ETF Evaluator: First Trust Multi Cap Val AlphaDEX® ETF () Follow This ETF

First Trust Multi Cap Val AlphaDEX® ETF Overview

First Trust Multi Cap Val AlphaDEX® ETF (FAB) is a passively managed U.S. Equity Mid-Cap Value exchange-traded fund (ETF). First Trust launched the ETF in 2007.

The investment seeks investment results that correspond generally to the price and yield (before the fund's fees and expenses) of the Nasdaq AlphaDEX® Multi Cap Value Index. The fund will normally invest at least 90% of its net assets (including investment borrowings) in the securities that comprise the index. The index is designed to select value stocks from the NASDAQ US 500 Large Cap Index TM, NASDAQ US 600 Mid Cap Index TM and NASDAQ US 700 Small Cap Index TM that may generate positive alpha, or risk-adjusted returns, relative to traditional indices through the use of the AlphaDEX® selection methodology.

About First Trust Multi Cap Val AlphaDEX® ETF (FAB)

There are 7 members of the management team with an average tenure of 16.02 years: Daniel Lindquist (2007), Jon Erickson (2007), David McGarel (2007), Stan Ueland (2007), Chris Peterson (2016), Erik Russo (2020) and Roger Testin (2007). Management tenure is more important for actively managed ETFs than passive index ETFs.

The ETF has 2 primary benchmarks: Russell 3000 TR USD index with a weighting of 100% and NASDAQ AlphaDEX(R) Multi-C Value TR USD index with a weighting of 100%. First Trust Multi Cap Val AlphaDEX® ETF has 677 securities in its portfolio. The top 10 holdings constitute 5.2% of the ETF’s assets. The ETF meets the SEC requirement of being classified as a diversified fund. The ETF is not considered to have an ESG focus with its investment selection and management.

First Trust Multi Cap Val AlphaDEX® ETF is part of the Equity global asset class and is within the U.S. Equity ETF group. First Trust Multi Cap Val AlphaDEX® ETF has 1.8% of its portfolio invested in foreign issues. The overall assets allocated to domestic stock is 98.2% There is 1.8% allocated to foreign stock, and 0.0% is allocated to preferred stocks. The bond allocation as a percentage of total assets is 0.0% (0.0% domestic bond, 0.0% foreign bond and 0.0% convertible bond). First Trust Multi Cap Val AlphaDEX® ETF has 0.1% of the portfolio in cash.

Assets Under Management

The fund has $168 million in total assets, which is below the $2 billion average for the Mid-Cap Value category. Normally, lower assets under management translates to higher average expense ratios, and greater total assets are desired. However, for some investment categories, such as small-cap investing, it may be difficult for the manager to fully employ the desired active strategy if assets grow too large or too quickly.

FAB Performance and Fees

The expense ratio measures how much of a fund’s assets are used for administrative expenses and operating expenses, including adviser fees and fees for the transfer agent and custodial services. The First Trust Multi Cap Val AlphaDEX® ETF expense ratio is above average compared to funds in the Mid-Cap Value category. First Trust Multi Cap Val AlphaDEX® ETF has an expense ratio of 0.66%, which is 41% higher than its category average, making the fund expense ratio grade a F. While it is difficult to predict returns, it is known that high annual expense ratios reduce your rate of return, and excessive fees are difficult to overcome. Active management normally comes with higher expense ratios than passive index management. Certain investment categories such as small company and foreign also normally have higher expense ratios. It is best to compare fund expense ratios against the category averages for meaningful assessments.

High portfolio turnover can translate to higher expenses and lower aftertax returns. First Trust Multi Cap Val AlphaDEX® ETF has a portfolio turnover rate of 86%, which indicates that it holds its assets around / 0.0 years. By way of comparison, the average portfolio turnover is 72% for the Mid-Cap Value category.

Recently, in the month of July 2026, First Trust Multi Cap Val AlphaDEX® ETF returned 3.8%, which earned it a grade of C, as the Mid-Cap Value category had an average return of 3.5%. The letter grades of A, B, C, D and F are based upon relative rankings within the investment category. A grade of A, for example, would indicate that the return is in the highest 20% for that time period compared to all ETFs in that category.

First Trust Multi Cap Val AlphaDEX® ETF has a trailing yield of 1.52%, which is below the 2.05% category average. The fund normally distributes its income quarterly and its capital gains annually.

It’s natural to seek the best-performing investments, but you must consider the relationship between risk and return and the impact of costs and taxes on your realized returns.

First Trust Multi Cap Val AlphaDEX® ETF Grades

Year to date, the ETF has returned 19.0%, 3.6 percentage points better than the category, which translates into a grade of A. The fund has returned 30.2% over the past year (grade of A), 13.7% over the past three years (grade of C) and 10.2% per year over the past five years (grade of C) and 10.8% per year over the past 10 years (grade of C).

For more ETF grades, analysis and screening tools to help your investment discovery, join AAII for a $2, full-access trial. Learn more here: https://invest.aaii.com/membership.

Otherwise, for more information about First Trust Multi Cap Val AlphaDEX® ETF, including its riskiness, submit your email to unlock the rest of the article.