Looking for broad exposure to the Large Cap Value segment of the US equity market? You should consider the First Trust Large Cap Value AlphaDEX ETF (FTA Quick QuoteFTA - Free Report) , a passively managed exchange traded fund launched on May 8, 2007.

The fund is sponsored by First Trust Advisors. It has amassed assets over $1.13 billion, making it one of the average sized ETFs attempting to match the Large Cap Value segment of the US equity market.

Why Large Cap Value

Large cap companies typically have a market capitalization above $10 billion. Overall, they are usually a stable option, with less risk and more sure-fire cash flows than mid and small cap companies.

While value stocks have lower than average price-to-earnings and price-to-book ratios, they also have lower than average sales and earnings growth rates. Looking at their long-term performance, value stocks have outperformed growth stocks in almost all markets. They are however likely to underperform growth stocks in strong bull markets.

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 0.58%, making it one of the more expensive products in the space.

It has a 12-month trailing dividend yield of 1.97%.

Sector Exposure and Top Holdings

ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.

This ETF has heaviest allocation to the Financials sector -- about 24.2% of the portfolio. Information Technology and Industrials round out the top three.

Looking at individual holdings, Western Digital Corporation (WDC) accounts for about 1.4% of total assets, followed by Micron Technology, Inc. (MU) and On Semiconductor Corporation (ON).

The top 10 holdings account for about 11.39% of total assets under management.

Performance and Risk

FTA seeks to match the performance of the Nasdaq AlphaDEX Large Cap Value Index before fees and expenses. The NASDAQ AlphaDEX Large Cap Value Index is an enhanced index which employs the AlphaDEX stock selection methodology to select stocks from the NASDAQ US 500 Large Cap Value Index.

The ETF has added about 7.77% so far this year and it's up approximately 11.18% in the last one year (as of 08/14/2025). In the past 52-week period, it has traded between $67.12 and $83.49.

The ETF has a beta of 0.91 and standard deviation of 16.8% for the trailing three-year period, making it a medium risk choice in the space. With about 189 holdings, it effectively diversifies company-specific risk.

Alternatives

First Trust Large Cap Value AlphaDEX 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, FTA is a reasonable option for those seeking exposure to the Style Box - Large Cap Value area of the market. Investors might also want to consider some other ETF options in the space.

The Schwab U.S. Dividend Equity ETF (SCHD) and the Vanguard Value ETF (VTV) track a similar index. While Schwab U.S. Dividend Equity ETF has $71.43 billion in assets, Vanguard Value ETF has $141.94 billion. SCHD has an expense ratio of 0.06% and VTV charges 0.04%.

Bottom-Line

An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they 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.