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Should You Invest in the Invesco Water Resources ETF (PHO)?
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The Invesco Water Resources ETF (PHO - Free Report) was launched on 12/06/2005, and is a passively managed exchange traded fund designed to offer broad exposure to the Industrials - Water segment of the equity market.
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 are also funds of convenience, offering many ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Industrials - Water is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 2, placing it in top 13%.
Index Details
The fund is sponsored by Invesco. It has amassed assets over $2.16 billion, making it one of the larger ETFs attempting to match the performance of the Industrials - Water segment of the equity market. PHO seeks to match the performance of the NASDAQ OMX US Water Index before fees and expenses.
The NASDAQ OMX US Water Index tracks the performance of US exchange-listed companies that create products designed to conserve and purify water for homes, businesses and industries.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.60%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.51%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Industrials sector--about 62% of the portfolio. Healthcare and Information Technology round out the top three.
Looking at individual holdings, Ferguson Plc (FERG - Free Report) accounts for about 8.03% of total assets, followed by Ecolab Inc (ECL - Free Report) and Roper Technologies Inc (ROP - Free Report) .
The top 10 holdings account for about 58.74% of total assets under management.
Performance and Risk
So far this year, PHO return is roughly 10.64%, and it's up approximately 26.36% in the last one year (as of 05/09/2024). During this past 52-week period, the fund has traded between $49.77 and $67.27.
The ETF has a beta of 0.98 and standard deviation of 19.13% for the trailing three-year period, making it a medium risk choice in the space. With about 41 holdings, it has more concentrated exposure than peers.
Alternatives
Invesco Water Resources ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, PHO is a great option for investors seeking exposure to the Industrials ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
Invesco S&P Global Water Index ETF (CGW - Free Report) tracks S&P GLOBAL WATER INDEX and the First Trust Water ETF (FIW - Free Report) tracks ISE Clean Edge Water Index. Invesco S&P Global Water Index ETF has $1.02 billion in assets, First Trust Water ETF has $1.70 billion. CGW has an expense ratio of 0.56% and FIW charges 0.53%.
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 Water Resources ETF (PHO)?
The Invesco Water Resources ETF (PHO - Free Report) was launched on 12/06/2005, and is a passively managed exchange traded fund designed to offer broad exposure to the Industrials - Water segment of the equity market.
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 are also funds of convenience, offering many ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Industrials - Water is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 2, placing it in top 13%.
Index Details
The fund is sponsored by Invesco. It has amassed assets over $2.16 billion, making it one of the larger ETFs attempting to match the performance of the Industrials - Water segment of the equity market. PHO seeks to match the performance of the NASDAQ OMX US Water Index before fees and expenses.
The NASDAQ OMX US Water Index tracks the performance of US exchange-listed companies that create products designed to conserve and purify water for homes, businesses and industries.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.60%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.51%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Industrials sector--about 62% of the portfolio. Healthcare and Information Technology round out the top three.
Looking at individual holdings, Ferguson Plc (FERG - Free Report) accounts for about 8.03% of total assets, followed by Ecolab Inc (ECL - Free Report) and Roper Technologies Inc (ROP - Free Report) .
The top 10 holdings account for about 58.74% of total assets under management.
Performance and Risk
So far this year, PHO return is roughly 10.64%, and it's up approximately 26.36% in the last one year (as of 05/09/2024). During this past 52-week period, the fund has traded between $49.77 and $67.27.
The ETF has a beta of 0.98 and standard deviation of 19.13% for the trailing three-year period, making it a medium risk choice in the space. With about 41 holdings, it has more concentrated exposure than peers.
Alternatives
Invesco Water Resources ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, PHO is a great option for investors seeking exposure to the Industrials ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
Invesco S&P Global Water Index ETF (CGW - Free Report) tracks S&P GLOBAL WATER INDEX and the First Trust Water ETF (FIW - Free Report) tracks ISE Clean Edge Water Index. Invesco S&P Global Water Index ETF has $1.02 billion in assets, First Trust Water ETF has $1.70 billion. CGW has an expense ratio of 0.56% and FIW charges 0.53%.
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.