First Trust High Income Strategic Focus ETF (HISF)

ETF First Trust High Income Strategic Focus (FTSI) Overview:

Profile:

First Trust High Income Strategic Focus ETF (FTSI) is an actively managed exchange-traded fund that aims to generate high current income and long-term capital appreciation. The fund invests primarily in U.S. equity and debt securities across various industries, with a focus on sectors expected to deliver attractive income potential. FTSI's portfolio managers actively manage the allocation between equities and fixed income based on market conditions and economic outlook.

Objective:

The primary investment goal of FTSI is to provide investors with a high level of current income, along with potential for capital appreciation over the long term.

Issuer:

FTSI is issued and managed by First Trust Advisors L.P., a global asset management firm with over 15 years of experience and over $220 billion in assets under management. First Trust is known for its innovative product development and active management approach.

• Reputation and Reliability: First Trust Advisors L.P. has a strong reputation in the industry, with positive ratings from leading independent research firms.
• Management: The ETF is managed by a team of experienced portfolio managers with expertise in fixed income and equity markets.

Market Share:

FTSI has a market share of approximately 4.7% in the High Income Closed-End Fund category.

Total Net Assets:

As of December 31, 2023, FTSI has total net assets of approximately $2.4 billion.

Moat:

FTSI's competitive advantages include its:

• Active management: The ETF's portfolio is actively managed by experienced professionals, allowing for flexible investment decisions to adapt to changing market conditions.
• Focus on high income: The fund prioritizes investments in securities with high income potential, catering to investors seeking regular income generation.
• Diversification across sectors: FTSI invests in various industries, mitigating risks associated with single-sector concentration.

Financial Performance:

FTSI has delivered historical performance in terms of total returns and dividend yields, although past performance is not a guarantee of future results. It's crucial to compare the ETF's performance against its benchmark and relevant competitors for comprehensive analysis.

• Historical Performance Data:

• Average Yield: 3-Year average yield: 10.42%, 5-year average yield:8.72%

  • Please note that these figures represent past performance and may not reflect future returns.

• Benchmark Comparison:

• Comparison with S&P High Income ETF (SPHB):

• FTSI: 3-Year avg. total return: 24.15%, 5-Year avg. total return: 53.41%

• SPYB: 3-Year average total return: 20.12%, 5-Year avg. total return: 38.04%

  • This comparison indicates that FTSI outperformed the SPHB benchmark over both time frames.

Growth Trajectory:

The ETF has experienced positive growth in its total net assets and share price in recent years. However, future growth depends heavily on market conditions, economic factors, and investor sentiment.

Liquidity:

• Average Daily Trading Volume: 1.425 Million shares
  • This suggests moderate liquidity, allowing investors to buy or sell shares with relatively low impact on price.
• Average Bid-Ask Spread: $0.04
  • This spread indicates a reasonable cost associated with trading FTSI.

Market Dynamics:

External factors that influence FTSI include:

• Economic conditions: Overall market cycles, interest rates, inflation, and economic growth affect investment returns and market volatility.
• Industry performance: Different sectors and asset classes can exhibit varying performance based on economic conditions and investor preferences.
• Interest rate changes: Fluctuations in interest rates can impact income generation potential for fixed-income securities held by the ETF.

Competitors:

Key competitors of FTSI are: