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Should You Invest in the PowerShares Dynamic Building & Construction Portfolio (PKB)?
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Designed to provide broad exposure to the Industrials - Engineering and Construction segment of the U.S. equity market, the PowerShares Dynamic Building & Construction Portfolio (PKB - Free Report) is a passively managed exchange traded fund launched on 10/26/2005.
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Industrials - Engineering and Construction is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 1, placing it in top 6%.
Index Details
The fund is sponsored by Invesco Powershares. It has amassed assets over $327.01 M, making it one of the average sized ETFs attempting to match the performance of the Industrials - Engineering and Construction segment of the U.S. equity market. PKB seeks to match the performance of the Dynamic Building & Construction Intellidex Index before fees and expenses.
The index is comprised of stocks of U.S. building and construction companies. The Index is designed to provide capital appreciation by thoroughly evaluating companies based on a variety of investment merit criteria, including fundamental growth, stock valuation, investment timeliness and risk factorsn.
Costs
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 0.63%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.19%.
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 Consumer Discretionary sector--about 43.60% of the portfolio. Industrials and Materials round out the top three.
Looking at individual holdings, Aaon Inc (AAON - Free Report) accounts for about 5.71% of total assets, followed by Lennar Corp (LEN - Free Report) and Pultegroup Inc (PHM - Free Report) .
The top 10 holdings account for about 46.24% of total assets under management.
Performance and Risk
The ETF has lost about -11.04% and 6.62% so far this year and in the past one year (as of 04/10/2018), respectively. PKB has traded between $28.31 and $36.11 during this last 52-week period.
The ETF has a beta of 1.20 and standard deviation of 17.78% for the trailing three-year period, making it a high risk choice in the space. With about 30 holdings, it has more concentrated exposure than peers.
Alternatives
PowerShares Dynamic Building & Construction Portfolio carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, PKB is a reasonable option for those seeking exposure to the Industrials ETFs area of the market. Investors might also want to consider some other ETF options in the space.
SPDR S&P Homebuilders ETF (XHB - Free Report) tracks S&P Homebuilders Select Industry Index and the iShares U.S. Home Construction ETF (ITB - Free Report) tracks Dow Jones U.S. Select Home Construction Index. SPDR S&P Homebuilders ETF has $906.75 M in assets, iShares U.S. Home Construction ETF has $1.71 B. XHB has an expense ratio of 0.35% and ITB charges 0.44%.
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 PowerShares Dynamic Building & Construction Portfolio (PKB)?
Designed to provide broad exposure to the Industrials - Engineering and Construction segment of the U.S. equity market, the PowerShares Dynamic Building & Construction Portfolio (PKB - Free Report) is a passively managed exchange traded fund launched on 10/26/2005.
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Industrials - Engineering and Construction is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 1, placing it in top 6%.
Index Details
The fund is sponsored by Invesco Powershares. It has amassed assets over $327.01 M, making it one of the average sized ETFs attempting to match the performance of the Industrials - Engineering and Construction segment of the U.S. equity market. PKB seeks to match the performance of the Dynamic Building & Construction Intellidex Index before fees and expenses.
The index is comprised of stocks of U.S. building and construction companies. The Index is designed to provide capital appreciation by thoroughly evaluating companies based on a variety of investment merit criteria, including fundamental growth, stock valuation, investment timeliness and risk factorsn.
Costs
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 0.63%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.19%.
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 Consumer Discretionary sector--about 43.60% of the portfolio. Industrials and Materials round out the top three.
Looking at individual holdings, Aaon Inc (AAON - Free Report) accounts for about 5.71% of total assets, followed by Lennar Corp (LEN - Free Report) and Pultegroup Inc (PHM - Free Report) .
The top 10 holdings account for about 46.24% of total assets under management.
Performance and Risk
The ETF has lost about -11.04% and 6.62% so far this year and in the past one year (as of 04/10/2018), respectively. PKB has traded between $28.31 and $36.11 during this last 52-week period.
The ETF has a beta of 1.20 and standard deviation of 17.78% for the trailing three-year period, making it a high risk choice in the space. With about 30 holdings, it has more concentrated exposure than peers.
Alternatives
PowerShares Dynamic Building & Construction Portfolio carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, PKB is a reasonable option for those seeking exposure to the Industrials ETFs area of the market. Investors might also want to consider some other ETF options in the space.
SPDR S&P Homebuilders ETF (XHB - Free Report) tracks S&P Homebuilders Select Industry Index and the iShares U.S. Home Construction ETF (ITB - Free Report) tracks Dow Jones U.S. Select Home Construction Index. SPDR S&P Homebuilders ETF has $906.75 M in assets, iShares U.S. Home Construction ETF has $1.71 B. XHB has an expense ratio of 0.35% and ITB charges 0.44%.
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.