FSZ: Outperforming EWL, And The Macros Don't Look Too Shabby Either

2025-02-07 14:52:12 ET

Summary

• The First Trust Switzerland AlphaDEX Fund is a lesser-known ETF that focuses on Swiss equities.
• FSZ pursues a more sophisticated portfolio construction than the popular EWL and this translates to better risk-adjusted returns.
• However, FSZ does suffer from structural flaws relative to EWL.
• Switzerland is one of the better positioned economies in Europe, and its export-dominant economy could get some support from policy rate decisions as inflation ebbs lower.
• Swiss equities offer better earnings potential than global stocks and are priced at a slight discount and could benefit from mean reversion interest.

Introduction

Investors who want to make a beeline for economies with a prosperous populace typically gravitate to Switzerland, which has the highest GDP per capita of all G20 nations. The popular route to gain access to Swiss economies has almost always been the iShares MSCI Switzerland ETF ( EWL ), which has been available for close to three decades now and built-up AUM of well over $1bn. However, we suspect many investors may also be overlooking the existence of an enhanced equity ETF product called the First Trust Switzerland AlphaDEX Fund ( FSZ ), which of course is much smaller in scope, with an AUM of just $70m (and a trading history of 13 years)....

Read the full article on Seeking Alpha

For further details see: