Should You Invest in the First Trust Consumer Staples AlphaDEX ETF (FXG)?

Looking for broad exposure to the Consumer Staples - Broad segment of the equity market? You should consider the First Trust Consumer Staples AlphaDEX ETF (FXG), a passively managed exchange traded fund launched on 05/08/2007.An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Consumer Staples - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 13, placing it in bottom 19%.Index DetailsThe fund is sponsored by First Trust Advisors. It has amassed assets over $407.79 million, making it one of the average sized ETFs attempting to match the performance of the Consumer Staples - Broad segment of the equity market. FXG seeks to match the performance of the StrataQuant Consumer Staples Index before fees and expenses.The StrataQuant Consumer Staples 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.CostsInvestors 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.Annual operating expenses for this ETF are 0.63%, making it the most expensive product in the space.It has a 12-month trailing dividend yield of 1.60%.Sector Exposure and Top HoldingsETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.This ETF has heaviest allocation in the Consumer Staples sector--about 90.10% of the portfolio.Looking at individual holdings, Pilgrim's Pride Corporation (PPC) accounts for about 4.91% of total assets, followed by Molson Coors Beverage Company (TAP) and Freshpet, Inc. (FRPT).The top 10 holdings account for about 39.60% of total assets under management.Performance and RiskSo far this year, FXG return is roughly 7.07%, and is up about 16.83% in the last one year (as of 10/28/2024). During this past 52-week period, the fund has traded between $58 and $69.07.The ETF has a beta of 0.66 and standard deviation of 13.48% for the trailing three-year period, making it a medium risk choice in the space. With about 41 holdings, it has more concentrated exposure than peers.AlternativesFirst Trust Consumer Staples 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, FXG is a good option for those seeking exposure to the Consumer Staples ETFs area of the market. Investors might also want to consider some other ETF options in the space.Vanguard Consumer Staples ETF (VDC) tracks MSCI US Investable Market Consumer Staples 25/50 Index and the Consumer Staples Select Sector SPDR ETF (XLP) tracks Consumer Staples Select Sector Index. Vanguard Consumer Staples ETF has $7.11 billion in assets, Consumer Staples Select Sector SPDR ETF has $16.94 billion. VDC has an expense ratio of 0.10% and XLP charges 0.09%.Bottom LineTo 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 key ETF info delivered straight to your inbox?Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.Get it free >>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 Consumer Staples AlphaDEX ETF (FXG): ETF Research Reports Molson Coors Beverage Company (TAP): Free Stock Analysis Report Freshpet, Inc. (FRPT): Free Stock Analysis Report Pilgrim's Pride Corporation (PPC): Free Stock Analysis Report Consumer Staples Select Sector SPDR ETF (XLP): ETF Research Reports Vanguard Consumer Staples ETF (VDC): ETF Research ReportsTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks