No Swiss Miss: Big Investors Feast on Switzerland ETFs

While other European bourses and the related U.S.-listed exchange traded funds have recently been flailing, Switzerland has been flashing its usual steady hand.

The Vanguard FTSE Europe ETF (NYSEArca: VGK) is showing some signs of life after faltering in June and July, gaining about 1.8% over the past month. However, that performance significantly lags the returns offered by theiShares MSCI Switzerland Capped ETF (NYSEArca: EWL) and theFirst Trust Switzerland AlphaDEX Fund (NYSEArca: FSZ) over the same period. [Steady Switzerland ETF Rallies]

Over the past month, EWL, the largest Switzerland ETF, is up 4.2% while FSZ, the alternatively-indexed Switzerland ETF, is higher by 2.8%. Adding to the bull case for these ETFs is this week’s increase in buying activity in the two funds. On Tuesday, EWL and FSZ saw notional buying of $250 and $125 million, respectively, according to one ETF trading desk.

There was follow-through for EWL on Wednesday with the ETF gaining more than half a percent on volume that was nearly double the daily average. However, the increased activity in FSZ is particularly noteworthy because the ETF had just $52.3 million in assets under management as of Sept. 2, according to First Trust data.

Like the other AlphaDEX ETFs from First Trust, FSZ is comprised of stocks that are ranked by a variety of growth and value factors including price appreciation value to price, cash flow to price and return on assets.

FSZ is also the largest holding in the recently launched First Trust Dorsey Wright International Focus 5 ETF (NasdaqGM: IFV), the international answer to the already popular First Trust Dorsey Wright Focus 5 Fund (NasdaqGM: FV). FSZ occupies a weight of nearly 25% in IFV.