FAAR: You Will Not Get Far Using This ETF
The First Trust Alternative Absolute Return Strategy ETF (FAAR) utilizes an active long-short commodities strategy aimed at achieving absolute returns. Despite its dynamic approach and +54% net long exposure, FAAR has underperformed compared to its peers over the past five years. The ETF also exhibits higher volatility and a notable expense ratio.
- ▪FAAR employs an active long-short commodities strategy aiming for absolute returns in any market environment.
- ▪The ETF currently maintains a +54% net long exposure but can adjust its net exposures across commodity sectors using futures.
- ▪FAAR has significantly underperformed its peers over five years, with a higher volatility of 11.2% standard deviation and a steep 0.97% expense ratio.
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