Market Overview

When There's A Pullback On A Bull, Look At These Leading ETFs

When There's A Pullback On A Bull, Look At These Leading ETFs
Related PKW
ETFs, Stocks See Dwindling Buyback Support
As Buybacks Soar, Buyback ETF Tries To Get Its Groove Back

U.S. stocks are once again hitting new highs and a wide range of sectors throughout the market fuels the rally.

Even though the bull market is nearly six years in age, there are a large number of investors looking to put more money to work.

Any type of pullback in the strongest sectors may provide buying opportunities for long-term investors.

Highlighted below are two ETFs that have performed well and could benefit from the buying opportunity a pullback provides.

Select Sector Financial

The Select Sector Financial Slct Str SPDR Fd (NYSE: XLF) tracks 87 companies in the financial sector with banks making up 36 percent of the portfolio.

The top individual holdings include:

  • Berkshire Hathaway Inc. (NYSE: BRK.B) at 8.9 percent
  • Wells Fargo & Co (NYSE: WFC) with an 8.5 percent holding
  • JPMorgan Chase & Co. (NYSE: JPM) coming in at 7.7 percent

The ETF is up 11 percent in 2014 and 11 percent over the last six months. An expense ratio of 0.16 percent makes it one of the cheapest ETFs in this sector.

XLF hit a high of $24.31 on November 11 and has been pulling back over the last week as it finds support at the $23.85 area. The healthy pullback could be a great opportunity for investors to build a position in a promising sector.

Related Link: Niche ETFs To Diversify A Portfolio

PowerShares BuyBack Achievers

The PowerShares BuyBack Achievers Fund (ETF) (NYSE: PKW) is comprised of 172 U.S. companies that have affected a net reduction in shares outstanding of 5 percent or more in the last 12 months.

The ETF is distributed across 10 sectors with consumer discretionary at 32 percent and information technology at 18 being the most heavily weighted sectors.

Following the financial crisis many companies began to stockpile cash and now with the economy improving it has led to the buying back of shares or distributions of dividends.

The top individual holdings are:

  • Oracle Corporation (NASDAQ: ORCL) with a 5.2 percent holding
  • Home Depot Inc (NYSE: HD) making up 5.1 percent
  • Pfizer Inc. (NYSE: PFE) at 5 percent

PKW is up 10 percent year to date and 9 percent over the last 6 months.

Posted-In: Bull Market ETF market pullbackLong Ideas Sector ETFs Specialty ETFs Trading Ideas ETFs Best of Benzinga


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