Is First Trust Dow Jones Global Select Dividend ETF (FGD) a Strong ETF Right Now?

The First Trust Dow Jones Global Select Dividend ETF (FGD), a smart beta fund tracking the dividend yield-weighted Dow Jones Global Select Dividend Index, has demonstrated robust performance, gaining 32.41% year-to-date and 27.32% over the past 12 months as of August 21, 2025. With $862.53 million in assets and a 0.56% expense ratio, FGD offers a low-risk profile (beta 0.76) and a 4.64% trailing dividend yield, positioning it as a notable option in the Foreign Large Value ETF segment, though larger, lower-cost alternatives are available.

Analysis

The First Trust Dow Jones Global Select Dividend ETF (FGD) has demonstrated strong recent performance within the Foreign Large Value category, posting a year-to-date gain of 32.41% and a 12-month return of 27.32% as of August 21, 2025. Its smart beta strategy, which tracks the dividend yield-weighted Dow Jones Global Select Dividend Index, provides a compelling 4.64% trailing dividend yield. The fund's risk profile appears favorable, characterized by a low beta of 0.76 and a three-year standard deviation of 14.83%, suggesting potentially strong risk-adjusted returns. With approximately 105 holdings and the top ten constituting only 16.52% of assets, the ETF offers significant diversification against company-specific risk. However, its 0.56% expense ratio is notably higher than that of larger competitors like Vanguard's VYMI (0.17%) and Schwab's FNDF (0.25%). While FGD's AUM of $862.53 million is described as average, it is substantially smaller than these alternatives, which may be a consideration for investors focused on scale and liquidity.

Key Decisions for Investors

• Investors focused on recent performance and risk-adjusted returns may find FGD attractive, given its 32.41% year-to-date gain and low beta of 0.76, but must accept its higher fee structure.
• Cost-sensitive investors or those prioritizing liquidity should evaluate the mentioned alternatives, VYMI and FNDF, which offer exposure to a similar asset class with significantly lower expense ratios of 0.17% and 0.25% respectively, and much larger asset bases.
• For income-oriented portfolios, the fund's 4.64% trailing dividend yield is a key attribute; however, it is critical to monitor if the smart beta strategy's performance continues to justify the premium 0.56% expense ratio over time.