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Is First Trust Mid Cap Growth AlphaDEX ETF (FNY) a Strong ETF Right Now?
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The First Trust Mid Cap Growth AlphaDEX ETF (FNY - Free Report) made its debut on 04/19/2011, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Mid Cap Growth category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
FNY is managed by First Trust Advisors, and this fund has amassed over $374.52 million, which makes it one of the average sized ETFs in the Style Box - Mid Cap Growth. Before fees and expenses, FNY seeks to match the performance of the Nasdaq AlphaDEX Mid Cap Growth Index.
The NASDAQ AlphaDEX Mid Cap Growth Index is an enhanced which employs the AlphaDEX stock selection methodology to select stocks from the NASDAQ US 600 Mid Cap Growth Index.
Cost & Other Expenses
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
Operating expenses on an annual basis are 0.70% for FNY, making it one of the most expensive products in the space.
It has a 12-month trailing dividend yield of 0.61%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
For FNY, it has heaviest allocation in the Industrials sector --about 21.30% of the portfolio --while Financials and Healthcare round out the top three.
Taking into account individual holdings, Hims & Hers Health, Inc. (HIMS - Free Report) accounts for about 1.23% of the fund's total assets, followed by Corcept Therapeutics Inc. (CORT - Free Report) and Sprouts Farmers Market, Inc. (SFM - Free Report) .
FNY's top 10 holdings account for about 9.01% of its total assets under management.
Performance and Risk
Year-to-date, the First Trust Mid Cap Growth AlphaDEX ETF has lost about -8.53% so far, and is down about -0.26% over the last 12 months (as of 03/11/2025). FNY has traded between $69.75 and $88.28 in this past 52-week period.
FNY has a beta of 1.19 and standard deviation of 21.58% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 226 holdings, it effectively diversifies company-specific risk.
Alternatives
First Trust Mid Cap Growth AlphaDEX ETF is an excellent option for investors seeking to outperform the Style Box - Mid Cap Growth segment of the market. There are other ETFs in the space which investors could consider as well.
Vanguard Mid-Cap Growth ETF (VOT - Free Report) tracks CRSP U.S. Mid Cap Growth Index and the iShares Russell Mid-Cap Growth ETF (IWP - Free Report) tracks Russell MidCap Growth Index. Vanguard Mid-Cap Growth ETF has $14.74 billion in assets, iShares Russell Mid-Cap Growth ETF has $15.99 billion. VOT has an expense ratio of 0.07% and IWP charges 0.23%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Mid Cap Growth.
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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Is First Trust Mid Cap Growth AlphaDEX ETF (FNY) a Strong ETF Right Now?
The First Trust Mid Cap Growth AlphaDEX ETF (FNY - Free Report) made its debut on 04/19/2011, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Mid Cap Growth category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
FNY is managed by First Trust Advisors, and this fund has amassed over $374.52 million, which makes it one of the average sized ETFs in the Style Box - Mid Cap Growth. Before fees and expenses, FNY seeks to match the performance of the Nasdaq AlphaDEX Mid Cap Growth Index.
The NASDAQ AlphaDEX Mid Cap Growth Index is an enhanced which employs the AlphaDEX stock selection methodology to select stocks from the NASDAQ US 600 Mid Cap Growth Index.
Cost & Other Expenses
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
Operating expenses on an annual basis are 0.70% for FNY, making it one of the most expensive products in the space.
It has a 12-month trailing dividend yield of 0.61%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
For FNY, it has heaviest allocation in the Industrials sector --about 21.30% of the portfolio --while Financials and Healthcare round out the top three.
Taking into account individual holdings, Hims & Hers Health, Inc. (HIMS - Free Report) accounts for about 1.23% of the fund's total assets, followed by Corcept Therapeutics Inc. (CORT - Free Report) and Sprouts Farmers Market, Inc. (SFM - Free Report) .
FNY's top 10 holdings account for about 9.01% of its total assets under management.
Performance and Risk
Year-to-date, the First Trust Mid Cap Growth AlphaDEX ETF has lost about -8.53% so far, and is down about -0.26% over the last 12 months (as of 03/11/2025). FNY has traded between $69.75 and $88.28 in this past 52-week period.
FNY has a beta of 1.19 and standard deviation of 21.58% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 226 holdings, it effectively diversifies company-specific risk.
Alternatives
First Trust Mid Cap Growth AlphaDEX ETF is an excellent option for investors seeking to outperform the Style Box - Mid Cap Growth segment of the market. There are other ETFs in the space which investors could consider as well.
Vanguard Mid-Cap Growth ETF (VOT - Free Report) tracks CRSP U.S. Mid Cap Growth Index and the iShares Russell Mid-Cap Growth ETF (IWP - Free Report) tracks Russell MidCap Growth Index. Vanguard Mid-Cap Growth ETF has $14.74 billion in assets, iShares Russell Mid-Cap Growth ETF has $15.99 billion. VOT has an expense ratio of 0.07% and IWP charges 0.23%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Mid Cap Growth.
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.