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If you're interested in broad exposure to the Consumer Discretionary - Leisure and Entertainment segment of the equity market, look no further than the Invesco Dynamic Leisure and Entertainment ETF (PEJ), 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.
Sector ETFs are also funds of convenience, offering many ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Consumer Discretionary - Leisure and Entertainment is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 13, placing it in bottom 19%.
Index Details
The fund is sponsored by Invesco. It has amassed assets over $868.98 million, making it one of the largest ETFs attempting to match the performance of the Consumer Discretionary - Leisure and Entertainment segment of the equity market. PEJ seeks to match the performance of the Dynamic Leisure & Entertainment Intellidex Index before fees and expenses.
The Dynamic Leisure & Entertainment Intellidex Index is comprised of stocks of U.S. leisure and entertainment 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 factors.
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 0.55%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.66%.
Sector Exposure and Top Holdings
Even 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.
This ETF has heaviest allocation in the Consumer Discretionary sector--about 52.40% of the portfolio. Telecom and Consumer Staples round out the top three.
Looking at individual holdings, Sysco Corp (SYY) accounts for about 5.55% of total assets, followed by Liberty Media Corp-Liberty Formula One (FWONA) and Live Nation Entertainment Inc (LYV).
The top 10 holdings account for about 46.78% of total assets under management.