Fund Description: First Trust Horizon Managed Volatility Developed International ETF is a non-diversified, 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 Horizon Managed Volatility Developed International ETF seeks to provide capital appreciation. 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 Sub-Advisor, Horizon Investments, LLC, 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 objective by investing at least 80% of its net assets (including investment borrowings) in common stocks and depositary receipts of developed market companies listed and traded on non-U.S. exchanges that the Sub-Advisor believes exhibit low future expected volatility. The Sub-Advisor considers Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, Luxembourg, the Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, the United Kingdom and the United States to be developed market countries. However, this list may change over time. The Fund will invest in at least three countries and at least 40% of its net assets in countries other than the United States. The Fund has significant investments in companies operating in Europe. The goal of this strategy is to capture upside price movements in rising markets and reduce downside risk when markets decline. To implement this strategy, in selecting securities for the Fund from a portfolio of eligible securities, the Sub-Advisor employs volatility forecasting models to forecast future expected volatility. The strategy is largely quantitative and rules-based, but also includes multiple parameters over which the Sub-Advisor may exercise discretion (including, but not limited to, the number of holdings and the weightings of particular holdings) in connection with its active management of the Fund. FUND MANAGEMENT: First Trust Advisors L.P. serves as investment advisor to the Fund. Horizon Investments, LLC serves as the Sub-Advisor to the Fund.