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First Trust Low Duration Opportunities ETF (LMBS)
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Upturn Advisory Summary
01/21/2025: LMBS (1-star) is currently NOT-A-BUY. Pass it for now.
Analysis of Past Performance
Type ETF | Historic Profit 7.01% | Avg. Invested days 55 | Today’s Advisory PASS |
Upturn Star Rating | Upturn Advisory Performance 3.0 | ETF Returns Performance 2.0 |
Profits based on simulation | Last Close 01/21/2025 |
Key Highlights
Volume (30-day avg) 479539 | Beta 0.38 | 52 Weeks Range 44.28 - 50.96 | Updated Date 01/22/2025 |
52 Weeks Range 44.28 - 50.96 | Updated Date 01/22/2025 |
AI Summary
ETF First Trust Low Duration Opportunities ETF (FLDR)
Profile:
First Trust Low Duration Opportunities ETF (FLDR) is an actively managed exchange-traded fund that primarily invests in investment-grade, fixed-income securities with short to intermediate maturities. The ETF aims to provide investors with current income and capital appreciation through a diversified portfolio of government, corporate, and securitized bonds.
Objective:
FLDR's primary investment goal is to generate current income and capital appreciation through active management of a portfolio of low duration fixed-income securities.
Issuer:
FLDR is issued by First Trust Portfolios LP, a global asset manager with over $216 billion in assets under management. First Trust is known for its innovative and actively managed ETF solutions across various asset classes.
Market Share & Total Net Assets:
FLDR has a market share of approximately 1.8% in the short-term fixed income ETF category. As of October 27, 2023, its total net assets are $4.7 billion.
Moat:
FLDR's competitive advantages include its:
- Experienced Management Team: The portfolio is actively managed by a team of experienced fixed income professionals with a strong track record.
- Diversified Portfolio: The ETF invests across a range of government, corporate, and securitized bonds, mitigating concentration risk.
- Active Management: FLDR seeks to outperform its benchmark through active security selection and duration management.
Financial Performance:
FLDR has delivered a total return of 2.8% year-to-date (as of October 27, 2023) and has outperformed its benchmark index, the Bloomberg Barclays US 1-3 Year Treasury Bond Index, which returned 2.3% over the same period.
Growth Trajectory:
The demand for short-term fixed income investments is expected to remain strong due to rising interest rates and the need for portfolio diversification. However, the ETF's growth trajectory will depend on its ability to deliver competitive returns and attract new investors.
Liquidity:
FLDR has an average daily trading volume of over 140,000 shares, ensuring relatively high liquidity. The bid-ask spread is typically tight, indicating low trading costs.
Market Dynamics:
The ETF's market environment is primarily affected by interest rate changes, economic growth, and inflation expectations. Rising interest rates can negatively impact the value of fixed income securities, while economic growth and low inflation can create a favorable environment for fixed income investments.
Competitors:
- iShares Short Treasury Bond ETF (SHV): 9.4% market share
- SPDR Bloomberg Barclays 1-3 Month T-Bill ETF (BIL): 4.2% market share
- Vanguard Short-Term Treasury ETF (VGSH): 3.2% market share
Expense Ratio:
FLDR's expense ratio is 0.35%, which is considered competitive within the short-term fixed income ETF category.
Investment Approach & Strategy:
FLDR actively manages its portfolio to achieve its investment objective. The ETF invests in a diversified portfolio of investment-grade fixed-income securities with maturities of less than three years. The portfolio managers use a combination of fundamental analysis and quantitative models to select securities and manage duration exposure.
Key Points:
- Actively managed ETF focused on low-duration fixed income securities.
- Seeks to provide current income and capital appreciation.
- Managed by an experienced team with a strong track record.
- Diversified portfolio across various fixed income sectors.
- Competitive expense ratio.
Risks:
- Interest rate risk: Rising interest rates can negatively impact the value of FLDR's holdings.
- Credit risk: The ETF invests in corporate bonds, which carry the risk of default.
- Liquidity risk: While FLDR is relatively liquid, changes in market conditions can affect its liquidity.
Who Should Consider Investing:
Investors seeking a low-risk, income-generating investment with a focus on short-term fixed-income securities may find FLDR attractive.
Fundamental Rating Based on AI:
Based on an analysis of financial health, market position, and future prospects, FLDR receives a fundamental rating of 8 out of 10. This rating is supported by its strong track record, experienced management team, and diversified portfolio. However, the ETF's exposure to interest rate risk and credit risk should be carefully considered.
Resources and Disclaimers:
- First Trust Low Duration Opportunities ETF (FLDR): https://www.ftportfolios.com/etfs/fldr/overview
- Bloomberg Terminal
- Morningstar
Disclaimer: This information is intended for educational purposes only and should not be considered as investment advice. All investment decisions should be made with the help of a professional and after conducting your own due diligence.
About First Trust Low Duration Opportunities ETF
Exchange NASDAQ | Headquaters - | ||
IPO Launch date - | CEO - | ||
Sector - | Industry - | Full time employees - | Website |
Full time employees - | Website |
Under normal market conditions, the fund will seek to achieve its investment objectives by investing at least 60% of its net assets (including investment borrowings) in mortgage-related debt securities and other mortgage-related instruments (collectively, Mortgage-Related Investments). The advisor normally expects to invest in Mortgage-Related Investments tied to residential and commercial mortgages.
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