Is Invesco Biotechnology & Genome ETF (PBE) a Strong ETF Right Now?

Launched on 06/23/2005, the Invesco Biotechnology & Genome ETF (PBE) is a smart beta exchange traded fund offering broad exposure to the Health Care 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.Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.Fund Sponsor & IndexThe fund is managed by Invesco, and has been able to amass over $250.48 million, which makes it one of the average sized ETFs in the Health Care ETFs. PBE, before fees and expenses, seeks to match the performance of the Dynamic Biotechnology & Genome Intellidex Index.The Dynamic Biotech & Genome Intellidex Index seeks to provide capital appreciation by thoroughly evaluating companies based on a variety of investment merit criteria, including price momentum, earnings momentum, quality, management action, and value.Cost & Other ExpensesCost 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.With on par with most peer products in the space, this ETF has annual operating expenses of 0.58%.PBE's 12-month trailing dividend yield is 0.05%.Sector Exposure and Top HoldingsWhile 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 Healthcare sector - about 99.80% of the portfolio.Taking into account individual holdings, Natera Inc (NTRA) accounts for about 5.12% of the fund's total assets, followed by Gilead Sciences Inc (GILD) and Biogen Inc (BIIB).PBE's top 10 holdings account for about 45.63% of its total assets under management.Performance and RiskThe ETF has added about 2.03% so far this year and is up roughly 3.55% in the last one year (as of 01/13/2025). In the past 52-week period, it has traded between $59.62 and $72.24.The ETF has a beta of 0.79 and standard deviation of 22.97% for the trailing three-year period, making it a high risk choice in the space. With about 32 holdings, it has more concentrated exposure than peers.AlternativesInvesco Biotechnology & Genome ETF is an excellent option for investors seeking to outperform the Health Care ETFs segment of the market. There are other ETFs in the space which investors could consider as well.SPDR S&P Biotech ETF (XBI) tracks S&P Biotechnology Select Industry Index and the iShares Biotechnology ETF (IBB) tracks Nasdaq Biotechnology Index. SPDR S&P Biotech ETF has $6.14 billion in assets, iShares Biotechnology ETF has $6.44 billion. XBI has an expense ratio of 0.35% and IBB charges 0.45%.Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Health Care ETFs.Bottom LineTo 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.Want key ETF info delivered straight to your inbox?Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.Get it free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Invesco Biotechnology & Genome ETF (PBE): ETF Research Reports Biogen Inc. (BIIB): Free Stock Analysis Report Gilead Sciences, Inc. (GILD): Free Stock Analysis Report iShares Biotechnology ETF (IBB): ETF Research Reports SPDR S&P Biotech ETF (XBI): ETF Research Reports Natera, Inc. (NTRA): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks