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Is Invesco DB US Dollar Index Bullish ETF (UUP) a Strong ETF Right Now?
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A smart beta exchange traded fund, the Invesco DB US Dollar Index Bullish ETF (UUP - Free Report) debuted on 02/20/2007, and offers broad exposure to the Currency ETFs category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
Managed by Invesco, UUP has amassed assets over $890.40 million, making it the largest ETF in the Currency ETFs. Before fees and expenses, UUP seeks to match the performance of the Deutsche Bank Long USD Currency Portfolio Index - Excess Return.
The Deutsche Bank Long USD Currency Portfolio Index - Excess Return is a rules-based index composed solely of long U.S. Dollar Index futures contracts that trade on the ICE futures exchange.
Cost & Other Expenses
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
Operating expenses on an annual basis are 0.78% for this ETF, which makes it one of the more expensive products in the space.
It has a 12-month trailing dividend yield of 0%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
The top 10 holdings account for about 100.02% of total assets under management.
Performance and Risk
So far this year, UUP has added roughly 2.75%, and was up about 7.33% in the last one year (as of 03/15/2022). During this past 52-week period, the fund has traded between $24.13 and $26.55.
UUP has a beta of -0.12 and standard deviation of 6.61% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 1 holdings, it has more concentrated exposure than peers.
Alternatives
Invesco DB US Dollar Index Bullish ETF is an excellent option for investors seeking to outperform the Currency ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
Invesco DB Commodity Index Tracking ETF (DBC - Free Report) tracks DBIQ Optimum Yield Diversified Commodity Index Excess Return and the Invesco Optimum Yield Diversified Commodity Stratgy No K1 ETF (PDBC - Free Report) tracks N/A. Invesco DB Commodity Index Tracking ETF has $4.19 billion in assets, Invesco Optimum Yield Diversified Commodity Stratgy No K1 ETF has $7.83 billion. DBC has an expense ratio of 0.87% and PDBC charges 0.59%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Currency 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 DB US Dollar Index Bullish ETF (UUP) a Strong ETF Right Now?
A smart beta exchange traded fund, the Invesco DB US Dollar Index Bullish ETF (UUP - Free Report) debuted on 02/20/2007, and offers broad exposure to the Currency ETFs category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
Managed by Invesco, UUP has amassed assets over $890.40 million, making it the largest ETF in the Currency ETFs. Before fees and expenses, UUP seeks to match the performance of the Deutsche Bank Long USD Currency Portfolio Index - Excess Return.
The Deutsche Bank Long USD Currency Portfolio Index - Excess Return is a rules-based index composed solely of long U.S. Dollar Index futures contracts that trade on the ICE futures exchange.
Cost & Other Expenses
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
Operating expenses on an annual basis are 0.78% for this ETF, which makes it one of the more expensive products in the space.
It has a 12-month trailing dividend yield of 0%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
The top 10 holdings account for about 100.02% of total assets under management.
Performance and Risk
So far this year, UUP has added roughly 2.75%, and was up about 7.33% in the last one year (as of 03/15/2022). During this past 52-week period, the fund has traded between $24.13 and $26.55.
UUP has a beta of -0.12 and standard deviation of 6.61% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 1 holdings, it has more concentrated exposure than peers.
Alternatives
Invesco DB US Dollar Index Bullish ETF is an excellent option for investors seeking to outperform the Currency ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
Invesco DB Commodity Index Tracking ETF (DBC - Free Report) tracks DBIQ Optimum Yield Diversified Commodity Index Excess Return and the Invesco Optimum Yield Diversified Commodity Stratgy No K1 ETF (PDBC - Free Report) tracks N/A. Invesco DB Commodity Index Tracking ETF has $4.19 billion in assets, Invesco Optimum Yield Diversified Commodity Stratgy No K1 ETF has $7.83 billion. DBC has an expense ratio of 0.87% and PDBC charges 0.59%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Currency 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.