First Trust Industrials/Producer Durables AlphaDEX® Fund (FXR)

Overview

The First Trust Industrials/Producer Durables AlphaDEXu00ae Fund (FXN) is an exchange-traded fund that seeks to provide investment results that correspond generally to the price and yield of the Nasdaq U.S. Industrials/Producer Durables AlphaDEXu00ae Index. The fund focuses on companies involved in the industrial sector, with an emphasis on producer durables, utilizing an AlphaDEXu00ae methodology to select stocks based on growth and value factors.

Reputation and Reliability

First Trust is a well-established ETF provider with a diverse range of products and a reputation for innovative index construction. They have a long track record in the asset management industry.

Management Expertise

The fund is managed by First Trust Advisors L.P., which has a team of experienced investment professionals dedicated to implementing the fund's strategy and managing its holdings.

Goal

To provide capital appreciation through investments in a selection of U.S.-listed industrial companies, focusing on those that exhibit strong growth and value characteristics as identified by the AlphaDEXu00ae methodology.

Investment Approach and Strategy

Strategy: The fund aims to track the Nasdaq U.S. Industrials/Producer Durables AlphaDEXu00ae Index, which uses a quantitative selection process to identify and rank stocks based on specific growth and value metrics.

Composition The ETF primarily holds common stocks of companies within the industrials sector, with a specific emphasis on producer durables manufacturers. The selection is not based on market capitalization alone but on the AlphaDEXu00ae scoring system.

Market Share: Information on specific market share for FXN is not readily available in public datasets, but it operates within the broader industrials ETF segment.

Total Net Assets (AUM): 1450000000

Key Competitors

• Industrial Select Sector SPDR Fund (XLI)
• Vanguard Industrials ETF (VIS)
• iShares U.S. Industrials ETF (IFRA)

Competitive Landscape

The industrials ETF market is competitive, dominated by larger, passively managed funds that track broad market indices. FXN differentiates itself through its AlphaDEXu00ae methodology, which is an actively managed quantitative approach aiming to outperform traditional market-cap weighted indices. Its advantages lie in its potential for factor-based outperformance, while disadvantages may include higher expense ratios compared to passive options and a more concentrated portfolio.

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Benchmark Comparison: The fund aims to outperform its benchmark, the Nasdaq U.S. Industrials/Producer Durables AlphaDEXu00ae Index. Historical performance data indicates that FXN has often demonstrated competitive returns against broad industrials indices, showcasing the effectiveness of its AlphaDEXu00ae selection criteria.

Expense Ratio: 0.0059

Average Trading Volume

FXN exhibits a healthy average daily trading volume, ensuring relatively easy buying and selling for investors.

Bid-Ask Spread

The bid-ask spread for FXN is typically tight, indicating efficient trading and low transaction costs for investors.

Market Environment Factors

FXN is influenced by macroeconomic trends such as GDP growth, industrial production, consumer spending on durable goods, and infrastructure development. Global supply chain dynamics and technological advancements in manufacturing also play a significant role.

Growth Trajectory

The fund's growth trajectory is tied to the performance of the industrials sector and the effectiveness of the AlphaDEXu00ae methodology in identifying growth and value opportunities within that sector. Changes in the underlying index methodology or significant shifts in economic conditions can impact holdings and strategy.

Competitive Edge

FXN's primary competitive advantage stems from its proprietary AlphaDEXu00ae selection methodology. This quantitative approach systematically identifies companies with strong growth and value characteristics, potentially leading to outperformance over traditional market-cap weighted industrial ETFs. This factor-based strategy offers a distinct alternative for investors seeking to capture specific investment factors within the industrials sector.

Volatility

FXN's historical volatility is generally in line with that of the broader industrials sector, with some fluctuations driven by its factor-based selection process.

Market Risk

The fund is subject to market risk, specifically the cyclical nature of the industrials sector, which can be sensitive to economic downturns. Additionally, risks associated with specific sub-sectors within industrials, such as aerospace, defense, machinery, and transportation, can impact performance.

Ideal Investor Profile

The ideal investor for FXN is one seeking exposure to the U.S. industrials sector with a quantitative, factor-based approach. This includes investors who believe in the potential for growth and value strategies to outperform traditional indexing within this sector.

Market Risk

FXN is best suited for long-term investors who are comfortable with sector-specific investments and understand the AlphaDEXu00ae methodology. It may also appeal to active traders seeking to capitalize on factor-driven market movements.

The First Trust Industrials/Producer Durables AlphaDEXu00ae Fund (FXN) offers a unique, factor-based approach to investing in the U.S. industrials sector. Leveraging the AlphaDEXu00ae methodology, it aims to identify companies with superior growth and value characteristics, potentially outperforming traditional indices. While operating in a competitive landscape, its distinct strategy provides a valuable alternative for investors seeking to target specific investment factors within this economically sensitive sector. FXN's performance is influenced by broader economic conditions and the effectiveness of its quantitative selection process.

Data Sources:

• First Trust Portfolios, L.P.
• Nasdaq
• Financial data aggregators (e.g., Morningstar, Yahoo Finance - specific dates of access not provided for generality)

Disclaimers:

This information is for informational purposes only and should not be considered investment advice. Past performance is not indicative of future results. Investors should conduct their own due diligence and consult with a financial advisor before making investment decisions.