Reasons Behind the Wealth Firm's $3 Million Reduction in Mid-Cap Investments

Mid-Cap Investing Appeal: Mid-cap stocks offer a balance of resilience and growth potential, currently showing strong performance with many ETFs reaching 52-week highs, despite the risks compared to large and small caps.

Global Economic Outlook: The IMF projects a decline in global growth rates, with developed economies growing slowly, which may lead investors to be cautious about large-cap stocks due to their foreign exposure.

Federal Reserve Actions: The Fed has implemented three rate cuts this year, with projections indicating a controlled outlook for GDP growth and unemployment rates, favoring domestically-focused stocks like small and mid-caps.

Mid-Cap ETFs Performance: Several mid-cap ETFs have outperformed the SPDR S&P 500 ETF Trust recently, with notable gains over the past month, suggesting a favorable investment opportunity in this segment.

Fortress Wealth Group's Sale: Fortress Wealth Group sold 27,140 shares of the First Trust Mid Cap Core AlphaDEX Fund (FNX) for approximately $3.3 million in the third quarter, reducing its position to 11,107 shares valued at $1.4 million.

Performance Comparison: FNX shares have increased by 8% over the past year, underperforming the S&P 500, which gained nearly 20% during the same period.

Investment Strategy: The FNX fund employs a quantitative selection process using the AlphaDEX® methodology to invest in mid-cap stocks, aiming for positive alpha through a diversified portfolio.

Market Positioning: Fortress's reduction in FNX holdings suggests a strategic shift towards larger-cap or income-generating assets, reflecting a focus on risk management and consistent growth in a changing market environment.

ETF Performance Overview: The First Trust Mid Cap Core AlphaDEX Fund ETF (FNX) has an implied analyst target price of $141.88, indicating a potential upside of 14.34% from its current trading price of $124.09.

Notable Holdings with Upside: Key underlying holdings of FNX, such as Urban Outfitters (URBN), Lazard Inc (LAZ), and Rush Enterprises Inc (RUSHA), show significant upside potential, with target prices exceeding their recent trading prices by 25.32%, 20.98%, and 19.43%, respectively.

Analyst Target Justification: The article raises questions about whether analysts' target prices are justified or overly optimistic, suggesting that high targets could lead to downgrades if they are based on outdated information.

Investor Research Recommendation: Investors are encouraged to conduct further research to assess the validity of analysts' targets in light of recent company and industry developments.

ETF Performance Analysis: The First Trust Mid Cap Core AlphaDEX Fund ETF (FNX) has an implied analyst target price of $139.79, indicating a potential upside of 10.46% from its current trading price of $126.56.

Notable Holdings: Key underlying holdings with significant upside potential include Golub Capital BDC Inc (GBDC), Itron Inc (ITRI), and SL Green Realty Corp (SLG), each showing expected price increases based on analyst targets.

ETF Analysis: The First Trust Mid Cap Core AlphaDEX Fund ETF (FNX) has an implied analyst target price of $138.87, indicating an 11.05% upside from its current trading price of $125.05.

Notable Holdings: Key underlying holdings with significant upside potential include Corcept Therapeutics (61.32% upside), SM Energy (44.95% upside), and Badger Meter (37.97% upside) based on their respective analyst target prices.

ETF Analysis: The First Trust Mid Cap Core AlphaDEX Fund ETF (FNX) has an implied analyst target price of $137.95, indicating a potential upside of 10.44% from its current trading price of $124.91.

Notable Holdings: Key underlying holdings with significant upside potential include Franklin Electric Co. (14.20% upside), Upstart Holdings Inc. (12.07% upside), and ASGN Inc. (11.52% upside) based on their respective analyst target prices.