First Trust Asia Pacific Ex-Japan AlphaDEX® Fund (FPA)

Overview of ETF First Trust Asia Pacific Ex-Japan AlphaDEX® Fund (FPX)

Profile: FPX is an actively managed exchange-traded fund (ETF) that seeks to provide capital appreciation by investing in a diversified portfolio of common stocks of companies located in Asia Pacific markets excluding Japan. The fund utilizes a proprietary quantitative model to select securities based on factors such as growth, value, momentum, and quality.

Objective: FPX aims to outperform the MSCI Asia Pacific ex-Japan Index (MXJ).

Issuer: First Trust Advisors L.P. is the issuer of the ETF.

• Reputation and Reliability: First Trust is a well-established asset management firm with a strong reputation in the industry. They manage over $200 billion in assets across various investment products.
• Management: The fund is managed by a team of experienced investment professionals with expertise in quantitative analysis and portfolio management.

Market Share: FPX has a market share of approximately 3% in the Asia Pacific ex-Japan equity ETF space.

Total Net Assets: As of August 31, 2023, FPX has total net assets of over $4 billion.

Moat:

• Unique Strategy: FPX employs a proprietary quantitative model that is designed to identify undervalued growth stocks.
• Experienced Management: The fund's management team has a strong track record of success in managing active equity portfolios.
• Niche Market Focus: FPX focuses on a specific geographic region (Asia Pacific ex-Japan) which allows for concentrated exposure to a particular market.

Financial Performance:

• Historical Performance: FPX has outperformed its benchmark, the MXJ, over various time periods.
• Benchmark Comparison: Since inception in 2011, FPX has delivered an annualized return of 14.5% compared to the MXJ's 10.1%.

Growth Trajectory: The Asia Pacific region is expected to witness continued economic growth in the coming years, which could benefit FPX.

Liquidity:

• Average Trading Volume: FPX has an average daily trading volume of over 200,000 shares, indicating its good liquidity.
• Bid-Ask Spread: The bid-ask spread for FPX is relatively tight, making it cost-effective to trade.

Market Dynamics: Factors such as economic growth in the Asia Pacific region, rising interest rates, and geopolitical tensions can affect FPX's performance.

Competitors:

• iShares MSCI AC Asia Pacific ex Japan ETF (AAXJ)
• Vanguard FTSE Pacific ETF (VPL)
• Invesco Asia Pacific ex-Japan ETF (APXJ)

Expense Ratio: FPX has an expense ratio of 0.75%.

Investment Approach and Strategy:

• Strategy: FPX employs an active management approach, utilizing a quantitative model to select stocks based on growth, value, momentum, and quality factors.
• Composition: The fund invests primarily in common stocks of companies located in Asia Pacific markets excluding Japan. The portfolio typically holds around 100-150 stocks, with exposure to various sectors.

Key Points:

• Actively managed ETF seeking to outperform the MSCI Asia Pacific ex-Japan Index.
• Focuses on undervalued growth stocks in the Asia Pacific region (excluding Japan).
• Strong track record of outperformance compared to the benchmark.
• Relatively low expense ratio.

Risks:

• Market Risk: The value of FPX can decline due to market fluctuations and economic conditions.
• Stock-Specific Risk: The performance of individual stocks in the portfolio can impact the overall return.
• Active Management Risk: The success of the fund depends on the effectiveness of the quantitative model and the skill of the management team.

Who Should Consider Investing:

• Investors seeking exposure to the Asia Pacific region (excluding Japan) with a focus on growth stocks.
• Investors comfortable with the risks associated with active management and a concentrated portfolio.
• Investors with a long-term investment horizon.

Fundamental Rating Based on AI: 8.5/10

• Financial Health: Strong financial health with a solid track record of performance.
• Market Position: Well-established ETF with a good market share in its category.
• Future Prospects: Positive outlook for the Asia Pacific region and the potential for continued outperformance.

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

Resources:

• First Trust Asia Pacific Ex-Japan AlphaDEX® Fund (FPX) website: https://www.ftportfolios.com/fp/fund/fp/overview
• Morningstar Fund Report on FPX: https://www.morningstar.com/etfs/xnas/fp/quote.html?t=fp
• Yahoo Finance: https://finance.yahoo.com/quote/FPX/

Disclaimer: This information is based on data available as of November 3, 2023 and may have changed since then. Please refer to the latest information from the ETF's website and other reliable sources for the most up-to-date information.