SCHEDULE: Sit Entities Maintain Majority Stake in First Trust Mortgage Income Fund

Sit Investment Associates and Sit Fixed Income Advisors II continue to hold a 53.0% beneficial ownership in First Trust Mortgage Income Fund despite recent net share sales.

Summary

• Sit Investment Associates, Inc. and Sit Fixed Income Advisors II, LLC (Sit Entities) beneficially own 2,230,943 shares of First Trust Mortgage Income Fund Common Stock.
• This represents 53.0% of the Issuer's 4,213,115 outstanding shares as of April 30, 2025.
• The Sit Entities have shared voting and dispositive power over these shares.
• In the last 60 days, the Sit Entities engaged in net selling of shares, including a purchase of 1,305 shares at $11.98 and sales totaling 37,922 shares at prices ranging from $12.18 to $12.24.

Sentiment

Score: 4

Explanation: The sentiment is slightly negative due to the net selling of shares by the majority owner, even though the overall ownership percentage remains high. This suggests a potential reduction in conviction or a rebalancing of the portfolio.

Positives

• Sit Entities maintain a significant majority stake of 53.0% in the Issuer, indicating strong conviction or strategic control.

Negatives

• The Sit Entities engaged in net selling of 36,617 shares over the last 60 days, which could be interpreted as a reduction in exposure or a strategic rebalancing.

Future Outlook

No forward-looking statements or guidance from the issuer or reporting persons regarding future performance or strategy are provided.

Industry Context

This filing reflects a significant institutional investor's ongoing position and recent trading activity in a mortgage income fund. Such funds are sensitive to interest rate changes and housing market conditions. The continued majority ownership by Sit Entities suggests a long-term strategic interest in the fund, despite recent rebalancing of holdings.

Comparison to Industry Standards

• This filing is a disclosure of beneficial ownership and trading activity by a significant shareholder. It does not contain performance metrics of the fund itself that would allow for direct comparison to industry benchmarks or specific comparable companies/projects.
• The 53.0% ownership is a very high concentration for an institutional investor in a publicly traded fund, indicating a controlling stake rather than a passive investment.

Stakeholder Impact

• Shareholders: The net selling by a majority shareholder could be perceived negatively, potentially influencing market sentiment. However, the continued majority stake suggests stability in control.
• Management: The significant ownership by Sit Entities implies their continued influence over the fund's strategic direction.

Key Dates

Recommendation

While the net selling by a majority shareholder could be a negative signal, the Sit Entities still maintain a substantial 53.0% ownership, indicating continued strategic interest or control. The filing itself does not provide enough information on the fund's underlying performance or the Sit Entities' future intentions to warrant a strong buy or sell recommendation. Investors should monitor future filings and the fund's performance.

Keywords

First Trust Mortgage Income Fund, Sit Investment Associates, Sit Fixed Income Advisors II, Schedule 13D, beneficial ownership, mortgage income fund, investment management, institutional ownership