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Is First Trust Energy AlphaDEX ETF (FXN) a Strong ETF Right Now?
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Designed to provide broad exposure to the Energy ETFs category of the market, the First Trust Energy AlphaDEX ETF (FXN - Free Report) is a smart beta exchange traded fund launched on 05/08/2007.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
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
The fund is sponsored by First Trust Advisors. It has amassed assets over $397.01 million, making it one of the average sized ETFs in the Energy ETFs. FXN seeks to match the performance of the StrataQuant Energy Index before fees and expenses.
The StrataQuant Energy Index is a modified equal-dollar weighted index designed by the AMEX to objectively identify and select stocks from the Russell 1000 Index that may generate positive alpha relative to traditional passive style indices through the use of the AlphaDEX screening methodology.
Cost & Other Expenses
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.
Operating expenses on an annual basis are 0.63% for FXN, making it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 1.86%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
This ETF has heaviest allocation in the Energy sector - about 98.3% of the portfolio.
Looking at individual holdings, Permian Resources Corp. (PR) accounts for about 5.23% of total assets, followed by Apa Corporation (APA) and Matador Resources Company (MTDR).
Its top 10 holdings account for approximately 44.38% of FXN's total assets under management.
Performance and Risk
Year-to-date, the First Trust Energy AlphaDEX ETF has added about 36.13% so far, and is up about 36.42% over the last 12 months (as of 03/25/2026). FXN has traded between $12.88 $22.42 in this past 52-week period.
The ETF has a beta of 0.67 and standard deviation of 25.13% for the trailing three-year period, making it a high risk choice in the space. With about 39 holdings, it has more concentrated exposure than peers .
Alternatives
First Trust Energy AlphaDEX ETF is not a suitable option for investors seeking to outperform the Energy ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.
Vanguard Energy Index Fund ETF Shares (VDE) tracks MSCI US Investable Market Energy 25/50 Index and the State Street Energy Select Sector SPDR ETF (XLE) tracks Energy Select Sector Index. Vanguard Energy Index Fund ETF Shares has $10.08 billion in assets, State Street Energy Select Sector SPDR ETF has $42.82 billion. VDE has an expense ratio of 0.09% and XLE 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 Energy 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 Energy AlphaDEX ETF (FXN) a Strong ETF Right Now?
Designed to provide broad exposure to the Energy ETFs category of the market, the First Trust Energy AlphaDEX ETF (FXN - Free Report) is a smart beta exchange traded fund launched on 05/08/2007.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
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
The fund is sponsored by First Trust Advisors. It has amassed assets over $397.01 million, making it one of the average sized ETFs in the Energy ETFs. FXN seeks to match the performance of the StrataQuant Energy Index before fees and expenses.
The StrataQuant Energy Index is a modified equal-dollar weighted index designed by the AMEX to objectively identify and select stocks from the Russell 1000 Index that may generate positive alpha relative to traditional passive style indices through the use of the AlphaDEX screening methodology.
Cost & Other Expenses
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.
Operating expenses on an annual basis are 0.63% for FXN, making it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 1.86%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
This ETF has heaviest allocation in the Energy sector - about 98.3% of the portfolio.
Looking at individual holdings, Permian Resources Corp. (PR) accounts for about 5.23% of total assets, followed by Apa Corporation (APA) and Matador Resources Company (MTDR).
Its top 10 holdings account for approximately 44.38% of FXN's total assets under management.
Performance and Risk
Year-to-date, the First Trust Energy AlphaDEX ETF has added about 36.13% so far, and is up about 36.42% over the last 12 months (as of 03/25/2026). FXN has traded between $12.88 $22.42 in this past 52-week period.
The ETF has a beta of 0.67 and standard deviation of 25.13% for the trailing three-year period, making it a high risk choice in the space. With about 39 holdings, it has more concentrated exposure than peers .
Alternatives
First Trust Energy AlphaDEX ETF is not a suitable option for investors seeking to outperform the Energy ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.
Vanguard Energy Index Fund ETF Shares (VDE) tracks MSCI US Investable Market Energy 25/50 Index and the State Street Energy Select Sector SPDR ETF (XLE) tracks Energy Select Sector Index. Vanguard Energy Index Fund ETF Shares has $10.08 billion in assets, State Street Energy Select Sector SPDR ETF has $42.82 billion. VDE has an expense ratio of 0.09% and XLE 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 Energy 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.