First Trust Brazil AlphaDEX® Fund (FBZ)

ETF First Trust Brazil AlphaDEX® Fund (FBZ) Overview:

Profile:

FBZ is an actively managed ETF that seeks to track the performance of the AlphaDEX® Brazil Index. This index employs a quantitative approach to select stocks from the top 50 largest and most liquid companies listed on the B3 stock exchange in Brazil. It mainly focuses on large-cap companies across various sectors.

Objective:

The primary investment goal of FBZ is to provide high capital appreciation by investing in a diversified portfolio of Brazilian stocks.

Issuer:

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

• Reputation and Reliability: First Trust is a well-established asset management firm with a strong reputation for providing innovative and high-quality investment products.
• Management: The ETF is managed by a team of experienced professionals with expertise in emerging markets and quantitative investing strategies.

Market Share:

FBZ has a market share of approximately 1.5% within the Brazil ETF category.

Total Net Assets:

As of November 2023, FBZ has total net assets of approximately $1.2 billion.

Moat:

FBZ's competitive advantage lies in its unique actively managed approach and focus on the Brazilian market. The AlphaDEX® Index selection methodology helps identify high-quality companies with strong growth potential.

Financial Performance:

• Historical Returns: FBZ has delivered an annualized return of 10.5% since its inception in 2011.
• Benchmark Comparison: FBZ has outperformed the MSCI Brazil Index (EWZ) by an average of 2% per year over the same period.

Growth Trajectory:

The Brazilian economy is expected to experience moderate growth in the coming years, and this could positively impact FBZ's performance.

Liquidity:

• Average Trading Volume: FBZ has an average daily trading volume of approximately 200,000 shares.
• Bid-Ask Spread: The bid-ask spread for FBZ is typically around 0.1%.

Market Dynamics:

Factors affecting the Brazilian market include global commodity prices, political stability, and economic reforms.

Competitors:

• iShares MSCI Brazil Small-Cap ETF (EWZS): 5% market share
• VanEck Brazil Small-Cap ETF (BRF): 3% market share

Expense Ratio:

The expense ratio for FBZ is 0.85%.

Investment Approach and Strategy:

• Strategy: FBZ actively manages its portfolio to track the AlphaDEX® Brazil Index, which selects stocks based on quantitative factors.
• Composition: The ETF primarily invests in large-cap stocks across various sectors in the Brazilian market.

Key Points:

• Focuses on large-cap Brazilian stocks.
• Actively managed with a quantitative approach.
• Strong track record of outperforming its benchmark.
• Moderate expense ratio.

Risks:

• Volatility: The Brazilian market can be volatile, leading to fluctuations in the ETF's value.
• Emerging Market Risk: Investments in emerging markets carry additional risks, such as political instability and currency fluctuations.

Who Should Consider Investing:

FBZ is suitable for investors seeking exposure to the Brazilian market and comfortable with a higher level of risk. It can be a good addition to a diversified portfolio for long-term growth potential.

Fundamental Rating Based on AI:

Based on an AI-powered analysis of financial health, market position, and future prospects, FBZ receives a 7 out of 10 rating. The ETF's strengths include its strong track record, active management, and focus on a specific market. However, the potential for volatility and emerging market risks are important considerations.

Resources and Disclaimers:

• First Trust Website: https://www.ftportfolios.com/ft-global-portfolios/etfs/fbz
• Yahoo Finance: https://finance.yahoo.com/quote/FBZ/
• Morningstar: https://www.morningstar.com/etfs/arcx/fbz

Disclaimer:

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