Should You Invest in the Invesco DWA Technology Momentum ETF (PTF)?
Looking for broad exposure to the Technology - Broad segment of the equity market? You should consider the Invesco DWA Technology Momentum ETF (PTF), a passively managed exchange traded fund launched on 10/12/2006.
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
Investor-friendly, sector ETFs provide many options 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 15, placing it in bottom 6%.
Index Details
The fund is sponsored by Invesco. It has amassed assets over $273.39 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.
Costs
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
ETFs offer a 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.
This ETF has heaviest allocation in the Information Technology sector--about 98.50% of the portfolio.
Looking at individual holdings, Intuit Inc (INTU) accounts for about 4.74% of total assets, followed by Epam Systems Inc (EPAM) and Docusign Inc (DOCU).
The top 10 holdings account for about 37.80% of total assets under management.
Performance and Risk
So far this year, PTF has gained about 5.48%, and is up about 46.01% in the last one year (as of 07/15/2021). During this past 52-week period, the fund has traded between $98.15 and $172.99.
The ETF has a beta of 1.06 and standard deviation of 36.63% for the trailing three-year period, making it a high risk choice in the space. With about 42 holdings, it has more concentrated exposure than peers.
Alternatives
Invesco DWA Technology Momentum ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, PTF is a good option for those seeking exposure to the Technology ETFs area of the market. Investors might also want to consider some other ETF options in the space.
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 $43.94 billion in assets, Vanguard Information Technology ETF has $48.13 billion. XLK has an expense ratio of 0.12% and VGT charges 0.10%.
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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Invesco DWA Technology Momentum ETF (PTF): ETF Research Reports
Intuit Inc. (INTU) : Free Stock Analysis Report
EPAM Systems, Inc. (EPAM) : Free Stock Analysis Report
Technology Select Sector SPDR ETF (XLK): ETF Research Reports
Vanguard Information Technology ETF (VGT): ETF Research Reports
DocuSign Inc. (DOCU) : Free Stock Analysis Report
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