First Trust Advisors L.P. ("First Trust"), announced today that the first exchange-traded fund ("ETF") focused on the cloud computing industry is expected to launch on The NASDAQ Stock Market® under the ticker symbol SKYY on Wednesday, July 6, 2011. The First Trust ISE Cloud Computing Index Fund is based on the ISE Cloud Computing™ Index. This index is a modified equal-dollar weighted index designed to provide a benchmark for investors interested in tracking companies involved in the cloud computing industry. The Index is owned and was developed by International Securities Exchange, LLC.
"The ISE Cloud ComputingTM Index reflects the evolution of technology infrastructure and provides new and dynamic opportunities for investors," said Kris Monaco, Head of New Product Development at ISE. "We are very pleased to work again with First Trust on this unique exchange-traded fund focused on this rapidly expanding industry."
"Cloud computing is projected to be one of the fastest growing IT markets this year, according to IDC Research," said Ryan Issakainen, Senior Vice President, ETF Strategist. "As businesses and consumers continue to migrate to a cloud environment, we believe there are significant growth opportunities for the companies involved in all aspects of cloud computing. The ETF provides a way to gain exposure to those companies. Forrester Research is projecting total public cloud revenues to go up 27% annually to reach nearly $160 billion by 2020, up from $15 billion in 2010."
"Offering specialty products that provide investors with targeted, efficient exposure to specialized segments of the market has helped First Trust to become the fastest growing ETF sponsor among the ten largest sponsors (by assets raised) since 2010," Issakainen added. Mr. Issakainen will ring the opening bell of The NASDAQ Stock Market® at 9:30 a.m. Eastern Time on Wednesday, July 6, 2011 to recognize the launch of the Fund. To view the live webcast of the opening bell, visit the NASDAQ website (http://www.nasdaq.com/about/marketsitetowervideo.asx) at 9:20 a.m. (Eastern Time).
About First Trust Advisors L.P.
First Trust Advisors L.P., the Fund's investment advisor, along with its affiliate First Trust Portfolios L.P., the Fund's distributor, are privately-held companies which provide a variety of investment services, including asset management, financial advisory services, and competitive municipal underwriting, with collective assets under management or supervision of approximately $52 billion as of May 31, 2011 through closed-end funds, unit investment trusts, exchange-traded funds, mutual funds and separate managed accounts. For more information, please visit www.ftportfolios.com.
About ISE
The International Securities Exchange (ISE) operates a leading U.S. options exchange and offers options trading on over 2,000 underlying equity, ETF, index, and FX products. As the first all-electronic options exchange in the U.S., ISE transformed the options industry by creating efficient markets through innovative market structure and technology. Regulated by the Securities and Exchange Commission (SEC) and a member-owner of The Options Clearing Corporation (OCC), ISE provides investors with a transparent marketplace for price and liquidity discovery on centrally cleared options products. ISE continues to expand its marketplace through the ongoing development of enhanced trading functionality, new products, and market data services. As a complement to its options business, ISE has expanded its reach into multiple asset classes through strategic investments in financial marketplaces and services that foster technology innovation and market efficiency. Through minority investments, ISE participates in the securities lending and equities markets. ISE also licenses its proprietary Longitude technology for trading in event-driven derivatives markets.
ISE is a wholly owned subsidiary of Eurex, a leading global derivatives exchange. Eurex itself is jointly operated by Deutsche Börse AG (Ticker: DB1) and SIX Swiss Exchange AG. Together, Eurex and ISE are the global market leader in individual equity and equity index derivatives. For more information, visit www.ise.com.
Principal Risk Factors
The information in the prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. The prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.
You should consider the fund's investment objectives, risks, and charges and expenses carefully before investing. Contact First Trust Portfolios L.P. at 1-800-621-1675 or visit www.ftportfolios.com to obtain a prospectus or summary prospectus which contains this and other information about the fund. The prospectus or summary prospectus should be read carefully before investing.
Risk Considerations
The fund's shares will change in value, and you could lose money by investing in the fund. One of the principal risks of investing in the fund is market risk. Market risk is the risk that a particular stock owned by the fund, fund shares or stocks in general may fall in value.
The fund's return may not match the return of the ISE Cloud Computing™ Index. The fund may not be fully invested at times. Securities held by the fund will generally not be bought or sold in response to market fluctuations. The fund may invest in small capitalization and mid capitalization companies. Such companies may experience greater price volatility than larger, more established companies.
Investors buying or selling fund shares on the secondary market may incur customary brokerage commissions. Investors who sell fund shares may receive less than the share's net asset value. Shares may be sold throughout the day on the exchange through any brokerage account. However, shares may only be redeemed directly from the fund by authorized participants, in very large creation/redemption units.
The fund is concentrated in stocks of companies in the technology sector. You should be aware that an investment in a portfolio which is concentrated in a particular sector involves additional risks, including limited diversification. The companies engaged in the technology sector are subject to fierce competition, high research and development costs, and their products and services may be subject to rapid obsolescence. Technology company stocks, especially those which are Internet-related, may experience extreme price and volume fluctuations that are often unrelated to their operating performance.
The fund invests in securities of companies engaged in the cloud computing industry, including companies that provide remote computation, software, data access and storage services. The risks related to investing in such companies include interruptions or delays in service, security breaches involving sensitive, confidential information managed and transmitted by cloud computing companies, and regulations that may limit or otherwise affect the operations of such companies.
The fund is classified as "non-diversified." A non-diversified fund generally may invest a larger percentage of its assets in the securities of a smaller number of issuers. As a result, the fund may be more susceptible to the risks associated with these particular companies, or to a single economic, political or regulatory occurrence affecting these companies.
The First Trust ISE Cloud Computing Index Fund is not sponsored, endorsed, sold or promoted by the International Securities Exchange (ISE). ISE makes no representation or warranty, express or implied, to the owners of the fund or any member of the public regarding the advisability of trading in the fund. ISE's only relationship to First Trust is the licensing of certain trademarks and trade names of the ISE and of the ISE Cloud Computing™ Index which is determined, composed and calculated by ISE without regard to First Trust or the fund.
Not FDIC Insured • Not Bank Guaranteed • May Lose Value
Contacts:
First Trust Advisors L.P.
Press Inquiries:
Jane Doyle
630-765-8775
or
Analyst Inquiries:
Eric Anderson
630-517-7676
or
Broker Inquiries:
Ryan Issakainen
630-765-8689
