What this ETF is trying to do

The FIRST TRUST GERMANY ALPHADEX FUND (Ticker: FGM) is an ETF that focuses on German companies. It holds a variety of stocks from the German market to provide investors with exposure to that region's economy.

What the numbers show

When looking at how this ETF has performed, it is important to look at two different types of returns: price return and total return. Price return only tracks how the share price changes. Total return includes both the price change and any cash distributions paid out to investors.

• Year-to-Date (YTD): The YTD price return is approximately -8.44%. When including distributions, the YTD total return is approximately -6.94%.

• One-Year: The one-year price return is approximately -3.65%, while the one-year total return is approximately -2.01%.

• Three-Year: Over the last three years, the fund has seen significant growth. The three-year price return is approximately 62.02%, and the three-year total return is approximately 72.03%.

• Five-Year: The five-year total return is approximately 20.97%.

Based on an estimated price from roughly one year ago of $59.26, the current price is $57.10.

Income and distribution explanation

This ETF provides some cash income through distributions. The current distribution yield is approximately 1.88%. This number represents the cash distributed relative to the ETF's price.

The fund has an income rating grade of "B." It is important to note that the distribution frequency is described as irregular or less frequent, with 3 payouts recorded over the last 12 months.

NAV erosion explanation

"NAV erosion" refers to a decline in the Net Asset Value (the actual value of the assets held by the fund). While a falling share price can sometimes be a sign of trouble, it is not the same thing as NAV erosion.

The supplied data is sufficient to evaluate price erosion, but it does not include enough historical NAV-per-share data to confirm or rule out NAV erosion. However, the fund has an erosion-risk score of 94, which is labeled as "Stable / sideways," and the erosion severity is rated as "good." There is no severe erosion-risk flag for this ETF.

Top Holdings

The following are the top holdings in the fund (note that this is a partial list):

• THYSSENKRUPP AG (4.57%)

• BAYERISCHE MOTOREN WERKE AG (4.48%)

• PORSCHE AUTOMOBIL HOLDING SE PARTICIPATING PREFERRED (4.41%)

• DELIVERY HERO SE (4.28%)

• AURUBIS AG (3.99%)

• UNITED INTERNET AG (3.94%)

• KION GROUP AG (3.71%)

• VONOVIA SE (3.71%)

• VOLKSWAGEN AG PARTICIPATING PREFERRED (3.67%)

• SCHAEFFLER AG PARTICIPATING PREFERRED (3.57%)

Holdings can change over time.

Pros

• The fund has shown strong total returns over a three-year period.

• The erosion-risk score suggests the price movement has been relatively stable or sideways rather than rapidly declining.

Cons

• The fund has experienced a share-price decline in both the one-year and year-to-date periods.

• The distributions are irregular rather than being paid on a steady, predictable schedule.

Beginner takeaway

FGM provides exposure to German companies. While it has faced some recent share-price declines, its long-term three-year total return has been positive. Investors should remember that a distribution yield shows the cash paid out, but it does not guarantee that the share price will stay stable.