The First Trust Large Cap Value AlphaDEX ETF (FTA) was launched on May 8, 2007, and is a passively managed exchange traded fund designed to offer broad exposure to the Large Cap Value segment of the US equity market.
The fund is sponsored by First Trust Advisors. It has amassed assets over $1.29 billion, making it one of the average sized ETFs attempting to match the Large Cap Value segment of the US equity market.
Why Large Cap Value
Large cap companies usually have a market capitalization above $10 billion. Overall, they are usually a stable option, with less risk and more sure-fire cash flows than mid and small cap companies.
Value stocks are known for their lower than average price-to-earnings and price-to-book ratios, but investors should also note their lower than average sales and earnings growth rates. When you look at long-term performance, value stocks have outperformed growth stocks in nearly all markets. But in strong bull markets, growth stocks are more likely to be winners.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.58%, making it one of the more expensive products in the space.
It has a 12-month trailing dividend yield of 1.72%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Financials sector -- about 19.5% of the portfolio. Energy and Utilities round out the top three.
Looking at individual holdings, Slb Ltd. (SLB) accounts for about 1.09% of total assets, followed by Exxon Mobil Corporation (XOM) and Chevron Corporation (CVX).
The top 10 holdings account for about 9.87% of total assets under management.
Performance and Risk
FTA seeks to match the performance of the Nasdaq AlphaDEX Large Cap Value Index before fees and expenses. The NASDAQ AlphaDEX Large Cap Value Index is an enhanced index which employs the AlphaDEX stock selection methodology to select stocks from the NASDAQ US 500 Large Cap Value Index.
The ETF has added about 10.2% so far this year and was up about 22.68% in the last one year (as of 02/19/2026). In the past 52-week period, it has traded between $67.12 and $94.94.
The ETF has a beta of 0.89 and standard deviation of 14.8% for the trailing three-year period, making it a medium risk choice in the space. With about 188 holdings, it effectively diversifies company-specific risk.
Alternatives
First Trust Large Cap Value AlphaDEX ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, FTA is a good option for those seeking exposure to the Style Box - Large Cap Value area of the market. Investors might also want to consider some other ETF options in the space.
The Schwab U.S. Dividend Equity ETF (SCHD) and the Vanguard Value ETF (VTV) track a similar index. While Schwab U.S. Dividend Equity ETF has $84.01 billion in assets, Vanguard Value ETF has $170.37 billion. SCHD has an expense ratio of 0.06% and VTV charges 0.03%.
Bottom-Line
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
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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First Trust Large Cap Value AlphaDEX ETF (FTA): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
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