FEMS vs. PPA

Last updated Jun 4, 2026

FEMS (First Trust Emerging Markets Small Cap AlphaDEX Fund) and PPA (Invesco Aerospace & Defense ETF) are both exchange-traded funds - FEMS is a Emerging Markets Equities fund tracking the NASDAQ AlphaDEX EM Small Cap Index, while PPA is a Aerospace & Defense fund tracking the SPADE Defense Index. Both are passively managed. Over the past 10 years, FEMS returned 9.49%/yr vs 17.38%/yr for PPA. At a 0.44 correlation, their price movements are largely independent. FEMS charges 0.80%/yr vs 0.58%/yr for PPA.

Performance

FEMS vs. PPA - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in First Trust Emerging Markets Small Cap AlphaDEX Fund (FEMS) and Invesco Aerospace & Defense ETF (PPA). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, FEMS achieves a 12.16% return, which is significantly higher than PPA's 8.54% return. Over the past 10 years, FEMS has underperformed PPA with an annualized return of 9.49%, while PPA has yielded a comparatively higher 17.38% annualized return.

FEMS

• 1D: -1.87%
• 1M: -0.95%
• YTD: 12.16%
• 6M: 11.13%
• 1Y: 24.48%
• 3Y*: 13.68%
• 5Y*: 4.43%
• 10Y*: 9.49%

PPA

• 1D: -1.74%
• 1M: 3.19%
• YTD: 8.54%
• 6M: 13.46%
• 1Y: 26.57%
• 3Y*: 28.92%
• 5Y*: 17.82%
• 10Y*: 17.38%

*Multi-year figures are annualized to reflect compound growth (CAGR)

FEMS vs. PPA - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
FEMS First Trust Emerging Markets Small Cap AlphaDEX Fund	12.16%	16.48%	1.88%	3.55%	1.85%	3.76%	7.85%	28.88%	-22.63%	49.02%
PPA Invesco Aerospace & Defense ETF	8.54%	37.15%	25.28%	18.41%	9.52%	7.09%	0.45%	39.63%	-7.51%	30.10%

Correlation

The correlation between FEMS and PPA is 0.40, which is low. Their price movements are largely independent, making them effective diversification partners.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.40
Correlation (3Y) Calculated over the trailing 3-year period	0.33
Correlation (5Y) Calculated over the trailing 5-year period	0.38
Correlation (10Y) Calculated over the trailing 10-year period	0.42
Correlation (All Time) Calculated using the full available price history since Feb 21, 2012	0.44

The correlation between FEMS and PPA shifts across timeframes, from 0.33 (3 years) to 0.44 (all time), reflecting how their relationship changes across market environments.

FEMS vs. PPA - Sectors Allocation Comparison

Sectors	FEMS	PPA
Industrials	16.0%	90.1%
Consumer Cyclical	15.4%	-
Technology	13.1%	9.8%
Basic Materials	12.0%	-
Energy	8.7%	-
Real Estate	7.9%	-
Consumer Defensive	7.0%	-
Utilities	6.6%	-
Financial Services	5.5%	-
Communication Services	4.6%	0.1%
Healthcare	3.4%	-

Return for Risk

FEMS vs. PPA — Risk / Return Rank

Compare risk-adjusted metric ranks to identify better-performing investments over the past 12 months.

FEMS

FEMS Risk / Return Rank: 47
FEMS Sharpe Ratio Rank: 44
FEMS Sortino Ratio Rank: 43
FEMS Omega Ratio Rank: 43
FEMS Calmar Ratio Rank: 58
FEMS Martin Ratio Rank: 46

PPA

PPA Risk / Return Rank: 37
PPA Sharpe Ratio Rank: 38
PPA Sortino Ratio Rank: 39
PPA Omega Ratio Rank: 35
PPA Calmar Ratio Rank: 38
PPA Martin Ratio Rank: 36

The rank (0–100) shows how this investment's returns compare to the risk taken. Higher = better. Based on the past 12 months of data, combining Sharpe, Sortino, and other metrics used by quantitative funds and institutional investors.

FEMS vs. PPA - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for First Trust Emerging Markets Small Cap AlphaDEX Fund (FEMS) and Invesco Aerospace & Defense ETF (PPA). Risk-adjusted metrics are performance indicators that assess an investment's returns in relation to its risk, enabling a more accurate comparison of different investment options.

	FEMS	PPA	Difference
Sharpe ratio: Return per unit of total volatility	1.55	1.40	+0.15
Sortino ratio: Return per unit of downside risk	2.17	2.05	+0.12
Omega ratio: Gain probability vs. loss probability	1.28	1.24	+0.04
Calmar ratio: Return relative to maximum drawdown	2.86	1.95	+0.92
Martin ratio: Return relative to average drawdown	7.50	5.68	+1.82
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

FEMS vs. PPA - Sharpe Ratio Comparison

The current FEMS Sharpe Ratio is 1.55, which is comparable to the PPA Sharpe Ratio of 1.40. The chart below compares the historical Sharpe Ratios of FEMS and PPA, calculated using daily returns over the previous 12 months. A higher Sharpe Ratio indicates better risk-adjusted performance relative to the risk-free rate.

Sharpe Ratios by Period

	FEMS	PPA	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	1.55	1.40	+0.15
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	0.25	0.97	-0.72
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	0.48	0.84	-0.37
Sharpe Ratio (All Time) Calculated using the full available price history	0.27	0.66	-0.38

Drawdowns

FEMS vs. PPA - Drawdown Comparison

The maximum FEMS drawdown since its inception was -47.85%, smaller than the maximum PPA drawdown of -57.37%. Use the drawdown chart below to compare losses from any high point for FEMS and PPA.

Drawdown Indicators

	FEMS	PPA	Difference
Max Drawdown Largest peak-to-trough decline	-47.85%	-57.37%	+9.52%
Max Drawdown (1Y) Largest decline over 1 year	-8.59%	-13.71%	+5.12%
Max Drawdown (3Y) Largest decline over 3 years	-21.09%	-15.24%	-5.85%
Max Drawdown (5Y) Largest decline over 5 years	-26.89%	-18.37%	-8.52%
Max Drawdown (10Y) Largest decline over 10 years	-47.85%	-43.92%	-3.93%
Current Drawdown Current decline from peak	-4.88%	-8.40%	+3.52%
Average Drawdown Average peak-to-trough decline	-17.41%	-9.18%	-8.23%
Ulcer Index Depth and duration of drawdowns from previous peaks	3.27%	4.69%	-1.42%

Volatility

FEMS vs. PPA - Volatility Comparison

The current volatility for First Trust Emerging Markets Small Cap AlphaDEX Fund (FEMS) is 6.37%, while Invesco Aerospace & Defense ETF (PPA) has a volatility of 6.73%. This indicates that FEMS experiences smaller price fluctuations and is considered to be less risky than PPA based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	FEMS	PPA	Difference
Volatility (1M) Calculated over the trailing 1-month period	6.37%	6.73%	-0.36%
Volatility (6M) Calculated over the trailing 6-month period	12.98%	15.95%	-2.97%
Volatility (1Y) Calculated over the trailing 1-year period	15.84%	19.03%	-3.19%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	17.79%	18.49%	-0.70%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	19.97%	20.64%	-0.67%

FEMS vs. PPA - Expense Ratio Comparison

FEMS has a 0.80% expense ratio, which is higher than PPA's 0.58% expense ratio.

Dividends

FEMS vs. PPA - Dividend Comparison

FEMS's dividend yield for the trailing twelve months is around 4.28%, more than PPA's 0.39% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
FEMS First Trust Emerging Markets Small Cap AlphaDEX Fund	4.28%	4.27%	3.97%	4.65%	4.55%	6.25%	2.90%	4.37%	4.68%	3.39%	2.42%	3.28%
PPA Invesco Aerospace & Defense ETF	0.39%	0.42%	0.61%	0.67%	0.83%	0.59%	0.88%	0.95%	0.90%	0.67%	1.70%	1.41%

Frequently Asked Questions

Can I hold both FEMS and PPA in my portfolio?

FEMS and PPA have a correlation of 0.40, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, FEMS or PPA?

PPA has higher volatility (6.73%) compared to FEMS (6.37%). In terms of maximum drawdown, FEMS dropped -47.85% vs PPA's -57.37%.

Which ETF is better, FEMS or PPA?

On 10-year performance, PPA leads with 17.38% vs 9.49% for FEMS. On fees, PPA is cheaper at 0.58% per year. On volatility, FEMS has been the lower-risk option at 6.37%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, FEMS or PPA?

Over the 10-year period, PPA has performed better with a 17.38% return vs 9.49%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, FEMS or PPA?

PPA is cheaper with a 0.58% expense ratio, compared with 0.80% for FEMS.

Which ETF pays a higher dividend yield, FEMS or PPA?

FEMS has the higher dividend yield at 4.28%, compared with 0.39% for PPA.

What is the main difference between FEMS and PPA?

FEMS is categorized as Emerging Markets Equities, while PPA is Aerospace & Defense. FEMS tracks NASDAQ AlphaDEX EM Small Cap Index, while PPA tracks SPADE Defense Index. They also come from different issuers: First Trust and Invesco. Their fees differ too: 0.80% for FEMS and 0.58% for PPA.

Which has better risk-adjusted returns?

FEMS currently has the higher Sharpe Ratio (1.55 vs 1.40), meaning it's delivered slightly more return per unit of risk over the trailing 12 months. However, this ranking shifts over time - use the Risk/Return Score above for a more comprehensive view that combines Sharpe, Sortino, and other measures used by quantitative funds.