Is Invesco DB Precious Metals ETF (DBP) a Strong ETF Right Now?

Designed to provide broad exposure to the Precious Metals ETFs category of the market, the Invesco DB Precious Metals ETF (DBP) is a smart beta exchange traded fund launched on 01/05/2007.What Are Smart Beta ETFs?Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.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.However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.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 & IndexManaged by Invesco, DBP has amassed assets over $201.27 million, making it one of the average sized ETFs in the Precious Metals ETFs. This particular fund, before fees and expenses, seeks to match the performance of the DBIQ Optimum Yield Precious Metals Index Excess Return.The DBIQ Optimum Yield Precious Metals Index Excess Return Index is a rules-based index composed of futures contracts on two of the most important precious metals?gold and silver. The index is intended to reflect the performance of the precious metals sector.Cost & Other ExpensesInvestors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.Annual operating expenses for DBP are 0.76%, which makes it one of the most expensive products in the space.DBP's 12-month trailing dividend yield is 3.63%.Sector Exposure and Top HoldingsEven 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.Looking at individual holdings, Comex Gold 100 Troy Ounces Future-12-29-2025 (GCZ5) accounts for about 80.83% of total assets, followed by Invesco Government & Agency Portfolio-01-01-2025 (AGPXX) and United States Treasury Bill-05-29-2025 (912797NN3).Its top 10 holdings account for approximately 193.45% of DBP's total assets under management.Performance and RiskSo far this year, DBP return is roughly 16.20%, and was up about 38.61% in the last one year (as of 03/28/2025). During this past 52-week period, the fund has traded between $53.55 and $70.57.The fund has a beta of 0.29 and standard deviation of 16.31% for the trailing three-year period, which makes DBP a medium risk choice in this particular space. With about 7 holdings, it has more concentrated exposure than peers.AlternativesInvesco DB Precious Metals ETF is a reasonable option for investors seeking to outperform the Precious Metals ETFs segment of the market. However, there are other ETFs in the space which investors could consider.Abrdn Physical Precious Metals Basket Shares ETF (GLTR) tracks Precious Metals Basket. The fund has $1.31 billion in assets. GLTR has an expense ratio of 0.60%.Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Precious Metals 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 DB Precious Metals ETF (DBP): ETF Research Reports abrdn Physical Precious Metals Basket Shares ETF (GLTR): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks