1. Broker/Advisor Use Only – Not For Use With the Public The Facts and Fallacies of ETF Investing Stan Ueland ETF Portfolio Manager

2. Broker/Advisor Use Only – Not For Use With the Public ETFs - State of the State ETPs @ 2010* –> 1,000 U.S. Listed –> $ 1 Trillion Assets –40% Assets in 10 ETPs –50% ETFs have < $100m –Beta vs. Alpha ETF Structure –vs. Mutual Funds –vs. CEFs –vs. Stocks Unique to ETFs –INAV –Basket –Creation/Redemption Process * Includes ETFs, ETNs as of 12/31/2010

3. Broker/Advisor Use Only – Not For Use With the Public This example is for illustrative purposes and does not represent any actual investment or fund. Source: First Trust Advisors, 8/6/09.

4. Broker/Advisor Use Only – Not For Use With the Public This example is for illustrative purposes only. Fund: FTA – First Trust Large Cap Value AlphaDEX Fund. Source: Bloomberg. The intraday NAV for an ETF is typically calculated and published by a third party under a separate symbol every 15 seconds throughout the trading day over the Consolidated Tape based on the current value of the securities specified for creation and redemption plus any estimated cash amounts associated with the creation unit, all on a per-ETF share basis. The intraday NAV is designed to give investors a sense of the relationship between a basket of securities that are representative of those held in the ETF’s portfolio and the share price of the ETF on an intraday basis.

5. Broker/Advisor Use Only – Not For Use With the Public Liquidity of the underlying holdings is a significant factor in the liquidity of an ETF. Liquidity of underlying: Shares trade $7.5b per day $10m / $7.5b = 0.13% of ADV Liquidity of underlying: Shares trade $7.5b per day $10m / $7.5b = 0.13% of ADV Buy $10m in FNX (First Trust Mid Cap Core AlphaDEX Fund) Trader’s perspective: “Stock trades $467k per day” $10m / $467k = 2,140% of ADV Trader’s perspective: “Stock trades $467k per day” $10m / $467k = 2,140% of ADV This example is for illustrative purposes only. ADV statistics as of 1/7/2010.

6. Broker/Advisor Use Only – Not For Use With the Public

7. Market Maker AP ETF Sponsor ETF This example is for illustrative purposes and does not represent any actual investment or fund.

8. Broker/Advisor Use Only – Not For Use With the Public  8,300 = Average Daily Volume  145,000 = Total Volume for the Day  92,800 = Size of a Single Trade  $4.6m (28%) = Growth in the Fund for the Day FTA – First Trust Large Cap Value AlphaDEX Fund. (7/1/08) This example uses actual data for illustrative purposes only.

9. Broker/Advisor Use Only – Not For Use With the Public ETF Liquidity – Cases in Point 1.8M share trade (17k = 30 day ADV) Microcaps – Smallest/Compelling FDM 3.8M shares trade (21k = 30 day ADV) $114M – growth in a single day BICK 16.3M shares trade (257k = 30 day ADV) 250k shares at the bid FXO 4.5M shares trade (85k = 30 day ADV) Buying commodity exposure via equities CU FDM – 5/7/10; BICK – 10/4/10; FXO & CU – 3/23/11

10. Broker/Advisor Use Only – Not For Use With the Public Market Maker AP ETF Sponsor ETF This example is for illustrative purposes and does not represent any actual investment or fund.

11. Broker/Advisor Use Only – Not For Use With the Public Traditional Mutual Fund Example

12. Broker/Advisor Use Only – Not For Use With the Public ETF Sponsor ETF

13. Broker/Advisor Use Only – Not For Use With the Public Despite a meaningful selloff, both small and large ETFs trade up tight to their Indicative Value. Graphs reflect Central time. Source: Bloomberg – 5/21/10. This example uses actual data for illustrative purposes only.

14. Broker/Advisor Use Only – Not For Use With the Public Thoughts on Trading ETFs  Tips — Open/Close — Limits — iNAV — INTL funds — Stops  Stop Limits  Alerts — Implementation  Engage Us — Assistance — Access — Trading Desks  ‘It’s an ETF’ This example is for illustrative purposes and does not represent any actual investment or fund. Graph reflects Central time. Blue line = iNav, Red line = Best Bid, Green line = Best Offer Example of Daily Fund Pricing 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.