Launched on 08/08/2017, the First Trust Dow 30 Equal Weight ETF (EDOW Quick QuoteEDOW - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Large Cap Blend segment of the US equity market.

The fund is sponsored by First Trust Advisors. It has amassed assets over $227.91 million, making it one of the average sized ETFs attempting to match the Large Cap Blend segment of the US equity market.

Why Large Cap Blend

Large cap companies usually have a market capitalization above $10 billion. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.

Typically holding a combination of both growth and value stocks, blend ETFs also demonstrate qualities seen in value and growth investments.

Costs

When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.

Annual operating expenses for this ETF are 0.50%, putting it on par with most peer products in the space.

It has a 12-month trailing dividend yield of 1.24%.

Sector Exposure and Top Holdings

It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.

This ETF has heaviest allocation to the Information Technology sector--about 19% of the portfolio. Financials and Healthcare round out the top three.

Looking at individual holdings, Amgen Inc. (AMGN Quick QuoteAMGN - Free Report) accounts for about 3.88% of total assets, followed by 3m Company (MMM Quick QuoteMMM - Free Report) and Johnson & Johnson (JNJ Quick QuoteJNJ - Free Report) .

The top 10 holdings account for about 36.77% of total assets under management.

Performance and Risk

EDOW seeks to match the performance of the Dow Jones Industrial Average Equal Weight Index before fees and expenses. The Dow Jones Industrial Average Equal Weight Index is an equally weighted index designed to be a price neutral version of the price-weighted DJIA.

The ETF return is roughly 1.35% so far this year and is up about 9.72% in the last one year (as of 03/26/2025). In the past 52-week period, it has traded between $32.70 and $38.24.

The ETF has a beta of 0.89 and standard deviation of 14.06% for the trailing three-year period. With about 31 holdings, it has more concentrated exposure than peers.

Alternatives

First Trust Dow 30 Equal Weight ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, EDOW is a good option for those seeking exposure to the Style Box - Large Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.

The SPDR S&P 500 ETF (SPY Quick QuoteSPY - Free Report) and the Vanguard S&P 500 ETF (VOO Quick QuoteVOO - Free Report) track a similar index. While SPDR S&P 500 ETF has $595.10 billion in assets, Vanguard S&P 500 ETF has $603.67 billion. SPY has an expense ratio of 0.09% and VOO charges 0.03%.

Bottom-Line

Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.

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.