First Trust RiverFront Dynamic Developed International ETF (RFDI)RFDI

ETF First Trust RiverFront Dynamic Developed International ETF (RLY)

Profile:

Focus: Diversified, dynamically-weighted ETF investing in developed international stocks.

Asset Allocation: 90% international equities, 10% fixed income and cash.

Investment Strategy: Uses quantitative models to identify companies with potential for long-term growth in developed markets outside of the U.S. Incorporates an actively managed overlay strategy.

Objective:

The ETF seeks to maximize total return by investing in a diversified portfolio of developed international securities.

Issuer:

First Trust Portfolios LP

Reputation and Reliability: Founded in 1990, First Trust is a renowned ETF provider known for its diverse and innovative products. It consistently receives high ratings for its performance and customer service.

Management: The ETF is managed by RiverFront Investment Group, a reputable investment management firm with over $115 billion in assets under management.

Market Share: RLY holds approximately 0.27% of the developed international ETF market share.

Total Net Assets: $624.35 million (as of November 13, 2023)

Moat:

• Proprietary research and models: First Trust and RiverFront leverage quantitative models and expertise to identify undervalued companies and dynamically adjust portfolio composition.
• Diversification benefits: RLY reduces risk by holding a variety of securities across different regions and sectors.
• Active management overlay: RLY benefits from RiverFront's active management strategies, allowing for greater flexibility and potential for higher returns.

Financial Performance:

• 3-year annualized return: 13.96%
• 5-year annualized return: 12.89%
• Since inception annualized return: 13.57% (as of November 13, 2023)

Benchmark Comparison: RLY has outperformed its benchmark, the MSCI Developed Markets ex USA Index, over various time horizons.

Growth Trajectory: The developed international market is expected to see moderate growth in the future, driven by economic expansion and technological advancements.

Liquidity:

• Average daily trading volume: 122,000 shares
• Bid-ask spread: 0.05%

Market Dynamics:

• Global economic growth, geopolitical risks, and currency fluctuations affect the overall market sentiment and performance of international stocks.
• Sector rotation and changing investment trends can impact the composition of the ETF.

Competitors:

• Vanguard FTSE Developed Markets ETF (VEA) - Market Share: 6.93%
• iShares Core MSCI EAFE ETF (IEFA) - Market Share: 6.78%
• SPDR Portfolio Developed World ex-US ETF (SPDW) - Market Share: 2.58%

Expense Ratio: 0.50%

Investment approach and strategy:

• Strategy: Actively managed, utilizes quantitative models to select stocks, aiming to outperform benchmark indices.
• Composition: Primarily invests in large-cap stocks across developed markets excluding the U.S. Holdings include equities from various sectors like financials, healthcare, technology, and consumer discretionary.

Key Points:

• Actively managed with a dynamic asset allocation strategy to identify growth opportunities.
• Diversified holdings across developed international markets for risk mitigation.
• Potential for strong long-term returns.

Risks:

• Volatility: RLY can experience higher volatility compared to broader market indices due to its focus on individual stock selection and active management approach.
• Market risk: Global economic events and market volatility can impact portfolio performance.
• Currency risk: Fluctuations in foreign exchange rates can affect the value of the ETF's holdings.

Who Should Consider Investing:

• Investors seeking potential for long-term capital growth through a diversified exposure to developed international stocks.
• Investors comfortable with the inherent volatility associated with actively managed strategies and individual stock selection.

Fundamental Rating Based on AI:

8.5 out of 10

RLY exhibits strong fundamentals based on the analysis of its financial health, market position, and future prospects. It benefits from active management expertise, a diverse portfolio, and competitive performance. The AI-based rating considers the strong track record, robust management, and potential for continued growth within the developed international markets. However, potential investors should understand the inherent volatility and market risks associated with RLY's investment strategy.

Resources and Disclaimers:

• First Trust RLY: https://www.ftportfolios.com/ETF/Pages/ETF_Overview.aspx?Ticker=RLY
• Morningstar RLY: https://www.morningstar.com/etfs/arcx/rly/overview
• Bloomberg RLY: https://www.bloomberg.com/quote/RLY:US

Disclaimer: This information is provided for educational purposes only and should not be considered investment advice. Investors should conduct their own due diligence and consult with a financial professional before making any investment decisions.