Consumer Staples ETF (FXG) Hits New 52-Week High

For investors seeking momentum, First Trust Consumer Staples AlphaDEX Fund FXG is probably on radar. The fund just hit a 52-week high and is up about 22% from its 52-week low price of $55.02/share.

But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:

FXG in Focus

First Trust Consumer Staples AlphaDEX Fund focuses on the consumer staples segment of the U.S. market. It employs the AlphaDEX stock selection methodology to select stocks from the Russell 1000 Index. FXG has key holdings in food producers, personal care, drug and grocery stores, and beverages. The fund charges investors 64 basis points a year in fees (see: all the Consumer Staples ETFs here).

Why the Move?

The consumer staples sector has recently been an area to watch given heightened volatility and uncertainty triggered by skyrocketing inflation, a war in Ukraine, and aggressive Fed rate hike bets. This is because the consumer staples sector sees steady demand in an economic downturn due to its low level of correlation with economic cycles. This factor makes the consumer segment a great place to stay invested in.

More Gains Ahead?

Currently, FXG has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook. Therefore, it is hard to get a handle on its future returns one way or the other. However, many of the segments that make up this ETF have a strong Zacks Industry Rank. So, there is definitely some promise for those who want to ride this surging ETF a little further.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.