First Trust Dorsey Wright Focus 5 ETF (FV) Covered Calls

First Trust Dorsey Wright Focus 5 ETF (FV) is an exchange-traded fund that serves as a fund-of-funds, investing primarily in a concentrated portfolio of other First Trust sector and industry-based ETFs. The fund utilizes a proprietary relative-strength momentum methodology to identify and hold the five ETFs within its investable universe that demonstrate the strongest technical performance, dynamically rebalancing to capture shifting market leadership.

You can sell covered calls on First Trust Dorsey Wright Focus 5 ETF 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 FV (prices last updated Fri 4:16 PM ET):

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The First Trust Dorsey Wright Focus 5 ETF (FV) is an actively managed "smart beta" vehicle designed to capitalize on momentum trends across the U.S. and global equity markets. By delegating sector selection to a quantitative relative-strength model, FV aims to rotate capital into the areas of the market exhibiting the strongest price action, thereby attempting to outperform static, broad-market indices.

Core Business and Objectives

FV’s investment objective is to track the performance of the Dorsey Wright Focus Five Index. The portfolio is intentionally concentrated, typically holding only five underlying First Trust ETFs at any given time, each weighted equally. This concentrated approach is intended to maximize the impact of the momentum signals identified by the Dorsey Wright model. The fund rebalances periodically—usually on a monthly basis—to exit underperforming sectors and rotate into those displaying greater relative strength.

This strategy makes FV a tactical tool for investors who want to participate in market leaders while offloading the burden of sector-rotation analysis to a systematic, rules-based framework. It is an "alpha-seeking" instrument, meaning it is intended to supplement, rather than replace, core diversified holdings.

Competitive Landscape

FV occupies a unique niche as a momentum-driven fund-of-funds. Because it exclusively holds other First Trust sector ETFs, it does not have a direct, like-for-like competitor with the exact same structure and methodology. Its closest thematic peers are other broad momentum ETFs, such as the iShares MSCI USA Momentum Factor ETF (MTUM), which uses a different factor-based approach to capture momentum.

FV distinguishes itself through its specific reliance on Dorsey Wright’s relative-strength model and its concentrated, equal-weighted selection of five sector ETFs. While MTUM is a standard benchmark for momentum-seeking investors, FV provides a more tactical, rotation-based alternative. Please note that while FV trades on the NASDAQ, it lacks the liquid options market found in benchmarks like MTUM, making it less suitable for tactical options-based strategies.

Strategic Outlook and Market Role

The fund’s performance is highly sensitive to market regime changes. Momentum strategies tend to thrive in trending markets but can face challenges during periods of sharp reversals, high volatility, or "whipsaw" conditions where leadership changes rapidly. As a tactical instrument, FV is designed to adapt to these shifts, but it requires the investor to have a high tolerance for portfolio turnover and potential performance variance relative to the broader S&P 500.

The long-term outlook for FV is tied to the effectiveness of its relative-strength selection model in navigating evolving economic and thematic trends. For investors seeking to add a momentum-driven, tactical layer to their equity allocation, FV offers a transparent and disciplined path to accessing rotating market leadership.

Want more examples? FUTY Covered Calls | FVAL Covered Calls