In the fourth quarter, as well as in the back-half of 2025, U.S. equity indices have been led by the Russell 2000 Index (RUT), which has gained over 4% in Q4 (thru 12/23) and 16% since June 30^th, 2025. Price action on December 11^th brought about a new all-time high for the small cap index, joining the Dow Jones Industrial Average (.DJIA) to improve upon October’s chart highs.

Alongside RUT breaking out to all-time highs, the First Trust Active Factor Small Cap ETF (AFSM) returned to a buy signal and achieved an all-time high. On the default trend chart, AFSM has maintained a positive trend since July and positive near-term market relative strength since September. This brings the small cap ETF’s fund score to above 4, which is higher than the average score for a fund within the small cap (3.89) group on the Asset Class Group Scores page.

Okay to consider AFSM here on the breakout or on a pullback to $32.50 on the point and figure trend chart. The current bullish price objective is $40.50 following the recent breakout, and the reward to risk ratio is just above the acceptable 2 to 1 threshold. Initial support can be found at $31, while the bullish support line resides at $27.50.

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, January 7th, 2026. 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, January 7th, 2026. 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, December 31st, 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)