FDM - ETF AI Analysis

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First Trust Dow Jones Select MicroCap Index Fund (FDM)

Rating:70Neutral

Price Target:―

FDM, the First Trust Dow Jones Select MicroCap Index Fund, has a solid overall rating driven by strong contributors like GigaCloud Technology, whose robust financial performance, strategic acquisitions, and attractive valuation support the fund’s quality. Other positive holdings such as Tetra Technologies and Central Pacific Financial add to this strength with solid profitability and growth, though some positions like Horizon Bancorp and Ameresco, which face weaker financial performance and higher leverage, may hold the rating back. The main risk factor is the fund’s focus on smaller micro-cap names, where issues like high leverage, cash flow volatility, and overbought technical conditions can make returns more volatile.

Positive Factors

Strong Recent Performance

The ETF has shown solid gains over the past three months and year-to-date, indicating positive recent momentum in its micro-cap holdings.

Leading Holdings Showing Strength

Several of the top positions, such as Tetra Technologies, American Axle, and Sun Country Airlines, have delivered strong year-to-date performance, helping support the fund’s returns.

Broad Sector Diversification

The fund spreads its investments across many sectors, including financials, industrials, consumer cyclical, technology, and others, which helps reduce the impact of weakness in any single industry.

Negative Factors

High Fee Level

The expense ratio is relatively high for an ETF, which means more of the fund’s returns are eaten up by costs over time.

Heavy Tilt to Financials

A large share of the portfolio is invested in financial companies, so a downturn in that sector could hurt the fund more than a more balanced ETF.

Very Concentrated in the U.S. Market

With nearly all assets in U.S. stocks, the fund offers little geographic diversification and is highly exposed to movements in the U.S. economy and markets.

FDM vs. SPDR S&P 500 ETF (SPY)

AUM235.57M

RegionNorth America

Expense Ratio0.60%

Beta0.96

IssuerFirst Trust

Inception DateSep 27, 2005

Dividend Yield1.3%

Asset ClassEquity

Index TrackedDJ Select Micro-Cap

Share Statistics

EPS (TTM)N/A

Shares OutstandingN/A

10 Day Avg. Volume12,770

30 Day Avg. Volume8,610

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)N/A

P/FCF RatioN/A

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

97.43

Price Target Upside― Downside

Rating ConsensusModerate Buy

Number of Analyst Covering150

EPS Forecast (FY)N/A

Revenue Forecast (FY)N/A

FDM Summary

FDM is an ETF that follows the Dow Jones Select Micro-Cap Index, focusing on very small U.S. companies that are early in their growth journey. It holds a wide mix of sectors, with a lot in financial and industrial firms, and includes lesser-known but real businesses like Deluxe and Sun Country Airlines. Someone might invest in FDM to seek higher growth potential and diversify beyond large, well-known stocks. However, micro-cap stocks can be very volatile, harder to trade, and the fund’s value can go up and down more sharply than the overall market.

How much will it cost me?The expense ratio for the First Trust Dow Jones Select MicroCap Index Fund (FDM) is 0.6%, which means you’ll pay $6 per year for every $1,000 invested. This is higher than average because the fund is actively managed and focuses on micro-cap stocks, which require more research and management compared to passive funds tracking larger companies.

What would affect this ETF?The First Trust Dow Jones Select MicroCap Index Fund (FDM) could benefit from economic growth and innovation in the U.S., particularly in sectors like financials and technology, which make up a significant portion of its holdings. However, micro-cap stocks are highly sensitive to market volatility, interest rate hikes, and economic downturns, which could negatively impact the fund's performance. Additionally, regulatory changes or challenges in key sectors like healthcare and energy may pose risks to its future growth.

FDM Top 10 Holdings

FDM is a U.S.-only micro-cap fund where a handful of fast-moving names set the tone. Energy player Tetra Technologies has been rising sharply, acting as a key engine for recent gains, while Sun Country Airlines and American Axle add more lift with solid, improving trends. On the flip side, biotech Stoke Therapeutics has been lagging, quietly tugging on performance, and Ameresco’s mixed, recently weaker momentum isn’t helping. With a heavy tilt toward financials and industrials, the fund leans into cyclical, economically sensitive corners of the micro-cap market.

Name	Company Name	Weight %	Market Value	Market Cap	Yearly Gain	Overall Rating
DCH	Dauch Corporation	2.70%	$6.36M	$1.01B	75.56%	64 Neutral
STOK	Stoke Therapeutics	2.21%	$5.21M	$1.83B	209.98%	70 Outperform
TTI	Tetra Technologies	2.12%	$5.00M	$1.58B	164.35%	77 Outperform
GOLD	Gold.com	1.70%	$4.01M	$1.62B	123.25%	71 Outperform
DLX	Deluxe	1.64%	$3.87M	$1.22B	46.12%	72 Outperform
SNCY	Sun Country Airlines Holdings	1.54%	$3.62M	$1.16B	26.77%	74 Outperform
GCT	GigaCloud Technology, Inc. Class A	1.37%	$3.22M	$1.46B	92.52%	82 Outperform
AMRC	Ameresco	1.33%	$3.14M	$1.71B	62.37%	61 Neutral
HBNC	Horizon Bancorp	1.29%	$3.03M	$956.74M	5.18%	58 Neutral
PLOW	Douglas Dynamics	1.25%	$2.95M	$932.00M	56.78%	68 Neutral

FDM Technical Analysis

Technical Analysis Sentiment

Positive

Last Price―

Price Trends

50DMA

81.80

Positive

100DMA

78.25

Positive

200DMA

73.91

Positive

Market Momentum

MACD

1.49

Negative

RSI

65.46

Neutral

STOCH

80.92

Negative

Evaluating momentum and price trends is crucial in ETF analysis to make informed investment decisions. For FDM, the sentiment is Positive. The current price of undefined is equal to the 20-day moving average (MA) of 84.13, equal to the 50-day MA of 81.80, and equal to the 200-day MA of 73.91, indicating a bullish trend. The MACD of 1.49 indicates Negative momentum. The RSI at 65.46 is Neutral, neither overbought nor oversold. The STOCH value of 80.92 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FDM.

FDM Peer Comparison

Comparison Results

Name	Price	Price Target	AUM	Expense Ratio	Overall Rating
FDM	―	―	$235.57M	0.60%	―
VOTE	―	―	$958.18M	0.05%	―
OUSM	―	―	$937.97M	0.48%	―
SYLD	―	―	$917.69M	0.59%	―
GSSC	―	―	$906.71M	0.20%	―
QQQJ	―	―	$896.89M	0.15%	―

Performance Comparison

FDM

First Trust Dow Jones Select MicroCap Index Fund

87.33

17.42

24.92%

VOTE

Engine No. 1 Transform 500 ETF

―

OUSM

OShares U.S. Small-Cap Quality Dividend ETF

―

SYLD

Cambria Shareholder Yield ETF

―

GSSC

Goldman Sachs Activebeta U.S. Small Cap Equity ETF

―

QQQJ

Invesco NASDAQ Next Gen 100 ETF

―

Glossary

BuyAn ETF rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the ETF is likely to deliver higher returns compared to other ETFs in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldAn ETF rated as a "Hold" s expected to perform in line with the overall market or a specific benchmark. This rating indicates that the ETF is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellAn ETF rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the ETF may deliver lower returns compared to other ETFs in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst ETF Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in ETFs carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: ―

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