(FAAR) First Trust Alternative - Ratings and Ratios

The First Trust Alternative Absolute Return Strategy ETF (FAAR) is an actively managed exchange-traded fund that employs a unique investment strategy to achieve long-term total returns. By utilizing a wholly-owned subsidiary organized under the laws of the Cayman Islands, the fund gains exposure to long and short investments in exchange-traded commodity futures contracts. This approach allows the advisor, First Trust Advisors L.P., to navigate the complexities of commodity markets while maintaining a flexible investment mandate.

The funds investment strategy is designed to capitalize on opportunities in the commodity futures markets, providing a diversified source of returns that can help mitigate risks associated with traditional asset classes. By investing in a broad basket of commodities, FAAR offers investors a way to gain exposure to this asset class, which can be an effective hedge against inflation, market volatility, and other economic uncertainties.

Analyzing the current market dynamics, we observe that the funds last price is $27.00, with a 20-day simple moving average (SMA) of $26.73, indicating a recent uptrend. The 50-day SMA is $27.30, and the 200-day SMA is $27.65, suggesting a potential consolidation phase. The average true range (ATR) is 2.33%, indicating moderate volatility. Given these technical indicators, we can anticipate a potential breakout or further consolidation in the near term.

Considering the fundamental data, the funds assets under management (AUM) stand at $92.30 million. While this is a relatively modest size, it is sufficient to maintain liquidity and support the funds investment strategy. Looking ahead, we forecast that FAARs price will be influenced by the overall direction of commodity markets, as well as the funds ability to effectively navigate these markets through its long and short investment positions. Based on the current technical and fundamental data, we expect FAARs price to potentially reach $30.00 within the next 12 months, driven by a combination of favorable market conditions and the funds active management strategy.