WHEATON, Illinois – (COMMERCIAL THREAD) – First Trust Energy Infrastructure Fund (the âFundâ (NYSE: FIF) declared the regular monthly distribution of common shares of the Fund in the amount of $ 0.0625 per share payable on November 15, 2021 to shareholders of record in November 2, 2021. The ex-dividend date is expected to be November 1, 2021. Information on the Fund’s monthly distributions is shown below.
First Trust Energy Infrastructure Fund (FIF):
Breakdown by share: ………………………………………. …………… …………………………….. ……………… …………… $ 0.0625
Distribution rate based on the net asset value of October 19, 2021 of $ 15.65: ………………………….. .. ………….. 4.79%
Distribution rate based on the closing market price of October 19, 2021 of $ 14.08: ……………………….. ….. 5.33%
The Fund’s Board of Trustees has approved a managed distribution policy for the Fund (the âPlanâ) based on an exemption received from the Securities and Exchange Commission which permits the Fund to make periodic distributions of capital gains to long term as frequently as monthly each tax year. Under the terms of the plan, the Fund intends to continue to pay its recurring monthly distribution in the amount of $ 0.0625 per share which reflects the distributable cash flow of the Fund. A portion of this monthly distribution may include long-term capital gains. This can lead to a reduction in the distribution of long-term capital gains required at the end of the year by distributing long-term capital gains throughout the year. The annual distribution rate is independent of the performance of the Fund over a given period. Therefore, you should not draw any conclusions about the Fund’s investment performance from the amount of a distribution or the terms of the plan.
The distribution may consist of net investment income earned by the Fund, short and long term net capital gains and / or a tax deferred return of capital. The tax-deferred return of capital, if any, is primarily due to the tax treatment of cash distributions made by the Master Limited Partnerships (âMLPsâ) in which the Fund invests. The final determination of the source of tax status for all 2021 distributions will be made after the end of 2021 and will be provided on Form 1099-DIV.
The Fund is an undiversified closed-end management investment company that seeks to provide a high level of total return with a focus on current distributions paid to shareholders. The Fund seeks to achieve its investment objectives by investing primarily in securities of companies active in the energy infrastructure sector. These companies mainly include publicly traded MLPs and limited liability companies taxed as partnerships, MLP affiliates, YieldCos, pipeline companies, utilities and other companies that earn at least 50% their income from operating or providing services in support of infrastructure assets such as pipelines, power transmission and storage of oil and natural gas in the oil, gas industries natural and power generation (collectively, âenergy infrastructure companiesâ). To generate additional income, the Fund plans to sell (or sell) covered call options on up to 35% of the managed assets held in the Fund’s portfolio.
First Trust Advisors LP (âFTAâ) is a federally registered investment advisor and acts as the investment advisor to the Fund. FTA and its affiliate First Trust Portfolios LP (âFTPâ), a brokerage registered with FINRA, are private companies that provide a variety of investment services. FTA has collective assets under management or supervision of approximately $ 207 billion as of September 30, 2021 through mutual funds, exchange-traded funds, closed-end funds, mutual funds and managed accounts distinct. FTA is the supervisor of the First Trust mutual funds, while FTP is the sponsor. FTP is also a distributor of UCITS units and exchange-traded fund creation units. FTA and FTP are based in Wheaton, Illinois.
Energy Income Partners, LLC (âEIPâ) acts as the Fund’s investment sub-advisor and provides advisory services to a number of investment firms and partnerships for the purpose of investing in MLPs and ‘other energy infrastructure titles. EIP is one of the first investment advisers specializing in this field. As of September 30, 2021, EIP managed or supervised approximately $ 4.4 billion in client assets.
Main risk factors: Past performance is no guarantee of future results. Investment returns and the market value of an investment in the Fund fluctuate. Stocks, 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 suitable for all investors.
The securities held by a fund, as well as the 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. The shares of a fund could lose value or underperform other investments because of the risk of loss associated with these market movements. In addition, local, regional or global events such as war, acts of terrorism, the spread of infectious diseases or other public health issues, recessions or other events could have a significant negative impact on a person. funds and its investments. Such events can affect certain geographic regions, countries, sectors and industries more significantly than others. The outbreak of respiratory disease known as COVID-19 in December 2019 caused significant volatility and declines in global financial markets, causing losses for investors. While vaccine development has slowed the spread of the virus and allowed the resumption of “reasonably” normal business activity in the United States, many countries continue to impose lockdowns in an attempt to slow the spread. In addition, there is no guarantee that the vaccines will be effective against emerging variants of the disease.
The Fund is subject to risks, including the fact that it is an undiversified closed-end investment company.
Since the Fund is concentrated in securities issued by energy infrastructure companies, it will be more sensitive to adverse economic or regulatory events affecting this industry, in particular high interest charges, high debt costs, financial effects. economic slowdown, excess capacity, increased competition, uncertainties about the availability of fuel at reasonable prices, the effects of energy conservation policies and other factors. Investments in securities of MLP involve certain different risks or in addition to the risks of investing in common stocks. The number of energy-related MLPs has decreased since 2014. The industry is witnessing the consolidation or simplification of corporate structures where the MLP capital sleeve is eliminated. As a result of the foregoing, the MLP investments of the Fund may become less diversified and the Fund may increase its non-MLP investments in accordance with its investment objective and policies. Changes in tax laws or regulations, or their interpretations in the future, could adversely affect the Fund or MLPs, MLP related entities and other companies in the energy and utilities industry. energy in which the Fund invests.
The Fund invests in securities of non-US issuers which are subject to higher volatility than securities of US issuers. Since the Fund invests in non-US securities, you could lose money if the local currency of a non-US market depreciates against the US dollar.
There can be no assurance that the portion of the distributions paid to holders of common shares of the Fund will consist of tax-advantaged eligible dividend income.
To the extent that a fund invests in floating or variable rate bonds which use the London Interbank Offered Rate (âLIBORâ) as the benchmark interest rate, it is subject to LIBOR risk. The UK Financial Conduct Authority, which regulates LIBOR, will stop offering LIBOR as a benchmark rate over a phase-out period that will begin immediately after December 31, 2021. LIBOR unavailability or replacement may affect the value. , liquidity or return on certain investments of the fund and may incur costs associated with closing positions and entering into new transactions. The potential effects of leaving LIBOR on the fund or on certain instruments in which the fund invests may be difficult to determine, and they may vary depending on various factors, and they may result in losses for the fund.
As the subscriber (seller) of a call option, the Fund waives, during the life of the option, the possibility of profiting from increases in the market value of the security in the portfolio covering the option at – above the sum of the premium and the strike price of the call option but retains the risk of loss in the event of a drop in the price of the underlying security. The value of call options written by the Fund may be affected if the option market is small or becomes illiquid. There can be no assurance that a liquid market will exist when the Fund seeks to close out an option position.
If the short-term interest rates are lower than the Fund’s fixed payment rate on an interest rate swap, the swap will reduce the net income of the common shares. In addition, a default by the counterparty to a swap transaction could also adversely affect the performance of the Common Shares.
The use of leverage can lead to additional risks and costs and can magnify the effect of any loss.
The risks associated with investing in the Fund are described in reports to shareholders and other regulatory documents.
The information presented is not intended to constitute an investment recommendation or advice to any particular person. By providing this information, First Trust does not undertake to give advice in a fiduciary capacity within the meaning of ERISA, the Internal Revenue Code or any other regulatory framework. Financial professionals are responsible for independently assessing investment risks and exercising independent judgment in determining whether investments are appropriate for their clients.
The Fund’s daily closing price on the New York Stock Exchange and net asset value per share along with other information is available at https://www.ftportfolios.com or by calling 1-800-988-5891.