First Trust Specialty Finance and Financial Opportunities Fund
(the "Fund") (NYSE: FGB) has decreased its regularly scheduled
quarterly distribution to $0.0825 per share from $0.135 per share
The distribution will be payable on August 31, 2020, to
shareholders of record as of August 24, 2020. The ex-dividend date
is expected to be August 21, 2020. The quarterly distribution
information for the Fund appears below.
First Trust
Specialty Finance and Financial Opportunities Fund
(FGB):
Distribution per share:
$0.0825
Distribution Rate based on the August 7,
2020 NAV of $3.02:
10.93%
Distribution Rate based on the August 7,
2020 closing market price of $3.00:
11.00%
Decrease from previous distribution of
$0.135:
-38.89%
A portion of the distribution may be treated as paid from
sources other than net investment income, including short-term
capital gain, long-term capital gain and return of capital. The
final determination of the source and tax status of all
distributions paid in 2020 will be made after the end of 2020 and
will be provided on Form 1099-DIV.
The Fund is a diversified, closed-end management investment
company that seeks to provide a high level of current income. As a
secondary objective, the Fund seeks to provide attractive total
return. The Fund pursues these investment objectives by investing
at least 80% of its managed assets in a portfolio of securities of
specialty finance and other financial companies that the Fund's
investment sub-advisor believes offer attractive opportunities for
income and capital appreciation.
The Fund’s dividend has been reduced due to COVID-19 market
volatility, which caused the Fund to lower its outstanding leverage
and resulted in a lower asset base earlier in the year. In
addition, the low interest rate environment and economic
uncertainty have presented various challenges to the Fund’s
holdings.
First Trust Advisors L.P. ("FTA") is a federally registered
investment advisor and serves as the Fund's investment advisor. FTA
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. FTA has collective assets under
management or supervision of approximately $145 billion as of July
31, 2020 through unit investment trusts, exchange-traded funds,
closed-end funds, mutual funds and separate managed accounts. FTA
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. FTA and FTP are based in
Wheaton, Illinois.
Confluence Investment Management LLC ("Confluence"), an SEC
registered investment advisor, serves as the Fund's investment
sub-advisor. The Confluence team has more than 500 years of
combined financial experience and 300 years of portfolio
management/research experience, maintaining a proven track record
that dates back to 1994. As of June 30, 2020, Confluence had more
than $9.0 billion in assets under management and advisement (assets
under management = $6.2 billion; assets under advisement = $2.9
billion).
Past performance is no assurance of future results. Investment
return and market value of an investment in the Fund will
fluctuate. Shares, when sold, may be worth more or less than their
original cost. There can be no assurance that the Fund’s investment
objectives will be achieved. The Fund may not be appropriate for
all investors.
Principal Risk Factors: Securities held by a fund, as well as
shares of a fund itself, are subject to market fluctuations caused
by factors such as general economic conditions, political events,
regulatory or market developments, changes in interest rates and
perceived trends in securities prices. Shares of a fund could
decline in value or underperform other investments as a result of
the risk of loss associated with these market fluctuations. In
addition, local, regional or global events such as war, acts of
terrorism, spread of infectious diseases or other public health
issues, recessions, or other events could have a significant
negative impact on a fund and its investments. Such events may
affect certain geographic regions, countries, sectors and
industries more significantly than others. The outbreak of the
respiratory disease designated as COVID-19 in December 2019 has
caused significant volatility and declines in global financial
markets, which have caused losses for investors. The COVID-19
pandemic may last for an extended period of time and will continue
to impact the economy for the foreseeable future.
The Fund invests in business development companies ("BDCs")
which may be subject to a high degree of risks, including
management's ability to meet the BDC's investment objective, and to
manage the BDC's portfolio when the underlying securities are
redeemed or sold, during periods of market turmoil and as
investors' perceptions regarding a BDC or its underlying
investments change.
Investing in real estate investment trusts ("REITs") involves
certain unique risks in addition to investing in the real estate
industry in general. REITs are subject to interest rate risk and
the risk of default by lessees or borrowers.
The Fund may invest in a variety of other mortgage-related
securities. Rising interest rates tend to extend the duration of
mortgage-related securities, making them more sensitive to changes
in interest rates, and may reduce the market value of the
securities. In addition, mortgage-related securities are subject to
the risk that borrowers may pay off their mortgages sooner than
expected, particularly when interest rates decline. This can reduce
the Fund's returns. The Fund's investments in other asset-backed
securities are subject to risks similar to those associated with
mortgage-backed securities, as well as additional risks associated
with the nature of the assets and the servicing of those
assets.
Because the Fund is concentrated in the financials sector, it
will be more susceptible to adverse economic or regulatory
occurrences affecting this sector, such as changes in interest
rates, availability and cost of capital funds, and competition.
Use of leverage can result in additional risk and cost, and can
magnify the effect of any losses.
The risks of investing in the Fund are spelled out in the
shareholder report and other regulatory filings.
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.
The Fund’s daily closing New York Stock Exchange price and net
asset value per share as well as other information can be found at
www.ftportfolios.com or by calling 1-800-988-5891.
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version on businesswire.com: https://www.businesswire.com/news/home/20200810005767/en/
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630-915-6784
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