First Trust Dorsey Wright DALI 1 ETF (DALI)

Overview

The First Trust Dorsey Wright DALI 1 ETF (DALI) is an actively managed ETF that seeks to provide capital appreciation by investing in a dynamic portfolio of U.S.-listed equities based on a proprietary momentum-based strategy.

Reputation and Reliability

First Trust is a well-established ETF provider known for offering innovative and actively managed investment strategies.

Management Expertise

First Trust has a dedicated team of investment professionals with expertise in quantitative analysis and active portfolio management.

Goal

The ETF's goal is to seek capital appreciation.

Investment Approach and Strategy

Strategy: DALI employs an active, momentum-based strategy to identify and invest in securities exhibiting strong relative strength.

Composition The ETF primarily holds U.S.-listed equities selected based on their momentum characteristics.

Market Share: DALI's market share within its specific investment niche of actively managed, momentum-based ETFs is relatively small.

Total Net Assets (AUM): 59220000

Key Competitors

• MTUM
• QUAL
• IVV
• SPY
• IWF

Competitive Landscape

The actively managed ETF space is highly competitive, with numerous providers offering a variety of strategies. DALI differentiates itself through its proprietary Dorsey Wright momentum-based approach. However, it faces competition from both passive and active ETFs that focus on growth and factor-based investing. DALIu2019s smaller AUM compared to larger, passive ETFs can impact its liquidity and trading costs.

Historical Performance: Historical performance data should be accessed from financial data providers. The ETF's performance will fluctuate depending on market conditions and the effectiveness of its momentum strategy.

Benchmark Comparison: DALI's performance should be compared to relevant momentum or growth indices to assess its relative performance. Such benchmarks are the Russell 1000 Growth TR USD, or the S&P 500 TR USD.

Expense Ratio: 0.65

Average Trading Volume

DALI's average trading volume is moderate, suggesting reasonable liquidity but may not be as high as more established ETFs.

Bid-Ask Spread

The bid-ask spread is typically in the range of $0.02 to $0.05, reflecting moderate trading efficiency for most investors.

Market Environment Factors

Economic growth, interest rate changes, and investor sentiment towards growth stocks can all impact DALI's performance. The ETF's focus on momentum means it may be more sensitive to short-term market trends.

Growth Trajectory

DALI's growth trajectory depends on its ability to attract assets through consistent performance and effective marketing. The strategy may be refined over time to adapt to changing market conditions.

Competitive Edge

DALI's primary competitive advantage is its use of the Dorsey Wright momentum-based methodology, a well-regarded approach to identifying stocks with strong relative strength. This unique process, combined with active management, seeks to generate alpha beyond traditional market benchmarks. First Trust's reputation for providing innovative ETFs enhances the fund's appeal. However, the effectiveness of the momentum strategy depends on prevailing market conditions, which can impact its short-term performance.

Volatility

DALI's volatility is likely to be higher than broad market ETFs due to its concentrated focus on momentum stocks.

Market Risk

The ETF is exposed to market risk, particularly related to the U.S. equity market and the sectors in which it invests. Changes in investor sentiment towards growth stocks can also significantly impact performance.

Ideal Investor Profile

DALI is suitable for investors seeking capital appreciation and willing to accept a higher level of risk in exchange for potentially higher returns. It may appeal to investors who believe in the effectiveness of momentum-based investing.

Market Risk

DALI is best suited for investors with a long-term investment horizon who can tolerate fluctuations in value. It's not ideal for risk-averse investors or those seeking stable income.

The First Trust Dorsey Wright DALI 1 ETF (DALI) offers investors access to an actively managed, momentum-based U.S. equity portfolio. The ETF aims for capital appreciation through a proprietary stock selection process. While its momentum strategy has potential for outperformance, DALI is subject to market volatility and concentration risk. Investors should carefully consider their risk tolerance and investment objectives before investing in DALI.

Data Sources:

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

Disclaimers:

The data and analysis provided are for informational purposes only and do not constitute investment advice. Past performance is not indicative of future results. Investing in ETFs involves risk, including the potential loss of principal.