First Trust Utilities AlphaDEX Fund

First Trust Utilities AlphaDEX Fund (FXU) is an ETF that tracks the StrataQuant Utilities Index. The index picks about 40 utility stocks from the Russell 1000 by their growth and value scores, not by company size. Because of that, mid-sized names like National Fuel Gas and UGI rank above giants like Duke Energy. The trade-off is cost: FXU charges 0.61% a year, while the largest utility index funds charge 0.08% to 0.09%.

• Over the year to Oct 27, 2026, FXU returned +4.1%, 2nd of 9 among similar funds.
• Its 5-year annualized return was +11.9% and its 10-year +9.2%.
• In the 2020 COVID crash it fell 34.7% and regained its old high 12.7 months after the low.
• Its worst full calendar year was 2008 (-28.8%); its best was 2014 (+25.5%).
• The deepest fall in its price history was 49% (May 22, 2007 to Mar 9, 2009), recovered by May 10, 2011.

As of Jul 31, 2026, the fund held 41 securities; the ten largest made up 41.18% of assets.

By sector

• Over the three months to Jul 31, 2026, investors withdrew a net $42.5M (creations minus redemptions, per the N-PORT report).
• Monthly total returns reported for that quarter: -3.70%, +3.52%, -1.82%.

FXU is an index fund. It normally puts at least 90% of its net assets into the stocks of the StrataQuant Utilities Index, which ICE Data Indices builds and owns. The index starts with stocks in the Russell 1000, roughly the 1,000 largest US companies, that pass share class and liquidity screens. It scores each stock on growth and value factors. This method is called AlphaDEX. It aims to find stocks that may beat traditional indexes on a risk-adjusted basis, which investors call "alpha."

Within the utilities sector, the index keeps the top 75% of stocks by score, or 40 stocks, whichever is greater. It doesn't size companies by market value. Instead, it splits them into five groups by score and gives the higher-scoring groups more weight. As of October 31, 2025, the index held 40 stocks worth $3.7 billion to $169.52 billion each. As of July 31, 2026, the largest holdings were National Fuel Gas (4.5%), UGI (4.4%) and PG&E (4.4%). The top 10 made up about 41% of the fund.

The index is reconstituted and rebalanced every quarter, and the fund follows shortly after. The prospectus reports portfolio turnover of 68%. That trading has costs that aren't included in the expense ratio. The fund holds stocks directly and uses no derivatives or leverage. The index provider can also add, drop or replace stocks at its own discretion.

• FXU charges 0.61% a year, versus an average of 0.39% for the similar funds below (8th of 9, cheapest first).
• Of that, 0.5% is the management fee; the rest covers other fund expenses.

It concentrates in one sector that has sometimes moved differently from the broad market, but its deep losses in 2008 and 2020 show it is no crisis shield.

FXU could add a utilities tilt and quarterly income, with a different mix of names than market-value-weighted utility funds hold. Its record in downturns is mixed. In the 2008 financial crisis it fell 47.3% and took about 25 months to recover. It lost 34.7% in the 2020 COVID crash and recovered in about 13 months. It held up better in 2022, losing 7.9% while the broad market fell. It later dropped 17.8%, though, and needed about 19 months to recover. Its worst calendar year was 2008, at -28.8%. Selling shares or drawing income in years like those could lock in losses. The trailing yield was 2.34% as of October 27, 2026, paid quarterly. The 0.61% expense ratio is above the 0.39% average for similar funds. 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.