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Europe ETF (FEP) Hits New 52-Week High

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For investors seeking momentum, First Trust Europe AlphaDEX Fund (FEP - Free Report) is probably on radar now. The fund just hit a 52-week high, and is up about 30.7% from its 52-week low price of $27.67 per share.

But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:

FEP in Focus    

This fund targets the European stock market with a slightly active choice as it uses the AlphaDEX methodology to select the stock. It has key holdings in consumer discretionary, industrials, financials, and materials, and is highly diversified across components with none holding more than 1.10% share. United Kingdom, France and Germany are the top three countries. The product charges 80 bps in fees per year (see: all the European Equity ETFs here).  

Why the Move?

The European stock market has been an area to watch lately given solid corporate earnings and dovish comments from the European Central Bank (ECB). The bank kept the interest rates steady and hinted at a gradual wind down of ultra-loose monetary policy in the fall season that has fueled optimism in European stocks, which were rattled by tapering talks in recent weeks.

More Gains Ahead?

Currently, FEP has a Zacks ETF Rank of 3 or ‘Hold’ rating with a Medium risk outlook. Therefore, it is hard to get a handle on its future returns one way or the other. However, many of the segments that make up this ETF have a strong Zacks Industry Rank. Further, this fund might remain strong given a high weighted alpha of 32.20% and a low 20-day volatility of 9.01%. As a result, there is still some promise for investors who want to ride on this surging ETF.

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