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Is Invesco Global Clean Energy ETF (PBD) a Strong ETF Right Now?
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Making its debut on 06/13/2007, smart beta exchange traded fund Invesco Global Clean Energy ETF (PBD - Free Report) provides investors broad exposure to the Alternative Energy ETFs category of the market.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is managed by Invesco. PBD has been able to amass assets over $284.96 million, making it one of the average sized ETFs in the Alternative Energy ETFs. PBD, before fees and expenses, seeks to match the performance of the WilderHill New Energy Global Innovation Index.
The WilderHill New Energy Global Innovation Index is comprised of companies engaged in the business of the advancement of cleaner energy and conservation.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Operating expenses on an annual basis are 0.75% for this ETF, which makes it one of the most expensive products in the space.
It has a 12-month trailing dividend yield of 1.14%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
Looking at individual holdings, Yadea Group Holdings Ltd accounts for about 1.62% of total assets, followed by Byd Co Ltd and Daqo New Energy Corp Adr (DQ - Free Report) .
Its top 10 holdings account for approximately 12.97% of PBD's total assets under management.
Performance and Risk
The ETF has lost about -7.99% and is down about -14.21% so far this year and in the past one year (as of 08/15/2022), respectively. PBD has traded between $18.84 and $32.33 during this last 52-week period.
The ETF has a beta of 1.29 and standard deviation of 35.96% for the trailing three-year period, making it a high risk choice in the space. With about 141 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco Global Clean Energy ETF is a reasonable option for investors seeking to outperform the Alternative Energy ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
IShares ESG Aware MSCI EAFE ETF (ESGD - Free Report) tracks MSCI EAFE ESG Focus Index and the iShares ESG Aware MSCI USA ETF (ESGU - Free Report) tracks MSCI USA ESG Focus Index. IShares ESG Aware MSCI EAFE ETF has $6.91 billion in assets, iShares ESG Aware MSCI USA ETF has $24.08 billion. ESGD has an expense ratio of 0.20% and ESGU charges 0.15%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Alternative Energy ETFs.
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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Is Invesco Global Clean Energy ETF (PBD) a Strong ETF Right Now?
Making its debut on 06/13/2007, smart beta exchange traded fund Invesco Global Clean Energy ETF (PBD - Free Report) provides investors broad exposure to the Alternative Energy ETFs category of the market.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is managed by Invesco. PBD has been able to amass assets over $284.96 million, making it one of the average sized ETFs in the Alternative Energy ETFs. PBD, before fees and expenses, seeks to match the performance of the WilderHill New Energy Global Innovation Index.
The WilderHill New Energy Global Innovation Index is comprised of companies engaged in the business of the advancement of cleaner energy and conservation.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Operating expenses on an annual basis are 0.75% for this ETF, which makes it one of the most expensive products in the space.
It has a 12-month trailing dividend yield of 1.14%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
Looking at individual holdings, Yadea Group Holdings Ltd accounts for about 1.62% of total assets, followed by Byd Co Ltd and Daqo New Energy Corp Adr (DQ - Free Report) .
Its top 10 holdings account for approximately 12.97% of PBD's total assets under management.
Performance and Risk
The ETF has lost about -7.99% and is down about -14.21% so far this year and in the past one year (as of 08/15/2022), respectively. PBD has traded between $18.84 and $32.33 during this last 52-week period.
The ETF has a beta of 1.29 and standard deviation of 35.96% for the trailing three-year period, making it a high risk choice in the space. With about 141 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco Global Clean Energy ETF is a reasonable option for investors seeking to outperform the Alternative Energy ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
IShares ESG Aware MSCI EAFE ETF (ESGD - Free Report) tracks MSCI EAFE ESG Focus Index and the iShares ESG Aware MSCI USA ETF (ESGU - Free Report) tracks MSCI USA ESG Focus Index. IShares ESG Aware MSCI EAFE ETF has $6.91 billion in assets, iShares ESG Aware MSCI USA ETF has $24.08 billion. ESGD has an expense ratio of 0.20% and ESGU charges 0.15%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Alternative Energy ETFs.
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.