Should You Invest in the Invesco Pharmaceuticals ETF (PJP)?

Looking for broad exposure to the Healthcare - Pharma segment of the equity market? You should consider the Invesco Pharmaceuticals ETF (PJP), a passively managed exchange traded fund launched on 06/23/2005.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. Healthcare - Pharma is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 3, placing it in top 19%.Index DetailsThe fund is sponsored by Invesco. It has amassed assets over $275.18 million, making it one of the average sized ETFs attempting to match the performance of the Healthcare - Pharma segment of the equity market. PJP seeks to match the performance of the Dynamic Pharmaceutical Intellidex Index before fees and expenses.The Dynamic Pharmaceutical Intellidex Index is comprised of stocks of U.S. pharmaceutical companies. It 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 factors.CostsWhen 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 0.57%, making it on par with most peer products in the space.It has a 12-month trailing dividend yield of 0.90%.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 100% of the portfolio.Looking at individual holdings, Abbott Laboratories (ABT) accounts for about 5.90% of total assets, followed by Abbvie Inc (ABBV) and Johnson & Johnson (JNJ).The top 10 holdings account for about 50.34% of total assets under management.Performance and RiskThe ETF has gained about 13.76% and was up about 20.46% so far this year and in the past one year (as of 12/10/2024), respectively. PJP has traded between $72.18 and $89.61 during this last 52-week period.The ETF has a beta of 0.56 and standard deviation of 15.59% for the trailing three-year period, making it a high risk choice in the space. With about 26 holdings, it has more concentrated exposure than peers.AlternativesInvesco Pharmaceuticals 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, PJP is an outstanding option for investors seeking exposure to the Health Care ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.IShares U.S. Pharmaceuticals ETF (IHE) tracks Dow Jones U.S. Select Pharmaceuticals Index and the VanEck Pharmaceutical ETF (PPH) tracks MVIS US Listed Pharmaceutical 25 Index. IShares U.S. Pharmaceuticals ETF has $607.29 million in assets, VanEck Pharmaceutical ETF has $612.35 million. IHE has an expense ratio of 0.39% and PPH charges 0.36%.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 Pharmaceuticals ETF (PJP): ETF Research Reports Abbott Laboratories (ABT): Free Stock Analysis Report Johnson & Johnson (JNJ): Free Stock Analysis Report AbbVie Inc. (ABBV): Free Stock Analysis Report iShares U.S. Pharmaceuticals ETF (IHE): ETF Research Reports VanEck Pharmaceutical ETF (PPH): ETF Research ReportsTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks