Should You Invest in the Invesco DWA Industrials Momentum ETF (PRN)?
Sector ETF report for PRN
If you're interested in broad exposure to the Industrials - Broad segment of the equity market, look no further than the Invesco DWA Industrials Momentum ETF (PRN), a passively managed exchange traded fund launched on 10/12/2006.
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.
Investor-friendly, sector ETFs provide many options to gain low risk and diversified exposure to a broad group of companies in particular sectors. Industrials - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 5, placing it in top 31%.
The fund is sponsored by Invesco. It has amassed assets over $268.33 million, making it one of the average sized ETFs attempting to match the performance of the Industrials - Broad segment of the equity market. PRN seeks to match the performance of the DWA Industrials Technical Leaders Index before fees and expenses.
The DWA Industrials 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.
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.
Annual operating expenses for this ETF are 0.60%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.08%.
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 Industrials sector--about 90% of the portfolio. Consumer Discretionary and Information Technology round out the top three.
Looking at individual holdings, Ametek Inc (AME) accounts for about 3.61% of total assets, followed by Generac Holdings Inc (GNRC) and Pool Corp (POOL).
The top 10 holdings account for about 33.11% of total assets under management.
Performance and Risk
The ETF has gained about 16.33% and is up about 32.35% so far this year and in the past one year (as of 09/03/2021), respectively. PRN has traded between $72.97 and $108.63 during this last 52-week period.
The ETF has a beta of 1.09 and standard deviation of 28.08% for the trailing three-year period, making it a medium risk choice in the space. With about 45 holdings, it has more concentrated exposure than peers.
Invesco DWA Industrials 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, PRN is a reasonable option for those seeking exposure to the Industrials ETFs area of the market. Investors might also want to consider some other ETF options in the space.
Vanguard Industrials ETF (VIS) tracks MSCI US Investable Market Industrials 25/50 Index and the Industrial Select Sector SPDR ETF (XLI) tracks Industrial Select Sector Index. Vanguard Industrials ETF has $5.46 billion in assets, Industrial Select Sector SPDR ETF has $19.51 billion. VIS has an expense ratio of 0.10% and XLI charges 0.12%.
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 Industrials Momentum ETF (PRN): ETF Research Reports
Pool Corporation (POOL): Free Stock Analysis Report
AMETEK, Inc. (AME): Free Stock Analysis Report
Vanguard Industrials ETF (VIS): ETF Research Reports
Industrial Select Sector SPDR ETF (XLI): ETF Research Reports
Generac Holdings Inc. (GNRC): Free Stock Analysis Report
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