First Trust Launches First Trust Bloomberg Emerging Market Democracies ETF
First Trust Advisors L.P. ("First Trust"), a leading exchange-traded fund ("ETF") provider and asset manager, announced today that it has launched a new ETF, the First Trust Bloomberg Emerging Market Democracies ETF (NYSE Arca: EMDM) (the "fund"). The fund seeks investment results that correspond generally to the price and yield (before the fund's fees and expenses) of an equity index called the Bloomberg Emerging Market Democracies Index (the "index").
The majority of global economic growth is expected to occur outside of the U.S. in the next few years, particularly in emerging markets, according to data from the International Monetary Fund ("IMF"). Traditional emerging market benchmarks may have significant weight in countries whose governmental policies and living conditions may not reflect democratic views toward individual and collective freedoms.
"Concerns about the rule of law, political rights, and civil liberties have led many investors to avoid allocating to emerging markets," said Ryan Issakainen, CFA, Senior Vice President and ETF Strategist at First Trust. EMDM aims to provide exposure to parts of the emerging markets segment where political rights and civil liberties are highly regarded. These countries must qualify as Electoral Democracies, a Freedom House designation that reflects the fact that a democratic electoral system requires not only fair balloting procedures and basic political competition, but also some respect for the rule of law and civil liberties, such as freedom of assembly. "By screening out countries that are not considered Electoral Democracies, we believe this ETF addresses many such concerns, while also providing exposure to the robust long-term growth potential of emerging markets stocks," Issakainen said.
"Bringing new ideas to market is a principal focus area for Bloomberg Indices as we recognize the opportunity for unique benchmarks that address specific interests, such as values-based investing. We're excited to see First Trust take one of these ideas forward to investors and launch an ETF with the Bloomberg Emerging Market Democracies Index," said Dave Gedeon, Head of Index Product, Bloomberg Index Services Limited.
For more information about First Trust, please contact Ryan Issakainen at (630) 765-8689 or [email protected].
About First Trust
First Trust is a federally registered investment advisor and serves as the fund's investment advisor. First Trust and its affiliate First Trust Portfolios L.P. ("FTP"), a FINRA registered broker-dealer, are privately held companies that provide a variety of investment services. First Trust has collective assets under management or supervision of approximately $201 billion as of January 31, 2023 through unit investment trusts, exchange-traded funds, closed-end funds, mutual funds and separate managed accounts. First Trust is the supervisor of the First Trust unit investment trusts, while FTP is the sponsor. FTP is also a distributor of mutual fund shares and exchange-traded fund creation units. First Trust and FTP are based in Wheaton, Illinois. For more information, visit http://www.ftportfolios.com.
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.
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Some Asian economies are highly dependent on trade with other countries and there is a high concentration of market capitalization and trading volume in a small number of Asian issuers as well as a high concentration of investors and financial intermediaries. Certain Asian countries experience expropriation and nationalization of assets, confiscatory taxation, currency maniplation, political instability, armed conflict and social instability as a result of religious, ethnic, socio-economic and/or political unrest. In particular escalated tensions involving North Korea could have severe adverse effect on Asian economies. Recent developments between the U.S. and China have heightened concerns of increased tariffs and restrictions on trade
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Investments in emerging market securities are generally considered speculative and involve additional risks relating to political, economic and regulatory conditions.
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The economies of Latin American countries have in the past experienced considerable difficulties, including high inflation rates, high interest rates, high unemployment, government overspending and political instability. International economic conditions, particularly those in the United States, Europe and Asia, as well as world prices for oil and other commodities may also influence the development of Latin American economies. Many Latin American countries are highly reliant on the exportation of commodities and their economies may be significantly impacted by fluctuations in commodity prices and the global demand for certain commodities.
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Taiwan is an emerging market and demonstrates significantly higher volatility from time to time. Taiwan's ongoing tensions with China may materially affect the Taiwanese economy. Also, the Taiwanese economy is export-oriented and dependent upon an open-world trade regime.
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The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. By providing this information, First Trust is not undertaking to give advice in any fiduciary capacity within the meaning of ERISA, the Internal Revenue Code or any other regulatory framework. Financial professionals are responsible for evaluating investment risks independently and for exercising independent judgment in determining whether investments are appropriate for their clients.
First Trust Advisors L.P. is the adviser to the fund. First Trust Advisors L.P. is an affiliate of First Trust Portfolios L.P., the fund's distributor.
"Bloomberg®" and the indices licensed herein (the "Indices") are service marks of Bloomberg Finance L.P. and its affiliates, including Bloomberg Index Services Limited ("BISL"), the administrator of the Indices (collectively, "Bloomberg") and have been licensed for use for certain purposes by First Trust Advisors L.P. (the "Licensee"). Bloomberg is not affiliated with the Licensee, and Bloomberg does not approve, endorse, review, or recommend the financial products referenced herein (the "Financial Products"). Bloomberg does not guarantee the timeliness, accurateness, or completeness of any data or information relating to the Indices or the Financial Products.
Freedom House is a non-profit, majority U.S. government funded organization in Washington, D.C., that conducts research and advocacy on democracy, political freedom, and human rights.
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