What Is the FDL ETF? A Complete Guide to Returns, Expense Ratio, Holdings, and Alternative ETFs
The First Trust Morningstar Dividend Leaders Index Fund (FDL) is a high-dividend ETF that holds large-cap US stocks with consistent dividend histories, weighted by dividends paid. It carries heavy exposure to the energy and communication services sectors, and its dividend strategy differs from that of VYM and SCHD, which is the key point to watch.
SubscribeWhat Is the First Trust Morningstar Dividend Leaders Index Fund ETF?
The fund tracks the Morningstar Dividend Leaders Index and holds large-cap US stocks with a consistent dividend payment history and sustainable payouts, weighted by the size of the dividends they pay.
It suits investors who value regular dividend income and want a portfolio with a high weighting in traditional high-dividend sectors.
It is a passively managed (index-tracking) ETF run by First Trust.
How Does the First Trust Morningstar Dividend Leaders Index Fund Invest?
| Item | Details |
|---|---|
| Tracked Index | Morningstar Dividend Leaders Index |
| Management Style | Passive (index tracking) |
| Rebalancing Frequency | Quarterly |
| Dividend Frequency | Quarterly |
| Total Expense Ratio | 0.43% |
The fund selects US-listed stocks with a consistent dividend payment history and sustainable dividend capacity, then builds its portfolio using a weighting scheme proportional to the size of dividends paid. Traditional high-dividend sectors such as energy, communication services, health care, and consumer staples carry relatively high weightings.
- Weighted by dividends paid rather than by market capitalization
- Stock selection based on a consistent dividend payment history
First Trust Morningstar Dividend Leaders Index Fund Size and Costs (AUM and Management Fee)
Assets under management (AUM) stand at $8.3B, and the total expense ratio is 0.43% per year.
Compared with the dividend ETFs shown alongside it in the table, such as VIG, SCHD, VYM, RDVY, and DVY, the fund differs in sector weightings and weighting methodology.
First Trust Morningstar Dividend Leaders Index Fund Performance and Trends
1-Year Price Performance
Dividend & Yield
52-Week Price RangeBecause of its heavy weighting in traditional high-dividend sectors, the fund tends to move differently from the broader market depending on interest rates and energy prices, and it can post relatively subdued returns when growth stocks are leading.
Fund flows have continued alongside demand for income-focused investing, and market interest in dividend stocks as a whole tends to shift over time as the interest rate environment changes.
First Trust Morningstar Dividend Leaders Index Fund Strengths and Weaknesses
Its strength is stable income generation centered on traditional high-dividend sectors, while its weakness is relatively limited capital appreciation potential compared with growth stocks.
💪 Key Strengths
⚠️ Points to Watch
First Trust Morningstar Dividend Leaders Index Fund Alternative ETFs and Related Products
Among the comparison products shown in the table, VIG and VYM are low-cost ETFs that track dividend growth and high-dividend indexes, respectively, while SCHD is a similar-category product that uses dividend growth quality metrics. RDVY is a variant that focuses on dividend growth rates, and DVY, like FDL, follows an index with a high weighting in traditional high-dividend sectors. In addition, DGRO, which uses the same dividend growth strategy, NOBL, which focuses on dividend aristocrats, and JEPI, an income product that combines covered calls, can also be considered for comparison.
Peer Comparison ETFs| Ticker | Name | Price | Change | AUM | Total Expense Ratio | Dividend Yield | 1Y |
|---|---|---|---|---|---|---|---|
 SCHD | Schwab US Dividend Equity ETF | $35.27 | -0.4% | $118.9B | 0.06% | 2.99% | +30.5% |
 VIG | Vanguard Dividend Appreciation FTF | $243.12 | -0.8% | $114.5B | 0.04% | 1.5% | +12.0% |
 VYM | Vanguard High Dividend Yield Indx ETF | $161.50 | -0.7% | $82.7B | 0.04% | 2.28% | +14.6% |
 DFAC | U.S. Core Equity 2 Portfolio-ETF Class Shares | $44.74 | -0.6% | $49.3B | 0.18% | 0.88% | +15.4% |
 RDVY | First Trust Rising Dividend Achievers ETF | $78.70 | -1.2% | $25.5B | 0.47% | 0.86% | +16.8% |
Top Holdings| Ticker | Name | Weight | Price | Change | Market Cap | P/E | Dividend Yield |
|---|---|---|---|---|---|---|---|
| XOM | ExxonMobil Holdings Corp | 0.11% | $183.21 | +2.8% | $753.3B | 23.6 | 2.27% |
| CVX | Chevron Corp | 0.17% | $233.21 | +2.9% | $460.8B | 22.4 | 3.06% |
| VZ | Verizon Communications Inc | 0.15% | $44.66 | -1.2% | $185.6B | 11.6 | 6.33% |
| PFE | Pfizer Inc | 0.12% | $30.03 | -1.3% | $171.2B | 39.8 | 5.74% |
| PM | Philip Morris International Inc | 0.06% | $199.47 | -1.1% | $310.9B | 29.1 | 3.05% |
| MRK | Merck & Co Inc | 0.06% | $145.27 | -1.3% | $358.4B | 116.1 | 2.34% |
| PEP | PepsiCo Inc | 0.05% | $135.77 | -2.2% | $185.0B | 17.1 | 4.31% |
First Trust Morningstar Dividend Leaders Index Fund Investor Checkpoints
Here are the points to review before investing in FDL. The fund is well suited to income generation, but sector concentration and limited growth potential are items worth confirming before making an investment decision.
| Checkpoint | What to Check | Current Status |
|---|---|---|
| 💵 Expense Ratio | Check the cumulative cost impact over a long holding period | Annual fee applies |
| 🏭 Sector Weightings | Check concentration in specific sectors such as energy and communication services | High weighting in traditional high-dividend sectors |
| 📈 Dividend Weighting Methodology | Understand the structure of weighting by dividends paid instead of market capitalization | Structure maintained |
| 💱 Exchange Rate | Consider the impact of exchange rates on returns converted to Korean won | Unhedged |
Sector concentration and interest rate sensitivity are the main drivers of short-term volatility, and the fund may lag during growth-stock rallies, so caution is advised in advance.
It is a suitable choice for investors who want stable income centered on traditional high-dividend sectors. Those who place more weight on dividend growth may also consider VIG and SCHD, and those who want broad high-dividend exposure may consider VYM.
SubscribeDisclaimer: This content is for informational purposes only and does not constitute investment advice. All investment responsibility lies with the investor.
This article reflects information as of July 1, 2026.
Today's 5 AI picks, all free