First Trust Active Factor Large Cap ETF

First Trust Active Factor Large Cap ETF (AFLG) is an actively managed fund of about 215 US large-company stocks. A computer-driven model chooses them by scoring traits such as value, momentum, quality and low volatility. Its 0.55% expense ratio is the highest among nine similar funds, which average 0.11%. Even so, about 48% of its holdings overlap with S&P 500 funds such as VOO, and NVIDIA, Apple and Alphabet led its portfolio as of August 31, 2026.

• Over the year to Oct 27, 2026, AFLG returned +14.8%, 3rd of 9 among similar funds.
• Its 5-year annualized return was +12.3%.
• In the 2020 COVID crash it fell 35.8% and regained its old high 5.3 months after the low.
• Its worst full calendar year was 2022 (-16.4%); its best was 2021 (+27.3%).
• The deepest fall in its price history was 35.8% (Feb 14, 2020 to Mar 23, 2020), recovered by Sep 1, 2020.

As of Aug 31, 2026, the fund held 215 securities; the ten largest made up 33.27% of assets.

By sector

• Over the three months to Aug 31, 2026, investors added a net $99.0M (creations minus redemptions, per the N-PORT report).
• Monthly total returns reported for that quarter: -0.78%, +1.38%, +1.48%.

AFLG does not track an index. Managers at First Trust run it actively, keeping at least 80% of net assets in US-listed stocks of large companies. "Large" means at least as big as the smallest company in a widely recognized large-cap index. That cutoff was $2 billion as of November 28, 2025. The fund does not have to sell a stock that later shrinks below that line.

To build the portfolio, the managers use a multi-factor quantitative model. Factors are stock traits that researchers have linked to returns. The model may weigh four of them: value (a low price compared with the company's fundamentals), momentum (stronger recent price gains than the market or peers), quality (strong finances) and low volatility (smaller price swings). The managers can change the factors as market conditions shift or new academic research appears. They also limit how much rides on any single stock, industry or sector.

As of August 31, 2026, the fund held 215 stocks. The top 10 made up 33% of assets, led by NVIDIA (7.9%), Apple (6.3%) and Alphabet (5.7%). It used no derivatives and held 0.24% in cash. The prospectus summary does not set a fixed rebalancing schedule. Its turnover, the share of the portfolio replaced over a year, was 37%.

• AFLG charges 0.55% a year, versus an average of 0.11% for the similar funds below (9th of 9, cheapest first).

It spreads money across about 215 US large-company stocks, though its high fee and changing factor tilts make it worth comparing with cheaper broad index funds.

AFLG could serve as a core US stock holding. It launched in December 2019, so it has no record from the 2008 crisis. In the 2020 COVID crash it fell 35.8% between February 14 and March 23, 2020, then got back to its peak by September 1. In the 2022 bear market it dropped 23% and needed 14.6 months, until December 19, 2023, to recover. 2022 was also its worst calendar year, down 16.3%. Its low-volatility factor did not prevent these losses. Anyone forced to sell shares during such a stretch would lock in lower prices.

Income is small. The yield was 0.71% as of October 27, 2026, paid quarterly. The 0.55% expense ratio is well above the 0.03% charged by VOO and IVV. Past results don't predict future ones, and a plan should look at the whole portfolio, not one fund.

Matched by holdings overlap from the latest N-PORT reports.