Explore whether the First Trust Small Cap Growth AlphaDEX ETF (FYC) should be on your investment radar
Chicago: If you’re looking to dive into small cap growth stocks, the First Trust Small Cap Growth AlphaDEX ETF (FYC) might catch your eye. Launched in 2011, this ETF aims to give you broad exposure to the small cap growth segment of the U.S. market.
Managed by First Trust Advisors, FYC has gathered over $480 million in assets, making it a solid player in the ETF space. Small cap companies, which have market caps under $2 billion, often show high growth potential, but they can be riskier than larger firms.
Growth stocks typically grow faster than the market, but they also come with higher volatility. While they can shine in bull markets, value stocks often outperform them over the long haul.
When it comes to costs, FYC has an expense ratio of 0.71%, which is on the higher side for ETFs. It also offers a 12-month trailing dividend yield of 0.71%.
This ETF is heavily invested in the healthcare sector, making up about 20.60% of its portfolio. Other significant sectors include industrials and financials. Notable holdings include Rocket Lab USA, Brinker International, and InterDigital.
FYC aims to match the performance of the Nasdaq AlphaDEX Small Cap Growth Index. So far this year, it’s up about 1.56% and has seen a 32.67% increase over the past year. It has a beta of 1.21, indicating higher risk, but it diversifies well with around 265 holdings.
With a Zacks ETF Rank of 3 (Hold), FYC is a decent option for those interested in small cap growth. If you’re exploring alternatives, consider the iShares Russell 2000 Growth ETF or the Vanguard Small-Cap Growth ETF, which have lower expense ratios.
In summary, FYC is a solid choice for long-term investors looking for exposure to small cap growth stocks. If you want to learn more about ETFs, check out Zacks ETF Center for the latest insights.
