CHAPMAN AND CUTLER LLP 111 WEST MONROE STREET
CHICAGO, ILLINOIS 60603
January 7, 2015
VIA EDGAR CORRESPONDENCE
------------------------
Karen Rossotto
United States Securities and Exchange Commission
100 F Street, N.E.
Washington, D.C. 20549
Re: First Trust Exchange-Traded Fund (the "Trust")
File Nos. 811-21775 and 333-125751
---------------------------------------------------------
Dear Ms. Rossotto:
This letter responds to your comments regarding the registration statement
filed on Form N-1A for First Trust Exchange-Traded Fund (the "Trust") with the
Securities and Exchange Commission (the "Commission") on December 8, 2014 (the
"Registration Statement"). The Registration Statement relates to the First Trust
Total US Market AlphaDEX 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 - ANNUAL FUND OPERATING EXPENSES
Footnote 1 to the Annual Fund Operating Expenses Table discloses that the
Fund has adopted a 12b-1 plan that will not require the Fund to pay 12b-1 fees
for a certain period of time. Footnote 2 to the Annual Fund Operating Expenses
Table discloses that the Fund's advisor has agreed to waive and/or pay certain
of the Fund's expenses for a certain period of time. In both cases, please
provide a date that is at least one year from the date of the prospectus.
Karen Rossotto
January 7, 2015
Page 2
RESPONSE TO COMMENT 1
In accordance with this comment, the footnotes reflect a date that is at
least one year from the date of the prospectus.
COMMENT 2 - PRINCIPAL INVESTMENT STRATEGIES
The first sentence of the second paragraph of the Principal Investment
Strategies section discloses that the "Index is designed to 'objectively'
identify and select stocks across market capitalizations .... " What does the
term, "objectively," mean with respect to the securities selection process for
the Index? Is the security selection a quantitative process? Provide the
appropriate disclosure.
RESPONSE TO COMMENT 2
The term "objectively" has been changed to "quantitatively" in response to
this comment.
COMMENT 3 - PRINCIPAL INVESTMENT STRATEGIES
Disclose whether the Index is equally-weighted and fully-invested in the
Index or whether the Fund will invest in a sampling of the securities in the
Index.
RESPONSE TO COMMENT 3
The Index is a modified equal-dollar weighted index, as explained in
greater detail in the prospectus. Under normal market conditions, the advisor
anticipates that the Fund will be fully invested in the holdings of the Index.
COMMENT 4 - PRINCIPAL INVESTMENT STRATEGIES
What is the nature of the relationship between the current Index and the
predecessor index? Provide the appropriate disclosure.
RESPONSE TO COMMENT 4
Because there is no direct relationship between the current Index and the
predecessor index, disclosure regarding any such relationship is not warranted.
Karen Rossotto
January 7, 2015
Page 3
COMMENT 5 - PRINCIPAL INVESTMENT STRATEGIES AND PRINCIPAL RISKS
If it is anticipated that the Fund will be actively traded, i.e., have a
portfolio turnover rate that is greater than 100%, provide the appropriate
disclosure in the Principal Investment Strategies and Principal Risks sections.
RESPONSE TO COMMENT 5
The prospectus has been revised in accordance with this comment.
COMMENT 6 - PURCHASE AND SALE OF FUND SHARES
Revise the disclosure to separately describe the process of purchasing and
selling shares for retail investors and institutional investors.
RESPONSE TO COMMENT 6
The prospectus has been revised in accordance with this comment.
COMMENT 7 - FUND INVESTMENTS
To the extent that the use of illiquid securities will be a part of the
Fund's principal investment strategies, provide the appropriate disclosure here
and in the Principal Investment Strategies section in the summary section.
RESPONSE TO COMMENT 7
The Fund's advisor does not anticipate that the use of illiquid securities
will be a part of the Fund's principal investment strategies.
COMMENT 8 - ADDITIONAL RISKS OF INVESTING IN THE FUND
Consider whether Legislation/Litigation Risk is a principal risk of the
Fund and consider moving this risk factor to the Non-Principal Risks
sub-section.
RESPONSE TO COMMENT 8
The prospectus has been revised in accordance with this comment.
Karen Rossotto
January 7, 2015
Page 4
COMMENT 9 - NET ASSET VALUE
The last two paragraphs of this section make references to foreign
securities exchanges and securities denominated in foreign currencies. Consider
whether this disclosure is appropriately placed here.
RESPONSE TO COMMENT 9
The prospectus has been revised in accordance with this comment.
COMMENT 10 - INDEX INFORMATION
Consider whether certain of the disclosure in this section should be added
to the Principal Investment Strategies section in summary form.
RESPONSE TO COMMENT 10
The prospectus has been revised in accordance with this comment.
* * *
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.
Karen Rossotto
January 7, 2015
Page 5
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
--------------------------------
Morrison C. Warren