For immediate release
Chicago, IL – August 12, 2022 – Zacks.com announces the list of stocks featured in the analyst blog. Every day, Zacks Equity Research analysts discuss the latest news and events impacting stocks and financial markets. ETFs recently featured in the blog include: Cambria Value & Momentum ETF VAMO, First Trust Dorsey Wright Momentum & Value ETF DVLU, Invesco S&P MidCap Value with Momentum ETF XMVM, First Trust Dorsey Wright Momentum & Dividend ETF DDIV and Invesco S&P 500 Value with Momentum ETF SPVM.
Here are highlights from Thursday’s analyst blog:
5 Momentum ETFs that offer value
Wall Street has been in decent shape in recent weeks thanks to strong corporate earnings reports, slower-than-expected future Fed rate hikes and bets that markets bottomed. Equities in the United States and Europe saw their biggest monthly increase since November 2020 (read: Best month for equities since 2020: Top ETF Areas of July).
Investors’ hopes that slowing inflation and growth could prompt the Fed to ease its interest rate hike plans boosted equities throughout the month. A cheaper valuation after a bearish first half also helped equities.
The S&P 500, Dow Jones, Nasdaq Composite and Russell 2000 gained 8%, 5.6%, 11.4% and 9.1% respectively in July (as of July 29, 2022). Some profits were positive to end the month. Amazon.com Inc. and Apple Inc. both exceeded revenue estimates. In July, Amazon shares gained 27%, marking their biggest monthly rally since October 2009.
The Wall Street rally came despite 41-year high inflation, a contraction in GDP for the second consecutive quarter and another Fed rate hike worth 0.75%. In this context, investors can count on strong momentum investments. Although a stock’s past price movement cannot be used to predict its future movement, history shows that recent past performance can be a fairly good predictor of short-term future performance.
The momentum effect, which refers to the tendency of winning stocks to keep winning, has been documented in numerous academic studies. Keen investors love to bet bigger on the high flyers, sometimes even ignoring the fundamentals. With investor optimism at its peak, we would like to note that the following dynamic ETFs may be operating now.
Dynamic investing can be an intriguing idea for those looking for higher returns in a short time. It seems to mirror the profits of buying stocks that are sizzling in the market. But looking at value is necessary now, given the ever-present inflationary threats.
Below we highlight a few dynamic ETFs that have a P/E below 21.70x SPDR S&P 500 ETF Trust.
Focus on ETFs
Cambria Value & Momentum ETF – P/E 8.01X
This ETF is active and does not replicate a benchmark index. The Cambria Value and Momentum ETF seeks to preserve and grow capital in US equity market investments by investing in 100 stocks with a market capitalization greater than US$200 million. The fund charges 64 basis points in fees.
First Trust Dorsey Wright Momentum & Value ETF – P/E 9.06X
The underlying Dorsey Wright Momentum Plus Value Index tracks the aggregate performance of the 50 most undervalued stocks within the NASDAQ US Large Mid Cap Index that maintain high levels of relative strength. The fund charges 60 basis points in fees.
Invesco S&P MidCap Value with Momentum ETF – P/E 10.77X
The underlying S&P MidCap 400 High Momentum Value Index is composed of securities with strong value characteristics selected from the Russell Midcap Index. The fund charges 39 basis points in fees.
First Trust Dorsey Wright Momentum & Dividend ETF – P/E 12.55X
The underlying Dorsey Wright Momentum Plus Dividend Yield Index is designed to track the aggregate performance of the 50 stocks with the highest dividend yield including the NASDAQ US Large Mid Index that consistently maintain high levels of relative strength. The fund charges 60 basis points in fees.
Invesco S&P 500 Value ETF with Momentum – P/E 13.11X
The underlying S&P 500 High Momentum Value Index is composed of securities with strong value characteristics selected from the Russell Top 200 Index. The fund charges 39 basis points in fees.
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Past performance is not indicative of future results. The potential for loss is inherent in any investment. This document is provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold any security. No recommendation or advice is given as to whether any investment is suitable for any particular investor. It should not be assumed that investments in the securities, companies, sectors or markets identified and described have been or will be profitable. All information is current as of the date hereof and is subject to change without notice. The views or opinions expressed may not reflect those of the company as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management of securities. These returns come from hypothetical portfolios composed of stocks with Zacks Rank = 1 that have been rebalanced monthly without transaction fees. These are not the returns of actual stock portfolios. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for more information on the performance figures displayed in this press release.
Zacks names ‘only one best choice for doubling up’
From thousands of stocks, 5 Zacks experts have each picked their favorite to skyrocket by +100% or more in the coming months. Of these 5, Research Director Sheraz Mian selects one to have the most explosive advantage of all.
It’s a little-known chemical company that’s up 65% year-on-year, but still very cheap. With relentless demand, rising earnings estimates for 2022 and $1.5 billion for stock buybacks, retail investors could step in at any time.
This company could rival or surpass other recent Zacks stocks which are expected to double like Boston Beer Company which jumped +143.0% in just over 9 months and NVIDIA which jumped +175.9% in one year .
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Cambria Value and Momentum ETF (VAMO): ETF Research Reports
Invesco S&P 500 Value with Momentum ETF (SPVM): ETF Research Reports
First Trust Dorsey Wright Momentum & Dividend ETF (DDIV): ETF Research Reports
First Trust Dorsey Wright Momentum & Value ETF (DVLU): ETF Research Reports
Invesco S&P MidCap Value with Momentum ETF (XMVM): ETF Research Reports
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.