Is First Trust RBA American Industrial Renaissance ETF (AIRR) a Strong ETF Right Now?

The First Trust RBA American Industrial Renaissance ETF (AIRR) made its debut on 03/10/2014, and is a smart beta exchange traded fund that provides broad exposure to the Industrials ETFs category of the market.What Are Smart Beta ETFs?Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.Fund Sponsor & IndexAIRR is managed by First Trust Advisors, and this fund has amassed over $6.05 billion, which makes it one of the largest ETFs in the Industrials ETFs. Before fees and expenses, AIRR seeks to match the performance of the Richard Bernstein Advisors American Industrial Renaissance Index.The Richard Bernstein Advisors American Industrial Renaissance Index is measures the performance of small and mid cap US companies in the industrial and community banking sectors.Cost & Other ExpensesInvestors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.With one of the most expensive products in the space, this ETF has annual operating expenses of 0.70%.It's 12-month trailing dividend yield comes in at 0.22%.Sector Exposure and Top HoldingsMost ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.For AIRR, it has heaviest allocation in the Industrials sector --about 93.9% of the portfolio.When you look at individual holdings, Kratos Defense & Security Solutions, Inc. (KTOS) accounts for about 4.53% of the fund's total assets, followed by Comfort Systems Usa, Inc. (FIX) and Bwx Technologies, Inc. (BWXT).AIRR's top 10 holdings account for about 35.12% of its total assets under management.Performance and RiskSo far this year, AIRR has added roughly 26.43%, and was up about 16.9% in the last one year (as of 11/10/2025). During this past 52-week period, the fund has traded between $61.92 and $100.35.AIRR has a beta of 1.31 and standard deviation of 24.51% for the trailing three-year period, which makes the fund a high risk choice in the space. With about 53 holdings, it effectively diversifies company-specific risk .AlternativesFirst Trust RBA American Industrial Renaissance ETF is an excellent option for investors seeking to outperform the Industrials ETFs segment of the market. There are other ETFs in the space which investors could consider as well.Vanguard Industrials ETF (VIS) tracks MSCI US Investable Market Industrials 25/50 Index and the Industrial Select Sector SPDR ETF (XLI) tracks Industrial Select Sector Index. Vanguard Industrials ETF has $6.28 billion in assets, Industrial Select Sector SPDR ETF has $23.93 billion. VIS has an expense ratio of 0.09% and XLI changes 0.08%.Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Industrials ETFsBottom LineTo learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.Boost Your Portfolio with Our Top ETF InsightsZacks' exclusive Fund Newsletter delivers actionable information, top news and analysis, as well as top-performing ETFs, straight to your inbox every week.Don’t miss out on this valuable resource. It’s free!Get it now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report First Trust RBA American Industrial Renaissance ETF (AIRR): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks