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For investors seeking momentum, iShares U.S. Home Construction ETF (ITB - Free Report) is probably on the radar. The fund just hit a 52-week high and is up 77.45% from its 52-week low price of $71.22/share.
But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea of where it might be headed:
ITB in Focus
The underlying Dow Jones U.S. Select Home Builders Index is a subset of the Dow Jones U.S. Household Goods Index. It is a free-float adjusted market capitalization-weighted index which measures the performance of the home construction sector of the U.S. equity market. The product charges 39 bps in annual fees (See: All Consumer Discretionary ETFs).
Why the Move?
The homebuilding sector has been an area to watch lately, given the likely rate cut by the Fed for the first time in over four years. A decline in the Federal funds rate, which typically has an indirect impact on the mortgage rate, may prove advantageous for borrowers. Cheaper borrowing costs can also encourage builders to undertake more projects, thereby boosting homebuilding activity.
More Gains Ahead?
Currently, ITB has a Zacks ETF Rank #3 (Hold) and a High risk outlook. However, it might continue its strong performance in the near term, with a positive weighted alpha of 57.73 (as per Barchart.com), which gives cues of a further rally.
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Homebuilder ETF (ITB) Hits New 52-Week High
For investors seeking momentum, iShares U.S. Home Construction ETF (ITB - Free Report) is probably on the radar. The fund just hit a 52-week high and is up 77.45% from its 52-week low price of $71.22/share.
But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea of where it might be headed:
ITB in Focus
The underlying Dow Jones U.S. Select Home Builders Index is a subset of the Dow Jones U.S. Household Goods Index. It is a free-float adjusted market capitalization-weighted index which measures the performance of the home construction sector of the U.S. equity market. The product charges 39 bps in annual fees (See: All Consumer Discretionary ETFs).
Why the Move?
The homebuilding sector has been an area to watch lately, given the likely rate cut by the Fed for the first time in over four years. A decline in the Federal funds rate, which typically has an indirect impact on the mortgage rate, may prove advantageous for borrowers. Cheaper borrowing costs can also encourage builders to undertake more projects, thereby boosting homebuilding activity.
More Gains Ahead?
Currently, ITB has a Zacks ETF Rank #3 (Hold) and a High risk outlook. However, it might continue its strong performance in the near term, with a positive weighted alpha of 57.73 (as per Barchart.com), which gives cues of a further rally.