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Is First Trust Health Care AlphaDEX ETF (FXH) a Strong ETF Right Now?
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Designed to provide broad exposure to the Health Care ETFs category of the market, the First Trust Health Care AlphaDEX ETF (FXH - 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.
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.
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.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is managed by First Trust Advisors, and has been able to amass over $1.15 billion, which makes it one of the larger ETFs in the Health Care ETFs. Before fees and expenses, this particular fund seeks to match the performance of the StrataQuant Health Care Index.
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.
Annual operating expenses for FXH are 0.61%, which makes it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.54%.
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 Healthcare sector - about 100% of the portfolio.
Looking at individual holdings, Natera, Inc. (NTRA) accounts for about 3.35% of total assets, followed by Guardant Health, Inc. (GH) and Universal Health Services, Inc. (class B) (UHS).
Its top 10 holdings account for approximately 25.37% of FXH's total assets under management.
Performance and Risk
So far this year, FXH has added roughly 20.04%, and was up about 21.37% in the last one year (as of 10/29/2026). During this past 52-week period, the fund has traded between $104.58 and $136.57.
The fund has a beta of 0.72 and standard deviation of 15.53% for the trailing three-year period, which makes FXH a medium risk choice in this particular space. With about 74 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 Index Fund ETF Shares (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 Index Fund ETF Shares has $20.24 billion in assets, State Street Health Care Select Sector SPDR ETF ETF has $46.89 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?
Designed to provide broad exposure to the Health Care ETFs category of the market, the First Trust Health Care AlphaDEX ETF (FXH - 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.
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.
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.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is managed by First Trust Advisors, and has been able to amass over $1.15 billion, which makes it one of the larger ETFs in the Health Care ETFs. Before fees and expenses, this particular fund seeks to match the performance of the StrataQuant Health Care Index.
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.
Annual operating expenses for FXH are 0.61%, which makes it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.54%.
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 Healthcare sector - about 100% of the portfolio.
Looking at individual holdings, Natera, Inc. (NTRA) accounts for about 3.35% of total assets, followed by Guardant Health, Inc. (GH) and Universal Health Services, Inc. (class B) (UHS).
Its top 10 holdings account for approximately 25.37% of FXH's total assets under management.
Performance and Risk
So far this year, FXH has added roughly 20.04%, and was up about 21.37% in the last one year (as of 10/29/2026). During this past 52-week period, the fund has traded between $104.58 and $136.57.
The fund has a beta of 0.72 and standard deviation of 15.53% for the trailing three-year period, which makes FXH a medium risk choice in this particular space. With about 74 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 Index Fund ETF Shares (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 Index Fund ETF Shares has $20.24 billion in assets, State Street Health Care Select Sector SPDR ETF ETF has $46.89 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.