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Software ETF (PSJ) Hits New 52-Week High

Sanghamitra Saha
Low-beta products could be worthwhile for low risk-tolerant investors looking to safeguard their portfolio in the current market environment and seeking outperformance.

For investors seeking momentum, Invesco Dynamic Software ETF (PSJ) is probably on radar now. The fund just hit a 52-week high, which is up roughly 42.5% from its 52-week low price of $68.08/share.

But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:

PSJ in Focus

The 30-security fund looks to track the Dynamic Software Intellidex Index. The index is is comprised of stocks of software companies. The Index is designed to provide capital appreciation by thoroughly evaluating companies based on a variety of investment merit criteria, including fundamental growth, stock valuation, investment timeliness and risk factors. Cadence Design Systems (5.66%), Cerner (5.34%) and VMware (5.31%) are the top three holdings of the fund.  The expense ratio of the fund is 0.63% (see all technology ETFs here).

Why the Move?

The software sector’s long-term story remains intact with the emergence of cutting-edge technology such as cloud computing, big data, Internet of Things, wearables, VR headsets, drones, virtual reality and artificial intelligence. The deployment of 5G (fifth-generation) technology — the next wireless revolution — is creating further opportunities. Probably this is why the fund has hit a 52-week high despite renewed US-China trade tensions.

More Gains Ahead?

The fund has a Zacks Rank #1 (Strong Buy). So, there is definitely still some promise for those who want to ride on this ETF a little longer.

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Invesco Dynamic Software ETF (PSJ): ETF Research Reports
 
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