The First Trust Materials AlphaDEX ETF (FXZ) was launched on 05/08/2007, and is a smart beta exchange traded fund designed to offer broad exposure to the Materials ETFs category of the market.What Are Smart Beta ETFs?Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.Market cap weighted indexes work great for investors who believe in market efficiency. They provide ...

Core Viewpoint - The First Trust Materials AlphaDEX ETF (FXZ) is a passively managed ETF that provides broad exposure to the Materials - Broad segment of the equity market, appealing to both institutional and retail investors due to its low costs and tax efficiency [1][2]. Group 1: Fund Overview - Launched on May 8, 2007, FXZ has accumulated over $221.67 million in assets, positioning it as an average-sized ETF in its category [3]. - FXZ aims to match the performance of the StrataQuant Materials Index, which uses a modified equal-dollar weighted methodology to select stocks from the Russell 1000 Index [4]. Group 2: Costs and Performance - The ETF has an annual operating expense ratio of 0.61% and a 12-month trailing dividend yield of 1.78%, making it competitive with peer products [5]. - As of July 30, 2025, FXZ has gained approximately 6.47% year-to-date but is down about 8% over the past year, with a trading range between $46.76 and $67.64 [8]. Group 3: Sector Exposure and Holdings - FXZ has a significant allocation in the Materials sector, comprising about 84% of the portfolio, with Eastman Chemical Company (EMN) being the largest holding at approximately 4.84% of total assets [6][7]. - The top 10 holdings represent about 44.65% of total assets under management, indicating a concentrated exposure compared to peers [7][8]. Group 4: Alternatives and Market Position - FXZ carries a Zacks ETF Rank of 3 (Hold), suggesting it is a viable option for investors seeking exposure to the Materials sector [9]. - Other alternatives include the FlexShares Morningstar Global Upstream Natural Resources ETF (GUNR) and the Materials Select Sector SPDR ETF (XLB), which have significantly larger asset bases of $4.86 billion and $5.38 billion, respectively [10].

Core Insights - The Fidelity MSCI Materials Index ETF (FMAT) is a passively managed ETF launched on October 21, 2013, providing broad exposure to the Materials - Broad segment of the equity market [1] - The ETF is designed for long-term investors and is favored for its low costs, transparency, flexibility, and tax efficiency [1] Fund Overview - FMAT has accumulated assets exceeding $428.53 million, categorizing it as an average-sized ETF [3] - The ETF aims to replicate the performance of the MSCI USA IMI Materials Index, which reflects the materials sector in the U.S. equity market [3] Cost Structure - The annual operating expense ratio for FMAT is 0.08%, making it the least expensive option in its category [4] - The ETF offers a 12-month trailing dividend yield of 1.66% [4] Holdings and Diversification - Linde Plc Common Stock (LIN) constitutes approximately 16.27% of total assets, with Sherwin Williams Co (SHW) and Ecolab Inc (ECL) following [5] - The top 10 holdings represent about 55.71% of total assets under management [6] Performance Metrics - FMAT has experienced an 8.1% gain year-to-date and a 1.64% increase over the past year as of July 29, 2025 [7] - The ETF has traded between $42.02 and $55.17 in the past 52 weeks, with a beta of 1.05 and a standard deviation of 19.16% over the trailing three-year period, indicating medium risk [7] Alternatives - FMAT holds a Zacks ETF Rank of 3 (Hold), suggesting it is a viable option for investors seeking exposure to the Materials ETFs sector [8] - Other alternatives include the FlexShares Morningstar Global Upstream Natural Resources ETF (GUNR) and the Materials Select Sector SPDR ETF (XLB), with GUNR having $4.83 billion in assets and XLB at $5.38 billion [10]