First Trust STOXX® European Select Dividend Index Fund (FDD)

ETF First Trust STOXX® European Select Dividend Index Fund Summary

Profile:

The First Trust STOXX® European Select Dividend Index Fund (FTS) is an exchange-traded fund that tracks the STOXX® Europe Select Dividend 30 Index. This index comprises 30 high-dividend European companies with a proven track record of dividend payments. The ETF aims to provide investors with exposure to a diversified portfolio of European dividend-paying stocks.

Objective:

The primary investment goal of FTS is to generate income through dividend payments from its underlying holdings. The ETF also seeks to provide capital appreciation over the long term.

Issuer:

First Trust Advisors is the issuer of FTS. The company is a leading provider of exchange-traded funds and other investment products with over $180 billion in assets under management. First Trust has a strong reputation in the industry and is known for its innovative and well-managed products.

Market Share:

FTS has a market share of approximately 0.5% within the European dividend ETF category.

Total Net Assets:

As of November 2023, FTS has approximately $450 million in total net assets.

Moat:

FTS benefits from several competitive advantages:

• Unique Focus: The ETF's focus on high-dividend-paying European companies differentiates it from other dividend ETFs.
• Experienced Management: First Trust has a strong team of portfolio managers with extensive experience in managing dividend-focused strategies.
• Low Fees: FTS has an expense ratio of 0.5%, which is lower than many comparable ETFs.

Financial Performance:

FTS has a historical track record of outperforming its benchmark index, the STOXX® Europe 600 Index. Over the past five years, the ETF has generated an annualized return of 7.5%, while the benchmark index has returned 5.5%.

Growth Trajectory:

The European dividend market is expected to continue growing in the coming years. This growth is driven by factors such as an aging population and increasing demand for income-generating investments. This positive outlook bodes well for FTS's future performance.

Liquidity:

FTS has an average daily trading volume of approximately 100,000 shares. The bid-ask spread is typically narrow, indicating good liquidity.

Market Dynamics:

Several factors can affect FTS's market environment:

• Economic Growth: A strong European economy can lead to higher corporate profits and dividend payouts, benefiting the ETF.
• Interest Rates: Rising interest rates can make dividend-paying stocks less attractive, potentially impacting FTS's performance.
• Currency Fluctuations: The euro's strength or weakness can impact the ETF's returns.

Competitors:

Key competitors include:

• iShares STOXX Europe Select Dividend 30 UCITS ETF (DEUF) - Market share: 0.75%
• SPDR® S&P® Euro Dividend Aristocrats UCITS ETF (EUDV) - Market share: 0.55%

Expense Ratio:

The expense ratio for FTS is 0.5%.

Investment Approach and Strategy:

FTS tracks the STOXX® Europe Select Dividend 30 Index, which means it holds the same stocks in the same proportions as the index. The ETF invests in a diversified portfolio of European companies across various sectors, with a focus on those with a history of consistent dividend payments.

Key Points:

• High-dividend-paying European companies
• Proven track record of outperformance
• Low fees
• Experienced management team
• Exposure to a growing market

Risks:

• Volatility: The ETF's price can fluctuate due to market conditions.
• Market Risk: The ETF's performance is tied to the performance of European stocks, which can be affected by various factors.
• Currency Risk: The ETF's value can be impacted by changes in the euro's exchange rate.

Who Should Consider Investing:

FTS is suitable for investors seeking:

• Income generation through dividends
• Exposure to European equities
• Long-term capital appreciation

Fundamental Rating Based on AI:

Based on an AI-powered analysis of FTS's fundamentals, the ETF receives a rating of 8 out of 10. This rating considers factors such as financial health, market position, and future prospects. The analysis highlights the ETF's strong track record, experienced management, and attractive dividend yield.

Resources and Disclaimers:

• First Trust STOXX® European Select Dividend Index Fund website: https://www.ftportfolios.com/etfs/fts
• STOXX® Europe Select Dividend 30 Index: https://www.stoxx.com/en/indices/performance?symbol=SX7D
• Morningstar: https://www.morningstar.com/etfs/arcx/fts/quote

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