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Is First Trust Technology AlphaDEX ETF (FXL) a Strong ETF Right Now?
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The First Trust Technology AlphaDEX ETF (FXL - Free Report) made its debut on 05/08/2007, and is a smart beta exchange traded fund that provides broad exposure to the Technology ETFs category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
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.
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.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other 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
Because the fund has amassed over $1.8 billion, this makes it one of the larger ETFs in the Technology ETFs. FXL is managed by First Trust Advisors. FXL, before fees and expenses, seeks to match the performance of the StrataQuant Technology Index.
The StrataQuant Technology 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
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
Annual operating expenses for this ETF are 0.60%, making it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 0.00%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
For FXL, it has heaviest allocation in the Information Technology sector --about 83.3% of the portfolio --while Industrials and Telecom round out the top three.
Taking into account individual holdings, Micron Technology, Inc. (MU) accounts for about 1.8% of the fund's total assets, followed by Marvell Technology, Inc. (MRVL) and Monolithic Power Systems, Inc. (MPWR).
Its top 10 holdings account for approximately 17.12% of FXL's total assets under management.
Performance and Risk
So far this year, FXL return is roughly 33.15%, and is up about 52.14% in the last one year (as of 06/03/2026). During this past 52-week period, the fund has traded between $149.80 and $224.06.
FXL has a beta of 1.24 and standard deviation of 23.43% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 104 holdings, it effectively diversifies company-specific risk .
Alternatives
First Trust Technology AlphaDEX ETF is an excellent option for investors seeking to outperform the Technology ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
State Street Technology Select Sector SPDR ETF (XLK) tracks Technology Select Sector Index and the Vanguard Information Technology Index Fund ETF Shares (VGT) tracks MSCI US Investable Market Information Technology 25/50 Index. State Street Technology Select Sector SPDR ETF has $128.93 billion in assets, Vanguard Information Technology Index Fund ETF Shares has $151.89 billion. XLK has an expense ratio of 0.08% and VGT changes 0.09%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Technology 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 Technology AlphaDEX ETF (FXL) a Strong ETF Right Now?
The First Trust Technology AlphaDEX ETF (FXL - Free Report) made its debut on 05/08/2007, and is a smart beta exchange traded fund that provides broad exposure to the Technology ETFs category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
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.
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.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other 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
Because the fund has amassed over $1.8 billion, this makes it one of the larger ETFs in the Technology ETFs. FXL is managed by First Trust Advisors. FXL, before fees and expenses, seeks to match the performance of the StrataQuant Technology Index.
The StrataQuant Technology 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
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
Annual operating expenses for this ETF are 0.60%, making it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 0.00%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
For FXL, it has heaviest allocation in the Information Technology sector --about 83.3% of the portfolio --while Industrials and Telecom round out the top three.
Taking into account individual holdings, Micron Technology, Inc. (MU) accounts for about 1.8% of the fund's total assets, followed by Marvell Technology, Inc. (MRVL) and Monolithic Power Systems, Inc. (MPWR).
Its top 10 holdings account for approximately 17.12% of FXL's total assets under management.
Performance and Risk
So far this year, FXL return is roughly 33.15%, and is up about 52.14% in the last one year (as of 06/03/2026). During this past 52-week period, the fund has traded between $149.80 and $224.06.
FXL has a beta of 1.24 and standard deviation of 23.43% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 104 holdings, it effectively diversifies company-specific risk .
Alternatives
First Trust Technology AlphaDEX ETF is an excellent option for investors seeking to outperform the Technology ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
State Street Technology Select Sector SPDR ETF (XLK) tracks Technology Select Sector Index and the Vanguard Information Technology Index Fund ETF Shares (VGT) tracks MSCI US Investable Market Information Technology 25/50 Index. State Street Technology Select Sector SPDR ETF has $128.93 billion in assets, Vanguard Information Technology Index Fund ETF Shares has $151.89 billion. XLK has an expense ratio of 0.08% and VGT changes 0.09%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Technology 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.