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Should You Invest in the Invesco MSCI Global Timber ETF (CUT)?
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Designed to provide broad exposure to the Materials - Timber segment of the equity market, the Invesco MSCI Global Timber ETF (CUT - Free Report) is a passively managed exchange traded fund launched on 11/09/2007.
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
Sector ETFs also provide investors access to a broad group of companies in particular sectors that offer low risk and diversified exposure. Materials - Timber is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 10, placing it in bottom 38%.
Index Details
The fund is sponsored by Invesco. It has amassed assets over $226.29 M, making it one of the average sized ETFs attempting to match the performance of the Materials - Timber segment of the equity market. CUT seeks to match the performance of the MSCI ACWI IMI Timber Select Capped Index before fees and expenses.
The MSCI ACWI IMI Timber Select Capped Index reflects the performance of those stocks in the MSCI ACWI Investable Market Indexes that are engaged in the ownership and management of forests and timberlands and production of finished products which use timber as raw material.
Costs
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.
Annual operating expenses for this ETF are 0.55%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.53%.
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, Upm-Kymmene Oyj (UPM) accounts for about 5.18% of total assets, followed by Amcor Ltd/australia (AMC - Free Report) and International Paper Co (IP - Free Report) .
The top 10 holdings account for about 44.07% of total assets under management.
Performance and Risk
So far this year, CUT return is roughly 2.39%, and is up about 15.63% in the last one year (as of 08/01/2018). During this past 52-week period, the fund has traded between $28 and $34.52.
The ETF has a beta of 1.07 and standard deviation of 16.00% for the trailing three-year period, making it a medium risk choice in the space. With about 80 holdings, it effectively diversifies company-specific risk.
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 MSCI Global Timber ETF (CUT)?
Designed to provide broad exposure to the Materials - Timber segment of the equity market, the Invesco MSCI Global Timber ETF (CUT - Free Report) is a passively managed exchange traded fund launched on 11/09/2007.
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
Sector ETFs also provide investors access to a broad group of companies in particular sectors that offer low risk and diversified exposure. Materials - Timber is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 10, placing it in bottom 38%.
Index Details
The fund is sponsored by Invesco. It has amassed assets over $226.29 M, making it one of the average sized ETFs attempting to match the performance of the Materials - Timber segment of the equity market. CUT seeks to match the performance of the MSCI ACWI IMI Timber Select Capped Index before fees and expenses.
The MSCI ACWI IMI Timber Select Capped Index reflects the performance of those stocks in the MSCI ACWI Investable Market Indexes that are engaged in the ownership and management of forests and timberlands and production of finished products which use timber as raw material.
Costs
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.
Annual operating expenses for this ETF are 0.55%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.53%.
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, Upm-Kymmene Oyj (UPM) accounts for about 5.18% of total assets, followed by Amcor Ltd/australia (AMC - Free Report) and International Paper Co (IP - Free Report) .
The top 10 holdings account for about 44.07% of total assets under management.
Performance and Risk
So far this year, CUT return is roughly 2.39%, and is up about 15.63% in the last one year (as of 08/01/2018). During this past 52-week period, the fund has traded between $28 and $34.52.
The ETF has a beta of 1.07 and standard deviation of 16.00% for the trailing three-year period, making it a medium risk choice in the space. With about 80 holdings, it effectively diversifies company-specific risk.
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.