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Should You Invest in the First Trust RBA American Industrial Renaissance ETF (AIRR)?
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Designed to provide broad exposure to the Industrials - Broad segment of the equity market, the First Trust RBA American Industrial Renaissance ETF (AIRR - Free Report) is a passively managed exchange traded fund launched on 03/10/2014.
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Industrials - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 6, placing it in top 38%.
Index Details
The fund is sponsored by First Trust Advisors. It has amassed assets over $491.10 million, making it one of the average sized ETFs attempting to match the performance of the Industrials - Broad segment of the equity market. AIRR seeks to match the performance of the Richard Bernstein Advisors American Industrial Renaissance Index before fees and expenses.
The Richard Bernstein Advisors American Industrial Renaissance Index is measures the performance of small and mid cap US companies in the industrial and community banking sectors.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.70%, making it one of the most expensive products in the space.
It has a 12-month trailing dividend yield of 0.22%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Industrials sector--about 91.40% of the portfolio.
Looking at individual holdings, Hubbell Incorporated (HUBB - Free Report) accounts for about 4.58% of total assets, followed by Sterling Infrastructure Inc. (STRL - Free Report) and Mastec, Inc. (MTZ - Free Report) .
The top 10 holdings account for about 42.16% of total assets under management.
Performance and Risk
So far this year, AIRR has gained about 21.49%, and is up roughly 25.13% in the last one year (as of 09/12/2023). During this past 52-week period, the fund has traded between $38.14 and $55.56.
The ETF has a beta of 1.26 and standard deviation of 25.09% for the trailing three-year period, making it a high risk choice in the space. With about 50 holdings, it has more concentrated exposure than peers.
Alternatives
First Trust RBA American Industrial Renaissance ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, AIRR is an excellent option for investors seeking exposure to the Industrials ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
Vanguard Industrials ETF (VIS - Free Report) tracks MSCI US Investable Market Industrials 25/50 Index and the Industrial Select Sector SPDR ETF (XLI - Free Report) tracks Industrial Select Sector Index. Vanguard Industrials ETF has $4.39 billion in assets, Industrial Select Sector SPDR ETF has $15.18 billion. VIS has an expense ratio of 0.10% and XLI charges 0.10%.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Should You Invest in the First Trust RBA American Industrial Renaissance ETF (AIRR)?
Designed to provide broad exposure to the Industrials - Broad segment of the equity market, the First Trust RBA American Industrial Renaissance ETF (AIRR - Free Report) is a passively managed exchange traded fund launched on 03/10/2014.
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Industrials - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 6, placing it in top 38%.
Index Details
The fund is sponsored by First Trust Advisors. It has amassed assets over $491.10 million, making it one of the average sized ETFs attempting to match the performance of the Industrials - Broad segment of the equity market. AIRR seeks to match the performance of the Richard Bernstein Advisors American Industrial Renaissance Index before fees and expenses.
The Richard Bernstein Advisors American Industrial Renaissance Index is measures the performance of small and mid cap US companies in the industrial and community banking sectors.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.70%, making it one of the most expensive products in the space.
It has a 12-month trailing dividend yield of 0.22%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Industrials sector--about 91.40% of the portfolio.
Looking at individual holdings, Hubbell Incorporated (HUBB - Free Report) accounts for about 4.58% of total assets, followed by Sterling Infrastructure Inc. (STRL - Free Report) and Mastec, Inc. (MTZ - Free Report) .
The top 10 holdings account for about 42.16% of total assets under management.
Performance and Risk
So far this year, AIRR has gained about 21.49%, and is up roughly 25.13% in the last one year (as of 09/12/2023). During this past 52-week period, the fund has traded between $38.14 and $55.56.
The ETF has a beta of 1.26 and standard deviation of 25.09% for the trailing three-year period, making it a high risk choice in the space. With about 50 holdings, it has more concentrated exposure than peers.
Alternatives
First Trust RBA American Industrial Renaissance ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, AIRR is an excellent option for investors seeking exposure to the Industrials ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
Vanguard Industrials ETF (VIS - Free Report) tracks MSCI US Investable Market Industrials 25/50 Index and the Industrial Select Sector SPDR ETF (XLI - Free Report) tracks Industrial Select Sector Index. Vanguard Industrials ETF has $4.39 billion in assets, Industrial Select Sector SPDR ETF has $15.18 billion. VIS has an expense ratio of 0.10% and XLI charges 0.10%.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.