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Is Invesco Bloomberg Pricing Power ETF (POWA) a Strong ETF Right Now?
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A smart beta exchange traded fund, the Invesco Bloomberg Pricing Power ETF (POWA - Free Report) debuted on 12/15/2006, and offers broad exposure to the Style Box - Large Cap Growth category of the market.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
The fund is sponsored by Invesco. It has amassed assets over $235.08 million, making it one of the average sized ETFs in the Style Box - Large Cap Growth. This particular fund 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.
Cost & Other Expenses
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
Operating expenses on an annual basis are 0.40% for POWA, making it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 1.48%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
POWA's heaviest allocation is in the Industrials sector, which is about 30.90% of the portfolio. Its Information Technology and Healthcare round out the top three.
When you look at individual holdings, Kroger Co/the (KR - Free Report) accounts for about 2.33% of the fund's total assets, followed by Archer-Daniels-Midland Co (ADM - Free Report) and Dupont De Nemours Inc (DD - Free Report) .
POWA's top 10 holdings account for about 21.39% of its total assets under management.
Performance and Risk
The ETF has gained about 8.26% and is up roughly 0% so far this year and in the past one year (as of 06/18/2024), respectively. POWA has traded between $63.22 and $78.79 during this last 52-week period.
The fund has a beta of 0.86. With about 51 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco Bloomberg Pricing Power ETF is an excellent option for investors seeking to outperform the Style Box - Large Cap Growth segment of the market. There are other ETFs in the space which investors could consider as well.
Vanguard Growth ETF (VUG - Free Report) tracks CRSP U.S. Large Cap Growth Index and the Invesco QQQ (QQQ - Free Report) tracks NASDAQ-100 Index. Vanguard Growth ETF has $133.74 billion in assets, Invesco QQQ has $289.14 billion. VUG has an expense ratio of 0.04% and QQQ charges 0.20%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Growth.
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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Is Invesco Bloomberg Pricing Power ETF (POWA) a Strong ETF Right Now?
A smart beta exchange traded fund, the Invesco Bloomberg Pricing Power ETF (POWA - Free Report) debuted on 12/15/2006, and offers broad exposure to the Style Box - Large Cap Growth category of the market.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
The fund is sponsored by Invesco. It has amassed assets over $235.08 million, making it one of the average sized ETFs in the Style Box - Large Cap Growth. This particular fund 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.
Cost & Other Expenses
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
Operating expenses on an annual basis are 0.40% for POWA, making it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 1.48%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
POWA's heaviest allocation is in the Industrials sector, which is about 30.90% of the portfolio. Its Information Technology and Healthcare round out the top three.
When you look at individual holdings, Kroger Co/the (KR - Free Report) accounts for about 2.33% of the fund's total assets, followed by Archer-Daniels-Midland Co (ADM - Free Report) and Dupont De Nemours Inc (DD - Free Report) .
POWA's top 10 holdings account for about 21.39% of its total assets under management.
Performance and Risk
The ETF has gained about 8.26% and is up roughly 0% so far this year and in the past one year (as of 06/18/2024), respectively. POWA has traded between $63.22 and $78.79 during this last 52-week period.
The fund has a beta of 0.86. With about 51 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco Bloomberg Pricing Power ETF is an excellent option for investors seeking to outperform the Style Box - Large Cap Growth segment of the market. There are other ETFs in the space which investors could consider as well.
Vanguard Growth ETF (VUG - Free Report) tracks CRSP U.S. Large Cap Growth Index and the Invesco QQQ (QQQ - Free Report) tracks NASDAQ-100 Index. Vanguard Growth ETF has $133.74 billion in assets, Invesco QQQ has $289.14 billion. VUG has an expense ratio of 0.04% and QQQ charges 0.20%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Growth.
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.