Should You Invest in the Invesco Leisure and Entertainment ETF (PEJ)?

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 Leisure and Entertainment ETF (PEJ), a passively managed exchange traded fund launched on June 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 12, placing it in bottom 25%.Index DetailsThe fund is sponsored by Invesco. It has amassed assets over $253.09 million, 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.CostsExpense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.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 0.13%.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 Consumer Discretionary sector -- about 49.8% of the portfolio. Telecom and Consumer Staples round out the top three.Looking at individual holdings, Warner Bros Discovery Inc (WBD) accounts for about 9.96% of total assets, followed by Las Vegas Sands Corp (LVS) and Doordash Inc (DASH).The top 10 holdings account for about 48.59% of total assets under management.Performance and RiskThe ETF has added roughly 17.45% so far this year and was up about 13.05% in the last one year (as of 12/17/2025). In that past 52-week period, it has traded between $42.84 and $62.19.The ETF has a beta of 1.12 and standard deviation of 20.31% for the trailing three-year period, making it a high risk choice in the space. With about 33 holdings, it has more concentrated exposure than peers.AlternativesInvesco Leisure and Entertainment ETF sports a Zacks ETF Rank of 4 (Sell), which is based on expected asset class return, expense ratio, and momentum, among other factors. PEJ, then, is not a suitable option for investors seeking exposure to the Consumer Discretionary ETFs segment of the market. However, there are better ETFs in the space to consider.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 $112.72 million in assets, VanEck Video Gaming and eSports ETF has $381.24 million. HERO has an expense ratio of 0.5%, and ESPO charges 0.56%.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.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 Leisure and Entertainment ETF (PEJ): 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