Should First Trust Large Cap Value AlphaDEX ETF (FTA) Be on Your Investing Radar?

Core Viewpoint - The First Trust Large Cap Value AlphaDEX ETF (FTA) is a passively managed ETF that provides exposure to the Large Cap Value segment of the US equity market, with assets exceeding $1.13 billion, making it a mid-sized option in this category [1]. Group 1: Large Cap Value Overview - Large cap companies are defined as those with a market capitalization above $10 billion, generally offering more stability and reliable cash flows compared to mid and small cap companies [2]. - Value stocks typically exhibit lower price-to-earnings and price-to-book ratios, along with lower sales and earnings growth rates, but have historically outperformed growth stocks in most markets, although they may lag in strong bull markets [3]. Group 2: Costs and Performance - The ETF has an annual operating expense ratio of 0.58%, which is relatively high compared to other funds in the space, and it offers a 12-month trailing dividend yield of 1.97% [4]. - FTA aims to match the performance of the Nasdaq AlphaDEX Large Cap Value Index, having gained approximately 7.77% year-to-date and 11.18% over the past year as of August 14, 2025, with a trading range between $67.12 and $83.49 in the past 52 weeks [7]. Group 3: Sector Exposure and Holdings - The ETF has a significant allocation to the Financials sector, comprising about 24.2% of the portfolio, followed by Information Technology and Industrials [5]. - Western Digital Corporation (WDC) represents about 1.4% of total assets, with the top 10 holdings accounting for approximately 11.39% of total assets under management [6]. Group 4: Risk and Alternatives - FTA has a beta of 0.91 and a standard deviation of 16.8% over the trailing three-year period, categorizing it as a medium risk investment with 189 holdings to diversify company-specific risk [8]. - Alternatives to FTA include the Schwab U.S. Dividend Equity ETF (SCHD) and the Vanguard Value ETF (VTV), which have significantly larger asset bases and lower expense ratios of 0.06% and 0.04%, respectively [10].