Fund Description: First Trust California Municipal High Income 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 III, an open-end investment management company. INVESTMENT OBJECTIVE: The First Trust California Municipal High Income ETF seeks to provide current income that is exempt from regular federal income taxes and California income taxes, and its secondary objective will be long-term capital appreciation. The Fund is an actively managed ETF and thus does not seek to replicate the performance of a specific index. Rather, the Adviser has discretion on a daily basis to actively manage the Fund’s portfolio in accordance with the Fund’s investment objective. FUND STRATEGY: Under normal market conditions, the Fund seeks to achieve its investment objectives by investing at least 80% of its net assets (including investment borrowings) in municipal debt securities that pay interest that is exempt from regular federal income taxes and California income taxes (collectively, Municipal Securities). Municipal Securities will be issued by or on behalf of the State of California or territories or possessions of the U.S. (including, but not limited to, Puerto Rico, the U.S. Virgin Islands and Guam). The types of Municipal Securities in which the Fund may invest include municipal lease obligations (and certificates of participation in such obligations), municipal general obligation bonds, municipal revenue bonds, municipal notes, municipal cash equivalents, private activity bonds (including without limitation industrial development bonds), and pre-refunded and escrowed to maturity bonds. In addition, Municipal Securities include inverse floating rate securities issued by tender option bond trusts and securities issued by custodial receipt trusts, each of which are investment vehicles the underlying assets of which are municipal bonds. The Fund may invest in Municipal Securities of any duration and any maturity. The Fund expects the weighted average maturity of the Fund will be less than or equal to 14 years. 50% of its net assets in Municipal Securities will be rated investment grade (i.e., rated Baa3/BBB- or above). The Fund is classified as non-diversified. FUND MANAGEMENT: First Trust Advisors L.P. serves as the investment advisor to the Fund.