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Is Invesco Global Water ETF (PIO) a Strong ETF Right Now?
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A smart beta exchange traded fund, the Invesco Global Water ETF (PIO - Free Report) debuted on 06/13/2007, and offers broad exposure to the Industrials ETFs category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
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.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
Because the fund has amassed over $277.85 million, this makes it one of the average sized ETFs in the Industrials ETFs. PIO is managed by Invesco. This particular fund, before fees and expenses, seeks to match the performance of the NASDAQ OMX Global Water Index.
The NASDAQ OMX Global Water Index is designed to track the performance of companies worldwide that are creating products that conserve and purify water for homes, businesses and industries.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Operating expenses on an annual basis are 0.75% for this ETF, which makes it one of the most expensive products in the space.
The fund has a 12-month trailing dividend yield of 0.83%.
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.
Taking into account individual holdings, Roper Technologies Inc (ROP - Free Report) accounts for about 8.53% of the fund's total assets, followed by Ecolab Inc (ECL - Free Report) and Pentair Plc (PNR - Free Report) .
PIO's top 10 holdings account for about 56.42% of its total assets under management.
Performance and Risk
So far this year, PIO return is roughly 7.13%, and it's up approximately 15.28% in the last one year (as of 08/01/2024). During this past 52-week period, the fund has traded between $31.37 and $43.54.
The fund has a beta of 1.03 and standard deviation of 18.47% for the trailing three-year period, which makes PIO a medium risk choice in this particular space. With about 48 holdings, it has more concentrated exposure than peers.
Alternatives
Invesco Global Water ETF is a reasonable option for investors seeking to outperform the Industrials ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
First Trust Water ETF (FIW - Free Report) tracks ISE Clean Edge Water Index and the Invesco Water Resources ETF (PHO - Free Report) tracks NASDAQ OMX US Water Index. First Trust Water ETF has $1.80 billion in assets, Invesco Water Resources ETF has $2.24 billion. FIW has an expense ratio of 0.53% and PHO charges 0.60%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Industrials ETFs.
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 Global Water ETF (PIO) a Strong ETF Right Now?
A smart beta exchange traded fund, the Invesco Global Water ETF (PIO - Free Report) debuted on 06/13/2007, and offers broad exposure to the Industrials ETFs category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
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.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
Because the fund has amassed over $277.85 million, this makes it one of the average sized ETFs in the Industrials ETFs. PIO is managed by Invesco. This particular fund, before fees and expenses, seeks to match the performance of the NASDAQ OMX Global Water Index.
The NASDAQ OMX Global Water Index is designed to track the performance of companies worldwide that are creating products that conserve and purify water for homes, businesses and industries.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Operating expenses on an annual basis are 0.75% for this ETF, which makes it one of the most expensive products in the space.
The fund has a 12-month trailing dividend yield of 0.83%.
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.
Taking into account individual holdings, Roper Technologies Inc (ROP - Free Report) accounts for about 8.53% of the fund's total assets, followed by Ecolab Inc (ECL - Free Report) and Pentair Plc (PNR - Free Report) .
PIO's top 10 holdings account for about 56.42% of its total assets under management.
Performance and Risk
So far this year, PIO return is roughly 7.13%, and it's up approximately 15.28% in the last one year (as of 08/01/2024). During this past 52-week period, the fund has traded between $31.37 and $43.54.
The fund has a beta of 1.03 and standard deviation of 18.47% for the trailing three-year period, which makes PIO a medium risk choice in this particular space. With about 48 holdings, it has more concentrated exposure than peers.
Alternatives
Invesco Global Water ETF is a reasonable option for investors seeking to outperform the Industrials ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
First Trust Water ETF (FIW - Free Report) tracks ISE Clean Edge Water Index and the Invesco Water Resources ETF (PHO - Free Report) tracks NASDAQ OMX US Water Index. First Trust Water ETF has $1.80 billion in assets, Invesco Water Resources ETF has $2.24 billion. FIW has an expense ratio of 0.53% and PHO charges 0.60%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Industrials ETFs.
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.