Investment Objective/Strategy - The First Trust NASDAQ CEA Cybersecurity ETF is an exchange-traded fund. The investment objective of the Fund is to seek investment results that correspond generally to the price and yield, before the Fund's fees and expenses, of an equity index called the Nasdaq CEA Cybersecurity IndexSM.There can be no assurance that the Fund's investment objectives will be achieved. •The Nasdaq CEA Cybersecurity Index℠ is designed to track the performance of companies engaged in the cybersecurity segment of the technology and industrials sectors. It includes companies primarily involved in the building, implementation, and management of security protocols applied to private and public networks, computers, and mobile devices in order to provide protection of the integrity of data and network operations.
•To be included in the index, a security must be listed on an index-eligible global stock exchange and classified as a cybersecurity company as determined by the Consumer Electronics Association (CEA).
•Each security must have a worldwide market capitalization of $250 million, have a minimum three-month average daily dollar trading volume of $1 million, and have a minimum free float of 20%.
•The index is evaluated semi-annually in March and September, but if at any time during the year other than the evaluation, an index security no longer meets the eligibility criteria, or is otherwise determined to have become ineligible for inclusion in the index, the security is removed from the index and is not replaced. Any index security that reaches its foreign investment limit between quarterly rebalances is removed from the index.
•The index employs a modified liquidity weighted methodology which includes caps on the percentage of any individual security to derive the final weights of the securities.
•The index is rebalanced quarterly.