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Should You Invest in the Invesco SP SmallCap Health Care ETF (PSCH)?
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The Invesco SP SmallCap Health Care ETF (PSCH - Free Report) was launched on 04/07/2010, and is a passively managed exchange traded fund designed to offer broad exposure to the Healthcare - Broad segment of the equity market.
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Healthcare - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 13, placing it in bottom 19%.
Index Details
The fund is sponsored by Invesco. It has amassed assets over $403.15 million, making it one of the average sized ETFs attempting to match the performance of the Healthcare - Broad segment of the equity market. PSCH seeks to match the performance of the S&P SmallCap 600 Capped Health Care Index before fees and expenses.
This Index is comprised of common stocks of U.S. healthcare companies.These are companies that are principally engaged in the business of providing healthcare-related products & services, including biotechnology, pharmaceuticals, medical technology and supplies & facilities and this Index is a subset of the S&P SmallCap 600 Index.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.29%, making it one of the least expensive products in the space.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
Looking at individual holdings, Neogenomics Inc (NEO - Free Report) accounts for about 5.59% of total assets, followed by Omnicell Inc (OMCL - Free Report) and Amn Healthcare Services Inc (AMN - Free Report) .
The top 10 holdings account for about 34.17% of total assets under management.
Performance and Risk
The ETF has added roughly 12.63% so far this year and it's up approximately 23.40% in the last one year (as of 11/10/2020). In that past 52-week period, it has traded between $88.57 and $145.54.
The ETF has a beta of 1.17 and standard deviation of 28.04% for the trailing three-year period, making it a high risk choice in the space. With about 72 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco SP SmallCap Health Care 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, PSCH is a reasonable option for those seeking exposure to the Health Care ETFs area of the market. Investors might also want to consider some other ETF options in the space.
Vanguard Health Care ETF (VHT - Free Report) tracks MSCI US Investable Market Health Care 25/50 Index and the Health Care Select Sector SPDR ETF (XLV - Free Report) tracks Health Care Select Sector Index. Vanguard Health Care ETF has $12.24 billion in assets, Health Care Select Sector SPDR ETF has $24.87 billion. VHT has an expense ratio of 0.10% and XLV charges 0.13%.
Bottom Line
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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Should You Invest in the Invesco SP SmallCap Health Care ETF (PSCH)?
The Invesco SP SmallCap Health Care ETF (PSCH - Free Report) was launched on 04/07/2010, and is a passively managed exchange traded fund designed to offer broad exposure to the Healthcare - Broad segment of the equity market.
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Healthcare - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 13, placing it in bottom 19%.
Index Details
The fund is sponsored by Invesco. It has amassed assets over $403.15 million, making it one of the average sized ETFs attempting to match the performance of the Healthcare - Broad segment of the equity market. PSCH seeks to match the performance of the S&P SmallCap 600 Capped Health Care Index before fees and expenses.
This Index is comprised of common stocks of U.S. healthcare companies.These are companies that are principally engaged in the business of providing healthcare-related products & services, including biotechnology, pharmaceuticals, medical technology and supplies & facilities and this Index is a subset of the S&P SmallCap 600 Index.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.29%, making it one of the least expensive products in the space.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
Looking at individual holdings, Neogenomics Inc (NEO - Free Report) accounts for about 5.59% of total assets, followed by Omnicell Inc (OMCL - Free Report) and Amn Healthcare Services Inc (AMN - Free Report) .
The top 10 holdings account for about 34.17% of total assets under management.
Performance and Risk
The ETF has added roughly 12.63% so far this year and it's up approximately 23.40% in the last one year (as of 11/10/2020). In that past 52-week period, it has traded between $88.57 and $145.54.
The ETF has a beta of 1.17 and standard deviation of 28.04% for the trailing three-year period, making it a high risk choice in the space. With about 72 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco SP SmallCap Health Care 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, PSCH is a reasonable option for those seeking exposure to the Health Care ETFs area of the market. Investors might also want to consider some other ETF options in the space.
Vanguard Health Care ETF (VHT - Free Report) tracks MSCI US Investable Market Health Care 25/50 Index and the Health Care Select Sector SPDR ETF (XLV - Free Report) tracks Health Care Select Sector Index. Vanguard Health Care ETF has $12.24 billion in assets, Health Care Select Sector SPDR ETF has $24.87 billion. VHT has an expense ratio of 0.10% and XLV charges 0.13%.
Bottom Line
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.