Materials ETF (PYZ) Hits New 52-Week High

For investors seeking momentum, Invesco DWA Basic Materials Momentum ETF PYZ is probably on radar. The fund just hit a 52-week high and is up 28.5% from its 52-week low price of $78.92/share.

But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea of where it might be headed:

PYZ in Focus

This product seeks to measure the performance of basic materials companies that are showing relative strength (momentum). It has key holdings in metals & mining, and chemicals. The ETF charges 33 basis points in annual fees (see: all the Materials ETFs here).

Why the Move?

The materials sector has been an area to watch lately given an ongoing war in Ukraine coupled with rising prices. The tensions have resulted in supply disruption fears in an already-tight commodity market, pushing up prices. Russia is a commodities powerhouse and a key supplier of energy, metals and agriculture. As prices of various materials have been on the surge, the material sector has been witnessing solid growth. Additionally, a tight policy means solid economic growth, which in turn results in higher demand for materials.

More Gains Ahead?

Currently, PYZ has a Zacks ETF Rank #3 (Hold) with a High risk outlook. Therefore, it is hard to get a handle on its future returns one way or the other. However, many of the segments that make up this ETF have a strong Zacks Industry Rank. So, there is definitely some promise for those who want to ride this surging ETF a little further.

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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.