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Is First Trust Health Care AlphaDEX ETF (FXH) a Strong ETF Right Now?
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The First Trust Health Care AlphaDEX ETF (FXH - Free Report) was launched on 05/08/2007, and is a smart beta exchange traded fund designed to offer broad exposure to the Health Care ETFs 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.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
FXH is managed by First Trust Advisors, and this fund has amassed over $941.63 million, which makes it one of the larger ETFs in the Health Care ETFs. FXH seeks to match the performance of the StrataQuant Health Care Index before fees and expenses.
The StrataQuant Health Care Index employs the AlphaDEX stock selection methodology to select stocks from the Russell 1000 Index.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Operating expenses on an annual basis are 0.60% for this ETF, which makes it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 0.82%.
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.
Representing 100% of the portfolio, the fund has heaviest allocation to the Healthcare sector.
Taking into account individual holdings, Tempus Ai, Inc. (class A) (TEM) accounts for about 2.5% of the fund's total assets, followed by Insmed Incorporated (INSM) and Avantor, Inc. (AVTR).
FXH's top 10 holdings account for about 23.3% of its total assets under management.
Performance and Risk
Year-to-date, the First Trust Health Care AlphaDEX ETF has added about 11.02% so far, and is up roughly 7% over the last 12 months (as of 12/15/2025). FXH has traded between $93.63 $118.44 in this past 52-week period.
The ETF has a beta of 0.79 and standard deviation of 14.92% for the trailing three-year period, making it a medium risk choice in the space. With about 77 holdings, it effectively diversifies company-specific risk .
Alternatives
First Trust Health Care AlphaDEX ETF is a reasonable option for investors seeking to outperform the Health Care ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
Vanguard Health Care ETF (VHT) tracks MSCI US Investable Market Health Care 25/50 Index and the State Street Health Care Select Sector SPDR ETF ETF (XLV) tracks Health Care Select Sector Index. Vanguard Health Care ETF has $17.31 billion in assets, State Street Health Care Select Sector SPDR ETF ETF has $40.27 billion. VHT has an expense ratio of 0.09% and XLV changes 0.08%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Health Care ETFs
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 Health Care AlphaDEX ETF (FXH) a Strong ETF Right Now?
The First Trust Health Care AlphaDEX ETF (FXH - Free Report) was launched on 05/08/2007, and is a smart beta exchange traded fund designed to offer broad exposure to the Health Care ETFs 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.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
FXH is managed by First Trust Advisors, and this fund has amassed over $941.63 million, which makes it one of the larger ETFs in the Health Care ETFs. FXH seeks to match the performance of the StrataQuant Health Care Index before fees and expenses.
The StrataQuant Health Care Index employs the AlphaDEX stock selection methodology to select stocks from the Russell 1000 Index.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Operating expenses on an annual basis are 0.60% for this ETF, which makes it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 0.82%.
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.
Representing 100% of the portfolio, the fund has heaviest allocation to the Healthcare sector.
Taking into account individual holdings, Tempus Ai, Inc. (class A) (TEM) accounts for about 2.5% of the fund's total assets, followed by Insmed Incorporated (INSM) and Avantor, Inc. (AVTR).
FXH's top 10 holdings account for about 23.3% of its total assets under management.
Performance and Risk
Year-to-date, the First Trust Health Care AlphaDEX ETF has added about 11.02% so far, and is up roughly 7% over the last 12 months (as of 12/15/2025). FXH has traded between $93.63 $118.44 in this past 52-week period.
The ETF has a beta of 0.79 and standard deviation of 14.92% for the trailing three-year period, making it a medium risk choice in the space. With about 77 holdings, it effectively diversifies company-specific risk .
Alternatives
First Trust Health Care AlphaDEX ETF is a reasonable option for investors seeking to outperform the Health Care ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
Vanguard Health Care ETF (VHT) tracks MSCI US Investable Market Health Care 25/50 Index and the State Street Health Care Select Sector SPDR ETF ETF (XLV) tracks Health Care Select Sector Index. Vanguard Health Care ETF has $17.31 billion in assets, State Street Health Care Select Sector SPDR ETF ETF has $40.27 billion. VHT has an expense ratio of 0.09% and XLV changes 0.08%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Health Care ETFs
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.