ETF Research Center

The First Trust Horizon Managed Volatility Domestic ETF is an actively managed fund. The fund manager uses volatility forecasting to select and weight US large-capitalization stocks.

FUND BASICS
Category	US Equities
Fund Sponsor	First Trust
Website	www.ftportfolios.com
Inception date	Aug 24, 2016
Assets (mns)	$256
Currency	USD
Expense ratio	70 bp
Distributions	Quarterly

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

SECTOR BREAKDOWN

CONSTITUENT BREAKDOWN
No. of constituents	99
Wgt avg mkt cap (mns)	$94,679
Large cap (>$10bn)	98.1%
Mid cap ($2-10bn)	1.9%
Small cap (<$2bn)	0.0%
Developed mkts	100.0%
Emerging mkts	0.0%

TOP TEN HOLDINGS
Total	13.3 %
PEPSICO INC	1.4 %
WASTE MANAGEMENT INC	1.4 %
AVALONBAY COMMUNITIES INC	1.4 %
CITRIX SYSTEMS INC	1.3 %
MID-AMERICA APARTMENT COMM	1.3 %
ARTHUR J GALLAGHER & CO	1.3 %
YUM! BRANDS INC	1.3 %
COCA-COLA CO/THE	1.3 %
VERIZON COMMUNICATIONS INC	1.3 %
JOHNSON & JOHNSON	1.3 %

TOP COUNTRY EXPOSURE
	UNITED STATES	90.0 %
	IRELAND	3.8 %
	SWITZERLAND	2.1 %
	BRITAIN	2.0 %
	BERMUDA	1.0 %

HISTORICAL PERFORMANCE info

	Custom date range	Compare to
	thru

Standardized Annual Returns (thru November 30)
Year-to-date	1 year	5 years	10 years	Since Incep.
25.4%	16.0%	--	--	12.1%

Market Correlations
versus...	Beta	R-squared
S&P500	0.63	72%
MSCI EAFE	0.56	48%
MSCI Emg. Mkts.	0.38	34%

Technical Indicators
Recent close	$27.43
30d moving avg.	$27.36
Annualized volatility	9.0%
Short interest (ETF)	0.2%
Relative strength (RSI)	54

Liquidity measures
Avg. volume (thou.)	32
Turnover	0.3%
Bid/Ask (% of price)	0.09%
ADV underlying (mns)	$32,140

Distributions

FINDING ALTERNATIVE FUNDS

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

Benchmark ticker:

HUSV

Expense:

70 bp

ALTAR Score™:

4.9%

ALTERNATIVE ETFs BASED ON OVERLAP WITH HUSV
Ticker	Fund Name	Overlap¹ vs HUSV (%)	Expense ratio (bp)	Savings vs HUSV (bp)	ALTAR Score™ (%)	ALTAR vs HUSV (%)
SPLV	Invesco S&P 500 Low Volatility	61.1	25	45	5.3	+0.4
LVHB	Elkhorn Lunt Low Vol/High Beta Tactical	60.9	52	18	5.0	+0.1
XRLV	Invesco S&P 500 ex-Rate Sensitive Low Volatility	59.1	25	45	6.0	+1.1
LGLV	SPDR Russell 1000 Low Volatility	48.4	12	58	5.2	+0.3
USMV	iShares MSCI USA Minimum Volatility	48.0	15	55	5.2	+0.3
FLLV	Franklin Liberty U.S. Low Volatility	45.5	29	41	5.3	+0.4
DEF	Invesco Defensive Equity	45.2	59	11	4.9	0.0
FDLO	Fidelity Low Volatility Factor	43.1	29	41	5.4	+0.5
LVUS	Hartford Multifactor Low Volatility US Equity	41.8	21	49	5.8	+0.9
OVOL	Invesco Russell 1000 Low Volatility Factor ETF	35.7	19	51	5.7	+0.8
KLCD	KFA Large Cap Quality Dividend Index	35.5	41	29	5.1	+0.2
ROUS	Lattice U.S. Equity Strategy ETF	34.2	19	51	6.4	+1.5
JMIN	JPMorgan U.S. Minimum Volatility	33.9	12	58	5.6	+0.7
RBUS	Nationwide Risk-Based U.S. Equity	33.7	30	40	6.1	+1.2
LSLT	Salt Low truBeta US Market	32.7	0	70	6.7	+1.8
FCTR	First Trust Lunt U.S. Factor Rotation	32.2	65	5	5.6	+0.7
EQWL	Invesco Fundamental Pure Large Core	31.5	25	45	6.3	+1.5
QUS	SPDR MSCI USA Quality Mix	31.0	15	55	6.0	+1.1
OMOM	Invesco Russell 1000 Momentum Factor ETF	30.9	19	51	5.3	+0.4
QLV	FlexShares US Quality Low Volatility	29.9	22	48	5.0	+0.1

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 Horizon Managed Volatility Domestic
Relative to:	S&P500	MSCI EAFE	MSCI Emg. Mkts.	Other ETF:

UNDERWEIGHT

Below average appreciation potential. A rating of UNDERWEIGHT is assigned to ETFs with ALTAR Scores in the 2nd quintile (ranking higher than only 20%-40%) of their category. Typically, funds in this category consist of stocks trading at relatively expensive valuations and/or having below-average fundamentals.

ALTAR Score™

Calculation of ALTAR Score™
Avg. Return on Equity	16.6	%
Divided by: Fwd. P/BV	3.0	x
Less: Expense ratio	70	bp
Equals: ALTAR Score	4.9	%

More information on ALTAR Score™

MODERN PORTFOLIO THEORY info

CONSENSUS RECOMMENDATIONS: FUND CONSTITUENTS

COMPOSITE RATING	1.64	CATEGORY AVERAGE	1.56

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.