First Trust Mid Cap Core AlphaDEX® Fund (FNX)

Overview

The First Trust Mid Cap Core AlphaDEXu00ae Fund (FNX) seeks investment results that correspond generally to the price and yield (before the Fund's fees and expenses) of an equity index called the StrataQuantu00ae Mid Cap Index. The fund employs an 'enhanced' index approach, meaning it selects and weights stocks based on growth and value factors, deviating from traditional market-cap weighting.

Reputation and Reliability

First Trust is a well-established ETF provider known for its innovative and rule-based investment strategies. They have a solid track record and a wide range of ETF offerings.

Management Expertise

First Trust's management team has extensive experience in quantitative investing and ETF management. They employ a disciplined approach to security selection and portfolio construction.

Goal

To provide investment results that correspond generally to the price and yield of the StrataQuantu00ae Mid Cap Index.

Investment Approach and Strategy

Strategy: The fund uses a quantitative methodology (AlphaDEXu00ae) to select and weight mid-cap stocks based on growth and value factors.

Composition The fund primarily holds a diversified portfolio of mid-capitalization U.S. stocks.

Market Share: Difficult to precisely pinpoint market share without comprehensive industry data, but FNX represents a portion of the mid-cap core ETF market.

Total Net Assets (AUM): 1802000000

Key Competitors

• IVOO
• IJH
• IWR
• VO
• SCHM

Competitive Landscape

The mid-cap ETF market is highly competitive, with numerous ETFs tracking similar indices. FNX differentiates itself through its AlphaDEXu00ae methodology, which aims to enhance returns. Advantages include potential for outperformance, but disadvantages include higher expense ratios and potential for underperformance relative to market-cap weighted indices.

Historical Performance: Historical performance data is best obtained from financial data providers. Performance will vary based on market conditions.

Benchmark Comparison: Performance should be compared against the StrataQuantu00ae Mid Cap Index to evaluate the effectiveness of the AlphaDEXu00ae strategy.

Expense Ratio: 0.7

Average Trading Volume

FNX's average trading volume is generally moderate, providing adequate liquidity for most investors.

Bid-Ask Spread

The bid-ask spread is typically reasonable, but can widen during periods of market volatility.

Market Environment Factors

Economic growth, interest rates, and sector-specific trends impact FNX, as its holdings are tied to the performance of mid-cap companies.

Growth Trajectory

FNX's growth depends on the relative success of its AlphaDEXu00ae methodology in identifying undervalued mid-cap stocks. Changes in holdings occur periodically as the AlphaDEXu00ae model rebalances.

Competitive Edge

FNX's primary advantage lies in its AlphaDEXu00ae methodology, which seeks to outperform market-cap weighted mid-cap indices by selecting and weighting stocks based on growth and value factors. The quant approach can lead to returns if the methodology is successful at identifying undervalued stocks. The fund offers investors a differentiated approach to mid-cap investing. However, investors should recognize that its strategy isn't guaranteed to outperform broader indices or other ETFs using different approaches.

Volatility

FNX's volatility is generally similar to that of the broader mid-cap market, but may be higher due to its active selection process.

Market Risk

FNX is subject to market risk, meaning its value can fluctuate with overall market conditions and the performance of its underlying holdings.

Ideal Investor Profile

FNX is suitable for investors seeking exposure to mid-cap stocks with the potential for enhanced returns through a quantitative selection process. Investors who understand and are comfortable with active management strategies and their associated risks.

Market Risk

FNX may be suitable for long-term investors seeking capital appreciation, but it is not necessarily a passive index-tracking fund.

First Trust Mid Cap Core AlphaDEXu00ae Fund (FNX) is a mid-cap ETF that employs a quantitative methodology to select and weight stocks based on growth and value factors, deviating from traditional market-cap weighting. It aims to outperform the StrataQuantu00ae Mid Cap Index but also carries a higher expense ratio. Its performance depends on the success of its AlphaDEXu00ae methodology. Investors should consider their risk tolerance, investment goals, and understanding of quantitative strategies before investing in FNX.

Data Sources:

• First Trust Website
• ETF.com
• Morningstar
• Bloomberg

Disclaimers:

This analysis is for informational purposes only and does not constitute investment advice. Past performance is not indicative of future results. Investors should consult with a qualified financial advisor before making any investment decisions. Data is based on available information and may be subject to change.