First Trust Materials AlphaDEX® Fund (FXZ)
Investment Objective/Strategy - The First Trust Materials AlphaDEX® Fund is an exchange-traded fund. The investment objective of the Fund is to seek investment results that correspond generally to the price and yield, before fees and expenses, of an equity index called the StrataQuant® Materials Index.
There can be no assurance that the Fund's investment objectives will be achieved.
  • The StrataQuant® Materials Index is an "enhanced" index developed, maintained and sponsored by ICE Data Indices, LLC or its affiliates ("IDI") which employs the AlphaDEX® stock selection methodology to select stocks from the Russell 1000® Index.
  • IDI constructs the StrataQuant® Materials Index by ranking the stocks which are members of the Russell 1000® Index on growth factors including three, six and 12-month price appreciation, sales to price and one year sales growth, and, separately, on value factors including book value to price, cash flow to price and return on assets.
  • Stocks which Russell has classified solely as growth or value, receive their score using the above growth or value factors respectively.
  • Stocks which Russell allocates between both growth and value receive their best score between the growth and value factors.
  • IDI then ranks those stocks contained in the materials sector according to their score. The bottom 25% is eliminated and the top 75% is selected for the StrataQuant® Materials Index.
  • The selected stocks are divided into quintiles based on their rankings and the top ranked quintiles receive a higher weight within the index. The stocks are equally-weighted within each quintile.
  • The index is reconstituted and rebalanced quarterly.
Fund Overview
Fund TypeMaterials
Investment AdvisorFirst Trust Advisors L.P.
Investor Servicing AgentBank of New York Mellon
Fiscal Year-End07/31
ExchangeNYSE Arca
Inception Price$20.00
Inception NAV$20.00
Rebalance FrequencyQuarterly
Gross Expense Ratio*0.64%
Net Expense Ratio*0.64%
* As of 11/30/2018
Expenses are capped contractually at 0.70% per year, at least until November 30, 2019.
Current Fund Data (as of 9/17/2019)
Closing NAV1$37.91
Closing Market Price2$37.89
Bid/Ask Midpoint$37.90
Bid/Ask Discount0.04%
Total Net Assets$125,116,298
Outstanding Shares3,300,002
Daily Volume35,584
Average 30-Day Daily Volume59,049
Closing Market Price 52-Week High/Low$42.80 / $31.50
Closing NAV 52-Week High/Low$42.83 / $31.51
Number of Holdings50
Fund Characteristics (as of 8/30/2019)9
Maximum Market Cap.$101,995
Median Market Cap.$7,515
Minimum Market Cap.$1,581
Price/Cash Flow6.25
Top Holdings (as of 9/17/2019)
Holding Percent
Reliance Steel & Aluminum Co. 4.13%
Crown Holdings, Inc. 3.93%
LyondellBasell Industries N.V. 3.90%
The Scotts Miracle-Gro Company 3.90%
Steel Dynamics, Inc. 3.87%
WestRock Company 3.86%
Nucor Corporation 3.64%
United States Steel Corporation 3.20%
Huntsman Corporation 3.00%
Domtar Corporation 2.99%

Holdings are subject to change.

NAV History (Since Inception)
Past performance is not indicative of future results.
Overall Morningstar RatingTM (as of 8/31/2019)3

Among 113 funds in the Natural Resources category. This fund was rated 3 stars/113 funds (3 years), 4 stars/109 funds (5 years), 4 stars/79 funds (10 years) based on risk adjusted returns.
Distribution Information
Dividend per Share Amt (as of 9/18/2019)4$0.0800
30-Day SEC Yield (as of 8/30/2019)51.95%
Unsubsidized 30-Day SEC Yield (as of 8/30/2019)61.95%
12-Month Distribution Rate (as of 8/30/2019)71.26%
Index Yield (as of 8/30/2019)82.59%
Bid/Ask Midpoint vs. NAV (as of 6/30/2019)
Number of Days Bid/Ask Midpoint Above NAV
Quarter Ended 0-49
Basis Points
Basis Points
Basis Points
Basis Points
6/30/2019 21 0 0 0
3/31/2019 1 0 0 0
12/31/2018 25 4 0 0
9/30/2018 32 0 0 0
Number of Days Bid/Ask Midpoint Below NAV
Quarter Ended 0-49
Basis Points
Basis Points
Basis Points
Basis Points
6/30/2019 42 0 0 0
3/31/2019 60 0 0 0
12/31/2018 32 2 0 0
9/30/2018 31 0 0 0

The price used to calculate market return is determined by using the midpoint between the highest bid and the lowest offer on the stock exchange, on which shares of the Fund are listed for trading, as of the time that the Fund's NAV is calculated.

Top Industry Exposure (as of 9/17/2019)
Chemicals 38.63%
Containers & Packaging 20.50%
Metals & Mining 19.24%
Building Products 5.40%
Machinery 4.46%
Construction Materials 3.06%
Paper & Forest Products 3.00%
Electrical Equipment 2.91%
Trading Companies & Distributors 1.41%
Semiconductors & Semiconductor Equipment 1.39%
Month End Performance (as of 8/30/2019)
  3 Month YTD 1 Year 3 Year 5 Year 10 Year Since
Fund Performance *
Net Asset Value (NAV) 2.99% 6.23% -15.27% 1.96% 2.24% 9.58% 6.15%
After Tax Held 2.91% 6.05% -15.68% 1.46% 1.69% 8.99% 5.61%
After Tax Sold 1.78% 3.69% -9.03% 1.29% 1.47% 7.58% 4.71%
Market Price 2.97% 6.29% -15.31% 1.94% 2.23% 9.57% 6.14%
Index Performance **
StrataQuant® Materials Index 3.25% 6.82% -14.66% 2.69% 2.95% 10.39% 6.93%
Russell 1000® Materials and Processing Index 7.37% 14.66% -3.12% 7.27% 5.04% 10.38% N/A
Russell 1000® Index 6.69% 18.48% 2.49% 12.57% 9.85% 13.49% 7.84%
S&P 500 Materials Index 8.15% 13.52% -2.52% 7.43% 4.39% 9.42% 5.28%
Quarter End Performance (as of 6/28/2019)
  3 Month YTD 1 Year 3 Year 5 Year 10 Year Since
Fund Performance *
Net Asset Value (NAV) 1.76% 15.60% -6.53% 7.37% 3.78% 12.35% 6.98%
After Tax Held 1.68% 15.40% -6.99% 6.85% 3.22% 11.75% 6.43%
After Tax Sold 1.04% 9.23% -3.88% 5.47% 2.65% 10.01% 5.40%
Market Price 1.71% 15.61% -6.63% 7.33% 3.76% 12.35% 6.97%
Index Performance **
StrataQuant® Materials Index 1.99% 16.10% -5.86% 8.13% 4.50% 13.19% 7.77%
Russell 1000® Materials and Processing Index 5.90% 18.86% 3.33% 10.44% 6.01% 12.46% N/A
Russell 1000® Index 4.25% 18.84% 10.02% 14.15% 10.45% 14.77% 7.99%
S&P 500 Materials Index 6.31% 17.26% 3.20% 10.39% 5.44% 11.39% 5.64%
3-Year Statistics (as of 8/30/2019)
  Standard Deviation Alpha Beta Sharpe Ratio Correlation
FXZ 18.56% -6.09 1.23 0.11 0.95
S&P 500 Materials Index 14.36% --- 1.00 0.46 1.00
Standard Deviation is a measure of price variability (risk). Alpha is an indication of how much an investment outperforms or underperforms on a risk-adjusted basis relative to its benchmark.Beta is a measure of price variability relative to the market. Sharpe Ratio is a measure of excess reward per unit of volatility. Correlation is a measure of the similarity of performance.

*Performance data quoted represents past performance. Past performance is not a guarantee of future results and current performance may be higher or lower than performance quoted. Investment returns and principal value will fluctuate and shares when sold or redeemed, may be worth more or less than their original cost.

After Tax Held returns represent return after taxes on distributions. Assumes shares have not been sold. After Tax Sold returns represent the return after taxes on distributions and the sale of fund shares. Returns do not represent the returns you would receive if you traded shares at other times. Market Price returns are based on the midpoint of the bid/ask spread on the stock exchange on which shares of the fund are listed for trading as of the time that the fund’s NAV is calculated. Returns are average annualized total returns, except those for periods of less than one year, which are cumulative. The fund's performance reflects fee waivers and expense reimbursements, absent which performance would have been lower.

After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on the investor’s tax situation and may differ from those shown. The after-tax returns shown are not relevant to investors who hold their fund shares through tax-deferred arrangements such as 401(k) plans or individual retirement accounts.

**Performance information for the StrataQuant® Materials Index is for illustrative purposes only and does not represent actual fund performance.
Indexes do not charge management fees or brokerage expenses, and no such fees or expenses were deducted from the performance shown. Indexes are unmanaged and an investor cannot invest directly in an index.

Russell 1000® Materials and Processing Index - The Index is an unmanaged index which includes the stocks in the materials & processing sector of the Russell 1000® Index.

Russell 1000® Index - The Index is an unmanaged index used to measure the large-cap U.S. equity universe.

S&P 500 Materials Index - The Index is an unmanaged index which includes the stocks in the materials sector of the S&P 500 Index.

1 The NAV represents the fund's net assets (assets less liabilities) divided by the fund's outstanding shares .
2 Fund shares are purchased and sold on an exchange at their market price rather than net asset value (NAV), which may cause the shares to trade at a price greater than NAV (premium) or less than NAV (discount).
The Morningstar RatingTM for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The Morningstar Rating does not include any adjustment for sales loads. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.
4 Most recent distribution paid or declared to today's date. Subject to change in the future. There is no guarantee that the fund will declare dividends.
5 The 30-day SEC yield is calculated by dividing the net investment income per share earned during the most recent 30-day period by the maximum offering price per share on the last day of the period and includes the effects of fee waivers and expense reimbursements, if applicable.
6 The unsubsidized 30-day SEC yield is calculated the same as the 30-day SEC yield, however it excludes contractual fee waivers and expense reimbursements.
7 12-Month Distribution Rate is calculated by dividing the sum of the fund's trailing 12-month ordinary distributions paid or declared by the NAV price. Distribution rates may vary.
8 Index yield represents the weighted average trailing 12-month dividend of the constituents of the StrataQuant® Materials Index.
9 All market capitalization numbers are in USD$ Millions.
10 Inception Date is 5/8/2007

You should consider the fund's investment objectives, risks, and charges and expenses carefully before investing. You can download a prospectus or summary prospectus, or contact First Trust Portfolios L.P. at 1-800-621-1675 to request a prospectus or summary prospectus which contains this and other information about the fund. The prospectus or summary prospectus should be read carefully before investing.

ETF Characteristics

The fund lists and principally trades its shares on the NYSE Arca, Inc.

The fund's return may not match the return of the StrataQuant® Materials Index.  Securities held by the fund will generally not be bought or sold in response to market fluctuations.

Investors buying or selling fund shares on the secondary market may incur customary brokerage commissions. Market prices may differ to some degree from the net asset value of the shares. Investors who sell fund shares may receive less than the share's net asset value. Shares may be sold throughout the day on the exchange through any brokerage account. However, unlike mutual funds, shares may only be redeemed directly from the fund by authorized participants, in very large creation/redemption units. If the fund's authorized participants are unable to proceed with creation/redemption orders and no other authorized participant is able to step forward to create or redeem, fund shares may trade at a discount to the fund's net asset value and possibly face delisting.

Risk Considerations

The fund's shares will change in value, and you could lose money by investing in the fund. One of the principal risks of investing in the fund is market risk. Market risk is the risk that a particular stock owned by the fund, fund shares or stocks in general may fall in value. There can be no assurance that the fund's investment objective will be achieved.

The fund may invest in small capitalization and mid capitalization companies. Such companies may experience greater price volatility than larger, more established companies.

Materials and processing companies are subject to certain risks, including the general state of the economy, consolidation, domestic and international politics and excess capacity. Materials companies may also be significantly affected by volatility of commodity prices, import controls, worldwide competition, liability for environmental damage, depletion of resources and mandated expenditures for safety and pollution control devices.

First Trust Advisors L.P. is the adviser to the fund. First Trust Advisors L.P. is an affiliate of First Trust Portfolios L.P., the fund's distributor.

The StrataQuant® Materials Index is a trademark of ICE Data Indices, LLC or its affiliates ("IDI") and has been licensed for use by First Trust Portfolios L.P. The fund is not sponsored, endorsed, sold or promoted by IDI and IDI makes no representation or warranty regarding the advisability of investing in the fund or as to the result to be obtained by any person from use of the index in connection with the trading of the fund.

Frank Russell Company is the source and owner of the trademarks, service marks and copyrights related to the Russell Indexes. Russell® is a trademark of Frank Russell Company. Frank Russell Company does not promote, sponsor or endorse the content of this communication.

"AlphaDEX®" is a registered trademark of First Trust Portfolios L.P. First Trust Portfolios L.P. has obtained a patent for the AlphaDEX® stock selection methodology from the United States Patent and Trademark Office.

©2019 Morningstar, Inc. All Rights Reserved. The Morningstar RatingTM information contained herein: (1) is proprietary to Morningstar;(2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.

Not FDIC Insured • Not Bank Guaranteed • May Lose Value