Designed to provide broad exposure to the Large Cap Value segment of the US equity market, the First Trust Rising Dividend Achievers ETF (RDVY Quick QuoteRDVY - Free Report) is a passively managed exchange traded fund launched on January 7, 2014.

The fund is sponsored by First Trust Advisors. It has amassed assets over $20.23 billion, making it one of the largest ETFs attempting to match the Large Cap Value segment of the US equity market.

Why Large Cap Value

Companies that find themselves in the large cap category typically have a market capitalization above $10 billion. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.

Carrying lower than average price-to-earnings and price-to-book ratios, value stocks also have lower than average sales and earnings growth rates. When you look at long-term performance, value stocks have outperformed growth stocks in nearly all markets. But in strong bull markets, growth stocks are more likely to be winners.

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 0.48%, putting it on par with most peer products in the space.

It has a 12-month trailing dividend yield of 1.08%.

Sector Exposure and Top Holdings

Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.

This ETF has heaviest allocation to the Financials sector -- about 34.3% of the portfolio. Information Technology and Industrials round out the top three.

Looking at individual holdings, Lam Research Corporation (LRCX) accounts for about 3.46% of total assets, followed by Applied Materials, Inc. (AMAT) and Alphabet Inc. (class A) (GOOGL).

The top 10 holdings account for about 25.24% of total assets under management.

Performance and Risk

RDVY seeks to match the performance of the NASDAQ US Rising Dividend Achievers Index before fees and expenses. The NASDAQ US Rising Dividend Achievers Index is designed to provide access to a diversified portfolio of companies with a history of paying dividends.

The ETF return is roughly 3.04% so far this year and it's up approximately 15.07% in the last one year (as of 02/06/2026). In the past 52-week period, it has traded between $51.60 and $73.21.

The ETF has a beta of 1.05 and standard deviation of 16.87% for the trailing three-year period, making it a medium risk choice in the space. With about 72 holdings, it effectively diversifies company-specific risk.

Alternatives

First Trust Rising Dividend Achievers ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, RDVY is a great option for investors seeking exposure to the Style Box - Large Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.

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 $81.43 billion in assets, Vanguard Value ETF has $167.30 billion. SCHD has an expense ratio of 0.06% and VTV charges 0.03%.

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.