Market Performance - Wall Street ended 2025 positively, with the S&P 500 gaining 16.39%, marking its third consecutive year of double-digit gains [1] - The Nasdaq Composite surged 20.36% due to ongoing enthusiasm for artificial intelligence (AI), while the Dow Jones increased by 12.97%, impacted by its limited exposure to technology stocks [1] Market Recovery - The strong year-end performance indicates a recovery from a significant sell-off at the beginning of 2025, which was driven by low-cost AI initiatives from China, Trump tariffs, persistent inflation, and high interest rates [2] - In April 2025, the S&P 500 had dropped nearly 19% from its February peak, briefly falling below the 5,000 mark, narrowly avoiding bear-market territory [3] Economic Factors - Market stability returned in May after a turbulent April, which was marked by tariff-related issues [2] - The Federal Reserve implemented three rate cuts in 2025, starting in September, but momentum was disrupted by a prolonged U.S. government shutdown and concerns over AI overvaluation [4] Year-End Trends - The anticipated "Santa Claus" rally did not materialize, as the final trading days of 2025 were characterized by profit-taking, reflecting investor caution regarding AI overvaluation and related concerns [5] Dividend ETFs - In a volatile market, dividend ETFs have become attractive, as investors seek income amidst uncertainty [6] - Not all dividend stocks serve the same purpose; high-yield stocks provide current income, while those with dividend growth indicate quality investing [7] Top Performing Dividend ETFs - First Trust STOXX European Select Dividend ETF (FDD) increased by 56.1%, with an annual yield of 3.99% [9] - iShares International Select Dividend ETF (IDV) rose by 44.2% [10] - WisdomTree International High Dividend ETF (DTH) gained 37.3%, yielding 3.80% annually [13] - First Trust Dow Jones Global Select Dividend ETF (FGD) increased by 36%, with a yield of 5.62% [14] - SPDR S&P International Dividend ETF (DWX) rose by 26.1%, yielding 4.44% annually [15]

Core Insights - The First Trust STOXX European Select Dividend ETF (FDD) offers investors broad exposure to the European Equity ETFs market, having debuted on August 27, 2007 [1] - FDD is managed by First Trust Advisors and has accumulated over $606.5 million in assets, positioning it as an average-sized ETF in the European Equity category [5] - The fund aims to replicate the performance of the STOXX Europe Select Dividend 30 Index, which includes 30 high dividend-yielding securities from the STOXX Europe 600 Index [5] Fund Characteristics - FDD has an annual operating expense ratio of 0.59%, which is competitive within its peer group, and a 12-month trailing dividend yield of 4.79% [6] - The top 10 holdings of FDD constitute approximately 43.77% of its total assets, with Aker Bp Asa being the largest holding at 5.92% [7][8] - The ETF has a beta of 0.84 and a standard deviation of 18.05% over the trailing three-year period, indicating a medium risk profile [10] Performance Metrics - Year-to-date, FDD has gained about 39.57%, and it has increased approximately 31.95% over the last 12 months as of July 31, 2025 [9] - The ETF has traded within a range of $11.07 to $16.13 over the past 52 weeks [9] Alternatives - For investors seeking to outperform the European Equity ETFs segment, alternatives such as iShares MSCI Eurozone ETF (EZU) and Vanguard FTSE Europe ETF (VGK) are available, with EZU having $7.89 billion in assets and VGK at $25.7 billion [12] - EZU has an expense ratio of 0.51%, while VGK has a notably lower expense ratio of 0.06% [12]