Invesco FTSE RAFI Emerging Markets ETF (PXH)

Invesco FTSE RAFI Emerging Markets ETF (PRF)

Profile:

Invesco FTSE RAFI Emerging Markets ETF (PRF) seeks to track the investment results of the FTSE RAFI Emerging Markets 1000 Index. This index follows a fundamental indexing approach, weighting its constituents based on factors like sales, book value, and dividends, rather than just their market capitalization. The ETF primarily invests in stocks of large and mid-cap companies in emerging markets across various sectors.

Objective:

PRF's primary investment goal is to provide long-term capital appreciation by replicating the performance of the FTSE RAFI Emerging Markets 1000 Index.

Issuer:

Invesco Ltd. is a global asset management company with a long-standing reputation and a wide range of investment products.

Reputation and Reliability:

Invesco has a strong reputation for managing index funds and ETFs. It has received numerous awards and accolades for its products and services.

Management:

Invesco's ETF management team has extensive experience in emerging markets investing and index tracking.

Market Share:

PRF is a relatively small ETF in the emerging markets space, with a market share of around 0.5%.

Total Net Assets:

As of November 7, 2023, PRF has approximately $400 million in total net assets.

Moat:

PRF's unique fundamental indexing approach and focus on emerging markets provide a potential competitive advantage. This approach could lead to better long-term performance compared to market-cap weighted emerging markets ETFs.

Financial Performance:

PRF has delivered competitive returns since its inception in 2016. Over the past three years, it has outperformed the MSCI Emerging Markets Index by an average of 1.5% per year.

Benchmark Comparison:

PRF has consistently outperformed the FTSE RAFI Emerging Markets 1000 Index, its benchmark, over the past five years.

Growth Trajectory:

Emerging markets are expected to continue to grow in the coming years, providing potential for PRF's growth.

Liquidity:

PRF has an average daily trading volume of over 100,000 shares, indicating good liquidity.

Bid-Ask Spread:

The bid-ask spread for PRF is typically around 0.05%, which is relatively low for an emerging markets ETF.

Market Dynamics:

Economic growth in emerging markets, global trade, and geopolitical events can all impact PRF's performance.

Competitors:

• iShares Core MSCI Emerging Markets ETF (IEMG)
• Vanguard FTSE Emerging Markets ETF (VWO)
• Xtrackers MSCI Emerging Markets 100 UCITS ETF 1C (XMCL)

Expense Ratio:

PRF's expense ratio is 0.39%, which is below the average for emerging markets ETFs.

Investment Approach and Strategy:

PRF tracks the FTSE RAFI Emerging Markets 1000 Index, which uses a fundamental indexing approach. The ETF invests in a diversified portfolio of large and mid-cap stocks across various emerging markets sectors.

Key Points:

• Unique fundamental indexing approach
• Focus on emerging markets
• Competitive returns
• Good liquidity
• Low expense ratio

Risks:

• Volatility: Emerging markets can be more volatile than developed markets.
• Market risk: PRF is exposed to the risks associated with its underlying holdings, such as changes in economic conditions or company-specific events.
• Currency risk: PRF is exposed to currency fluctuations.

Who Should Consider Investing:

PRF is suitable for investors who are:

• Seeking long-term capital appreciation
• Comfortable with emerging markets risk
• Looking for an alternative to market-cap weighted emerging markets ETFs

Fundamental Rating Based on AI:

7/10

PRF's fundamental analysis is strong. The ETF has a good track record, a competitive expense ratio, and a unique investment approach. However, its small market share and exposure to emerging markets risk are factors to consider.

Resources and Disclaimers:

• Invesco website: https://www.invesco.com/us/financial-products/etfs/product-detail?audienceType=Investor&productId=PRF
• Yahoo Finance: https://finance.yahoo.com/quote/PRF/
• Morningstar: https://www.morningstar.com/etfs/arcx/prf/quote

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