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Is First Trust Consumer Discretionary AlphaDEX ETF (FXD) a Strong ETF Right Now?
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Designed to provide broad exposure to the Consumer Discretionary ETFs category of the market, the First Trust Consumer Discretionary AlphaDEX ETF (FXD - Free Report) is a smart beta exchange traded fund launched on 05/08/2007.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.
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.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
Managed by First Trust Advisors, FXD has amassed assets over $320.9 million, making it one of the larger ETFs in the Consumer Discretionary ETFs. FXD seeks to match the performance of the StrataQuant Consumer Discretionary Index before fees and expenses.
The StrataQuant Consumer Discretionary Index employs the AlphaDEX stock selection methodology to select stocks from the Russell 1000 Index.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Annual operating expenses for FXD are 0.60%, which makes it on par with most peer products in the space.
FXD's 12-month trailing dividend yield is 0.79%.
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.
FXD's heaviest allocation is in the Consumer Discretionary sector, which is about 75.6% of the portfolio. Its Industrials and Telecom round out the top three.
Taking into account individual holdings, Expedia Group, Inc. (EXPE) accounts for about 1.89% of the fund's total assets, followed by General Motors Company (GM) and Macy's, Inc. (M).
The top 10 holdings account for about 17.39% of total assets under management.
Performance and Risk
Year-to-date, the First Trust Consumer Discretionary AlphaDEX ETF return is roughly 2.08% so far, and is up roughly 7.01% over the last 12 months (as of 01/21/2026). FXD has traded between $50.42 $72.23 in this past 52-week period.
The fund has a beta of 1.18 and standard deviation of 20.19% for the trailing three-year period, which makes FXD a medium risk choice in this particular space. With about 119 holdings, it effectively diversifies company-specific risk .
Alternatives
First Trust Consumer Discretionary AlphaDEX ETF is a reasonable option for investors seeking to outperform the Consumer Discretionary ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
Vanguard Consumer Discretionary ETF (VCR) tracks MSCI US Investable Market Consumer Discretionary 25/50 Index and the State Street Consumer Discretionary Select Sector SPDR ETF (XLY) tracks Consumer Discretionary Select Sector Index. Vanguard Consumer Discretionary ETF has $6.35 billion in assets, State Street Consumer Discretionary Select Sector SPDR ETF has $23.45 billion. VCR has an expense ratio of 0.09% and XLY 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 Consumer Discretionary 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 Consumer Discretionary AlphaDEX ETF (FXD) a Strong ETF Right Now?
Designed to provide broad exposure to the Consumer Discretionary ETFs category of the market, the First Trust Consumer Discretionary AlphaDEX ETF (FXD - Free Report) is a smart beta exchange traded fund launched on 05/08/2007.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.
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.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
Managed by First Trust Advisors, FXD has amassed assets over $320.9 million, making it one of the larger ETFs in the Consumer Discretionary ETFs. FXD seeks to match the performance of the StrataQuant Consumer Discretionary Index before fees and expenses.
The StrataQuant Consumer Discretionary Index employs the AlphaDEX stock selection methodology to select stocks from the Russell 1000 Index.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Annual operating expenses for FXD are 0.60%, which makes it on par with most peer products in the space.
FXD's 12-month trailing dividend yield is 0.79%.
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.
FXD's heaviest allocation is in the Consumer Discretionary sector, which is about 75.6% of the portfolio. Its Industrials and Telecom round out the top three.
Taking into account individual holdings, Expedia Group, Inc. (EXPE) accounts for about 1.89% of the fund's total assets, followed by General Motors Company (GM) and Macy's, Inc. (M).
The top 10 holdings account for about 17.39% of total assets under management.
Performance and Risk
Year-to-date, the First Trust Consumer Discretionary AlphaDEX ETF return is roughly 2.08% so far, and is up roughly 7.01% over the last 12 months (as of 01/21/2026). FXD has traded between $50.42 $72.23 in this past 52-week period.
The fund has a beta of 1.18 and standard deviation of 20.19% for the trailing three-year period, which makes FXD a medium risk choice in this particular space. With about 119 holdings, it effectively diversifies company-specific risk .
Alternatives
First Trust Consumer Discretionary AlphaDEX ETF is a reasonable option for investors seeking to outperform the Consumer Discretionary ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
Vanguard Consumer Discretionary ETF (VCR) tracks MSCI US Investable Market Consumer Discretionary 25/50 Index and the State Street Consumer Discretionary Select Sector SPDR ETF (XLY) tracks Consumer Discretionary Select Sector Index. Vanguard Consumer Discretionary ETF has $6.35 billion in assets, State Street Consumer Discretionary Select Sector SPDR ETF has $23.45 billion. VCR has an expense ratio of 0.09% and XLY 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 Consumer Discretionary 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.