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Upturn AI Summary
First Trust Active Factor Emerging Markets Fund(AFEM)
Advisory History & Simulated Performance *
*as per simulation (see disclosures)- ALL
- 1Y
- 1M
- 1W
- BUY Advisory
- SELL Advisory (Profit)
- SELL Advisory (Loss)
- Profit
- Loss
- PASS (Skip)
Stock price based on last close Advisory Performance History (Simulated)
Upturn Advisory & Investor View for AFEM
10/28/2026: AFEM (2-star) is currently NOT-A-BUY. Pass it for now.
AFEM provides actively managed exposure to emerging markets by using a multi-factor quantitative strategy that emphasizes value and quality. Its main strengths include the potential for alpha generation through active management and a more disciplined approach than traditional market-cap-weighted indices. It is best used as a satellite holding to diversify a core portfolio. Key risks include high volatility, liquidity constraints, and inherent geopolitical risks associated with developing economies. This fund is most suitable for investors who have a high risk tolerance and a belief that factor-based strategies can outperform passive emerging market benchmarks.
How to Read the Upturn Advisory
The Upturn Star Rating and the current BUY, SELL, or PASS advisory are generated by Upturn’s AI advisory engine based on proprietary signal analysis, price behavior, advisory history, and historical signal performance.
ETF holdings, costs, diversification, valuation, risks, and market conditions provide supporting context about the fund.
Investor Fit
| Investor style | Fit | Why |
|---|---|---|
| Growth investor | Mixed fit | The fund offers exposure to emerging growth, but its factor-tilts may underperform during pure momentum-driven market rallies. |
| Momentum investor | Strong fit while signal remains positive | The fund incorporates momentum factors into its selection process, making it suitable when these signals align. |
| Value investor | Strong fit | Value is a core component of the fund's factor-based selection strategy, appealing to those seeking undervalued emerging market stocks. |
| Dividend/Income investor | Mixed fit | While some holdings may pay dividends, the fund's primary focus is on factor-based capital appreciation rather than yield. |
| Low-risk investor | Weak fit | Emerging markets carry inherent geopolitical and currency risks that are generally incompatible with a low-risk mandate. |
Investor Profile
Ideal Investor Profile
The ideal investor is an experienced market participant with a long-term horizon who believes in the efficacy of factor-based investing and is comfortable with the higher risk profile of emerging markets.
Suitability
AFEM is best suited for long-term investors seeking to augment a core portfolio with an active emerging markets satellite position.
Risk Profile
| Risk factor | Level | Why it matters |
|---|---|---|
| Volatility | High | Emerging markets are subject to sudden price swings due to local economic and political events. |
| Market risk | High | The fund is fully exposed to systemic risks associated with developing financial markets. |
| Concentration | Medium | Factor-based selection may lead to unintended over-concentration in specific countries or sectors. |
| Tracking/expense | Medium | The higher expense ratio and active management style create a performance hurdle relative to low-cost benchmarks. |
| Liquidity | Medium / high | Lower trading volumes can make it difficult to enter or exit large positions without affecting the price. |
| Business/sector quality | Medium | Quality factors help mitigate, but cannot eliminate, the risk of investing in companies with poor governance. |
Risk Analysis
Volatility
AFEM exhibits high historical volatility, consistent with the broader emerging markets asset class, amplified by its active factor tilts.
Market Risk
The primary risk is the high beta associated with developing nations, where political risk, regulatory changes, and currency fluctuations significantly impact asset values.
What the ETF Owns
| Exposure Type | Exposure | Weight (%) | Retail Investor Read |
|---|---|---|---|
| Geography | Emerging Markets Equity | 98 | This provides broad exposure to the growth potential of developing economies while focusing on factor-selected companies. |
| Cash/collateral | Cash and Cash Equivalents | 2 | A small cash buffer is maintained for liquidity and to facilitate daily fund operations. |
Price Behavior
Strong Uptrend
The stock has maintained a strong upward price trend across the last three quarters.
Smooth
The stock has moved along a generally orderly path with only modest fluctuations.
Analysis of Past Performance
Type ETF | Historic Profit 43.1% | Avg. Invested days 95 | Today’s Advisory PASS |
Upturn Advisory Rating  | Upturn Advisory Performance  3.0 | ETF Returns Performance  5.0 |
| Profits based on simulation | Last Close 10/28/2026 |
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