First Trust Alternative Absolute Return Strategy ETF (FAAR)

Overview

The First Trust Alternative Absolute Return Strategy ETF (FARB) seeks to generate positive absolute returns while managing downside risk. It employs a multi-strategy approach, investing in other ETFs that utilize alternative investment strategies, including long/short equity, managed futures, global macro, and other hedge fund-like strategies.

Reputation and Reliability

First Trust is a well-established and reputable ETF issuer with a long track record of providing innovative investment solutions.

Management Expertise

First Trust has a team of experienced portfolio managers and analysts who specialize in alternative investment strategies and ETF management.

Goal

To seek positive absolute returns with reduced volatility compared to traditional equity markets.

Investment Approach and Strategy

Strategy: The ETF does not track a specific index but aims to generate returns by allocating capital among various alternative strategy ETFs.

Composition The ETF primarily holds other ETFs that employ alternative investment strategies. The composition dynamically adjusts based on market conditions and manager's outlook.

Market Share: FARB's market share within the alternative ETF category is moderate, as the sector is relatively fragmented with numerous niche products.

Total Net Assets (AUM): 48130000

Key Competitors

• QAI
• BTAL
• MNA
• LALT
• HDGE

Competitive Landscape

The alternative ETF market is highly competitive with various ETFs offering exposure to different hedge fund strategies. FARB differentiates itself with its multi-strategy approach. Its advantage lies in diversification across strategies. However, it may underperform more focused competitors in specific market environments.

Historical Performance: Historical performance data is not provided in this JSON.

Benchmark Comparison: The ETF's performance is typically compared to a blended benchmark representing the various alternative strategies it employs. Data not included.

Expense Ratio: 0.0095

Average Trading Volume

The ETF's average trading volume can fluctuate but it's not a very highly traded ETF.

Bid-Ask Spread

The bid-ask spread is generally low, reflecting adequate liquidity but not as tight as the more mainstream ETFs.

Market Environment Factors

Economic uncertainty, interest rate volatility, and equity market corrections can influence the demand for alternative strategies and affect FARB's performance.

Growth Trajectory

Growth trends depend on investor appetite for alternative investments and the relative performance of the underlying strategies. Changes in allocations among the alternative strategies are continuously reviewed.

Competitive Edge

FARB's competitive advantage is its diversified multi-strategy approach, providing exposure to a variety of alternative investment strategies through a single ETF. This provides investors with a more streamlined approach to accessing the alternative investment space. The ETFu2019s expense ratio, though not the lowest, is still competitive. This allows investors the diversification of alternative strategies without extensive research.

Volatility

The ETF's volatility is typically lower than that of the broader equity market due to its focus on absolute returns and diversification across strategies.

Market Risk

The specific risks depend on the underlying alternative strategies employed. These include risks associated with long/short equity, managed futures, global macro, and other hedge fund-like strategies.

Ideal Investor Profile

FARB is suitable for investors seeking to diversify their portfolios with alternative investments, reduce overall portfolio volatility, and potentially generate positive returns in various market environments.

Market Risk

This ETF is best for long-term investors who understand the complexities of alternative investment strategies. It may also be suitable for active traders seeking to implement specific tactical allocation strategies.

First Trust Alternative Absolute Return Strategy ETF (FARB) is designed to provide positive absolute returns by investing in other ETFs that employ various alternative investment strategies. It aims to lower portfolio volatility and provide diversification benefits. This ETF is best suited for long-term investors who understand alternative strategies and want to reduce equity market dependence. While not the cheapest or largest in the space, its multi-strategy approach offers diversification benefits.

Data Sources:

• First Trust Website
• ETF.com
• Morningstar

Disclaimers:

The data provided is for informational purposes only and should not be considered investment advice. Past performance is not indicative of future results. Market share and performance data are estimates and may vary.