Fund Description: First Trust Alternative Absolute Return Strategy ETF is an actively managed exchange-traded fund or Actively Managed ETF which is a separate investment portfolio of the First Trust Exchange-Traded Fund VII, an open-end investment management company. INVESTMENT OBJECTIVE: The First Trust Alternative Absolute Return Strategy ETF seeks to provide long-term total return. The Fund is an actively managed ETF and thus, does not seek to replicate the performance of a specific index, but rather uses an active investment strategy to meet its investment objective. Accordingly, the ETF’s investment advisor, First Trust Advisors L.P., has discretion on a daily basis to actively manage the Fund’s portfolio in accordance with the Fund’s investment objective. FUND STRATEGY: The Fund seeks to reach its investment objective through long and short investments in exchange-traded commodity futures contracts (Commodity Futures) through a wholly-owned subsidiary of the Fund organized under the laws of the Cayman Islands (the Subsidiary). The Fund will not invest directly in Commodity Futures. The Fund expects to gain exposure to these investments exclusively by investing in the Subsidiary. The Fund's investment in the Subsidiary is intended to provide the Fund with exposure to commodity markets within the limits of current federal income tax laws applicable to investment companies such as the Fund, which limit the ability of investment companies to invest directly in Commodity Futures. The Subsidiary has the same investment objective as the Fund, but unlike the Fund, it may invest without limitation in Commodity Futures. The Subsidiary's holdings will primarily consist of Commodity Futures, which are contractual agreements to buy or sell a particular commodity or financial instrument at a pre-determined price at a settlement date in the future. As the settlement date for a futures contract approaches, the Fund, through the Subsidiary, intends to sell the expiring contract and replace it with a similar contract with a more distant settlement date. This process is known as rolling and may be done frequently by the Fund throughout the year so as to maintain a fully invested position. This frequent buying and selling of Commodity Futures, in addition to attempts by the Fund to rebalance its exposure to various market sectors, may cause the Fund to experience higher levels of portfolio turnover. The Fund, through the Subsidiary, engages in trading on commodity markets both inside and outside of the United States on behalf of the Fund. The remainder of the Fund's assets will primarily be invested in: (1) U.S. government and agency securities with maturities of five years or less; (2) short-term repurchase agreements; (3) money market instruments; and (4) cash. The Fund uses such instruments as investments and to collateralize the Subsidiary's Commodity Futures exposure on a day-to-day basis. FUND MANAGEMENT: First Trust Advisors L.P. serves as investment advisor to the Fund and to the Subsidiary.