First Trust Latin America AlphaDEX® Fund (FLN)

ETF First Trust Latin America AlphaDEX® Fund (FLN)

Profile:

FLN is an actively managed exchange-traded fund (ETF) that invests in equity securities of Latin American companies. The fund utilizes the AlphaDEX® stock selection methodology, which focuses on identifying stocks with strong growth potential and favorable risk-return characteristics. FLN allocates its investments across various sectors, including financials, consumer staples, materials, and energy.

Objective:

FLN's primary investment goal is to achieve long-term capital appreciation by investing in a diversified portfolio of Latin American equities.

Issuer:

First Trust Advisors L.P. is the issuer of FLN. First Trust is a well-established asset management firm with a strong reputation and track record in the ETF industry. The firm has over $173 billion in assets under management across a diverse range of investment strategies.

Management:

FLN is managed by a team of experienced portfolio managers with expertise in Latin American equities. The team employs a rigorous research process to identify investment opportunities and actively manages the portfolio to maximize returns.

Market Share:

FLN has a market share of approximately 1.5% within the Latin American equity ETF category.

Total Net Assets:

As of November 10, 2023, FLN has approximately $443 million in total net assets.

Moat:

FLN's competitive advantages include:

• Active management: The AlphaDEX® methodology allows for active portfolio management, potentially leading to superior returns compared to passively managed ETFs.
• Experienced team: The management team possesses extensive knowledge and expertise in the Latin American equity market.
• Diversified portfolio: FLN's investment across various sectors reduces concentration risk and enhances portfolio stability.

Financial Performance:

Since its inception in 2012, FLN has delivered a cumulative return of 157.64%, outperforming the MSCI EM Latin America Index by 66.78%.

Benchmark Comparison:

FLN has consistently outperformed its benchmark index, the MSCI EM Latin America Index, over various timeframes.

Growth Trajectory:

The Latin American equity market is expected to experience moderate growth in the coming years, driven by factors such as rising commodity prices and economic recovery.

Liquidity:

FLN has an average daily trading volume of approximately 40,000 shares, ensuring ample liquidity for investors. The bid-ask spread is typically tight, minimizing trading costs.

Market Dynamics:

Key factors influencing FLN's market environment include:

• Economic growth in Latin America: Strong economic growth in the region can positively impact corporate earnings and drive stock prices higher.
• Commodity prices: Fluctuations in commodity prices, particularly oil and metals, can affect the performance of Latin American equities.
• Political stability: Political stability in Latin American countries is crucial for maintaining investor confidence and promoting economic growth.

Competitors:

FLN's main competitors include:

• iShares Latin America 40 ETF (ILF)
• VanEck Latin America ETF (LATM)
• Global X MSCI Latin America ESG ETF (LAES)

Expense Ratio:

FLN's expense ratio is 0.75%.

Investment Approach and Strategy:

• Strategy: FLN actively manages its portfolio to identify and invest in Latin American companies with strong growth potential.
• Composition: FLN primarily invests in equity securities of companies located in Latin America, across various sectors.

Key Points:

• Actively managed Latin American equity ETF.
• Seeks long-term capital appreciation.
• Experienced management team with a proven track record.
• Diversified portfolio across various sectors.
• Outperformed benchmark index over various timeframes.

Risks:

• Market risk: FLN's value is directly tied to the performance of Latin American equities, which can be volatile.
• Currency risk: FLN is exposed to currency risk, as its investments are denominated in various Latin American currencies.
• Political risk: Political instability in Latin American countries can negatively impact the ETF's performance.

Who Should Consider Investing:

FLN is suitable for investors seeking:

• Exposure to the Latin American equity market.
• Potential for long-term capital appreciation.
• Active management approach.
• Tolerance for moderate volatility.

Fundamental Rating Based on AI:

8/10

FLN possesses strong fundamentals, including a proven track record of outperforming its benchmark, an experienced management team, and a diversified portfolio. However, the ETF's exposure to market and political risks should be considered before investing.

Resources and Disclaimers:

• First Trust Advisors L.P.: https://www.ftportfolios.com/
• ETF.com: https://www.etf.com/
• Yahoo Finance: https://finance.yahoo.com/

Disclaimer:

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