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WHEATON, Ill.--([ BUSINESS WIRE ])--First Trust Advisors L.P. (aFirst Trusta), a provider of more than 200 investment products, many of which offer transparency, tax efficiency and a rules-based approach to stock selection, has announced the launch of a new exchange-traded fund, First Trust CBOE S&P 500 VIX Tail Hedge Fund (NYSE Arca: VIXH).

"The lesson of the 2008 global financial crisis is that a single severe market shock can devastate entire portfolios and wipe out many years of market gains"

A tail hedging strategy, which tries to protect a portfolio from extreme market swings resulting from unpredictable, random and unexpected events (also known as ablack swansa), will be utilized. This methodology may help the Fund hedge against such developments and hopefully offset some of the losses in the common stock portfolio due to the unexpected events.

The CBOE VIX Tail Hedge Index, a benchmark index created by Chicago Board Options Exchange (CBOE), tracks the performance of each equity security in the S&P 500 Index (with dividends reinvested) and allocates a variable percentage to a long position in a call option on the CBOE Volatility Index (VIX). The Index is reconstituted and rebalanced every month. At the time of the Index rebalancing, the amount allocated to the call option varies between 0% and 1%, with the balance of the Index being invested in an S&P 500 stock portfolio. During periods of extreme volatility, the out-of-money call options on the VIX index may generate large positive returns that offset losses in the common stock portfolio; however, there is no guarantee that the tail hedge will be effective in offsetting any of the losses in the Indexas allocation to the S&P 500 stocks.

In order to reduce hedging costs, the Index (and the Fund) varies the weight of the VIX calls at each monthly rebalance. The weight of the VIX calls is dependent upon expected levels of forward volatility as measured by the VIX futures curve. At low levels of expected volatility (<15%) or extremely high levels of expected volatility (>=50%), no call options are purchased and their respective weight is 0%. At levels greater than or equal to 15%, but less than 30%, 1% of the portfolio is allocated to call options. At levels greater than or equal to 30%, but less than 50%, 0.5% of the portfolio is allocated to call options. If an allocation is made to the atail hedginga strategy at the monthly rebalance date, the VIX call options are held through the expiration date the following month, at which time the index is reconstituted and rebalanced.

aThe lesson of the 2008 global financial crisis is that a single severe market shock can devastate entire portfolios and wipe out many years of market gains,a said Robert Carey, CFA, Chief Market Strategist of First Trust. aGiven the surge in interest in tail risk and tail risk hedging in the wake of that crisis, we believe this is an ideal time to launch a Fund offering long-term investors a convenient way to attempt to hedge against the risk of similar extreme market events.a

For more information about First Trust, please contact Chris Moon of JCPR at 973-850-7304 or [ cmoon@jcprinc.com ].

About First Trust

First Trust provides a broad range of investment products and services that help financial advisors, registered investment advisors and other third-party asset managers meet the financial needs and objectives of their clients. Among the firmas more than 200 investment products are its family of 73 Exchange-Traded Funds (ETFs), including First Trustas core AlphaDEX series of ETFs. Founded in 1991 with the goal of offering investors a better way to invest, First Trust uses a proprietary, rules-based and quantitative investment methodology to select securities for its AlphaDEX products. The result is a portfolio weighted on merit, not cap size, which lowers stock-specific risk and offers greater tax efficiency. As of July 31, 2012, 13 First Trust ETFs, including 6 AlphaDEX ETFs, had four- or five-star ratings from Morningstar**. First Trust is based in Wheaton, Illinois. For more information, visit [ http://www.ftportfolios.com ].

**Ranking Criteria: The Morningstar Rating^TM is provided for ETFs with at least a three-year history. Ratings are based on the ETFas Morningstar Risk-Adjusted Return measure which accounts for variation in monthly performance, placing more emphasis on downward variations and rewarding consistent performance. An ETFas risk-adjusted return includes a brokerage commission estimate. PLEASE NOTE, this estimate is subject to change and the actual brokerage commission an investor pays may be higher or lower than this estimate. Morningstar compares each ETFas risk-adjusted return to the open-end mutual fund rating breakpoints for that category. Consistent with the open-end mutual fund ratings, the top 10% of ETFs in each category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars and the bottom 10% receive 1 star. The overall rating for an ETF is based on a weighted average of the ETFas 3, 5, and 10 year rating. The determination of an ETFas rating does not affect the retail open end mutual fund data published by Morningstar.

The Fundas shares will change in value, and you could lose money by investing in the Fund. One of the principal risks of investing in the Fund is market risk. Market risk is the risk that a particular stock owned by the Fund, Fund shares or stocks in general may fall in value.

The Fundas return may not match the return of the CBOE VIX Tail Hedge Index. The Fund may not be fully invested at times. 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.

The Fund may effect a portion of creations and redemptions for cash, rather than in-kind securities. As a result, an investment in the Fund may be less tax efficient than an investment in a more conventional exchange-traded Fund.

The use of options and other derivatives can lead to losses because of adverse movements in the price or value of the underlying asset, index or rate, which may be magnified by certain features of the derivatives. These risks are heightened when the Fundas portfolio managers use derivatives to enhance the Fundas return or as a substitute for a position or security, rather than solely to hedge (or offset) the risk of a position or security held by the Fund. The option positions employed, as dictated by the attempt to replicate the index, may present additional risk. The value of an option may be adversely affected if the market for the option becomes less liquid or smaller, and will be affected by changes in the value and dividend rates of the stock subject to the option, an increase in interest rates, a change in the actual and perceived volatility of the stock market and the common stock and the remaining time to expiration. Additionally, the value of an option does not increase or decrease at the same rate as the underlying stock (although they generally move in the same direction).

Investors buying or selling Fund shares on the secondary market may incur customary brokerage commissions. Investors who sell Fund shares may receive less than the shareas net asset value. Shares may be sold throughout the day on the exchange through any brokerage account. However, shares may only be redeemed directly from the Fund by authorized participants, in very large creation/redemption units.

The Fund is classified as anon-diversified.a A non-diversified fund generally may invest a larger percentage of its assets in the securities of a smaller number of issuers. As a result, the Fund may be more susceptible to the risks associated with these particular companies, or to a single economic, political or regulatory occurrence affecting these companies.

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 Fundas distributor.

An investor should consider the Fundas investment objectives, risks, 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.

Standard & Pooras and S&P are registered trademarks of Standard & Pooras Financial Services LLC (aSPFSa) and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC (aDow Jonesa) and have been licensed for use by S&P Dow Jones Indices LLC and sublicensed for certain purposes by First Trust Advisors L.P. aS&P 500a is a registered trademark of SPFS; aCBOEa, Chicago Board Options Exchange, CBOE Volatility Index and aVIXa are registered trademarks of Chicago Board Options Exchange, Incorporated (aCBOEa); and have been licensed for use by S&P Dow Jones Indices LLC and First Trust Advisors L.P. The aCBOE VIX Tail Hedge Indexa is a product of S&P Dow Jones Indices LLC, and has been licensed for use by First Trust Advisors L.P. The First Trust CBOE S&P 500 VIX Tail Hedge Fund is not sponsored, endorsed, sold or promoted by S&P Dow Jones Indices LLC, Dow Jones, S&P, their respective affiliates, or CBOE and neither S&P Dow Jones Indices LLC, Dow Jones, S&P, their respective affiliates or CBOE make any representation regarding the advisability of investing in such product(s).