First Trust Active Factor Mid Cap ETF

First Trust Active Factor Mid Cap ETF (AFMC) is an actively managed fund holding about 262 US mid-sized company stocks. A computer-driven model picks them by looking at value, momentum, quality and low volatility. Its 0.68% expense ratio is far above the 0.15% average of similar mid-cap funds. Even so, its 1-year and 3-year returns led that group as of October 27, 2026.

• Over the year to Oct 27, 2026, AFMC returned +20.0%, 1st of 9 among similar funds.
• Its 5-year annualized return was +10.9%.
• In the 2020 COVID crash it fell 42.1% and regained its old high 8.5 months after the low.
• Its worst full calendar year was 2022 (-15.6%); its best was 2021 (+25.8%).
• The deepest fall in its price history was 42.1% (Feb 20, 2020 to Mar 23, 2020), recovered by Dec 8, 2020.

As of Aug 31, 2026, the fund held 262 securities; the ten largest made up 11.76% of assets.

• Over the three months to Aug 31, 2026, investors added a net $44.9M (creations minus redemptions, per the N-PORT report).
• Monthly total returns reported for that quarter: +3.83%, -1.10%, +0.39%.

AFMC does not track an index. First Trust manages it actively. Under normal conditions, at least 80% of its net assets go into US-listed stocks of mid-sized companies. To decide what counts as mid-sized, the fund uses the range of a widely recognized mid-cap index. As of November 28, 2025, that range ran from $482.14 million to $60.6 billion in market value. The fund does not have to sell a stock that later grows or shrinks out of that range.

Stocks are chosen with a quantitative, or rules-based, model built on four factors. Value compares a stock's price with the company's underlying worth. Momentum tracks how its price has done against the market. Quality measures the strength of its finances. Low volatility favors stocks whose prices swing less. The manager can change these factors when markets shift or new research appears. It also limits how much the fund puts into any one sector or stock.

The result is a widely spread portfolio. As of August 31, 2026, the fund held 262 stocks, and the 10 largest made up just 11.76% of assets. The biggest were Reliance (1.48%), BorgWarner (1.24%) and Mueller Industries (1.20%). The fund held no derivatives and 0.2% cash, and 93.5% of assets were in US companies. Portfolio turnover was 52%, meaning about half the holdings changed over the year.

• AFMC charges 0.68% a year, versus an average of 0.15% for the similar funds below (9th of 9, cheapest first).
• Of that, 0.65% is the management fee; the rest covers other fund expenses.

It is a small, actively managed mid-cap fund that costs much more than its peers, so it fits better as a side position next to a cheaper core than as the core itself.

AFMC could add mid-sized US companies to a portfolio built mostly on large-cap stocks. Its record is short. The fund launched in December 2019, so it has no 2008 history. It fell 42.1% in the 2020 COVID crash, from February 20 to March 23, 2020, and recovered by December 8, 2020, about 8.5 months later. In the 2022 bear market it dropped 24.6% and took 14.6 months to recover, until December 14, 2023. Its worst calendar year was 2022, at -15.5%. A retiree who had to sell shares during either drop would have locked in losses. The yield was only 0.71% as of October 27, 2026, paid quarterly, so it does little for income. Its 0.68% expense ratio compares with a 0.15% peer average. Past results don't predict future returns, and a retirement plan should look at the whole portfolio, not one fund.

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