CHAPMAN AND CUTLER LLP 111 WEST MONROE STREET
CHICAGO, ILLINOIS 60603
July 16, 2014
VIA EDGAR CORRESPONDENCE
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Karen Rossotto
United States Securities and Exchange Commission
100 F Street, N.E.
Washington, D.C. 20549
Re: First Trust Exchange-Traded Fund VI (the "Trust")
File Nos. 811-22717 and 333-182308
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Dear Ms. Rossotto:
This letter responds to your comments regarding the registration statement
filed on Form N-1A for First Trust Exchange-Traded Fund VI (the "Trust") with
the Securities and Exchange Commission (the "Commission") on May 7, 2014 (the
"Registration Statement"). The Registration Statement relates to the First Trust
Dorsey Wright International Focus 5 ETF (the "Fund"), a series of the Trust.
Capitalized terms used herein, but not otherwise defined, have the meanings
ascribed to them in the Registration Statement.
Please also note that to the extent that your previous comments to
recently filed registration statements for the First Trust family of open-end
and exchange-traded funds were applicable, we have made the corresponding
changes to the prospectus and statement of additional information of this Fund.
COMMENT 1 - PRINCIPAL INVESTMENT STRATEGIES
The penultimate sentence of the third paragraph under the Principal
Investment Strategies section states, "When determining relative strength, the
Index Provider does not perform the analysis within a finite time period, rather
the Index Provider takes into account a variety of factors to track movements
and trends of securities prices over various time periods." Disclose the time
periods in which such movements and trends are tracked (e.g., short-term or
long-term).
Karen Rossotto
July 16, 2014
Page 2
RESPONSE TO COMMENT 1
The disclosure has been revised to disclose that when determining relative
strength, the Index Provider performs its analysis within shorter time periods,
usually weekly, and takes into account a variety of factors to track movements
and trends of securities prices over longer time periods, usually a month or
more.
COMMENT 2 - PRINCIPAL INVESTMENT STRATEGIES
The security selection language states that the selection universe begins
with "all of the First Trust ETFs"; however, according to the Principal
Investment Strategies, the Index is designed to provide targeted exposure to
First Trust's country/region-based ETFs. Revise the security selection language
to provide that the selection universe begins with all of the First Trust
country/region-based ETFs.
RESPONSE TO COMMENT 2
As the disclosure provides, the first step of the security selection
process starts with a universe of all First Trust ETFs and the second step
selects the First Trust country/region-based ETFs.
COMMENT 3 - PRINCIPAL INVESTMENT STRATEGIES
The penultimate sentence in paragraph number 5 describing the security
selection states that "When an addition or deletion is made to the Index, the
Index is rebalanced so that each position is equally weighted." Disclose how
frequently the Index has been rebalanced and how often the Advisor expects the
Index to be rebalanced. Also, confirm whether the Fund expects to be
actively-traded. If it is expected that the portfolio turnover rate will be
greater than 100%, provide the appropriate risk disclosure.
RESPONSE TO COMMENT 3
The Fund's portfolio turnover is expected to be 100% or less and
therefore, not actively traded. Since December 2012, the Index's security
selection model has only resulted in one security change.
Karen Rossotto
July 16, 2014
Page 3
COMMENT 4 - PRINCIPAL INVESTMENT STRATEGIES
The first sentence in the second paragraph under "Additional Information
on the Fund's Investment Objective and Strategies" states in part, "the Fund
intends to invest in all of the securities comprising the Index, in proportion
to their weightings in the Index"; however, the language from the security
selection section quoted in Comment 3 above states that the Index is rebalanced
so that each position is equally weighted. Confirm that the Index is rebalanced
so that each position is equally weighted and revise the language that indicates
otherwise.
RESPONSE TO COMMENT 4
At the Fund's inception, the Fund's Index may not be equally weighted
because the Fund will be investing in accordance with a live index. Upon a
rebalancing, the Index should be equally weighted.
COMMENT 5 - PRINCIPAL INVESTMENT STRATEGIES AND PRINCIPAL RISKS
In addition to disclosing that the ETFs in which the Fund invests invest
in non-U.S. equity securities in the final paragraph under the Principal
Investment Strategies, disclose that the ETFs in which the Fund invests invest
in all market capitalization ranges (i.e., "small," "mid" and "large"). Also, in
either the "Equity Securities Risk" or a separate risk disclosure, disclose that
the ETFs in which the Fund invests invest in equity securities of all market
capitalization ranges. Because the Fund invests in the First Trust Emerging
Markets Small Cap AlphaDEX(R) Fund, consider whether a small capitalization risk
is necessary.
RESPONSE TO COMMENT 5
The disclosure has been revised in accordance with this comment.
COMMENT 6 - PRINCIPAL INVESTMENT STRATEGIES AND PRINCIPAL RISKS
To the extent the Fund invests in ETFs that hold unsponsored ADRs or other
unsponsored Depositary Receipts, disclose that such Depositary Receipts are
unsponsored and provide appropriate risk disclosure.
RESPONSE TO COMMENT 6
The Fund does not invest in unsponsored ADRs or other unsponsored
Depositary Receipts.
Karen Rossotto
July 16, 2014
Page 4
COMMENT 7 - PRINCIPAL RISKS
Confirm that the Fund is classified as "non-diversified" under the 1940
Act and provide the appropriate disclosure in the Principal Investment
Strategies section. Also, remove the language in the final sentence of the
"Non-Diversification Risk" disclosure that states that the Fund may be "highly
concentrated" in certain issuers, as such language may be confusing for
investors.
RESPONSE TO COMMENT 7
We confirm that the Fund is classified as "non-diversified" under the 1940
Act and the Principal Investment Strategies section has been revised
accordingly. Also, the language quoted above that is contained in the final
sentence of the "Non-Diversification Risk" disclosure has been revised.
COMMENT 8 - PRINCIPAL INVESTMENT STRATEGIES AND PRINCIPAL RISKS
If the Fund has any specific country focus or concentration, provide the
appropriate disclosures in the Principal Investment Strategies and Principal
Risks sections accordingly.
RESPONSE TO COMMENT 8
A country/region focus is not a part of the Index methodology, however,
the Index may be comprised of ETFs that have a country/region focus. Therefore,
the Replication Management Risk has been revised to provide that the Fund may be
concentrated in certain country/regions if the Index is so concentrated.
COMMENT 9 - PRINCIPAL RISKS
Please include a momentum style investing risk disclosure, particularly
with respect to short-term price movements.
RESPONSE TO COMMENT 9
The disclosure has been revised in accordance with this comment.
Karen Rossotto
July 16, 2014
Page 5
COMMENT 10 - ADDITIONAL INFORMATION ON THE FUND'S INVESTMENT OBJECTIVE AND
STRATEGIES
Confirm whether the language regarding the Fund's purchase of a sample of
securities is appropriate. Remove the disclosure if it is deemed not to be
appropriate.
RESPONSE TO COMMENT 10
The disclosure regarding sampling of securities has been removed.
COMMENT 11 - FUND INVESTMENTS
Consider whether the disclosure regarding the exemptive relief that
certain ETFs have been granted to invest in ETFs beyond certain statutory
limitations is appropriate considering the nature of this Fund. Also, confirm
whether the Fund is permitted to invest in unaffiliated funds and provide the
appropriate disclosures in the Principal Investment Strategies and Principal
Risks sections accordingly.
RESPONSE TO COMMENT 11
The disclosure has been revised in accordance with this comment.
COMMENT 12 - FUND INVESTMENTS.
The first sentence in the "Illiquid Securities" section states that the
Fund may invest up to 15% of its net assets in illiquid securities. Confirm
whether this disclosure applies to the underlying ETFs of the Fund and include
an appropriate disclosure in the Principal Investment Strategies and Principal
Risks sections.
RESPONSE TO COMMENT 12
The underlying funds will have the same limitation regarding illiquid
securities and the disclosure has been revised to provide that investments in
illiquid securities is a non-principal investment strategy of the Fund.
* * *
Karen Rossotto
July 16, 2014
Page 6
TANDY ACKNOWLEDGMENT
In connection with the Trust's Registration Statement, the Trust
acknowledges that:
o should the Commission or the staff, acting pursuant to delegated
authority, declare the filing effective, it does not foreclose the
Commission from taking any action with respect to the filing;
o the action of the Commission or the staff, acting pursuant to delegated
authority in declaring the filing effective, does not relieve the Trust
from its full responsibility for the adequacy and accuracy for the
disclosure in the filing; and
o the Trust may not assert this action as a defense in any proceeding
initiated by the Commission or any person under the federal securities
laws of the United States.
Please call me at (312) 845-3484 if you have any questions or issues you
would like to discuss regarding these matters.
Sincerely yours,
CHAPMAN AND CUTLER LLP
By: /s/ Morrison C. Warren
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Morrison C. Warren