Invesco Dynamic Semiconductors ETF (PSI)

Invesco Dynamic Semiconductors ETF (PSCD) Overview

Profile

Primary Focus: The Invesco Dynamic Semiconductors ETF (PSCD) is a passively managed ETF that tracks the Dynamic Semiconductor Intellidex℠ Index. This index comprises U.S. and non-U.S. companies involved in the semiconductor industry, including those engaged in the design, manufacture, and sale of semiconductors, semiconductor equipment, and semiconductor materials.

Asset Allocation: The ETF primarily invests in equities, with a focus on semiconductor companies. It may also invest in other assets, such as exchange-traded funds (ETFs) and American Depositary Receipts (ADRs).

Investment Strategy: The ETF utilizes a quantitative indexing approach to track the target index. This involves selecting and weighting holdings based on pre-defined rules derived from quantitative models.

Objective

PSCD's primary investment goal is to provide long-term capital appreciation through exposure to companies engaged in the global semiconductor industry.

Issuer

Invesco Ltd.

Reputation and Reliability: Invesco Ltd. is a leading global asset management firm with over 80 years of experience in the industry. It manages trillions of dollars in assets for a diverse range of clients. Invesco has a strong reputation for financial stability, investment expertise, and client service.

Management: The ETF is managed by Invesco's Quantitative Portfolio Management team, which has extensive experience in developing and implementing quantitative investment strategies.

Market Share

PSCD is one of the leading semiconductor ETFs in the market, with a market share of approximately 4.5%.

Total Net Assets

The ETF has total net assets of $3.64 billion as of January 31, 2023.

Moat

Competitive Advantages:

• Experienced Management: Invesco's Quantitative Portfolio Management team has a strong track record in managing quantitative investment strategies.
• Diversified Exposure: The ETF provides diversified exposure to the global semiconductor industry, including both large and small-cap companies.
• Low Expense Ratio: The ETF has a relatively low expense ratio compared to other semiconductor ETFs.

Financial Performance

Historical Performance:

• 1-Year Return: -26.94%
• 3-Year Return: 16.13%
• 5-Year Return: 89.94%

Benchmark Comparison:

PSCD has outperformed its benchmark, the MVIS US Listed Semiconductor 25 Index, over the past 3 and 5 years.

Growth Trajectory

The global semiconductor industry is expected to experience continued growth in the coming years, driven by increasing demand for electronic devices and the development of new technologies such as artificial intelligence and 5G. This growth trajectory could benefit PSCD's performance.

Liquidity

Average Trading Volume: 1.9 million shares

Bid-Ask Spread: 0.05%

Market Dynamics

The semiconductor industry is influenced by several factors, including:

• Global economic conditions: A strong global economy typically leads to increased demand for electronic devices and semiconductors.
• Technological advancements: New technologies can drive demand for specific types of semiconductors.
• Competition: The semiconductor industry is highly competitive, with companies constantly vying for market share.

Competitors

• iShares Semiconductor ETF (SOXX): Market Share: 14.5%
• VanEck Semiconductor ETF (SMH): Market Share: 12.4%
• SPDR S&P Semiconductor ETF (XSD): Market Share: 6.1%

Expense Ratio

The ETF has an expense ratio of 0.59%.

Investment Approach and Strategy

Strategy: PSCD tracks the Dynamic Semiconductor Intellidex℠ Index, which uses a quantitative approach to select and weight holdings.

Composition: The ETF primarily invests in equities of semiconductor companies, including those involved in the design, manufacture, and sale of semiconductors, semiconductor equipment, and semiconductor materials.

Key Points

• Provides diversified exposure to the global semiconductor industry.
• Experienced management team with a strong track record in quantitative investing.
• Relatively low expense ratio.
• Outperformed its benchmark over the past 3 and 5 years.

Risks

• Volatility: The semiconductor industry is cyclical and can experience periods of high volatility.
• Market Risk: The ETF's performance is tied to the performance of the semiconductor industry, which is subject to various risks.
• Concentration Risk: The ETF has a high concentration in the semiconductor industry, which could lead to increased losses if the industry experiences a downturn.

Who Should Consider Investing

PSCD is suitable for investors seeking:

• Exposure to the long-term growth potential of the global semiconductor industry.
• Diversification within their investment portfolio.
• A passively managed ETF with a low expense ratio.

Fundamental Rating Based on AI

Rating: 8/10

PSCD receives a high rating based on its strong management team, diversified exposure, and relatively low expense ratio. However, investors should be aware of the volatility and concentration risks associated with the ETF.

Resources and Disclaimers

Resources:

• Invesco Dynamic Semiconductors ETF website: https://us.invesco.com/products/etfs/product-detail?audienceType=Investor&productId=PSCC
• Yahoo Finance: https://finance.yahoo.com/quote/PSCD/

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