Should You Invest in the First Trust RBA American Industrial Renaissance ETF (AIRR)?

Designed to provide broad exposure to the Industrials - Broad segment of the equity market, the First Trust RBA American Industrial Renaissance ETF (AIRR) is a passively managed exchange traded fund launched on March 10, 2014.

Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.

Sector ETFs are also funds of convenience, offering many ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Industrials - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 7, placing it in top 44%.

Index Details

The fund is sponsored by First Trust Advisors. It has amassed assets over $8.47 billion, making it one of the largest ETFs attempting to match the performance of the Industrials - Broad segment of the equity market. AIRR seeks to match the performance of the Richard Bernstein Advisors American Industrial Renaissance Index before fees and expenses.

The Richard Bernstein Advisors American Industrial Renaissance Index is measures the performance of small and mid cap US companies in the industrial and community banking sectors.

Costs

Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.

Annual operating expenses for this ETF are 0.7%, making it one of the most expensive products in the space.

It has a 12-month trailing dividend yield of 0.15%.

Sector Exposure and Top Holdings

It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.

This ETF has heaviest allocation in the Industrials sector -- about 91.9% of the portfolio.

The top 10 holdings account for about 36.08% of total assets under management.

Performance and Risk

So far this year, AIRR return is roughly 21.22%, and is up about 49.2% in the last one year (as of 02/11/2026). During this past 52-week period, the fund has traded between $61.92 and $119.9.

The ETF has a beta of 1.28 and standard deviation of 24.69% for the trailing three-year period, making it a high risk choice in the space. With about 53 holdings, it effectively diversifies company-specific risk.

Alternatives

First Trust RBA American Industrial Renaissance ETF sports a Zacks ETF Rank of 4 (Sell), which is based on expected asset class return, expense ratio, and momentum, among other factors. AIRR, then, is not a great choice for investors seeking exposure to the Industrials ETFs segment of the market. Instead, there are better ETFs in the space to consider.

Vanguard Industrials ETF (VIS) tracks MSCI US Investable Market Industrials 25/50 Index and the State Street Industrial Select Sector SPDR ETF (XLI) tracks Industrial Select Sector Index. Vanguard Industrials ETF has $7.33 billion in assets, State Street Industrial Select Sector SPDR ETF has $30.09 billion. VIS has an expense ratio of 0.09%, and XLI charges 0.08%.

Bottom Line

To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.

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This article originally published on Zacks Investment Research (zacks.com).

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