NEW YORK ( TheStreet) -- Brazil has become a very popular investment destination in recent years, and this has led to the creation of multiple exchange-traded products focused on this emerging market.

The latest is First Trust Brazil AlphaDEX Fund ( FBZ), one of nine international AlphaDEX funds that were recently launched.

First Trust defines the AlphaDEX brand/strategy as enhanced indexing. What this means is that First Trust takes an index, screens all its components for fundamental and growth factors and then selects the top-scoring stocks for inclusion in a fund.

First Trust has had success using this process with domestic ETFs. With the launch of the Brazil AlphaDEX and its eight sister funds, the company is betting it can repeat that success with international indices.

The Brazil AlphaDEX screens the S&P Brazil BMI "universe," an index that is not terribly well-known.

Investors are likely to be more familiar with the MSCI Brazil index that the iShares MSCI Brazil Index Fund ( EWZ) tracks.

There are marked differences between the new Brazil AlphaDEX ETF and the iShares fund.

Both generally target the same market, with each having a $5 billion to $6 billion median market cap, but the AlphaDEX fund is much more diversified.

The iShares MSCI Brazil Index Fund allocates 20% of its portfolio to Petrobras' ( PBR) common and preferred shares and 15% to Vale's ( VALE) common and preferred shares.

But the Brazil AlphaDEX ETF's combined exposure to these two companies is less than 7%.

It should be obvious that when Petrobras and Vale are doing relatively well that EWZ will outperform, but when either or both stocks struggle, the AlphaDEX will be the better performer. Anyone looking to reduce single-stock risk in general would be better off in the AlphaDEX fund.

The sector makeup between the two funds is much different as well. EWZ allocates more than 20% each to energy, financials and materials. Those sectors get only 6%, 10% and 18%, respectively, in the Brazil AlphaDEX fund.

The largest sector in the new fund is utilities, at 22%. The downside to the AlphaDEX fund's limited resources exposure is that resources are what attracted many investors to Brazil in the first place.

Lopsided though it may be, EWZ offers direct access to that theme. The AlphaDEX fund offers broader exposure to the local economic growth that is being fueled by Brazil's resource boom.

The Brazil AlphaDEX has 50 holdings, the largest of which accounts for 3.5% of the fund, and it rescreens portfolio and rebalances its portfolio twice a year. Investors should also note that its expense ratio will be 0.80%, which is noticeably higher than the 0.61% charged by the iShares Brazil ETF.

There are countless ways to invest in Brazil roaring economy, including sector funds, niche funds, and, of course, individual stocks. The Brazil AlphaDEX's role is to offer more diversified exposure to this emerging market.

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At the time of publication, Nusbaum held VALE for a client, although positions may change at any time.

Roger Nusbaum is a portfolio manager with Your Source Financial of Phoenix, and the author of Random Roger's Big Picture Blog. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Nusbaum appreciates your feedback; click here to send him an email.

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