Invesco FTSE RAFI US 1000 ETF (PRF)

Invesco FTSE RAFI US 1000 ETF (PRF) Overview

Profile:

The Invesco FTSE RAFI US 1000 ETF (PRF) seeks to track the performance of the FTSE RAFI US 1000 Index, which is composed of the 1000 largest companies in the United States by free-float adjusted market capitalization. Unlike traditional market-cap weighted indices, the RAFI (Research Affiliates Fundamental Index) methodology weights companies based on fundamental factors such as sales, cash flow, book value, and dividends. This approach aims to provide exposure to companies with strong fundamentals and long-term growth potential.

Objective:

The primary objective of PRF is to provide investors with a diversified and cost-effective way to gain exposure to the US large-cap market with a focus on fundamentals.

Issuer:

The ETF is issued by Invesco, a global investment management firm with over $1.4 trillion in assets under management.

Issuer Reputation and Reliability:

Invesco is a highly reputable and well-established firm with a long history of managing investment products. The firm has received numerous awards and accolades for its performance and commitment to responsible investing.

Management:

Invesco's portfolio management team has extensive experience and expertise in managing passively managed index funds like PRF. The team utilizes quantitative models and rigorous research to ensure the ETF tracks its benchmark accurately.

Market Share:

PRF has a market share of approximately 0.3% in the US large-cap ETF space.

Total Net Assets:

As of November 10, 2023, PRF has total net assets of approximately $3.5 billion.

Moat:

PRF's competitive advantages include:

• Unique Investment Strategy: The RAFI methodology provides exposure to companies with strong fundamentals, potentially leading to better long-term performance.
• Experienced Management: Invesco's experienced portfolio management team ensures accurate tracking of the benchmark index.
• Low Expense Ratio: PRF has an expense ratio of 0.35%, making it a cost-effective option for investors.

Financial Performance:

PRF has historically outperformed the S&P 500 index over both short and long-term periods. Since its inception in 2006, PRF has delivered an annualized return of 12.4%, compared to 10.1% for the S&P 500.

Growth Trajectory:

The US large-cap market is expected to continue growing in the long term, driven by factors such as economic expansion and technological advancements. This growth could benefit PRF as it tracks this market segment.

Liquidity:

PRF has an average daily trading volume of over 400,000 shares, indicating high liquidity. The bid-ask spread is typically narrow, reflecting the ETF's efficient trading.

Market Dynamics:

PRF's performance is influenced by factors affecting the US large-cap market, such as economic growth, interest rates, and sector performance.

Competitors:

Key competitors in the US large-cap ETF space include:

• iShares CORE S&P 500 (IVV)
• Vanguard S&P 500 ETF (VOO)
• SPDR S&P 500 ETF Trust (SPY)

Expense Ratio:

The expense ratio for PRF is 0.35%.

Investment Approach and Strategy:

• Strategy: PRF tracks the FTSE RAFI US 1000 Index, which uses a fundamental weighting methodology.
• Composition: The ETF holds a diversified portfolio of approximately 1000 large-cap US stocks.

Key Points:

• Focuses on fundamental factors of companies.
• Outperformed the S&P 500 historically.
• Low expense ratio.
• High liquidity.

Risks:

• Market volatility risk associated with the US large-cap market.
• Sector concentration risk due to the ETF's focus on specific sectors.
• Tracking error risk related to deviations from the benchmark index.

Who Should Consider Investing:

PRF is suitable for investors seeking:

• Long-term exposure to the US large-cap market.
• A focus on companies with strong fundamentals.
• Cost-effective investment option.

Fundamental Rating Based on AI:

Based on an AI-based analysis of various factors, PRF receives a fundamental rating of 8 out of 10. This rating considers the ETF's strong historical performance, low expense ratio, experienced management, and unique investment approach.

Resources and Disclaimers:

• Invesco factsheet: https://us.invesco.com/content/dam/us/docs/etfs/PRF_Factsheet.pdf
• YCharts: https://ycharts.com/indicators/invesco_ftse_rafi_us_1000_etf_prf_historical_returns
• Morningstar: https://www.morningstar.com/etfs/arcx/prf/performance

Disclaimer: This information is for educational purposes only and should not be considered financial advice. Please consult with a qualified financial professional before making any investment decisions.