Understanding the First Trust International Developed Capital Strength ETF (FICS)

The First Trust International Developed Capital Strength ETF (ticker: FICS) is an exchange-traded fund designed to invest in developed international markets. It focuses on companies that show specific capital strength characteristics.

What this ETF is trying to do

FICS seeks to provide exposure to international companies located in developed countries. Based on its top holdings, the fund includes a variety of global names such as Aristocrat Leisure Ltd, DBS Group Holdings Ltd, and Great-West Lifeco Inc. Because the holdings list provided is partial, these represent only some of the 56 total holdings in the fund. Please note that holdings can change over time.

What the numbers show

When looking at how this ETF has performed, it is important to distinguish between price return (the change in the share price) and total return (which includes distributions).

• Year-to-Date (YTD): The price return is approximately -0.47%, while the total return is approximately 1.38%.

• One-Year: The price return was approximately 3.40%, and the total return was approximately 5.41%.

• Three-Year: The price return was approximately 32.86%, while the total return was approximately 40.90%.

• Five-Year: The five-year total return was approximately 29.12%.

An estimated price from roughly one year ago was $38.61, compared to the current price of $39.92.

Income and distribution explanation

FICS provides cash distributions to investors. The current distribution yield is approximately 1.95%. This means the fund paid out about $0.78 per share in trailing distributions. The distribution frequency is usually quarterly, with 4 payments made over the last 12 months.

It is important to remember that a distribution yield tells you how much cash was paid out relative to the price, but it is not the same as your total return.

NAV erosion explanation

"NAV erosion" refers to a decline in the Net Asset Value (the actual value of the fund's underlying assets). 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" with a "good" severity rating. There is no severe erosion-risk flag for this ETF.

Pros

• Positive Total Returns: In all measured timeframes (YTD, 1-year, 3-year, and 5-year), the total return has been positive.

• Stable Risk Profile: The erosion-risk score suggests the price trend has been relatively stable.

• Income Generation: The fund provides regular quarterly distributions.

Cons

• Price Fluctuations: The year-to-date price return has been slightly negative (-0.47%), even though the total return remained positive.

• Partial Data: The provided list of holdings is only a partial view of the full portfolio.

Beginner takeaway

FICS is an international ETF that offers both share-price movement and cash distributions. When researching this fund, remember to look at the total return to see how much you would have earned including those distributions, rather than just looking at the share price. While the price has seen small dips recently, the overall historical total returns have been positive.