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The funds target distributions equal to six times the dividend payouts on the Nasdaq-100 Index and four times the S & P 500 dividend, respectively. The idea behind the Pacer funds is that the funds will capture more of that upside during market rallies, according to Sean O'Hara, president at Pacer ETF Distributors. The QDPL's website currently shows a distribution yield of 5.79%, or more than four-times the roughly 1.3% dividend yield on the S & P 500, according to YCharts.com. The dividend futures could also see bigger gains if more companies in the index decide to start paying dividends. To be sure, the dividend futures contracts could also decrease in value during times of economic stress.
Persons: Sean O'Hara, O'Hara, QDPL, Dow, Apple Organizations: Nasdaq, , ETF Distributors, Schwab, Equity, Dow Jones, CME Group, Pacer, SEC, Microsoft
This month's market rotation into small caps is being led by a rebound in cheap stocks. According to FactSet, three of the top five small-cap exchange-traded funds in July are explicitly focused on value, including the iShares US Small Cap Value Factor ETF (SVAL) . That fund was up 11.4% for the month through Wednesday, compared to 7.4% for the broader iShares Russell 2000 ETF (IWM) . Investors can account for profitability by looking for stocks with lower price-to-earnings ratios, one of the metrics captured by many value funds. Screening for value stocks can sometimes miss areas of trouble in the market.
Persons: FactSet, ProShares Russell, Sean O'Hara, O'Hara, Todd Sohn, Sohn Organizations: Growers, Companies
Concerns about overpriced growth and large-cap stocks have left the market in a holding pattern. The stock market is in a bit of a holding pattern right now. Some investors worry that growth and large-cap stocks are too expensive. One popular opinion among fund managers is that investors will favor mid and small-cap value stocks as the Fed cuts interest rates. But since inflation came in hotter than expected for March, whether rates will drop this year is now also in question.
Persons: Sean O'Hara Organizations: Business
On Friday, the S & P 500 closed below its 200-day moving average for the first time since March 17. If the total-return version of the index closes below that level for five straight days, then the $2 billion Pacer Trendpilot US Large Cap ETF (PTLC) will automatically sell some of its all-stock portfolio to shift to a 50-50 split between equities and Treasury bills. And if the 200-day moving average itself then starts to fall, the fund will go to 100% T-bills. Still, the fund's rule tied to the 200-day moving average is an example of how the move of a stock or index across a widely-followed indicator can cause volatility. Year to date, the fund is up just under 5% — well below the gain of more than 11% for the SPDR S & P 500 ETF Trust (SPY) .
Persons: rebalance, Sean O'Hara, O'Hara Organizations: Trust, ETF Distributors, Pacer, Nasdaq Locations: technologystocks
A popular ETF focused on cash flow is finding its footing again after lagging the broader market in the first half of 2023. The Pacer U.S. Cash Cows ETF (COWZ) has set several recent highs over the past two weeks, including closing at a record $51.49 per share on Wednesday. The index consists of Russell 1000 stocks with the best free cash flow yield. "The rebalance every 90 day is sort of the key because it keeps the focus on the most current free cash flow yield, and the names with the highest free cash flow yield. "When you focus on high free cash flow yield names, you actually end up owning companies who grow their earnings faster than their index," he added.
Persons: COWZ, Russell, Sean O'Hara, Morningstar, O'Hara Organizations: The Pacer U.S, Cash, Nasdaq, Energy, Chevron, Booking Holdings
Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailBuy high-quality names for better earnings growth: PacerETFs' Sean O'HaraSean O'Hara, president of Pacer ETFs Distributors, joins 'Power Lunch' to discuss finding opportunities in cash flow ETFs.
They're emphasizing growth right now," van Eck said at the Exchange ETF conference in Miami. The iShares MSCI China ETF (MCHI) had a total return of more than 10% this year, through Feb. 3. MCHI YTD mountain This popular China ETF is outperforming in 2023. Van Eck pointed to the outsized growth of major U.S. tech firms as a key reason for that outperformance, but said that era appears to be over. "We've got a decade where you're really taking a risk if you're under invested overseas," van Eck said.
Investors are flocking back into tech, after shunning the sector for the better part of 2022 amid broad risk-off sentiment. The tech-heavy Nasdaq Composite has been the best-performing Wall Street index in 2023, having gained about 15.6% since the start of the year. This could be the rebound," Wang told CNBC's "Street Signs Asia" on Thursday. " Some 87% of analysts covering the stock rate it a "buy," according to FactSet data, and give it average upside of 10.3%. Christopher Crawford, managing partner at Crawford Fund Management, told CNBC's "Street Signs Asia" on Tuesday that his firm is overweight tech "for the first time in our 10-year history."
Forget growth stocks like tech. "We're starting to enter a bifurcated market: companies with strong balance sheets will hold up much better than growth companies that have never posted a profit," he added. He said his firm has been bullish on energy, thanks to high free cash flow yield in the sector. "Energy companies used to take every dollar they could get their hands on ... "Investors are looking to fade the growth trade in favor of more reliable cash flow generating stocks.
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