First Trust Europe AlphaDEX Fund

First Trust Europe AlphaDEX Fund (FEP) is an exchange-traded fund that tracks the Nasdaq AlphaDEX Europe Index. The index holds about 200 larger companies from developed European countries, picked and weighted by growth and value scores rather than by company size. FEP shares no more than about 20% of its holdings with any similar Europe fund. Its 0.80% expense ratio is far above rivals such as Vanguard FTSE Europe ETF (VGK), at 0.06%.

• Over the year to Oct 27, 2026, FEP returned +12.7%, 1st of 7 among similar funds.
• Its 5-year annualized return was +9.0% and its 10-year +10.4%.
• In the 2020 COVID crash it fell 42.7% and regained its old high 8.6 months after the low.
• Its worst full calendar year was 2022 (-23.0%); its best was 2025 (+55.7%).
• The deepest fall in its price history was 46% (Jan 26, 2018 to Mar 18, 2020), recovered by Jan 6, 2021.

As of Jun 30, 2026, the fund held 203 securities; the ten largest made up 14.31% of assets.

• Over the three months to Jun 30, 2026, investors withdrew a net $3.0M (creations minus redemptions, per the N-PORT report).
• Monthly total returns reported for that quarter: +6.59%, +2.32%, -3.12%.

First Trust Europe AlphaDEX Fund (FEP) normally invests at least 90% of its net assets in the stocks of the Nasdaq AlphaDEX Europe Index, which Nasdaq, Inc. owns and maintains. Most indexes weight companies by market value. This index screens and scores stocks instead, aiming for "alpha," meaning better risk-adjusted returns than a traditional index.

The index starts with the Nasdaq Developed Markets Europe Index, which covers countries such as the United Kingdom, Germany and France. Nasdaq removes duplicate share classes and thinly traded stocks. It also generally removes the smaller half of companies by market value, which meant those at or below $4.45 billion as of March 31, 2026. It ranks the remaining stocks on growth and value measures and keeps the top 200. These are split into five tiers, and higher-scoring tiers get more weight. Each industry and country is capped at 15% above its share of the base index.

Nasdaq rebalances the index and resets its membership twice a year, and the fund trades to match shortly after. Portfolio turnover, the share of holdings replaced in a year, was 92%, which adds trading costs. Many holdings are priced in euros, pounds and other currencies, so a stronger dollar can hurt returns. The fund uses no leverage or options. As of June 30, 2026, its largest stock holding, Italy's Prysmian, was about 1.2% of assets.

• FEP charges 0.8% a year, versus an average of 0.24% for the similar funds below (7th of 7, cheapest first).

FEP adds a high-cost, factor-driven tilt toward European stocks that has seen deep drops, so it fits better as a small addition than as a foundation.

FEP could add European companies that broad Europe funds tend to hold in smaller amounts. It paid a 3.11% trailing yield, in quarterly payments, as of October 27, 2026. The ride has been rough. In the 2020 COVID crash it fell 42.7% in about a month, then recovered by December 2020, about 8.6 months later. In the 2022 bear market it fell 38.2% and took about 24 months, until September 2024, to get back. Its worst calendar year was 2022, at -22.87%, and its deepest drop was 46%. The fund launched in 2011, so it has no 2008 record. Someone forced to sell shares in a slump like these would lock in losses. FEP's 0.80% expense ratio is well above the 0.24% average of similar funds. Past results don't predict the future, and a plan should look at the whole portfolio, not one fund.

Matched by closest holdings overlap from the latest N-PORT reports (no similar fund shares 20% or more of its holdings).