ETF Spotlight: First Trust Industrial / Producer Durable AlphaDEX (FXR)

Apr.22.10 | About: First Trust (FXR)

ETF Spotlight on First Trust Industrial/Producer Durable AlphaDEX (NYSEARCA:FXR), part of a weekly series.

Assets: $29.2 million

Objective: Tracks the StrataQuant Industrials Index, an index developed and maintained by the NYSE Euronext.

Holdings: Top holdings include Xerox (NYSE:XRX), Southwest Airlines (NYSE:LUV), Boeing (NYSE:BA), Delta Airline (NYSE:DAL) and Raytheon (NYSE:RTN).

What You Should Know

  • The index ranks stocks in the Russell 1000 on growth factors including three, six and 12-month price appreciation, sales to price and one-year sales growth, as well as other value factors.
  • The bottom 25% are then eliminated and the rest are selected for the index, then divided into quantiles based on their rankings. The higher-ranked quantiles get the greatest weightings, but stocks are equally weighted within each quantile.
  • The fund’s expense ratio is 1.08%, has 92 holdings and it rebalances quarterly.
  • FXR is heaviest in mid-cap companies, which have 58.7% of the total weighting; large-caps make up another 23.1%.

The Latest News

  • Manufacturing surged to 59.6 last month; any number above 50 is a sign of expansion. The growth is the fastest pace since July 2004. The increase is being attributed to improving demand in the United States and Asia and a need for businesses to begin the work of rebuilding depleted inventories.
  • Industrials are a good value right now, something investors will find appealing in this recovery.
  • Industrial companies are feeling positive, and many of them are raising their dividends. Around 10 industrial companies raised their dividends for the month of February.

Disclosure: None