Designed to provide broad exposure to the Technology - Broad segment of the equity market, the Invesco DWA Technology Momentum ETF (PTF) is a passively managed exchange traded fund launched on 10/12/2006.
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.
Sector ETFs are also funds of convenience, offering many ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Technology - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 9, placing it in bottom 44%.
The fund is sponsored by Invesco. It has amassed assets over $286.45 million, making it one of the average sized ETFs attempting to match the performance of the Technology - Broad segment of the equity market. PTF seeks to match the performance of the DWA Technology Technical Leaders Index before fees and expenses.
The DWA Technology Technical Leaders Index identifies companies that are showing relative strength and are composed of at least 30 common stocks from a universe of approximately 3,000 common stocks traded on US exchanges.
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.60%, making it on par with most peer products in the space.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Information Technology sector--about 88% of the portfolio. Telecom and Healthcare round out the top three.
Looking at individual holdings, Five9 Inc (FIVN) accounts for about 5.28% of total assets, followed by Apple Inc (AAPL) and Nvidia Corp (NVDA).
The top 10 holdings account for about 40.40% of total assets under management.
Performance and Risk
The ETF has added about 64.76% so far this year and was up about 77.46% in the last one year (as of 11/08/2020). In that past 52-week period, it has traded between $57.94 and $127.31.
The ETF has a beta of 1.11 and standard deviation of 32.88% for the trailing three-year period, making it a high risk choice in the space. With about 38 holdings, it has more concentrated exposure than peers.
Invesco DWA Technology Momentum 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, PTF is a great option for investors seeking exposure to the Technology ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
Technology Select Sector SPDR ETF (XLK) tracks Technology Select Sector Index and the Vanguard Information Technology ETF (VGT) tracks MSCI US Investable Market Information Technology 25/50 Index. Technology Select Sector SPDR ETF has $35.83 billion in assets, Vanguard Information Technology ETF has $38.48 billion. XLK has an expense ratio of 0.13% and VGT charges 0.10%.
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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Invesco DWA Technology Momentum ETF (PTF): ETF Research Reports
NVIDIA Corporation (NVDA) : Free Stock Analysis Report
Apple Inc. (AAPL) : Free Stock Analysis Report
Technology Select Sector SPDR ETF (XLK): ETF Research Reports
Five9, Inc. (FIVN) : Free Stock Analysis Report
Vanguard Information Technology ETF (VGT): ETF Research Reports
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