First Trust Mid Cap Growth AlphaDEX Fund (FNY) Covered Calls

The First Trust Mid Cap Growth AlphaDEX Fund is an exchange-traded fund that tracks the NASDAQ AlphaDEX Mid Cap Growth Index. The fund employs a proprietary, rules-based selection process to identify mid-cap growth stocks from the NASDAQ US 600 Mid Cap Index. By ranking securities on specific growth and value factors, FNY aims to build a portfolio of mid-sized companies that have the potential for significant risk-adjusted capital appreciation.

You can sell covered calls on First Trust Mid Cap Growth AlphaDEX Fund to lower risk and earn monthly income. Born To Sell's covered call screener gives you customized search capabilities across all possible covered calls but here are a couple of examples for FNY (prices last updated Wed 10:50 AM ET):

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The First Trust Mid Cap Growth AlphaDEX Fund (FNY) provides investors with a quantitatively driven approach to the mid-cap growth segment of the U.S. equity market. The fund utilizes the AlphaDEX selection methodology, which ranks stocks from the NASDAQ US 600 Mid Cap Index based on fundamental growth factors—such as sales growth, price appreciation, and sales-to-price ratios—as well as value factors like return on assets and cash flow to price. The highest-ranked stocks are selected and weighted into quintiles, with the top-scoring companies receiving the largest allocations, effectively "enhancing" the index to favor stocks with the best relative momentum and quality.

The fund typically invests at least 90% of its assets in the common stocks that make up its underlying index. This multi-factor approach is designed to exploit market inefficiencies by identifying mid-cap companies that are often overlooked by broad-market benchmarks but exhibit strong operational health and growth potential. The portfolio is reconstituted and rebalanced quarterly, ensuring the fund remains aligned with its alpha-seeking objectives. By focusing on the "sweet spot" of the market—mid-sized firms that have outgrown the small-cap phase but still offer more growth headroom than large-cap peers—FNY serves as a tactical tool for aggressive equity allocation.

Competition

The mid-cap growth category is a highly active segment of the ETF market, with several liquid and optionable alternatives. FNY’s primary rivals include the iShares Russell Mid-Cap Growth ETF, which follows a traditional market-cap-weighted benchmark, and the Vanguard Mid-Cap Growth ETF. Other notable optionable competitors include the iShares S&P Mid-Cap 400 Growth ETF and the iShares Morningstar Mid-Cap Growth ETF, both of which offer different takes on the mid-cap growth factor.

Strategic Outlook and Innovation

The strategic focus of the fund is to provide a systematic way to capture excess returns by rotating into the most promising mid-cap growth names. As economic cycles shift, the AlphaDEX engine filters out companies with deteriorating fundamentals, aiming to avoid "momentum traps" where stock prices outpace their underlying earnings quality. This disciplined, non-discretionary process is intended to provide a more resilient return profile than "pure growth" strategies that might ignore valuation or profitability metrics, making it a sophisticated choice for factor-based investing.

Innovation at First Trust involves the continuous application of data analytics to refine the AlphaDEX selection criteria. By maintaining a high degree of transparency and an "enhanced" indexing structure, the fund seeks to offer the benefits of active management—potential outperformance—with the efficiency and lower costs of an ETF. As institutional and retail demand for "smart beta" products grows, FNY is positioned as a core vehicle for investors seeking to benefit from the innovation and agility of mid-sized American companies through a quantitative, data-driven lens.

Want more examples? FNX Covered Calls | FOA Covered Calls