Last week’s action saw developed markets outpace their emerging market and US equity counterparts. The First Trust Developed Markets Ex-US AlphaDEX Fund (FDT) rallied more than 2% (5/16 – 5/23), and Tuesday’s trading saw the fund rally above $66, marking a multi-year high and placing the fund within one box of its all-time chart high. This builds on the positive technical developments that occurred early last week with the market RS chart comparing the fund against the S&P 500 Equal Weight Index (SPXEWI) giving an RS buy signal for the first time in the fund’s history. This places the long-term relative strength for the fund favoring FDT over SPXEWI in addition to near-term RS favoring the ETF.

The trend and relative strength chart improvement within the past week has driven the fund score for the ETF to its highest in history at 5.86, outscoring the average score for the fund within the Non-US (4.21) and Global Developed Markets (3.91) groups. Year-to-date, FDT is up over 20% outpacing the MSCI ACWI ex-US ETF (ACWX) by roughly 7%. This week’s action has brought the ETF near-term top of the 10-week trading band and into overbought territory indicating those seeking exposure to the fund are best served by looking for a pullback to the lower $60s before adding exposure. Note that prior resistance at $61 may be seen as near-term support, while additional may be found at the 2024 and 2025 chart lows in the lower $50s.

This weekly overview is designed to be used as a "radar" screen to bring your attention to potentially important technical changes that may require your attention and potential action. When evaluating the Fund Score, the strongest issues have scores of 4 or higher while those ETFs with scores below a 3 are no longer considered solid citizens.

The ETFs with the most relative strength buy signals (suggesting outperformance) versus the others in the group are listed at the top. These ETFs should be overweighted in the portfolio. Those ETFs with the least amount of relative strength buy signals versus the others in the group are listed at the bottom. These ETFs should be underweighted in the portfolio.

The First Trust ETF Portfolios are designed to identify major sector themes in the market place through the use of the Point & Figure relative strength tools. For more information on the portfolio construction and back testing, see the model info file on the models page.  To enter a portfolio amount and see shares to be purchased as well as modify the portfolio to your specifications, click here. (Note: The First Trust ETF Portfolios will be updated Wednesday mornings by 9:30 am EST) 

Weekly Changes:  There were no changes to any of the First Trust Models covered within the report this week.

* - Dates prior to 1/9/2008, which is when the First Trust Sector ETF Model Portfolio became available in the First Trust Weekly ETF Report, are representative of when the position was added to the backtested model.

* - The next evaluation date for the Focus Five Model is Wednesday, June11th, 2025. Dates prior to 10/20/2009, which is when the First Trust Focus Five ETF Model Portfolio became available in the First Trust Weekly ETF Report, are representative of when the position was added to the backtested model.

* - The next evaluation date for the Thematic Focus Five Model is Wednesday, June 11th, 2025. Dates prior to 9/13/2023, which is when the First Trust Thematic Focus Five ETF Model Portfolio became available in the First Trust Weekly ETF Report, are representative of when the position was added to the backtested model.

* - The next evaluation date for the International Focus Five Model is Wednesday, June 4th, 2025. Dates prior to 2/22/2012, which is when the First Trust International Focus Five ETF Model Portfolio became available in the First Trust Weekly ETF Report, are representative of when the position was added to the backtested model.

Am I better off owning the managed mutual fund or the unmanaged ETF? The table below will help you answer that question. For each of the nine major asset classes and sectors, see the Top 20 mutual funds in NAV compared to the First Trust Universe of ETFs. The results are ordered by Fund Score, from highest to lowest. The Fund Score is a snapshot of the overall health of the fund based upon relative strength versus the broad market, relative strength versus its peers, and other trend measures. Those ETFs and Funds with a score above 3 are considered solid citizens with those having scores of 4 and above ideal candidates for purchase. Those ETFs and Funds with a score below 3 should be examined closer from a technical basis as they are not holding their ground versus the market and their peer group.
 

(Click any link above to see the Fund Score of the First Trust ETFs and the funds with the largest Net Assets in that category)