Rule 497(k)
File No. 333-182308
FIRST TRUST First Trust Exchange-Traded Fund VI
SUMMARY PROSPECTUS
Multi-Asset Diversified Income Index Fund
Ticker Symbol: MDIV
Exchange: The NASDAQ(R) Stock Market
Before you invest, you may want to review the Fund's prospectus, which contains
more information about the Fund and its risks. You can find the Fund's
prospectus and other information about the Fund, including the statement of
additional information and most recent reports to shareholders, online at
http://www.ftportfolios.com/retail/ETF/ETFfundnews.aspx?Ticker=MDIV. You can
also get this information at no cost by calling (800) 621-1675 or by sending an
e-mail request to info@ftportfolios.com. The Fund's prospectus and statement of
additional information, both dated January 31, 2013, are all incorporated by
reference into this Summary Prospectus.
INVESTMENT OBJECTIVE
The Multi-Asset Diversified Income Index Fund (the "Fund") seeks investment
results that correspond generally to the price and yield (before the Fund's fees
and expenses) of an index called the NASDAQ Multi-Asset Diversified Income Index
(the "Index").
January 31, 2013
FEES AND EXPENSES OF THE FUND
The following table describes the fees and expenses you may pay if you buy and
hold Shares of the Fund. Investors purchasing and selling Shares may be subject
to costs (including customary brokerage commissions) charged by their broker.
SHAREHOLDER FEES (fees paid directly from your investment)
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) None
ANNUAL FUND OPERATING EXPENSES (Expenses that you pay each year as a percentage of the
value of your investment)
Management Fees 0.60%
Distribution and Service (12b-1) Fees (1) 0.00%
Other Expenses 0.00%
Acquired Fund Fees and Expenses (2) 0.02%
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Total Annual Fund Operating Expenses 0.62%
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EXAMPLE
The example below is intended to help you compare the cost of investing in
the Fund with the cost of investing in other funds. This example does not
take into account customary brokerage commissions that you pay when
purchasing or selling Shares of the Fund in the secondary market.
The example assumes that you invest $10,000 in the Fund for the time periods
indicated and then you retain the Shares or redeem all of your Shares at the
end of those periods. The example also assumes that your investment has a 5%
return each year and that the Fund's annual operating expenses remain at
current levels until January 31, 2014. Additionally, the example assumes that
the Fund imposes a 12b-1 fee of 0.25% per annum of the Fund's average daily
net assets following January 31, 2014. Although your actual costs may be
higher or lower, based on these assumptions your costs would be:
1 Year 3 Years 5 Years 10 Years
$63 $244 $449 $1,041
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(1) Although the Fund has adopted a 12b-1 plan that permits it to pay up to
0.25% per annum, it will not pay 12b-1 fees at any time before January
31, 2014.
(2) The Advisor is paid an annual unitary management fee of 0.60% of the
Fund's average daily net assets and is responsible for the Fund's
expenses including the cost of transfer agency, 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 pursuant to a 12b-1
plan, if any, acquired fund fees and extraordinary expenses.
PORTFOLIO TURNOVER
The Fund pays transaction costs, such as commissions, when it buys and sells
securities (or "turns over" its portfolio). A higher portfolio turnover rate
may indicate higher transaction costs and may result in higher taxes when
Fund Shares are held in a taxable account. These costs, which are not
reflected in annual fund operating expenses or in the example, affect the
Fund's performance. During the fiscal period August 13, 2012 (inception)
through September 30, 2012, the Fund's portfolio turnover rate was 34% of the
average value of its portfolio.
PRINCIPAL INVESTMENT STRATEGIES
The Fund will normally invest at least 90% of its net assets (plus the amount of
any borrowings for investment purposes) in the common stocks and/or depositary
receipts (25%), real estate investment trusts ("REITs") (20%), preferred
securities (20%), master limited partnerships ("MLPs") (20%) and an
exchange-traded fund ("ETF") (15%) that comprise the Index (each an "Index
Segment"). The percentages provided above reflect the approximate percentages of
each of the Index Segments included in the Index as of each quarterly rebalance.
The percentages will vary from these amounts between rebalances of the Index.
The Fund, using an indexing investment approach, attempts to replicate, before
fees and expenses, the performance of the Index. First Trust Advisors L.P.
("First Trust" or the "Advisor"), the Fund's investment advisor, seeks a
correlation of 0.95 or better (before fees and expenses) between the Fund's
performance and the performance of the Index; a figure of 1.00 would represent
perfect correlation. First Trust will regularly monitor the Fund's tracking
accuracy and will seek to maintain an appropriate correlation.
The Index is owned and was developed by NASDAQ(R) (the "Index Provider"). The
Index Provider also calculates and maintains the Index. The Index is designed to
provide access to a diversified portfolio of small, mid and large capitalization
income producing securities, which are composed of domestic and international
dividend-paying stocks, REITs, oil and gas or basic materials MLPs, U.S.-listed
preferred securities and an index-based ETF that invests in high yield or "junk"
bonds. International securities included in the index are U.S.-listed securities
of non-U.S. companies, some of which may be located in emerging markets.
The Index employs a modified market cap weighting methodology which assigns a
pre-set weight to the five Index Segments at each quarterly rebalance. Each
Index Segment has a set of separate and distinct eligibility rules and weighting
procedures as described in this prospectus under "Index Information."
The Index Provider evaluates the Index components quarterly in March, June,
September and December of each year for eligibility, using market data through
the end of January, April, July and October, respectively. Eligible components
for the Index are identified as such using the eligibility criteria set forth in
this Prospectus under "Index Information." The Index is rebalanced quarterly.
Rebalancing is effective as of the market close of the third Friday in March,
June, September and December. The reference dates for the data used in the
rebalancing are at the close of trading on the last trading day in January,
April, July and October, respectively. As of December 31, 2012, the Index was
comprised of 124 securities.
The Fund intends to invest entirely in securities included in the Index;
however, there may also be instances in which the Fund may be underweighted or
overweighted in certain securities in the Index, not invest in certain
securities included in the Index, purchase securities not in the Index that are
appropriate to substitute for certain securities in the Index or utilize various
combinations of the above techniques in seeking to track the Index.
PRINCIPAL RISKS
You could lose money by investing in the Fund. An investment in the Fund is not
a deposit of a bank and is not insured or guaranteed by the Federal Deposit
Insurance Corporation or any other governmental agency.
MARKET RISK. Market risk is the risk that a particular security owned by the
Fund, Shares of the Fund or securities in general may fall in value. Shares are
subject to market fluctuations caused by such factors as economic, political,
regulatory or market developments, changes in interest rates and perceived
trends in stock prices. Overall security values could decline generally or could
underperform other investments.
MLP RISK. An investment in MLP units involves risks which differ from an
investment in common stock of a corporation. Holders of MLP units have limited
control and voting rights on matters affecting the partnership. In addition,
there are certain tax risks associated with an investment in MLP units and
conflicts of interest exist between common unit holders and the general partner,
including those arising from incentive distribution payments. In addition, there
is the risk that a MLP could be, contrary to its intention, taxed as a
corporation, resulting in decreased returns from such MLP
REIT INVESTMENT RISK. The Fund invests in REITs. Therefore, the Fund is subject
to the risks associated with investing in real estate, which may include, but
are not limited to, fluctuations in the value of underlying properties; defaults
by borrowers or tenants; market saturation; changes in general and local
operating expenses; and other economic, political or regulatory occurrences
affecting companies in the real estate industry. In addition to risks related to
investments in real estate generally, investing in REITs involves certain other
risks related to their structure and focus, which include, but are not limited
to, dependency upon management skills, limited diversification, the risks of
locating and managing financing for projects, heavy cash flow dependency,
possible default by borrowers, the costs and potential losses of
self-liquidation of one or more holdings, the risk of a possible lack of
mortgage funds and associated interest rate risks, overbuilding, property
vacancies, increases in property taxes and operating expenses, changes in zoning
laws, losses due to environmental damages, changes in neighborhood values and
appeal to purchases, the possibility of failing to maintain exemptions from
registration under the 1940 Act and, in many cases, relatively small market
capitalization, which may result in less market liquidity and greater price
volatility.
REITs are also subject to the risk that the real estate market may experience an
economic downturn generally, which may have a material effect on the real estate
in which the REITs invest and their underlying portfolio securities.
INTEREST RATE RISK. The Fund is subject to interest rate risk. Increases in
interest rates typically lower the present value of a REIT's future earnings
stream, and may make financing property purchases and improvements more costly.
Because the market price of REIT stocks may change based upon investors'
collective perceptions of future earnings, the value of the Fund will generally
decline when investors anticipate or experience rising interest rates.
Rising interest rates could adversely impact the financial performance of MLPs.
Rising interest rates may increase an MLP's cost of capital, which would
increase operating costs and may reduce an MLP's ability to execute acquisitions
or expansion projects in a cost-effective manner. Rising interest rates may also
impact the price of MLP units as the yields on alternative investments increase.
ETF RISK. ETFs are often index funds and are bought and sold on a securities
exchange. An ETF trades like common stock and represents a portfolio of
securities. The risks of owning an ETF generally reflect the risks of owning the
underlying securities, although lack of liquidity in an ETF could result in it
being more volatile and ETFs have management fees that increase their costs.
HIGH YIELD SECURITIES RISK. The Fund invests in an ETF that invests in high
yield securities, which are subject to greater market fluctuations and risk of
loss than securities with higher investment ratings. These securities are issued
by companies that may have limited operating history, narrowly focused
operations, and/or other impediments to the timely payment of periodic interest
and principal at maturity. If the economy slows down or dips into recession, the
issuers of high-yield securities may not have sufficient resources to continue
making timely payment of periodic interest and principal at maturity. The market
for high-yield securities is smaller and less liquid than that for investment
grade securities. High-yield securities are generally not listed on a national
securities exchange but trade in the over-the-counter markets. Due to the
smaller, less liquid market for high-yield securities, the bid-offer spread on
such securities is generally greater than it is for investment grade securities
and the purchase or sale of such securities may take longer to complete.
PREFERRED SECURITIES RISK. Preferred securities combine some of the
characteristics of both common stocks and bonds. Preferred securities are
typically subordinated to bonds and other debt instruments in a company's
capital structure, in terms of priority to corporate income, and therefore will
be subject to greater credit risk than those debt instruments. Preferred
securities are also subject to credit risk, interest rate risk and income risk.
NON-CORRELATION RISK. The Fund's return may not match the return of the Index
for a number of reasons. For example, the Fund incurs operating expenses not
applicable to the Index, and may incur costs in buying and selling securities,
especially when rebalancing the Fund's portfolio holdings to reflect changes in
the composition of the Index. In addition, the Fund's portfolio holdings may not
exactly replicate the securities included in the Index or the ratios between the
securities included in the Index.
REPLICATION MANAGEMENT RISK. The Fund is exposed to additional market risk due
to its policy of investing principally in the securities included in the Index.
As a result of this policy, securities held by the Fund will generally not be
bought or sold in response to market fluctuations and the securities may be
issued by companies concentrated in a particular industry. Therefore, the Fund
will generally not sell a stock because the stock's issuer is in financial
trouble, unless that stock is removed or is anticipated to be removed from the
Index.
NON-U.S. SECURITIES AND EMERGING MARKETS RISK. The Fund invests in U.S.
dollar-denominated securities of non-U.S. issuers traded in the United States.
Such securities are subject to higher volatility than securities of domestic
issuers due to possible adverse political, social or economic developments;
restrictions on foreign investment or exchange of securities; lack of liquidity;
excessive taxation; government seizure of assets; different legal or accounting
standards and less government supervision and regulation of exchanges in foreign
countries. These risks may be heightened for securities of companies located in,
or with significant operations in, emerging market countries.
CREDIT RISK. Credit risk is the risk that an issuer of a security will be unable
or unwilling to make dividend, interest and/or principal payments when due and
the related risk that the value of a security may decline because of concerns
about the issuer's ability to make such payments. Credit risk may be heightened
for the Fund because it may invest in exchange-traded funds that invest in high
yield or "junk" debt; such securities, while generally offering higher yields
than investment-grade debt with similar maturities, involve greater risks,
including the possibility of dividend or interest deferral, default or
bankruptcy, and are regarded as predominantly speculative with respect to the
issuer's capacity to pay dividends or interest and repay principal.
INDEX CORRELATION RISK. You should anticipate that the value of Fund Shares will
decline more or less in correlation with any decline in the value of the Fund's
Index.
DEPOSITARY RECEIPTS RISK. Depositary receipts may be less liquid than the
underlying shares in their primary trading market. Any distributions paid to the
holders of depositary receipts are usually subject to a fee charged by the
depositary. Holders of depositary receipts may have limited voting rights, and
investment restrictions in certain countries may adversely impact the value of
depositary receipts because such restrictions may limit the ability to convert
equity shares into depositary receipts and vice versa. Such restrictions may
cause equity shares of the underlying issuer to trade at a discount or premium
to the market price of the depositary receipts.
SMALLER COMPANY RISK. The Fund invests in small and mid capitalization
companies. Such companies may be more vulnerable to adverse general market or
economic developments, and their securities may be less liquid and may
experience greater price volatility than larger, more established companies as a
result of several factors, including limited trading volumes, products or
financial resources, management inexperience and less publicly available
information. Accordingly, such companies are generally subject to greater market
risk than larger, more established companies.
ANNUAL TOTAL RETURN
The Fund has not yet operated for a full calendar year and, therefore,
performance information is not included in this section of the Prospectus. See
"Total Return Information" for performance information regarding the Fund.
MANAGEMENT
INVESTMENT ADVISOR
First Trust Advisors L.P. ("First Trust")
PORTFOLIO MANAGERS
The Fund's portfolio is managed by a team (the "Investment Committee")
consisting of:
o Daniel J. Lindquist, Chairman of the Investment Committee and Senior
Vice President of First Trust;
o Jon C. Erickson, Senior Vice President of First Trust;
o David G. McGarel, Chief Investment Officer and Senior Vice President
of First Trust;
o Roger F. Testin, Senior Vice President of First Trust; and
o Stan Ueland, Senior Vice President of First Trust.
Each Investment Committee member has served as a part of the portfolio
management team of the Fund since inception.
PURCHASE AND SALE OF FUND SHARES
The Fund issues and redeems Shares on a continuous basis, at NAV, only in
Creation Units consisting of 50,000 Shares. The Fund's Creation Units are issued
and redeemed in-kind for securities in which the Fund invests and/or cash, and
only to and from broker-dealers and large institutional investors that have
entered into participation agreements. Individual Shares may only be purchased
and sold on NASDAQ(R) through a broker-dealer. Shares of the Fund will trade on
NASDAQ(R) at market prices rather than NAV, which may cause the Shares to trade
at a price greater than NAV (premium) or less than NAV (discount).
TAX INFORMATION
The Fund's distributions are taxable and will generally be taxed as ordinary
income or capital gains.
PAYMENTS TO BROKER-DEALERS AND OTHER FINANCIAL INTERMEDIARIES
If you purchase the Fund through a broker-dealer or other financial intermediary
(such as a bank), First Trust and First Trust Portfolios L.P., the Fund's
distributor, may pay the intermediary for the sale of Fund Shares and related
services. These payments may create a conflict of interest by influencing the
broker-dealer or other intermediary and your salesperson to recommend the Fund
over another investment. Ask your salesperson or visit your financial
intermediary's website for more information.
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