One of the hottest themes in the exchange traded funds space this year has been investors favoring ex-US developed markets in search of value opportunities. In fact, some of the top asset-gathering ETFs this year are funds tracking stocks in developed markets outside the U.S.
More importantly, some of these ETFs are delivering impressive returns. For example, the First Trust Developed Markets ex-US AlphaDEX Fund (NASDAQ: FDT) is up more than 15% year-to-date and hit an all-time high on Monday. As a fundamentally-weighted fund, FDT can be used as an alternative or complement to traditional EAFE strategies, which are usually cap-weighted.
AlphaDEX ETFs are based “on growth factors including three, six and 12-month price appreciation, sales to price and one year sales growth, and, separately, on value factors including book value to price, cash flow to price and return on assets,” according to First Trust.
FDT, which just turned six years old, tracks the NASDAQ AlphaDEX® Developed Markets Ex-US Index.