Launched on April 19, 2011, the First Trust Mid Cap Value AlphaDEX ETF (FNK Quick QuoteFNK - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Mid Cap Value segment of the US equity market.

The fund is sponsored by First Trust Advisors. It has amassed assets over $204.79 million, making it one of the smaller ETFs attempting to match the Mid Cap Value segment of the US equity market.

Why Mid Cap Value

With market capitalization between $2 billion and $10 billion, mid cap companies usually contain higher growth prospects than large cap companies, and are considered less risky than their small cap counterparts. Thus they have a nice balance of growth potential and stability.

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. Value stocks have outperformed growth stocks in nearly all markets when you consider long-term performance, growth stocks are more likely to outpace value stocks in strong bull markets.

Costs

Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.

Annual operating expenses for this ETF are 0.7%, making it one of the most expensive products in the space.

It has a 12-month trailing dividend yield of 1.62%.

Sector Exposure and Top Holdings

While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.

This ETF has heaviest allocation to the Consumer Discretionary sector -- about 22.1% of the portfolio. Financials and Industrials round out the top three.

Looking at individual holdings, Riot Platforms, Inc. (RIOT) accounts for about 1.18% of total assets, followed by Fluor Corporation (FLR) and Elanco Animal Health Incorporated (ELAN).

The top 10 holdings account for about 9.23% of total assets under management.

Performance and Risk

FNK seeks to match the performance of the Nasdaq AlphaDEX Mid Cap Value Index before fees and expenses. The NASDAQ AlphaDEX Mid Cap Value Index is an enhanced index which employs the AlphaDEX stock selection methodology to select stocks from the NASDAQ US 600 Mid Cap Value Index.

The ETF return is roughly 5.62% so far this year and was up about 7.56% in the last one year (as of 08/25/2025). In the past 52-week period, it has traded between $43.24 and $58.28.

The ETF has a beta of 1.08 and standard deviation of 21.97% for the trailing three-year period, making it a medium risk choice in the space. With about 226 holdings, it effectively diversifies company-specific risk.

Alternatives

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

The iShares Russell Mid-Cap Value ETF (IWS) and the Vanguard Mid-Cap Value ETF (VOE) track a similar index. While iShares Russell Mid-Cap Value ETF has $14.11 billion in assets, Vanguard Mid-Cap Value ETF has $18.89 billion. IWS has an expense ratio of 0.23% and VOE charges 0.07%.

Bottom-Line

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.

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.