Paul Britt of IndexUniverse, after noting the strong inflows of the PowerShares DWA Technical Leaders ETF (PDP), had the following to say about its appeal:
In the end, PDP’s performance over more recent periods should bolster its appeal to those willing to take a bit more risk in search of more return.
This makes it a viable middle-ground alternative between purely passive super-low-cost ETFs like VTI and traditional actively managed mutual funds, which often come with higher costs.
Without a doubt, PDP is just one of many ETFs that offer an alternative to pure-vanilla U.S equity exposure.
But importantly, PDP stands out from many in this crowd, as its strong liquidity, hefty asset base and history of avoiding radical risk clearly suggest.
Britt also noted that turnover in the index last year was 96%. As we discussed in our article Tax-Efficient Alpha, the combination of the tax-efficient ETF structure and our unique relative strength approach to indexing makes for a compelling investment solution.
See www.powershares.com for more information. Past performance is no guarantee of future returns.
I was surprised to see MO still included in PDP, It is now dropped to a 2 with arrow pointed down, no longer a tech leader 3,4,5. In addition it has been removed from the dividend model, and replaced by CINF, a technically stronger stock.
James,
MO was a 3 attribute stock when we created the list for the year end rebalance. We (like all other index providers) are required to submit the list of securities to the index calculator several business days in advance of the rebalance date so they can make sure everything is loaded properly into their system. MO dropped to a 2 ranking right after we submitted the list. Email or call me if you have additional questions.
Thanks,
John
Thanks for response. Another question. Do you look at DWA chart prior to making the stock a new add? I was surprised to CLH even though it is a 4/5er. It would never be on equity buy list with so much resistance to slog through until big breakout at 62. It might possibly be classified “stock close to technical breakout” at 60-61. The last 6 weeks of 2012 it never got much over 58
James,
The ranking system we use only takes relative strength into account. Trend, support, and resistance are not considered when we generate the ranks that are used to constitute the index.
Thanks,
John Lewis
Thanks again for your response. J. Miller, M.D.