF:

SPECULATIVE

Deeply undervalued but risky. A rating of SPECULATIVE is assigned to ETFs with ALTAR Scores in the top quintile (the top 20%) of their category, indicating exceptional appreciation potential. However, often these are narrowly-focused funds or in industries with structural issues, which may also make them very risky. Nonetheless they may still be useful as part of a well-diversified portfolio.

ALTAR Score™

Calculation of ALTAR Score™
Avg. Return on Equity	10.0	%
Divided by: Fwd. P/BV	1.2	x
Less: Expense ratio	60	bp
Equals: ALTAR Score	7.7	%

More information on ALTAR Score™

MODERN PORTFOLIO THEORY info

CONSENSUS RECOMMENDATIONS: FUND CONSTITUENTS

COMPOSITE RATING	1.64	CATEGORY AVERAGE	1.55

The composite rating is a weighted average of analysts' consensus recommendations for individual ETF constituents, based on the following scale: BUY = 1; OVERWEIGHT = 1.5, HOLD = 2; UNDERWEIGHT = 2.5; and SELL = 3. Readers are cautioned that because analyst ratings tend to be inflated, the composite score may be more useful as a relative measure of sentiment between funds rather than as a stand-alone recommendation.