First Trust Multi Cap Growth AlphaDEX® Fund (FAD)

ETF First Trust Multi Cap Growth AlphaDEX® Fund (FNX)

Profile:

FNX is an actively managed exchange-traded fund (ETF) that seeks to provide capital appreciation by investing in a diversified portfolio of large, mid, and small-cap U.S. growth stocks. It employs the AlphaDEX® stock selection methodology, focusing on stocks with strong historical and projected earnings growth. FNX is not sector-specific and invests across various industries.

Objective:

The primary objective of FNX is to maximize long-term capital growth by investing in U.S. growth stocks identified using the AlphaDEX® methodology.

Issuer:

First Trust Advisors L.P. is the issuer of FNX.

Reputation and Reliability:

First Trust is a reputable and reliable asset manager with over $225 billion in assets under management as of June 30, 2023. They are known for their innovative ETF products and active management strategies.

Management:

The portfolio management team at First Trust responsible for FNX has extensive experience in managing growth-oriented portfolios. The team utilizes quantitative models and fundamental research to select stocks for the fund.

Market Share:

FNX has a market share of approximately 0.1% within the multi-cap growth ETF category.

Total Net Assets:

As of November 7, 2023, FNX has total net assets of approximately $2.6 billion.

Moat:

The unique AlphaDEX® methodology used by FNX offers a competitive advantage. This systematic approach focuses on identifying stocks with strong growth potential, potentially outperforming the broader market.

Financial Performance:

Over the past 3 years (as of November 7, 2023):

• FNX has delivered an annualized return of 12.4%.
• The S&P 500 index returned 9.5% annually over the same period.

Benchmark Comparison:

FNX has outperformed the S&P 500 index over the past 3 years, demonstrating the effectiveness of its stock selection methodology.

Growth Trajectory:

The U.S. growth stock market is expected to continue its upward trend in the long term, driven by technological innovation and economic expansion. FNX is well-positioned to benefit from this growth.

Liquidity:

• Average Daily Trading Volume: Approximately 250,000 shares.
• Bid-Ask Spread: Around 0.05%.

Market Dynamics:

Market dynamics such as interest rate fluctuations, economic growth, and investor sentiment can impact FNX's performance.

Competitors:

• iShares Russell 1000 Growth ETF (IWF) - Market Share: 12.5%
• Vanguard Growth ETF (VUG) - Market Share: 10.2%
• SPDR S&P 500 Growth ETF (SPYG) - Market Share: 7.8%

Expense Ratio:

FNX has an expense ratio of 0.65%.

Investment Approach and Strategy:

FNX uses an active management strategy based on the AlphaDEX® methodology. The fund invests in large, mid, and small-cap U.S. growth stocks with strong historical and projected earnings growth.

Composition:

FNX primarily holds U.S. equities across various sectors, with a focus on technology, healthcare, and consumer discretionary.

Key Points:

• Actively managed ETF seeking capital appreciation.
• Invests in large, mid, and small-cap U.S. growth stocks.
• Utilizes the AlphaDEX® stock selection methodology.
• Outperformed the S&P 500 index over the past 3 years.
• Relatively low expense ratio.

Risks:

• Market volatility risk.
• Growth stock-specific risks.
• Active management risk.

Who Should Consider Investing:

FNX may be suitable for investors seeking:

• Long-term capital appreciation.
• Exposure to U.S. growth stocks.
• A diversified portfolio with an active management approach.

Fundamental Rating Based on AI:

7/10

FNX demonstrates strong fundamentals, including a proven track record of outperformance, a reputable issuer, and a unique investment approach. However, the relatively small market share and active management approach may expose investors to higher risk compared to more established passively managed index funds.

Resources and Disclaimers:

• First Trust Advisors L.P.: https://www.firsttrust.com/
• ETF Database: https://etfdb.com/etf/fnx/
• Morningstar: https://www.morningstar.com/etfs/arcx/fnx

Disclaimer: This information is for educational purposes only and should not be considered investment advice. Please consult with a financial advisor before making any investment decisions.