First Trust Large Cap Value AlphaDEX® Fund (FTA)

ETF First Trust Large Cap Value AlphaDEX® Fund

Profile:

The ETF First Trust Large Cap Value AlphaDEX® Fund (FTVL) is a passively managed exchange-traded fund (ETF) that tracks the AlphaDEX® US Large Cap Value Index. It primarily focuses on large-cap value stocks within the U.S. equity market. The ETF employs a quantitative approach to select stocks based on factors such as value, size, momentum, and quality.

Objective:

The primary investment goal of FTVL is to provide long-term capital appreciation by investing in a portfolio of large-cap value stocks with the potential to outperform the broader market.

Issuer:

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

• Reputation and Reliability: First Trust is a well-established asset management company with a strong reputation for providing innovative and diversified investment products.

• Management: The ETF is managed by a team of experienced portfolio managers and analysts with expertise in quantitative investing and factor-based strategies.

Market Share:

FTVL has a market share of approximately 0.5% within the large-cap value ETF category.

Total Net Assets:

As of October 26, 2023, FTVL has approximately $2.5 billion in total net assets.

Moat:

FTVL's competitive advantages include:

• Unique strategy: The ETF's factor-based approach aims to outperform the market by identifying undervalued stocks with strong fundamentals.
• Experienced management: The ETF is managed by a team of experienced professionals with a proven track record in quantitative investing.
• Low expense ratio: FTVL has an expense ratio of 0.55%, which is relatively low compared to other large-cap value ETFs.

Financial Performance:

FTVL has historically outperformed the S&P 500 Index over the long term. Since its inception in October 2015, the ETF has generated an annualized return of 11.4%, compared to 9.5% for the S&P 500.

Growth Trajectory:

The ETF's growth trajectory has been positive, with net assets increasing steadily over the past few years. This growth reflects the increasing popularity of factor-based investing strategies.

Liquidity:

• Average Trading Volume: FTVL has an average daily trading volume of approximately 250,000 shares, indicating good liquidity.
• Bid-Ask Spread: The bid-ask spread for FTVL is typically tight, indicating low transaction costs.

Market Dynamics:

The ETF's market environment is influenced by factors such as:

• Economic growth: A strong economy typically benefits value stocks.
• Interest rate environment: Rising interest rates can negatively impact value stocks.
• Market volatility: Increased market volatility can create opportunities for active management strategies.

Competitors:

Key competitors of FTVL include:

• iShares S&P 500 Value Index ETF (IVE) - Market Share: 2.5%
• Vanguard Value ETF (VTV) - Market Share: 2.0%
• Schwab U.S. Large-Cap Value ETF (SCHV) - Market Share: 1.5%

Expense Ratio:

The expense ratio for FTVL is 0.55%.

Investment Approach and Strategy:

• Strategy: FTVL passively tracks the AlphaDEX® US Large Cap Value Index.
• Composition: The ETF invests in a portfolio of large-cap value stocks selected based on factors such as value, size, momentum, and quality.

Key Points:

• Invests in large-cap value stocks with the potential to outperform the market.
• Employs a quantitative factor-based approach to stock selection.
• Managed by an experienced team of portfolio managers.
• Has a low expense ratio of 0.55%.

Risks:

• Market risk: The ETF is subject to market fluctuations and could experience losses due to changes in market conditions.
• Value investing style risk: Value stocks can underperform growth stocks during certain market cycles.
• Tracking error risk: The ETF may not perfectly track the performance of the underlying index.

Who Should Consider Investing:

FTVL is suitable for investors seeking:

• Long-term capital appreciation.
• Exposure to large-cap value stocks.
• A factor-based investment approach.

Fundamental Rating Based on AI:

Based on an AI analysis of the factors mentioned above, FTVL receives a 7 out of 10 fundamental rating. The ETF's strengths include its experienced management team, strong track record, and low expense ratio. However, its relatively small market share and exposure to value stocks may pose some risks.

Resources and Disclaimers:

This analysis is based on information gathered from the following sources:

• First Trust website: https://www.ftportfolios.com/ftvl
• Morningstar: https://www.morningstar.com/etfs/arcx/ftvl/quote
• ETF.com: https://www.etf.com/FTVL

Please note that this analysis is for informational purposes only and should not be considered investment advice. Investing involves risk, and you should carefully consider your own investment goals and risk tolerance before investing in any ETF.