Going Large: First Trust Introduces Mega-Cap ETF

First Trust, the Illinois-based ETF issuer now with 58 funds and over $8 billion in assets under management, introduced the First Trust Mega Cap AlphaDex Fund FMK today, an ETF that holds some of the largest and most familiar stocks listed in the U.S. With an expense ratio of 0.7%, FMK will track the Defined Mega Cap Index, a modified equal-dollar weighted index where higher ranked stocks receive a higher weight within the index. FMK holds 50 stocks. Intel INTC, the world's largest semiconductor maker, is the largest holding with a weight of 3.73%. Oil services giant Baker Hughes BHI and pharmaceuticals producer Eli Lilly LLY are next with weights of 3.42% each. Dow components Caterpillar CAT and Chevron CVX round the top-five holdings with weights of 3.36% and 3.31%, respectively. Energy is the biggest sector weight with an allocation of almost 29.5%. Information technology follows with a weight of almost 22% while healthcare is the only other sector to garner double-digit representation at nearly 12.5% FMK is the second new ETF launched by First Trust this week. On Tuesday, the firm introduced the First Trust Nasdaq Global Auto Index Fund CARZ, the first ETF to track the auto industry. First Trust, which says it is the fastest-growing among the top-10 U.S. ETF issuers, has rolled out 15 new funds this year, including the suite of nine AlphaDEX international ETFs in April.