At a glance
It has $58.9M in assets, the 5th largest of that group; it paid 1.22% of its price in distributions over the past 12 months, quarterly. Over the past year it returned +3.7% with distributions reinvested (S&P 500: +11.5%), the weakest of those 7 funds. Its ten largest positions make up 12.5% of the fund, out of 100 in all.
The short version
First Trust SMID Capital Strength ETF (FSCS) is an index fund that holds 100 small and mid-sized companies. Nasdaq's SMID Capital Strength Index picks them for large cash reserves, low debt and a return on equity above 15%, and gives each stock an equal weight. Its 0.60% management fee is above the 0.41% average for similar funds. It is also small, with about $59 million in assets as of June 30, 2026.
Price history
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FSCS +3.7% over the year to Oct 27, 2026, total return with distributions reinvested.
How it has behaved
| YTD | 1 yr | 3 yr | 5 yr | 10 yr | Since start | |
|---|---|---|---|---|---|---|
| FSCS official prospectus, to Dec 31, 2025 | — | +1.57% | — | +9.46% | — | +8.71% |
| FSCS price data to Oct 27, 2026 | +4.4% | +3.7% | — | — | — | +7.7% |
- Over the year to Oct 27, 2026, FSCS returned +3.7%, 7th of 7 among similar funds.
- Its worst full calendar year was 2025 (+1.8%); its best was 2025 (+1.8%).
- The deepest fall in its price history was 19.5% (Nov 26, 2024 to Apr 8, 2025), recovered by Jul 28, 2026.
Show as a table
| Year | Price data | Prospectus (official) |
|---|---|---|
| 2026 (to date) | +4.4% | — |
| 2025 | +1.8% | +1.57% |
| 2024 | — | +15.44% |
| 2023 | — | +16.41% |
| 2022 | — | -9.02% |
| 2021 | — | +26.53% |
| 2020 | — | +4.97% |
| 2019 | — | +27.75% |
| 2018 | — | -11.93% |
| 2008 financial crisis stocks fell Oct 9, 2007 – Mar 9, 2009 | Before this security existed |
|---|---|
| 2020 COVID crash stocks fell Feb 19, 2020 – Mar 23, 2020 | Not in the price data, which starts Jun 10, 2024 |
| 2022 bear market stocks fell Jan 3, 2022 – Oct 12, 2022 | Not in the price data, which starts Jun 10, 2024 |
Dividends and income
Show as a table
| Year | Per share | Change |
|---|---|---|
| 2026 (to date) | $0.3500 | |
| 2025 | $0.2600 |
What's inside
As of Jun 30, 2026, the fund held 100 securities; the ten largest made up 12.46% of assets.
| Holding | Weight | |
|---|---|---|
| VALMONT INDUSTRIES INC | 1.39% | |
| A10 NETWORKS INC | 1.35% | |
| WATTS WATER TECHNOLOGIES INC | 1.29% | |
| GRANITE CONSTRUCTION INC | 1.26% | |
| NEUROCRINE BIOSCIENCES INC | 1.26% | |
| CABOT CORP | 1.21% | |
| SIMPSON MANUFACTURING CO INC | 1.18% | |
| ASSURANT INC | 1.17% | |
| HANOVER INSURANCE GROUP INC (THE) | 1.17% | |
| GLOBE LIFE INC | 1.17% | |
| T. ROWE PRICE GROUP INC | 1.17% | |
| TEXAS ROADHOUSE INC | 1.16% | |
| APPLIED INDUSTRIAL TECHNOLOGIES INC | 1.16% | |
| INCYTE CORP | 1.15% | |
| OFG BANCORP | 1.15% |
By country
United States 93.68%Bermuda 2.93%Puerto Rico 2.26%Ireland 0.97%By asset type
Stocks 99.85%What changed recently
- Over the three months to Jun 30, 2026, investors added a net $0.00 (creations minus redemptions, per the N-PORT report).
- Monthly total returns reported for that quarter: +3.18%, -2.97%, +4.71%.
How it works
FSCS tracks The SMID Capital Strength Index, which Nasdaq, Inc. owns and maintains. The fund puts at least 80% of its net assets in the stocks in the index. The starting pool is the members of the Nasdaq US Small Cap and Nasdaq US Mid Cap indexes that meet the index's size and liquidity rules. Only one security per company is allowed.
Each company must pass four tests. It needs at least $100 million in cash or short-term investments, not counting restricted cash. Its long-term debt must be less than 30% of its market value. Its shareholder equity must be positive, meaning its assets exceed its debts. And its return on equity must be above 15%. Return on equity is yearly profit as a share of the money shareholders have in the business. Nasdaq ranks the companies that pass and keeps the top 100. Each one gets the same weight, so no single stock dominates. As of June 30, 2026, the largest holding was Valmont Industries at 1.39%, and the top 10 made up just 12.46%.
The index is rebalanced and rebuilt every quarter. That means selling some winners, topping up laggards and swapping companies in and out. Portfolio turnover was 123%, which is high. The fund can lean heavily toward an industry when the index does. As of June 30, 2026, its biggest exposures were financials and industrials. It uses no leverage, options or derivatives.
What it really costs
In a retirement portfolio
It offers an equal-weighted mix of financially strong small and mid-sized companies, but it is a small fund that has had sharp drops and charges more than many peers.
Alongside a large-cap core fund, FSCS could add exposure to smaller companies with strong balance sheets. It launched in June 2017, so it has no record from the 2008 crisis. During the 2020 COVID crash, it lost 32.34% in the first quarter of 2020, though it finished that year up 4.97%. It lost 9.02% in the 2022 bear market. Its worst calendar year was 2018, when it fell 11.93%. Price records for this fund start in June 2024. Its deepest drop since then was 19.5%, from November 2024 to April 2025, and it took about 15.6 months to recover. Selling shares or drawing cash during a slump like that would lock in losses. The trailing yield was 1.22% as of October 27, 2026, paid quarterly, so this is not an income fund. Past results don't predict the future, and a plan should look at the whole portfolio, not one fund.
Who it may suit — and who should look elsewhere
May suit
- Investors who want small and mid-sized companies screened for cash, low debt and return on equity above 15%, rather than a plain size-weighted index.
- Those who prefer equal weighting: 100 stocks near 1% each, with the top 10 at just 12.46% as of June 30, 2026.
- Holders of a large-cap core fund who want a smaller tilt toward financials and industrials, the fund's main sectors as of June 30, 2026.
Look elsewhere if
- Cost-focused investors: the 0.60% management fee compares with a 0.41% average for similar funds and 0.15% at MIDE and IQSM.
- Anyone who needs steady income: the trailing yield was just 1.22% as of October 27, 2026, paid quarterly.
- Those wary of small funds or weak recent returns: it has about $59 million in assets, and its 3.7% one-year return ranked last of seven similar funds.
Close alternatives
Matched by closest holdings overlap from the latest N-PORT reports (no similar fund shares 20% or more of its holdings).
| Fund | Overlap | Cost | Net assets | 1 yr | 3 yr |
|---|---|---|---|---|---|
| FSCS this fund | — | — | $58.9M | +3.7% | — |
| SDVY First Trust SMID Cap Rising Dividend Achiev… | 31% | 0.59% | $11.35B | +12.2% | +18.5% |
| FSGS First Trust SMID Growth Strength ETF | 23% | 0.6% | $28.5M | +4.5% | — |
| FLQM Franklin U.S. Mid Cap Multifactor Index ETF | 17% | 0.3% | $1.53B | +10.8% | +16.3% |
| AFMC First Trust Active Factor Mid Cap ETF | 15% | 0.65% | $211.5M | +20.0% | +23.3% |
| MIDE Xtrackers S&P MidCap 400 Scored & Screened … | 13% | 0.15% | $3.4M | +14.7% | +18.8% |
| IQSM NYLI Candriam U.S. Mid Cap Equity ETF | 12% | 0.15% | $329.7M | +14.3% | +18.0% |
Questions investors ask
What does FSCS invest in?
FSCS holds 100 small and mid-sized companies from Nasdaq's US Small Cap and Mid Cap indexes. To get in, a company needs at least $100 million in cash, long-term debt below 30% of its market value, positive shareholder equity and a return on equity above 15%. Every stock gets an equal weight. As of June 30, 2026, the largest holdings were Valmont Industries, A10 Networks, Watts Water Technologies and Granite Construction, at about 1.3% to 1.4% each.
What is the FSCS expense ratio?
FSCS's prospectus, filed July 29, 2026, lists a management fee of 0.60% a year. That is above the 0.41% average for similar funds. First Trust's SMID Cap Rising Dividend Achievers ETF (SDVY) charges 0.59%, and the Franklin U.S. Mid Cap Multifactor Index ETF (FLQM) charges 0.30%. MIDE and IQSM charge 0.15% each. Fees come out of the fund's returns every year, so the gap compounds over long holding periods.
Does FSCS pay dividends?
Yes. FSCS pays dividends quarterly. Over the 12 months to October 27, 2026, it paid $0.45 per share, a trailing yield of 1.22%. That is a modest yield. The fund picks companies for financial strength and profitability, not for high payouts, so it is not built to provide income. Payments can change from quarter to quarter as the holdings and their dividends change.
FSCS vs SDVY: what's the difference?
Both are First Trust ETFs that hold small and mid-sized companies. Among similar funds, SDVY's holdings overlap most with FSCS's. FSCS screens for cash, low debt and high return on equity. SDVY, as its name suggests, focuses on companies with rising dividends. SDVY is far bigger, with $11.35 billion in assets versus about $59 million as of June 30, 2026. As of October 27, 2026, SDVY returned 12.2% over one year, compared with 3.7% for FSCS. The fees are nearly the same: 0.59% for SDVY and 0.60% for FSCS.
How has FSCS performed over the long run?
As of December 31, 2025, FSCS returned an average of 9.46% a year over five years and 8.71% a year since it launched in June 2017. The ride was bumpy. It gained 27.75% in 2019 and 26.53% in 2021, but lost 11.93% in 2018 and 9.02% in 2022. It returned just 1.57% in 2025. Its worst quarter was a 32.34% drop in early 2020. Past results don't predict future returns.