The Invesco Dynamic Leisure and Entertainment ETF (PEJ) was launched on 06/23/2005, and is a passively managed exchange traded fund designed to offer broad exposure to the Consumer Discretionary – Leisure and Entertainment segment of the equity market.
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
Additionally, sector ETFs offer convenient 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 11, placing it in bottom 31%.
The fund is sponsored by Invesco. It has amassed assets over $1.32 billion, making it one of the larger 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.
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 0.34%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, 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 54.40% of the portfolio. Telecom and Consumer Staples round out the top three.
Looking at individual holdings, Booking Holdings Inc (BKNG) accounts for about 5.24% of total assets, followed by Mcdonald's Corp (MCD) and Sysco Corp (SYY).
The top 10 holdings account for about 44.18% of total assets under management.
Performance and Risk
The ETF has added about 26.37% and was up about 24.74% so far this year and in the past one year (as of 12/30/2021), respectively. PEJ has traded between $38.89 and $54.78 during this last 52-week period.
The ETF has a beta of 1.35 and standard deviation of 32.90% for the trailing three-year period, making it a high risk choice in the space. With about 31 holdings, it has more concentrated exposure than peers.
Invesco Dynamic Leisure and Entertainment ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, PEJ is a sufficient option for those seeking exposure to the Consumer Discretionary ETFs area of the market. Investors might also want to consider some other ETF options in the space.
Global X Video Games & Esports ETF (HERO) tracks SOLACTIVE VIDEO GAMES & ESPORTS INDEX and the VanEck Video Gaming and eSports ETF (ESPO) tracks MVIS GLOBAL VIDEO GAMING AND ESPORTS IND. Global X Video Games & Esports ETF has $433 million in assets, VanEck Video Gaming and eSports ETF has $604.44 million. HERO has an expense ratio of 0.50% and ESPO charges 0.55%.
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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Invesco Dynamic Leisure and Entertainment ETF (PEJ): ETF Research Reports
McDonald's Corporation (MCD) : Free Stock Analysis Report
Sysco Corporation (SYY) : Free Stock Analysis Report
Global X Video Games & Esports ETF (HERO): ETF Research Reports
Booking Holdings Inc. (BKNG) : Free Stock Analysis Report
VanEck Video Gaming and eSports ETF (ESPO): ETF Research Reports
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