The PowerShares Dynamic Software Portfolio, (PSJ), was launched in 2005 and provides interested investors an ETF option to build exposure to U.S. software firms. The ETF attempts to track and match the yield and price of the Dynamic Software Intellidex Index, which assesses firms offering stock on a number of criteria, including stock valuation timeliness, fundamental growth, and of course associated risks
According to Invesco, the fund typically has around 90 percent of its total holdings invested in common equities that can be found on the Dynamic Software Intellidex Index. The Intellidex is actually made up of 30 U.S. software firms' common shares. These firms focus primarily on the design, research, and distribution of process/products that use or work with software, systems, and other IT-based services. The ETF is reconstituted and rebalanced on a quarterly schedule.
PSJ ETF comes with a total expense ratio of .66% and has no minimum investment. PSJ's management company is Invesco PowerShares Capital Management LLC. As of Sep. 21 2016, PSJ has a total AUM of around $79.85 million.
Performance Update Since PSJ’s Inception
As of Aug. 31, 2016, the ETF’s average annual performance (represents changes to the net asset value) since PSJ’s launch on Jun. 23, 2005, is 10.95% - indicated by Invesco. Below, we have a detailed look at the 1-year, 3-years, 5-years and 10-years average annual performance – as of Aug. 31, 2016, shown by Invesco:
1-year average annual performance (NAV): 17.59%
3-year average annual performance (NAV): 14.63%
5-year average annual performance (NAV): 16.03%
10-year average annual performance (NAV): 10.70%
The Bottom Line
An interesting ETF option for investors who particularly wish to increase exposure to U.S. software corporations. It is, however, important to check this fund’s liquidity as well as apply the proper risk management and due diligence before making an investment decision.