AFLG Profile
The First Trust Active Factor Large Cap ETF is an actively managed exchange-traded fund (ETF) that seeks to provide investors with exposure to large-cap U.S. equities. Under normal market conditions, the fund allocates at least 80% of its net assets, including any borrowings for investment purposes, to U.S.-listed equity securities of large capitalization companies. These companies are defined as those with a market capitalization that meets or exceeds the minimum threshold of a widely recognized large-cap index at the time of investment. This focus on large-cap stocks is intended to capture the stability and growth potential of established industry leaders.
The fund’s active management approach leverages a factor-based investment strategy, which involves systematically selecting stocks based on specific attributes, such as value, quality, momentum, and volatility. The portfolio managers analyze these factors to identify companies that are likely to outperform their peers, aiming to enhance returns and manage risk more effectively than traditional market-cap-weighted indices. This dynamic strategy allows the fund to adjust its holdings in response to changing market conditions, providing a more tailored investment approach.
In addition to its core focus on large-cap equities, the First Trust Active Factor Large Cap ETF seeks to diversify its portfolio across various sectors and industries. This diversification is designed to reduce concentration risk and provide more balanced exposure to the U.S. equity market. By investing in a broad range of companies, the fund aims to benefit from the growth of multiple sectors, while mitigating the impact of downturns in any single industry.
The First Trust Active Factor Large Cap ETF is suitable for investors looking for a strategic and active approach to large-cap investing. The fund offers the potential for enhanced returns through its factor-based selection process, while still maintaining a core allocation to the stability of large, well-established companies. This makes it an attractive option for those seeking long-term capital appreciation with a focus on large-cap U.S. equities, complemented by the flexibility and responsiveness of an actively managed strategy.
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