Is First Trust SMID Cap Rising Dividend Achievers ETF (SDVY) a Strong ETF Right Now?

Launched on 11/01/2017, the First Trust SMID Cap Rising Dividend Achievers ETF (SDVY) is a smart beta exchange traded fund offering broad exposure to the Style Box - Mid Cap Value category of the market.What Are Smart Beta ETFs?Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.Fund Sponsor & IndexThe fund is managed by First Trust Advisors, and has been able to amass over $11.27 billion, which makes it one of the largest ETFs in the Style Box - Mid Cap Value. Before fees and expenses, SDVY seeks to match the performance of the NASDAQ US Small Mid Cap Rising Dividend Achievers Index.The NASDAQ US Small Mid Cap Rising Dividend Achievers Index is composed of the securities of 100 small and mid-cap companies with a history of raising their dividends and exhibit the characteristics to continue to do so in the future.Cost & Other ExpensesWhen considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.With one of the most expensive products in the space, this ETF has annual operating expenses of 0.58%.The fund has a 12-month trailing dividend yield of 1.36%.Sector Exposure and Top HoldingsWhile ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.For SDVY, it has heaviest allocation in the Financials sector --about 34.4% of the portfolio --while Industrials and Consumer Discretionary round out the top three.Taking into account individual holdings, Comfort Systems Usa, Inc. (FIX) accounts for about 1.54% of the fund's total assets, followed by Enersys (ENS) and Clear Secure, Inc. (class A) (YOU).SDVY's top 10 holdings account for about 12.01% of its total assets under management.Performance and RiskYear-to-date, the First Trust SMID Cap Rising Dividend Achievers ETF has added roughly 12.76% so far, and it's up approximately 25.16% over the last 12 months (as of 06/26/2026). SDVY has traded between $35.28 $43.02 in this past 52-week period. The ETF has a beta of 1.01 and standard deviation of 18.71% for the trailing three-year period. With about 168 holdings, it effectively diversifies company-specific risk .AlternativesFirst Trust SMID Cap Rising Dividend Achievers ETF is a reasonable option for investors seeking to outperform the Style Box - Mid Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.iShares Russell Mid-Cap Value ETF (IWS) tracks Russell MidCap Value Index and the Vanguard Mid-Cap Value Index Fund ETF Shares (VOE) tracks CRSP U.S. Mid Cap Value Index. iShares Russell Mid-Cap Value ETF has $15.76 billion in assets, Vanguard Mid-Cap Value Index Fund ETF Shares has $23.17 billion. IWS has an expense ratio of 0.23% and VOE changes 0.05%.Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Mid Cap ValueBottom LineTo learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.Boost Your Portfolio with Our Top ETF InsightsZacks' exclusive Fund Newsletter delivers actionable information, top news and analysis, as well as top-performing ETFs, straight to your inbox every week.Don’t miss out on this valuable resource. It’s free!Get it now >>This article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks