Is First Trust Technology AlphaDEX ETF (FXL) a Strong ETF Right Now?
A smart beta exchange traded fund, the First Trust Technology AlphaDEX ETF (FXL) debuted on 05/08/2007, and offers broad exposure to the Technology ETFs category of the market.
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 a low-cost, convenient and transparent way of replicating market returns.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Because the fund has amassed over $1.31 billion, this makes it one of the larger ETFs in the Technology ETFs. FXL is managed by First Trust Advisors. This particular fund, before fees and expenses, seeks to match the performance of the StrataQuant Technology Index.
The StrataQuant Technology Index is a modified equal-dollar weighted index designed by the AMEX to objectively identify and select stocks from the Russell 1000 Index that may generate positive alpha relative to traditional passive style indices through the use of the AlphaDEX screening methodology.
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.60%.
It's 12-month trailing dividend yield comes in at 0.03%.
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
FXL's heaviest allocation is in the Information Technology sector, which is about 79.60% of the portfolio. Its Industrials and Telecom round out the top three.
Taking into account individual holdings, Palantir Technologies Inc. (class A) (PLTR) accounts for about 2.46% of the fund's total assets, followed by Doordash, Inc. (class A) (DASH) and Guidewire Software, Inc. (GWRE).
FXL's top 10 holdings account for about 18.85% of its total assets under management.
So far this year, FXL has added about 1.25%, and was up about 10.42% in the last one year (as of 05/21/2025). During this past 52-week period, the fund has traded between $115.28 and $160.72.
FXL has a beta of 1.18 and standard deviation of 25.55% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 100 holdings, it effectively diversifies company-specific risk.
First Trust Technology AlphaDEX ETF is an excellent option for investors seeking to outperform the Technology ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
Technology Select Sector SPDR ETF (XLK) tracks Technology Select Sector Index and the Vanguard Information Technology ETF (VGT) tracks MSCI US Investable Market Information Technology 25/50 Index. Technology Select Sector SPDR ETF has $72.15 billion in assets, Vanguard Information Technology ETF has $85.98 billion. XLK has an expense ratio of 0.08% and VGT charges 0.09%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Technology ETFs.
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.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
First Trust Technology AlphaDEX ETF (FXL): ETF Research Reports
Guidewire Software, Inc. (GWRE) : Free Stock Analysis Report
Technology Select Sector SPDR ETF (XLK): ETF Research Reports
Vanguard Information Technology ETF (VGT): ETF Research Reports
Palantir Technologies Inc. (PLTR) : Free Stock Analysis Report
DoorDash, Inc. (DASH) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
12 hours ago
- Yahoo
Is First Trust NASDAQ-100 Ex-Technology Sector ETF (QQXT) a Strong ETF Right Now?
The First Trust NASDAQ-100 Ex-Technology Sector ETF (QQXT) was launched on 02/08/2007, and is a smart beta exchange traded fund designed to offer broad exposure to the Style Box - Large Cap Growth category of the market. The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment. Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way. But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market. This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics. The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns. Managed by First Trust Advisors, QQXT has amassed assets over $1.09 billion, making it one of the average sized ETFs in the Style Box - Large Cap Growth. This particular fund, before fees and expenses, seeks to match the performance of the NASDAQ-100 Ex-Tech Sector Index. The NASDAQ-100 Ex-Tech Sector Index is an equal-weighted index based on the securities of the NASDAQ-100 Index that are not classified as technology and, as a result, is a subset of the NASDAQ-100 Index. The NASDAQ-100 Index includes 100 of the largest domestic and international non-financial companies listed on NASDAQ based on market capitalization. Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same. Operating expenses on an annual basis are 0.60% for QQXT, making it one of the more expensive products in the space. The fund has a 12-month trailing dividend yield of 0.85%. It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis. This ETF has heaviest allocation in the Industrials sector - about 19.9% of the portfolio. Healthcare and Consumer Discretionary round out the top three. Looking at individual holdings, Netflix, Inc. (NFLX) accounts for about 2.13% of total assets, followed by Tesla, Inc. (TSLA) and Copart, Inc. (CPRT). The top 10 holdings account for about 20.04% of total assets under management. Year-to-date, the First Trust NASDAQ-100 Ex-Technology Sector ETF has added about 3.67% so far, and is up roughly 9.74% over the last 12 months (as of 06/20/2025). QQXT has traded between $84.34 and $99.49 in this past 52-week period. QQXT has a beta of 0.94 and standard deviation of 16.46% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 57 holdings, it effectively diversifies company-specific risk . First Trust NASDAQ-100 Ex-Technology Sector ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Growth segment of the market. However, there are other ETFs in the space which investors could consider. Vanguard Growth ETF (VUG) tracks CRSP U.S. Large Cap Growth Index and the Invesco QQQ (QQQ) tracks NASDAQ-100 Index. Vanguard Growth ETF has $167.44 billion in assets, Invesco QQQ has $338.42 billion. VUG has an expense ratio of 0.04% and QQQ changes 0.20%. Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Growth 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. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report First Trust NASDAQ-100 Ex-Technology Sector ETF (QQXT): ETF Research Reports This article originally published on Zacks Investment Research ( Zacks Investment Research
Bloomberg
14 hours ago
- Bloomberg
Trust in AI Strongest in China, Low-Income Nations, Study Shows
A United Nations study found a sharp global divide on attitudes toward artificial intelligence, with trust strongest in low-income countries and skepticism high in wealthier ones. More than 6 out of 10 people in developing nations said they have faith that AI systems serve the best interests of society, according to a UN Development Programme survey of 21 countries seen by Bloomberg News. In two-thirds of the countries surveyed, over half of respondents expressed some level of confidence that AI is being designed for good.
Yahoo
16 hours ago
- Yahoo
San Juan Basin Royalty Trust Declares No Cash Distribution for June 2025
DALLAS, June 20, 2025 /PRNewswire/ -- Argent Trust Company, as the trustee (the "Trustee") of the San Juan Basin Royalty Trust (the "Trust") (NYSE: SJT), today reported that it will not declare a monthly cash distribution to the holders of its Units of beneficial interest (the "Unit Holders") due to the application of net proceeds of $294,238, which amount would otherwise be payable to the Trust as royalty income, to the balance of excess production costs accrued as a result of Hilcorp San Juan L.P.'s ("Hilcorp") drilling of two new horizonal wells in 2024. Excess production costs occur when production costs and capital expenditures exceed the gross proceeds for a certain period. The balance of cumulative excess production costs is currently approximately $14,767,940 gross ($11,075,955 net to the Trust), a decrease in the deficit of $392,317 gross ($294,238 net to the trust) from last month's reporting period. Hilcorp will continue to charge the balance of excess production costs to the Trust's net proceeds each month. Until the balance is paid in full, the Trust will not receive royalty income as all net proceeds will be applied to the balance of excess production costs. No cash distributions will be made by the Trust until future net proceeds are sufficient to pay Trust liabilities and replenish cash reserves. Hilcorp reported $4,558,987 of total revenue from the Subject Interests for the production month of April 2025, consisting of $4,403,222 of gas revenues and $155,765 of oil revenues. For the Subject Interests, Hilcorp reported $4,201,917 of production costs (excluding the balance of excess production costs) for the production month of April 2025, consisting of $2,510,928 of lease operating expenses, $568,685 of severance taxes, and $1,122,304 of capital costs. Based upon information provided to the Trust by Hilcorp, gas volumes for the Subject Interests for April 2025 totaled 2,349,703 Mcf (2,610,782 MMBtu), as compared to 2,448,569 Mcf (2,720,632 MMBtu) for March 2025. Dividing gas revenues by production volume yielded an average gas price for April 2025 of $1.87 per Mcf ($1.69 per MMBtu), a decrease of $0.95 per Mcf ($0.85 per MMBtu) as compared to the average gas price for March 2025 of $2.82 per Mcf ($2.54 per MMBtu). This month's Trust administrative expenses totaled $135,339. The increase in administrative expenses was attributable to differences in timing of the receipt and payment of certain expenses by the Trust. Interest income received by the Trust in the amount of $394 will be applied to cover a portion of this month's Trust administrative expenses. Pursuant to the Amended and Restated Royalty Trust Indenture, dated December 12, 2007 (as amended on February 15, 2024, by the First Amendment to the Amended and Restated Royalty Trust Indenture), the Trustee is authorized to retain, in its sole discretion, a cash reserve for payment of Trust liabilities that are contingent or uncertain or otherwise not currently due and payable. To cover Trust expenses during any period of revenue shortfall, which has resulted and may continue to result from lower commodity prices and increased capital expenditures and lease operating expenses under Hilcorp's 2024 capital project plan for the Subject Interests, the Trustee increased the cash reserves in March and April of 2024, such that total cash reserves were $1.8 million as of April 30, 2024. Interest income and cash reserves were utilized to pay Trust administrative expenses each month from May 2024 through May of 2025. As of May 31, 2025, the balance of cash reserves maintained by the Trustee was $32,959. On May 21, 2025, the Trust entered into a promissory note (the "Note") to establish a line of credit (the "Line of Credit") in the amount of $2,000,000 with Texas Bank, together with a mortgage to secure that Note. The Line of Credit is intended to cover the Trust's administrative expenses until the Trust receives royalty income in amounts sufficient to (a) repay the balance of excess production costs accrued as a result of Hilcorp San Juan L.P.'s drilling of two new horizonal wells in 2024, (b) replenish a reserve in the amount of $2,000,000, and (c) repay the principal due under the Note, after which time, the Trust will resume distributions of the net profits income to the holders of the Trust's units of beneficial interest. On June 18, 2025, cash reserves in the amount of $212 were utilized to pay interest accrued on the Line of Credit, such that the balance of cash reserves maintained by the trust is $32,747. Interest income in the amount of $394, a draw of $132,851 from the Trust's Line of Credit at Texas Bank, and $1883 of cash reserves remaining from an over withdrawal of funds from the reserves in April 2025 will be used to pay Trust administrative expenses for the month of June. Production from the Subject Interests continues to be gathered, processed, and sold under market sensitive and customary agreements, as recommended for approval by the Trust's Consultant. The Trustee continues to engage with Hilcorp regarding its ongoing accounting and reporting to the Trust, and the Trust's third-party compliance auditors continue to audit payments made by Hilcorp to the Trust, inclusive of sales revenues, production costs, capital expenditures, adjustments, actualizations, and recoupments. The Trust's auditing process has also included detailed analysis of Hilcorp's pricing and rates charged. As previously disclosed in the Trust's filings, these revenues and costs (along with all costs) are the subject of the Trust's ongoing comprehensive audit process by the Trust's professional consultants and outside counsel to analyze compliance with all the underlying operative Trust agreements and evaluate potential remedies in the event there is suspected non-compliance. As of July 21, 2025, the Trust will self-publish press releases on its website, and the release will not be included in any wire distribution, which has been the normal procedure for each monthly press release through June 20, 2025. The self-publication is due to the depletion of the Trust's cash reserves and conservation of the line of credit resources. The trust will self-publish press releases until such time as the cash reserves have been replenished and increased to $2.0 million. The Trust will continue to furnish unitholders with information through its website and Form 8-K filings with the Securities and Exchange Commission, which are available at Forward Looking Statements. Except for historical information contained in this news release, the statements in this news release are forward-looking statements that are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements generally are accompanied by words such as "estimates," "anticipates," "could," "plan," or other words that convey the uncertainty of future events or outcomes. Forward-looking statements and the business prospects of San Juan Basin Royalty Trust are subject to a number of risks and uncertainties that may cause actual results in future periods to differ materially from the forward-looking statements. These risks and uncertainties include, among other things, certain information provided to the Trust by Hilcorp, volatility of oil and gas prices, governmental regulation or action, litigation, and uncertainties about estimates of reserves. These and other risks are described in the Trust's reports and other filings with the Securities and Exchange Commission. Contact: San Juan Basin Royalty Trust Argent Trust Company, Trustee Nancy Willis, Director of Royalty Trust Services Toll-free: (855) 588-7839 Fax: (214) 559-7010 Website: Email: trustee@ View original content: SOURCE San Juan Basin Royalty Trust Inicia sesión para acceder a tu portafolio
