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Should PowerShares Dynamic Large Cap Growth Portfolio (PWB) Be on Your Investing Radar?
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If you're interested in broad exposure to the Large Cap Growth segment of the US equity market, look no further than the PowerShares Dynamic Large Cap Growth Portfolio (PWB - Free Report) , a passively managed exchange traded fund launched on 03/03/2005.
The fund is sponsored by Invesco Powershares. It has amassed assets over $587.01 M, making it one of the average sized ETFs attempting to match the Large Cap Growth segment of the US equity market.
Why Large Cap Growth
Large cap companies usually have a market capitalization above $10 billion. Overall, they are usually a stable option, with less risk and more sure-fire cash flows than mid and small cap companies.
Growth stocks have higher than average sales and earnings growth rates. While these are expected to grow faster than the broader market, they also have higher valuations. Additionally, growth stocks have a greater level of risk associated with them. Compared to value stocks, growth stocks are a safer bet in a strong bull market, but don't perform as strongly in almost all other financial environments.
Costs
Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.
Annual operating expenses for this ETF are 0.57%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.60%.
Sector Exposure and Top Holdings
ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Information Technology sector--about 42.10% of the portfolio. Industrials and Consumer Discretionary round out the top three.
Looking at individual holdings, Chevron Corp (CVX - Free Report) accounts for about 3.77% of total assets, followed by Adobe Systems Inc (ADBE - Free Report) and Mastercard Inc (MA - Free Report) .
The top 10 holdings account for about 34.81% of total assets under management.
Performance and Risk
PWB seeks to match the performance of the Dynamic Large Cap Growth Intellidex Index before fees and expenses. The Index is designed to provide capital appreciation while maintaining consistent stylistically accurate exposure.
The ETF has gained about 8.11% so far this year and was up about 29.39% in the last one year (as of 05/18/2018). In the past 52-week period, it has traded between $35.23 and $45.21.
The ETF has a beta of 0.90 and standard deviation of 13.99% for the trailing three-year period, making it a medium risk choice in the space. With about 50 holdings, it has more concentrated exposure than peers.
Alternatives
PowerShares Dynamic Large Cap Growth Portfolio carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, PWB is a good option for those seeking exposure to the Large Cap ETFs area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 1000 Growth ETF (IWF - Free Report) and the PowerShares QQQ (QQQ - Free Report) track a similar index. While iShares Russell 1000 Growth ETF has $41.55 B in assets, PowerShares QQQ has $62.48 B. IWF has an expense ratio of 0.20% and QQQ charges 0.20%.
Bottom-Line
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.
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 PowerShares Dynamic Large Cap Growth Portfolio (PWB) Be on Your Investing Radar?
If you're interested in broad exposure to the Large Cap Growth segment of the US equity market, look no further than the PowerShares Dynamic Large Cap Growth Portfolio (PWB - Free Report) , a passively managed exchange traded fund launched on 03/03/2005.
The fund is sponsored by Invesco Powershares. It has amassed assets over $587.01 M, making it one of the average sized ETFs attempting to match the Large Cap Growth segment of the US equity market.
Why Large Cap Growth
Large cap companies usually have a market capitalization above $10 billion. Overall, they are usually a stable option, with less risk and more sure-fire cash flows than mid and small cap companies.
Growth stocks have higher than average sales and earnings growth rates. While these are expected to grow faster than the broader market, they also have higher valuations. Additionally, growth stocks have a greater level of risk associated with them. Compared to value stocks, growth stocks are a safer bet in a strong bull market, but don't perform as strongly in almost all other financial environments.
Costs
Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.
Annual operating expenses for this ETF are 0.57%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.60%.
Sector Exposure and Top Holdings
ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Information Technology sector--about 42.10% of the portfolio. Industrials and Consumer Discretionary round out the top three.
Looking at individual holdings, Chevron Corp (CVX - Free Report) accounts for about 3.77% of total assets, followed by Adobe Systems Inc (ADBE - Free Report) and Mastercard Inc (MA - Free Report) .
The top 10 holdings account for about 34.81% of total assets under management.
Performance and Risk
PWB seeks to match the performance of the Dynamic Large Cap Growth Intellidex Index before fees and expenses. The Index is designed to provide capital appreciation while maintaining consistent stylistically accurate exposure.
The ETF has gained about 8.11% so far this year and was up about 29.39% in the last one year (as of 05/18/2018). In the past 52-week period, it has traded between $35.23 and $45.21.
The ETF has a beta of 0.90 and standard deviation of 13.99% for the trailing three-year period, making it a medium risk choice in the space. With about 50 holdings, it has more concentrated exposure than peers.
Alternatives
PowerShares Dynamic Large Cap Growth Portfolio carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, PWB is a good option for those seeking exposure to the Large Cap ETFs area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 1000 Growth ETF (IWF - Free Report) and the PowerShares QQQ (QQQ - Free Report) track a similar index. While iShares Russell 1000 Growth ETF has $41.55 B in assets, PowerShares QQQ has $62.48 B. IWF has an expense ratio of 0.20% and QQQ charges 0.20%.
Bottom-Line
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.
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.