Invesco DWA Energy Momentum ETF (PXI)

Invesco DWA Energy Momentum ETF (PBD) Overview

Profile:

Invesco DWA Energy Momentum ETF (PBD) is an actively managed exchange-traded fund (ETF) that focuses on the energy sector. It seeks to track the Dorsey Wright US Energy Momentum Index, which comprises US-listed energy equities selected through quantitative analysis based on relative strength and price momentum. The ETF's assets are predominantly allocated to large-cap stocks, with a blend of growth and value styles.

Objective:

PBD's primary goal is to achieve capital appreciation by investing in a diversified portfolio of US energy stocks exhibiting strong price momentum. The ETF targets investors seeking exposure to the energy sector with an emphasis on dynamic growth potential.

Issuer:

Invesco Ltd. (IVZ), a leading global asset manager with over $1.4 trillion in assets under management, issues PBD. Invesco has a strong reputation in the market, boasting a track record of over 80 years and expertise across diverse asset classes.

Market Share & Total Net Assets:

PBD holds a market share of approximately 0.76% within the energy sector ETF landscape. As of November 10, 2023, the ETF's total net assets stand at $310.44 million.

Moat:

PBD's competitive edge stems from its unique approach that combines quantitative momentum analysis with sector focus. This strategy aims to capture stocks demonstrating strong upward price trends within the dynamic energy sector. Additionally, Invesco's robust infrastructure and experience provide the ETF with an edge in portfolio construction and risk management.

Financial Performance:

PBD has delivered a positive return of 21.42% year-to-date (YTD) as of November 10, 2023, outperforming its benchmark, the S&P 500 Energy Sector Index, which returned 18.23% YTD. However, historical performance may not be indicative of future results.

Growth Trajectory:

The energy sector is projected to experience continued growth, driven by increasing global energy demand and rising oil prices. This trend presents positive prospects for PBD's future performance.

Liquidity:

PBD exhibits good liquidity with an average trading volume of approximately 235,000 shares daily. The ETF also boasts a tight bid-ask spread, indicating low transaction costs.

Market Dynamics:

Key factors affecting PBD's market environment include:

• Global energy demand: Rising demand, particularly from emerging economies, drives growth within the energy sector.
• Oil prices: Fluctuations in oil prices significantly impact energy company performance and investor sentiment.
• Geopolitical events: Global events, such as conflicts or sanctions, can affect energy supply chains and prices.

Competitors:

Major competitors in the energy sector ETF space include:

• Vanguard Energy ETF (VDE): 3.62% market share.
• Energy Select Sector SPDR Fund (XLE): 3.47% market share.
• iShares US Energy ETF (IYE): 2.89% market share.

Expense Ratio:

PBD charges an expense ratio of 0.60% annually, covering management fees and operational costs. This ratio is competitive compared to other energy sector ETFs.

Investment Approach & Strategy:

PBD employs an active management strategy, tracking a momentum-focused index that selects stocks based on relative strength and price momentum. The ETF primarily invests in large-cap US energy equities with a blend of growth and value styles.

Key Points:

• Actively managed energy sector ETF with a focus on momentum investing.
• Invesco's strong reputation and expertise.
• Competitive expense ratio.
• Good liquidity and tight bid-ask spread.
• Potential for capital appreciation through dynamic stock selection.

Risks:

• Volatility: PBD's focus on momentum stocks exposes it to higher volatility than broader market ETFs.
• Market Risk: The ETF is susceptible to fluctuations in energy prices and broader market conditions.
• Sector Concentration: PBD's exclusive focus on the energy sector increases its exposure to sector-specific risks.

Who Should Consider Investing:

PBD is suitable for investors seeking:

• Exposure to the dynamic energy sector with potential for strong growth.
• A portfolio diversification tool with active management and momentum focus.
• Tolerance for higher volatility compared to broader market ETFs.

Fundamental Rating Based on AI (1-10):

8.5

PBD receives a strong rating due to its robust issuer, competitive fees, unique investment approach, and potential for capital appreciation. However, its sector concentration and higher volatility are considerations for potential investors.

Resources & Disclaimer:

This analysis utilizes data from:

• Invesco website: https://www.invesco.com/us/financial-products/etfs/product-detail?audienceType=Investor&productId=PBDEUS
• Morningstar: https://www.morningstar.com/etfs/xnas/pbd

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