Is Invesco Semiconductors ETF (PSI) a Strong ETF Right Now?

Designed to provide broad exposure to the Technology ETFs category of the market, the Invesco Semiconductors ETF (PSI) is a smart beta exchange traded fund launched on 06/23/2005.What Are Smart Beta ETFs?For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking 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 $828.4 million, which makes it one of the average sized ETFs in the Technology ETFs. This particular fund, before fees and expenses, seeks to match the performance of the Dynamic Semiconductor Intellidex Index.The Dynamic Semiconductor Intellidex Index is comprised of stocks of semiconductor 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.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.Operating expenses on an annual basis are 0.56% for PSI, making it on par with most peer products in the space.It has a 12-month trailing dividend yield of 0.14%.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.For PSI, it has heaviest allocation in the Information Technology sector --about 97.5% of the portfolio.When you look at individual holdings, Micron Technology Inc (MU) accounts for about 5.63% of the fund's total assets, followed by Broadcom Inc (AVGO) and Kla Corp (KLAC).The top 10 holdings account for about 46.12% of total assets under management.Performance and RiskYear-to-date, the Invesco Semiconductors ETF has gained about 24.74% so far, and was up about 28.96% over the last 12 months (as of 10/06/2025). PSI has traded between $39.29 $72.90 in this past 52-week period. The fund has a beta of 1.57 and standard deviation of 36.00% for the trailing three-year period, which makes PSI a high risk choice in this particular space. With about 31 holdings, it has more concentrated exposure than peers .AlternativesInvesco Semiconductors ETF is an excellent option for investors seeking to outperform the Technology ETFs segment of the market. There are other ETFs in the space which investors could consider as well.iShares Semiconductor ETF (SOXX) tracks PHLX SOX Semiconductor Sector Index and the VanEck Semiconductor ETF (SMH) tracks MVIS US Listed Semiconductor 25 Index. iShares Semiconductor ETF has $15.32 billion in assets, VanEck Semiconductor ETF has $33 billion. SOXX has an expense ratio of 0.34% and SMH changes 0.35%.Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Technology ETFsBottom 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.Boost Your Portfolio with Our Top ETF InsightsZacks' exclusive Fund Newsletter delivers actionable information, top news and analysis, as well as top-performing ETFs, straight to your inbox every week.Don’t miss out on this valuable resource. It’s free!Get it now >>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 Semiconductors ETF (PSI): 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