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Should Invesco Bloomberg Pricing Power ETF (POWA) Be on Your Investing Radar?
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Launched on 12/15/2006, the Invesco Bloomberg Pricing Power ETF (POWA - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Large Cap Growth segment of the US equity market.
The fund is sponsored by Invesco. It has amassed assets over $232.44 million, making it one of the average sized ETFs attempting to match the Large Cap Growth segment of the US equity market.
Why Large Cap Growth
Companies that fall in the large cap category tend to have a market capitalization above $10 billion. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.
While growth stocks do boast higher than average sales and earnings growth rates, and they are expected to grow faster than the wider market, investors should note these kinds of stocks have higher valuations. Further, growth stocks have a higher level of volatility associated with them. When you consider growth versus value, growth stocks are usually the clear winner in strong bull markets but tend to fall flat in nearly all other environments.
Costs
Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.
Annual operating expenses for this ETF are 0.40%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.49%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Industrials sector--about 31% of the portfolio. Information Technology and Healthcare round out the top three.
Looking at individual holdings, Kroger Co/the (KR - Free Report) accounts for about 2.33% of total assets, followed by Archer-Daniels-Midland Co (ADM - Free Report) and Dupont De Nemours Inc (DD - Free Report) .
The top 10 holdings account for about 21.39% of total assets under management.
Performance and Risk
POWA seeks to match the performance of the BLOOMBERG PRICING POWER INDEX before fees and expenses. The Bloomberg Pricing Power Index composes of U.S. large and mid-capitalization companies that are well-positioned to maintain stable profit margins in all market conditions while focusing on companies that have the smallest deviations among their annual gross profit margins over the last five years.
The ETF has gained about 7.08% so far this year and it's up approximately 0% in the last one year (as of 06/17/2024). In the past 52-week period, it has traded between $63.22 and $78.79.
The ETF has a beta of 0.86. With about 51 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco Bloomberg Pricing Power ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, POWA is an excellent option for investors seeking exposure to the Style Box - Large Cap Growth segment of the market. There are other additional ETFs in the space that investors could consider as well.
The Vanguard Growth ETF (VUG - Free Report) and the Invesco QQQ (QQQ - Free Report) track a similar index. While Vanguard Growth ETF has $132.66 billion in assets, Invesco QQQ has $285.17 billion. VUG has an expense ratio of 0.04% and QQQ charges 0.20%.
Bottom-Line
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
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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Should Invesco Bloomberg Pricing Power ETF (POWA) Be on Your Investing Radar?
Launched on 12/15/2006, the Invesco Bloomberg Pricing Power ETF (POWA - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Large Cap Growth segment of the US equity market.
The fund is sponsored by Invesco. It has amassed assets over $232.44 million, making it one of the average sized ETFs attempting to match the Large Cap Growth segment of the US equity market.
Why Large Cap Growth
Companies that fall in the large cap category tend to have a market capitalization above $10 billion. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.
While growth stocks do boast higher than average sales and earnings growth rates, and they are expected to grow faster than the wider market, investors should note these kinds of stocks have higher valuations. Further, growth stocks have a higher level of volatility associated with them. When you consider growth versus value, growth stocks are usually the clear winner in strong bull markets but tend to fall flat in nearly all other environments.
Costs
Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.
Annual operating expenses for this ETF are 0.40%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.49%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Industrials sector--about 31% of the portfolio. Information Technology and Healthcare round out the top three.
Looking at individual holdings, Kroger Co/the (KR - Free Report) accounts for about 2.33% of total assets, followed by Archer-Daniels-Midland Co (ADM - Free Report) and Dupont De Nemours Inc (DD - Free Report) .
The top 10 holdings account for about 21.39% of total assets under management.
Performance and Risk
POWA seeks to match the performance of the BLOOMBERG PRICING POWER INDEX before fees and expenses. The Bloomberg Pricing Power Index composes of U.S. large and mid-capitalization companies that are well-positioned to maintain stable profit margins in all market conditions while focusing on companies that have the smallest deviations among their annual gross profit margins over the last five years.
The ETF has gained about 7.08% so far this year and it's up approximately 0% in the last one year (as of 06/17/2024). In the past 52-week period, it has traded between $63.22 and $78.79.
The ETF has a beta of 0.86. With about 51 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco Bloomberg Pricing Power ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, POWA is an excellent option for investors seeking exposure to the Style Box - Large Cap Growth segment of the market. There are other additional ETFs in the space that investors could consider as well.
The Vanguard Growth ETF (VUG - Free Report) and the Invesco QQQ (QQQ - Free Report) track a similar index. While Vanguard Growth ETF has $132.66 billion in assets, Invesco QQQ has $285.17 billion. VUG has an expense ratio of 0.04% and QQQ charges 0.20%.
Bottom-Line
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
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.