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Is First Trust Capital Strength ETF (FTCS) a Strong ETF Right Now?
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The First Trust Capital Strength ETF (FTCS - Free Report) made its debut on 07/06/2006, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
The fund is sponsored by First Trust Advisors. It has amassed assets over $7.70 billion, making it one of the largest ETFs in the Style Box - Large Cap Blend. Before fees and expenses, this particular fund seeks to match the performance of the The Capital Strength Index.
The Capital Strength Index is an equal-dollar weighted index which provides exposure to well-capitalized companies with strong market positions based on strong balance sheets, high degree of liquidity, ability to generate earnings growth & record financial strength & profit growth.
Cost & Other Expenses
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 0.54% for this ETF, which makes it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.42%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
For FTCS, it has heaviest allocation in the Financials sector --about 22.90% of the portfolio --while Industrials and Consumer Staples round out the top three.
Looking at individual holdings, Ecolab Inc. (ECL - Free Report) accounts for about 2.23% of total assets, followed by Johnson & Johnson (JNJ - Free Report) and Monster Beverage Corporation (MNST - Free Report) .
Its top 10 holdings account for approximately 21.83% of FTCS's total assets under management.
Performance and Risk
The ETF has lost about -6.84% so far this year and is down about -1.53% in the last one year (as of 04/09/2025). In the past 52-week period, it has traded between $81.48 and $94.03.
The fund has a beta of 0.83 and standard deviation of 13.40% for the trailing three-year period, which makes FTCS a medium risk choice in this particular space. With about 51 holdings, it effectively diversifies company-specific risk.
Alternatives
First Trust Capital Strength ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core S&P 500 ETF (IVV - Free Report) tracks S&P 500 Index and the Vanguard S&P 500 ETF (VOO - Free Report) tracks S&P 500 Index. IShares Core S&P 500 ETF has $511.37 billion in assets, Vanguard S&P 500 ETF has $518.53 billion. IVV has an expense ratio of 0.03% and VOO charges 0.03%.
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 Blend.
Bottom Line
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.
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Is First Trust Capital Strength ETF (FTCS) a Strong ETF Right Now?
The First Trust Capital Strength ETF (FTCS - Free Report) made its debut on 07/06/2006, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
The fund is sponsored by First Trust Advisors. It has amassed assets over $7.70 billion, making it one of the largest ETFs in the Style Box - Large Cap Blend. Before fees and expenses, this particular fund seeks to match the performance of the The Capital Strength Index.
The Capital Strength Index is an equal-dollar weighted index which provides exposure to well-capitalized companies with strong market positions based on strong balance sheets, high degree of liquidity, ability to generate earnings growth & record financial strength & profit growth.
Cost & Other Expenses
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 0.54% for this ETF, which makes it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.42%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
For FTCS, it has heaviest allocation in the Financials sector --about 22.90% of the portfolio --while Industrials and Consumer Staples round out the top three.
Looking at individual holdings, Ecolab Inc. (ECL - Free Report) accounts for about 2.23% of total assets, followed by Johnson & Johnson (JNJ - Free Report) and Monster Beverage Corporation (MNST - Free Report) .
Its top 10 holdings account for approximately 21.83% of FTCS's total assets under management.
Performance and Risk
The ETF has lost about -6.84% so far this year and is down about -1.53% in the last one year (as of 04/09/2025). In the past 52-week period, it has traded between $81.48 and $94.03.
The fund has a beta of 0.83 and standard deviation of 13.40% for the trailing three-year period, which makes FTCS a medium risk choice in this particular space. With about 51 holdings, it effectively diversifies company-specific risk.
Alternatives
First Trust Capital Strength ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core S&P 500 ETF (IVV - Free Report) tracks S&P 500 Index and the Vanguard S&P 500 ETF (VOO - Free Report) tracks S&P 500 Index. IShares Core S&P 500 ETF has $511.37 billion in assets, Vanguard S&P 500 ETF has $518.53 billion. IVV has an expense ratio of 0.03% and VOO charges 0.03%.
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 Blend.
Bottom Line
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.