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Is Invesco 130 Laddered Treasury ETF (PLW) a Strong ETF Right Now?
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Making its debut on 10/11/2007, smart beta exchange traded fund Invesco 130 Laddered Treasury ETF provides investors broad exposure to the Government Bond ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
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.
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.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
PLW is managed by Invesco, and this fund has amassed over $372.74 million, which makes it one of the average sized ETFs in the Government Bond ETFs. Before fees and expenses, this particular fund seeks to match the performance of the Ryan/NASDAQ U.S. 1-30 Year Treasury Laddered Index.
The Ryan/NASDAQ U.S. 1-30 Year Treasury Laddered Index measures the potential returns of the U.S. Treasury yield curve based on approximately 30 equally weighted U.S. Treasury issues with fixed coupons, scheduled to mature in a proportional, annual sequential structure.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Operating expenses on an annual basis are 0.25% for this ETF, which makes it one of the more expensive products in the space.
It has a 12-month trailing dividend yield of 1.41%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
Taking into account individual holdings, United States Treasury Note/bond-4.50%-2-15-2036 (912810FT0) accounts for about 10.07% of the fund's total assets, followed by United States Treasury Note/bond-5.38%-2-15-2031 (912810FP8) and United States Treasury Note/bond-1.88%-2-15-2051 (912810SU3).
Its top 10 holdings account for approximately 47.21% of PLW's total assets under management.
Performance and Risk
Year-to-date, the Invesco 130 Laddered Treasury ETF has lost about -10.12% so far, and is down about -7.52% over the last 12 months (as of 04/12/2022). PLW has traded between $32.30 and $37.46 in this past 52-week period.
The ETF has a beta of -0.14 and standard deviation of 10.02% for the trailing three-year period, making it a high risk choice in the space. With about 28 holdings, it has more concentrated exposure than peers.
Alternatives
Invesco 130 Laddered Treasury ETF is not a suitable option for investors seeking to outperform the Government Bond ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.
SPDR Portfolio Long Term Treasury ETF (SPTL - Free Report) tracks Bloomberg Barclays Long U.S. Treasury Index and the iShares 20 Year Treasury Bond ETF (TLT - Free Report) tracks ICE U.S. Treasury 20+ Year Bond Index. SPDR Portfolio Long Term Treasury ETF has $5.45 billion in assets, iShares 20 Year Treasury Bond ETF has $18.59 billion. SPTL has an expense ratio of 0.06% and TLT 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 Government Bond 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 130 Laddered Treasury ETF (PLW) a Strong ETF Right Now?
Making its debut on 10/11/2007, smart beta exchange traded fund Invesco 130 Laddered Treasury ETF provides investors broad exposure to the Government Bond ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
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.
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.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
PLW is managed by Invesco, and this fund has amassed over $372.74 million, which makes it one of the average sized ETFs in the Government Bond ETFs. Before fees and expenses, this particular fund seeks to match the performance of the Ryan/NASDAQ U.S. 1-30 Year Treasury Laddered Index.
The Ryan/NASDAQ U.S. 1-30 Year Treasury Laddered Index measures the potential returns of the U.S. Treasury yield curve based on approximately 30 equally weighted U.S. Treasury issues with fixed coupons, scheduled to mature in a proportional, annual sequential structure.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Operating expenses on an annual basis are 0.25% for this ETF, which makes it one of the more expensive products in the space.
It has a 12-month trailing dividend yield of 1.41%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
Taking into account individual holdings, United States Treasury Note/bond-4.50%-2-15-2036 (912810FT0) accounts for about 10.07% of the fund's total assets, followed by United States Treasury Note/bond-5.38%-2-15-2031 (912810FP8) and United States Treasury Note/bond-1.88%-2-15-2051 (912810SU3).
Its top 10 holdings account for approximately 47.21% of PLW's total assets under management.
Performance and Risk
Year-to-date, the Invesco 130 Laddered Treasury ETF has lost about -10.12% so far, and is down about -7.52% over the last 12 months (as of 04/12/2022). PLW has traded between $32.30 and $37.46 in this past 52-week period.
The ETF has a beta of -0.14 and standard deviation of 10.02% for the trailing three-year period, making it a high risk choice in the space. With about 28 holdings, it has more concentrated exposure than peers.
Alternatives
Invesco 130 Laddered Treasury ETF is not a suitable option for investors seeking to outperform the Government Bond ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.
SPDR Portfolio Long Term Treasury ETF (SPTL - Free Report) tracks Bloomberg Barclays Long U.S. Treasury Index and the iShares 20 Year Treasury Bond ETF (TLT - Free Report) tracks ICE U.S. Treasury 20+ Year Bond Index. SPDR Portfolio Long Term Treasury ETF has $5.45 billion in assets, iShares 20 Year Treasury Bond ETF has $18.59 billion. SPTL has an expense ratio of 0.06% and TLT 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 Government Bond 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.