Designed to provide broad exposure to the Healthcare - Broad segment of the equity market, the Invesco DWA Healthcare Momentum ETF (
PTH Quick Quote PTH - Free Report) is a passively managed exchange traded fund launched on 10/12/2006.
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds 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. Healthcare - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 11, placing it in bottom 31%.
The fund is sponsored by Invesco. It has amassed assets over $318.92 million, making it one of the average sized ETFs attempting to match the performance of the Healthcare - Broad segment of the equity market. PTH seeks to match the performance of the DWA Healthcare Technical Leaders Index before fees and expenses.
The Dorsey Wright??Healthcare Technical Leaders Index identifies companies that are showing relative strength and are composed of at least 30 common stocks from a universe of approximately 3,000 common stocks traded on US exchanges.
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.60%, making it on par with most peer products in the space.
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 in the Healthcare sector--about 100% of the portfolio.
Looking at individual holdings, Iveric Bio Inc (
ISEE Quick Quote ISEE - Free Report) accounts for about 6.94% of total assets, followed by Danaher Corp ( DHR Quick Quote DHR - Free Report) and Horizon Therapeutics Plc ( HZNP Quick Quote HZNP - Free Report) .
The top 10 holdings account for about 44.56% of total assets under management.
Performance and Risk
Year-to-date, the Invesco DWA Healthcare Momentum ETF has lost about -14.20% so far, and is down about -30.90% over the last 12 months (as of 02/15/2022). PTH has traded between $121.89 and $182.95 in this past 52-week period.
The ETF has a beta of 0.98 and standard deviation of 31.44% for the trailing three-year period, making it a high risk choice in the space. With about 43 holdings, it has more concentrated exposure than peers.
Invesco DWA Healthcare Momentum 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, PTH is a good 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 Quick Quote VHT - Free Report) tracks MSCI US Investable Market Health Care 25/50 Index and the Health Care Select Sector SPDR ETF ( XLV Quick Quote XLV - Free Report) tracks Health Care Select Sector Index. Vanguard Health Care ETF has $16 billion in assets, Health Care Select Sector SPDR ETF has $33.75 billion. VHT has an expense ratio of 0.10% and XLV charges 0.10%. Bottom Line
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