Should You Invest in the First Trust Technology AlphaDEX ETF (FXL)?

Core Viewpoint - The First Trust Technology AlphaDEX ETF (FXL) offers a low-cost, transparent, and flexible investment option for gaining exposure to the Technology - Broad segment of the equity market, appealing to both institutional and retail investors [1][2]. Fund Overview - FXL, launched on May 8, 2007, has accumulated over $1.37 billion in assets, positioning it as one of the larger ETFs in the Technology - Broad segment [3]. - The ETF aims to match the performance of the StrataQuant Technology Index, which utilizes a modified equal-dollar weighted methodology to select stocks from the Russell 1000 Index [4]. Cost Structure - The annual operating expenses for FXL are 0.6%, which is competitive within its peer group, and it has a trailing dividend yield of 0.03% [5]. Sector Exposure and Holdings - Approximately 80.2% of FXL's portfolio is allocated to the Information Technology sector, with Industrials and Telecom also being significant sectors [6]. - The top holdings include Palantir Technologies Inc. (2.28% of total assets), Reddit, Inc., and Amphenol Corporation, with the top 10 holdings comprising about 18.42% of total assets [7]. Performance Metrics - As of September 1, 2025, FXL has increased by approximately 7.95% year-to-date and 18.88% over the past year, with a trading range between $115.28 and $162.699 in the last 52 weeks [8]. - The ETF has a beta of 1.16 and a standard deviation of 24.15% over the trailing three-year period, indicating a medium risk profile [8]. Alternatives - FXL holds a Zacks ETF Rank of 2 (Buy), suggesting it is a strong option for investors looking for exposure to Technology ETFs [9]. - Other notable ETFs in the sector include the Technology Select Sector SPDR ETF (XLK) and the Vanguard Information Technology ETF (VGT), with XLK having $83.99 billion in assets and VGT $99.65 billion [11].