First Trust Dividend Strength ETF (FTDS)

Overview

The First Trust Dividend Strength ETF (FTCS) seeks investment results that correspond to the price and yield of an equity index called the NASDAQ US Dividend Achievers 50 Index. It invests in companies that have consistently increased their dividends over time, focusing on dividend strength and sustainability.

Reputation and Reliability

First Trust is a well-established ETF provider with a solid reputation for offering innovative and specialized investment products.

Management Expertise

First Trust Advisors L.P. has a seasoned team of investment professionals with extensive experience in managing ETFs and dividend-focused strategies.

Goal

The ETF aims to provide investment results that generally correspond to the price and yield of the NASDAQ US Dividend Achievers 50 Index.

Investment Approach and Strategy

Strategy: The ETF tracks the NASDAQ US Dividend Achievers 50 Index, which consists of 50 US companies with a consistent history of dividend increases.

Composition The ETF primarily holds stocks of large and mid-cap US companies that have demonstrated a strong track record of dividend growth.

Market Share: FTCSu2019 market share is relatively modest compared to broader dividend ETFs.

Total Net Assets (AUM): 162740000

Key Competitors

• Schwab US Dividend Equity ETF (SCHD)
• Vanguard Dividend Appreciation ETF (VIG)
• iShares Select Dividend ETF (DVY)

Competitive Landscape

The dividend ETF market is highly competitive, with several large and well-established players. FTCS competes by focusing on dividend strength based on methodology and sustainability, but faces stiff competition from lower-cost and more broadly diversified dividend ETFs like SCHD and VIG. FTCS's smaller AUM may limit its liquidity compared to larger competitors.

Historical Performance: Historical performance data will vary, but it should be compared to the benchmark index and peers. Provide numerical data as a structured array for graphing.

Benchmark Comparison: Benchmark comparison involves assessing how closely the ETF tracks the NASDAQ US Dividend Achievers 50 Index. Provide numerical data as a structured array for graphing.

Expense Ratio: 0.3

Average Trading Volume

The average daily trading volume of FTCS is moderate, indicating sufficient liquidity for most investors.

Bid-Ask Spread

The bid-ask spread for FTCS is generally reasonable, reflecting acceptable trading costs.

Market Environment Factors

Economic indicators such as interest rates and inflation can impact dividend-paying stocks. Sector growth prospects and overall market conditions also influence the ETF's performance.

Growth Trajectory

Growth trends depend on the performance of dividend-paying companies and investor demand for dividend ETFs. Strategy changes or portfolio adjustments may impact its future trajectory.

Competitive Edge

FTCS's competitive advantage lies in its focus on dividend strength, potentially leading to more sustainable dividend income streams. The specific methodology of the NASDAQ US Dividend Achievers 50 Index may differentiate it from other dividend ETFs. However, larger and lower-cost competitors pose a significant challenge. Its narrower focus compared to more diversified dividend ETFs can be viewed as both a strength and weakness.

Volatility

FTCS's volatility depends on the volatility of its underlying holdings, which are typically large-cap dividend-paying stocks.

Market Risk

Market risk includes the potential for stock prices to decline due to economic downturns or market corrections. Specific risks include sector concentration and reliance on dividend payments.

Ideal Investor Profile

The ideal investor for FTCS is someone seeking a consistent income stream from dividend-paying stocks, with a focus on dividend strength and sustainability.

Market Risk

FTCS may be suitable for long-term investors seeking dividend income as part of a diversified portfolio.

The First Trust Dividend Strength ETF (FTCS) offers exposure to US companies with a consistent history of dividend increases. It tracks the NASDAQ US Dividend Achievers 50 Index and aims to provide a stable income stream. However, it faces competition from larger and lower-cost dividend ETFs. Investors should consider its expense ratio and specific investment strategy when making investment decisions. Despite the competitive environment, it can be an attractive option for those prioritizing dividend sustainability.

Data Sources:

• First Trust website
• ETF.com
• Morningstar
• etfdb.com

Disclaimers:

The information provided is for informational purposes only and does not constitute investment advice. Past performance is not indicative of future results. Consult with a financial advisor before making any investment decisions.