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&#39;Citadel Knows More Than You Do,&#39; But Is There A Profitable Trade On Unity And Carvana?

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ModernIR&#8217;s Founder and CEO, Tim Quast, shared his views on the dynamics of momentum trading during a Monday appearance on Benzinga&#8217;s "PreMarket Prep," emphasizing a key point for traders to bear in mind: modest, repeated returns on each trade, rather than large one-time profits, are the <a href="https://www.benzinga.com/topic/bz-inspire">secret to wealth accumulation</a>.
"Citadel knows more than you do," Quast said, referring to Citadel Securities, the market-making division of Citadel. The leading global market maker is responsible for executing more than 33% of individual investors orders, "so the only way that you can use the presence of Citadel to your advantage, is to know where the supply and demand imbalances are."
Quast identified four momentum stocks that traders can move in and out of due to their near daily volatility: Carvana Co (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/CVNA#NYSE">CVNA</a>), Matador Resources Co (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/MTDR#NYSE">MTDR</a>), Unity Software Inc (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/U#NYSE">U</a>), and Coinbase Global Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/COIN#NASDAQ">COIN</a>). Read also: <a href="https://www.benzinga.com/news/earnings/23/07/33163264/nasdaq-s-p-500-futures-stumble-in-fresh-week-as-inflation-earnings-in-focus-why-this-analyst-says-d">S&amp;P 500, Nasdaq 100 Ease As Traders Await CPI Report: What&#8217;s Driving Markets Monday</a>
He emphasized the difficulties associated with trading a highly volatile stock such as Carvana, which exhibits an approximately 10% volatility. To tackle the trading challenges posed by such stocks, Quast recommended implementing a stop-loss order that should be positioned considerably below the stock&#8217;s acquisition price to accommodate the heightened volatility.
The trade-off here is increased risk, but with careful consideration of the stock&#8217;s behavior, traders can increase their chances of turning in a profit.
Despite volatility and risk, Quast suggests that there&#8217;s a high mathematical probability of making a 2%-4% gain on those types of trades. "The entry will take care of itself as long as your exit is 2%," he said.
His advice is simple: &#8220;Just take what the market gives you.&#8221;
The 2%-4% principle guides his internal model, which netted a 37.2% return by mid-year. Though, if you&#8217;re more of a passive investor, there are momentum trading-focused ETFs like the iShares MSCI USA Momentum Factor ETF (BATS:<a class="ticker" href="https://www.benzinga.com/stock/MTUM#BATS">MTUM</a>), and the Invesco DWA Momentum ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/PDP#NASDAQ">PDP</a>), so you can skirt the traditional approach to momentum trading.
Quast&#8217;s strategy for momentum trading is consistent with the fundamental definition of the approach, where the emphasis is on leading rather than following the crowd. The idea is to ride the wave of a stock&#8217;s upward trend and sell as soon as there are signs of a downward trend, moving the capital to new positions.
Key elements of momentum investing include choosing the right stocks (Quast mentioned the four above), understanding risks in opening and closing trades, opening trades early, managing the position, and consistent charting for profitable exit points.
Above all, investors must understand that the aim is not to make a killing on a single trade, but to make modest gains that compound over time. As Quast puts it, you have to &#8220;take what the market gives you&#8221; and use it to your advantage.
Watch Monday&#8217;s &#8220;PreMarket Prep&#8221; show below:
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<iframe loading="lazy" title="PreMarket Prep &#x7C; July 10, 2023" width="500" height="281" src="https://www.youtube.com/embed/ngaX3sUzK1g?feature=oembed" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen></iframe>
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Read next: <a href="https://www.benzinga.com/analyst-ratings/analyst-color/23/07/33171353/why-this-first-financial-bancorp-analyst-is-bullish-in-a-tough-year-for-regional-ba">Why This First Financial Bancorp Analyst Is Bullish In A Tough Year For Regional Banks</a>
Photo: Shutterstock

'Citadel Knows More Than You Do,' But Is There A Profitable Trade On Unity And Carvana?

Timing when a particular investment factor will be in style and when it will fall out of favor isn&#39;t an easy task. Making the task even harder is that, by some estimates, the low volatility and momentum factors are increasingly <a href="http:// http://www.benzinga.com/trading-ideas/long-ideas/16/07/8276380/a-scientific-approach-to-multi-factor-investing">correlated with each other</a>.

	The PowerShares DWA Momentum &amp; Low Volatility Rotation Portfolio (NASDAQ: DWLV), which debuted last month, is a solution for investors looking for simultaneous exposure to the low volatility and momentum factors. DWLV tracks the he Dorsey Wright Multi-Factor Global Equity Index.

	That index &ldquo;is designed to gain exposure to US or international equity markets through the universe of up to eight PowerShares momentum or low volatility ETFs, and may also hold up to 100 percent cash position (via 1- to 6-month US Treasury Bills) when equity securities as a whole are out of favor. The Fund and the Index are evaluated monthly for potential rebalance and reconstitution,&rdquo; <a href="https://www.invesco.com/portal/site/us/financial-professional/etfs/product-detail?productId=DWLV&amp;ivz_campain=focus-etf-DWLV&amp;ivz_source=carousel-1&amp;ivz-content=img-introducing-dwlv">according to PowerShares</a>.

	DWLV, which currently holds four PowerShares low volatility and momentum ETFs along T-bills, has some other nifty features.

	&ldquo;The ability to rotate between momentum, low volatility and cash provides investors the potential for equity exposure and risk mitigation. Dorsey Wright&rsquo;s proven relative strength methodology uses the forces of supply and demand to determine exposure and may help overcome or balance some of the uncertainties found in fundamental analysis,&rdquo; said PowerShares <a href="https://www.blog.invesco.us.com/equities-post-gains-amid-mixed-economic-backdrop">in a recent note</a>.&nbsp;

	Not surprisingly, DWLV&#39;s current tilt is toward low volatility as the PowerShares S&amp;P SmallCap Low Volatility Portfolio (NYSE: <a class="ticker" href="/stock/xslv#NYSE">XSLV</a>) and the PowerShares S&amp;P 500 Low Volatility Portfolio (NYSE: <a class="ticker" href="/stock/splv#NYSE">SPLV</a>) combine for 49 percent of the new ETF&#39;s weight.

	DWLV&#39;s momentum exposure is achieved via a combined allocation of 21.3 percent to the PowerShares DWA SmallCap Momentum Portfolio (NASDAQ: <a class="ticker" href="/stock/dwas#NASDAQ">DWAS</a>) and the PowerShares DWA Momentum Portfolio (NYSE: <a class="ticker" href="/stock/pdp#NYSE">PDP</a>).

	The low volatility factor could remain an investor favorite amid election year jitters and slowing economic growth.

	&ldquo;In the US, decelerating economic growth is showing signs of abating and a trough may finally be forming. Industrial production growth reached a high of 3.9% on a year-over-year basis in July 2014, before falling to a low of -2.3% in December 2014. This decelerating industrial growth was driven in part by a drop in commodity prices, the strength of the US dollar and inventory imbalances,&rdquo; adds PowerShares.

	DWLV has accumulated $12.8 million in assets since its July 15 debut.

Low volatility and momentum are two widely followed investment factors, but rare are the occasions that these two factors meet and stand as the primary factors under the umbrella of a single exchange-traded fund.
That changed a bit Thursday with the debut of the PowerShares DWA Momentum &amp; Low Volatility Rotation Portfolio (NASDAQ: DWLV), the latest in a growing lineup of ETFs of ETFs from PowerShares, the fourth-largest U.S. issuer of exchange-traded funds. The new ETF follows the Dorsey Wright Multi-Factor Global Equity Index.
<h3>Welcome, DWLV!</h3>
That index &ldquo;is designed to gain exposure to US or international equity markets through the universe of up to eight PowerShares momentum or low volatility ETFs, and may also hold up to 100 percent cash position (via 1- to 6-month US Treasury Bills) when equity securities as a whole are out of favor. The Fund and the Index are evaluated monthly for potential rebalance and reconstitution,&rdquo; <a href="https://www.invesco.com/portal/site/us/financial-professional/etfs/product-detail?productId=DWLV&amp;ivz_campain=focus-etf-DWLV&amp;ivz_source=carousel-1&amp;ivz-content=img-introducing-dwlv">according to PowerShares</a>.
<bzrelatedlink>Related Link: <a href="http://www.benzinga.com/news/16/07/8220907/wisdomtree-expands-etfs-offerings-on-schwab-onesource">WisdomTree Expands ETFs Offerings On Schwab OneSource</a>
At a time when low volatility ETFs are not only delivering for investors in terms of returns, but are also on the receiving end of billions of dollars in new assets, it is not surprising that DWLV debuted with a heavier tilt to such ETFs.
Home to four other PowerShares ETFs, the PowerShares S&amp;P SmallCap Low Volatility Portfolio (PowerShares Exchange-Traded Fund Trust II (NYSE: <a class="ticker" href="/stock/xslv#NYSE">XSLV</a>)) and the PowerShares S&amp;P 500 Low Volatility Portfolio (PowerShares Exchange-Traded Fund Trust II (NYSE: <a class="ticker" href="/stock/splv#NYSE">SPLV</a>)) combine for nearly 70 percent of DWLV&#39;s weight. The momentum portion of the new ETF&#39;s lineup comes by way of the PowerShares DWA SmallCap Momentum Portfolio (NYSE: <a class="ticker" href="/stock/dwas#NYSE">DWAS</a>) and the PowerShares DWA Momentum Portfolio (PowerShares DWA Technical Ldrs Pf (ETF) (NYSE: <a class="ticker" href="/stock/pdp#NYSE">PDP</a>)).
&ldquo;DWLV&#39;s underlying index offers pure exposure to the low volatility factor, without sector constraints, blended with an ability to identify meaningful momentum trends for potential diversification benefits. DWLV also offers global tactical exposure by tracking the Dorsey Wright Multi-Factor Global Equity Index, which systematically evaluates on a monthly basis the relative strength of six global asset classes in determining an allocation between US and international equity ETFs and cash,&rdquo;<a href="http://finance.yahoo.com/news/invesco-powershares-expands-industry-leading-130000498.html"> according to a statement</a>.
PowerShares has achieved previous success with the ETF of ETFs model. For example, the PowerShares DWA Tactical Sector Rotation Portfolio (NASDAQ: <a class="ticker" href="/stock/dwtr#NASDAQ">DWTR</a>) debuted in October and already has $172.4 million in assets while the PowerShares DWA Tactical Multi-Asset Income Portfolio (NASDAQ: <a class="ticker" href="/stock/dwin#NASDAQ">DWIN</a>) debuted in March and has $87.6 million in assets.
Did you like this article? Could it have been improved? Please email <a href="mailto:feedback@benzinga.com">feedback@benzinga.com</a> to let us know!
</bzrelatedlink>

Of the more than 280 exchange traded products that debuted in the US last year, plenty were multi-factor funds. But with the momentum factor excelling last year and investors hoping for more of the same in 2016, investors may want to consider exchange traded funds that are dedicated plays on the momentum factor.

	Investors looking for seasoned ETFs that emphasize the momentum factor have some worthy choices in the forms of the $1.88 billion PowerShares DWA Momentum Portfolio (NYSE: <a class="ticker" href="/stock/pdp#NYSE">PDP</a>) and the $1.07 billion iShares MSCI USA Momentum Factor ETF (NYSE: <a class="ticker" href="/stock/mtum#NYSE">MTUM</a>).

	PDP, which turns eight years old in early March, follows the Dorsey Wright Technical Leaders Index (DWA Technical Leaders Index), a benchmark that <a href="http://www.benzinga.com/news/13/01/3245079/powershares-technical-leaders-etfs-cross-1b-in-aum">adheres to the Dorsey Wright relative strength methodology</a>. Consumer discretionary, industrial and healthcare names combine for over 53 percent of the ETF&#39;s weight.

	&quot;PDP was more diversified at the sector level than MTUM, with less exposure to the top-performers of 2015 and more toward the laggards. PDP is reconstituted and rebalanced on a quarterly basis using a proprietary screening methodology that starts with stocks within the NASDAQ US Benchmark index,&quot; said <a href="http://trymsatoday.com/">S&amp;P Capital IQ </a>in a new research note.

	Top 10 holdings in PDP include familiar momentum names such as Apple Inc. (NASDAQ: <a class="ticker" href="/stock/aapl#NASDAQ">AAPL</a>), Gilead Sciences, Inc. (NASDAQ: <a class="ticker" href="/stock/gild#NASDAQ">GILD</a>) and Priceline Group Inc. (NASDAQ: <a class="ticker" href="/stock/pcln#NASDAQ">PCLN</a>). Apple is the ETF&#39;s largest holding with a weight of 2.87 percent.

	With both MTUM and PDP, investors should make a habit of checking the ETFs&#39; rosters because although neither is actively managed, holdings frequently change in these funds.

	&quot;We think both PDP and MTUM need to be regularly monitored to understand their exposures as turnover rates were 73% and 106%, respectively. Neither paid out a capital gain in 2015,&quot; said S&amp;P Capital IQ.

	MTUM follows the MSCI USA Momentum Index and holds 124 stocks. The ETF is discretionary and tech heavy as those sectors combine for over 54 percent of the fund&#39;s weight. Amazon.com, Inc. (NASDAQ: <a class="ticker" href="/stock/amzn#NASDAQ">AMZN</a>) and Facebook Inc&nbsp;(NASDAQ: <a class="ticker" href="/stock/fb#NASDAQ">FB</a>) are MTUM&#39;s top two holdings, combining for 9.5 percent of the ETF&#39;s weight.

	&quot;Meanwhile, energy, materials and utilities shares made up a combined 2% of assets, well below the 12% in the S&amp;P 500 index. MTUM trades approximately 270,000 shares on a daily basis. The ETF has a low 0.15 percent expense ratio. The MSCI index behind MTUM&#39;s construction is generally rebalanced on a semi-annual basis, using six and 12-month risk-adjusted momentum criteria. However, the index can undergo &#39;conditional ad-hoc rebalancing&#39; based on changes in monthly volatility measures if triggers are hit, according to MSCI,&quot; said S&amp;P Capital IQ.

Intraday Update

AAPL

AMZN

GILD

GOOGL

PCLN

Moving To Momentum With ETFs

The number of exchange traded funds rooted in the momentum factor continues proliferating, though that may not be a surprise at a time when the momentum factor is outpacing its value counterpart. Even with the increased population of such ETFs, momentum remains arguably one of the most critiqued investment factors.

	While the momentum factor has shown long-term durability against traditional broad market indexes, some ETFs have a way of over-complicating the factor (along with other investment factors), so perhaps the best application of momentum among ETFs is a simple approach. Enter the newly minted PowerShares S&amp;P 500 Momentum Portfolio (NYSE: <a class="ticker" href="/stock/spmo#NYSE">SPMO</a>).

	Just as the popular PowerShares S&amp;P 500 Low Volatility Portfolio (NYSE: <a class="ticker" href="/stock/splv#NYSE">SPLV</a>) tracks the 100 S&amp;P 500 with the lowest trailing 12-month volatility, the PowerShares S&amp;P 500 Momentum Portfolio is currently home to 101 S&amp;P 500 stocks displaying <a href="https://www.invesco.com/portal/site/us/financial-professional/etfs/product-detail?productId=SPLV&amp;title=powershares-s-p-500-low-volatility-portfolio">favorable momentum scores</a>.

	Related Link: <a href="http://www.benzinga.com/trading-ideas/long-ideas/15/11/5954102/this-emerging-markets-etf-can-deal-with-the-strong-dollar">This Emerging Markets ETF Can Deal With The Strong Dollar</a>

	PowerShares, the fourth-largest U.S. issuer of exchange traded funds, knows a little something about momentum-based ETFs. The company is the issuer behind the $1.9 billion PowerShares DWA Momentum Portfolio (NYSE: <a class="ticker" href="/stock/pdp#NYSE">PDP</a>), a lineup of momentum-driven sector ETFs that are swelling in size and the PowerShares DWA Tactical Sector Rotation Portfolio (NASDAQ: <a class="ticker" href="/stock/dwtr#NASDAQ">DWTR</a>), which has needed less than a month of trading to haul in&nbsp;<a href="http:// http://www.benzinga.com/trading-ideas/long-ideas/15/10/5941513/momentum-is-working-at-the-sector-level">$42.6 million in assets under management</a>.

	For its part, SPMO has, at the top, an expected look for a momentum ETF. Nearly 61 percent of the ETF&#39;s combined sector weight is allocated to consumer discretionary and healthcare names. There are, however, some surprises. For example, despite SPMO&#39;s 27.3 percent healthcare weight, the ETF holds just three biotech stocks, which combine for just 5.5 percent of the ETF&#39;s weight.

	Additionally, <a href="http://www.benzinga.com/trading-ideas/long-ideas/15/10/5942807/problem-children-arent-derailing-consumer-staples-etfs">consumer staples</a>, a sector not often associated with momentum, is SPMO&#39;s third-largest sector weight at 17.4 percent. That serves as a reminder that momentum is more about price action than mere identification of so called glamorous or sexy stocks. On that note, SPMO&#39;s technology weight is just 11 percent and few of the ETF&#39;s tech holdings can be classified as glamorous or glitzy.

	Investors in search of discretionary sector momentum need fret. SPMO is home to a nearly 6 percent weight to Amazon.com, Inc. (NASDAQ: <a class="ticker" href="/stock/amzn#NASDAQ">AMZN</a>) as well as several of the best-performing discretionary stocks from the Dow Jones Industrial Average.

	Due to the laggard status of or lack of momentum displayed by energy, industrial and materials stocks, those sectors combine for just 6.4 percent of SPMO&#39;s weight. The ETF charges 0.25 percent per year, or $25 for every $10,000 invested.

SPMO

Some Momo From A New Momentum ETF

Given all the talk about market volatility this year, it might be surprising for some investors to learn that the momentum factor has outpaced the value factor.

	For example, the Russell 1000 Value Index is being soundly thumped by the S&amp;P 500 and the Russell 1000 Growth Index. Taking the comparisons even further, investors can parse through the world of exchange funds and find a number of growth and/or momentum offerings that are easily beating value equivalents. A good example is the PowerShares Dynamic Large Cap Value Portfolio (NYSE: <a class="ticker" href="/stock/pwv#NYSE">PWV</a>) being down 6.8 percent year-to-date while the PowerShares DWA Momentum Portfolio (NYSE: <a class="ticker" href="/stock/pdp#NYSE">PDP</a>) is off just 0.4 percent.

	Part of the value factor&#39;s problem this year has been the Federal Reserve. Financial services and utilities names are value residents and those sectors have been plagued by speculation regarding when the Fed will raise interest rates or if the central bank can even make that move anymore. When Treasury yields climbed, financials got a lift, but utilities were hampered. The opposite was true when yields fell, but the result has been less-than-impressive performances for sector ETFs tracking financials services <a href="http://www.benzinga.com/trading-ideas/long-ideas/15/10/5889362/sleepy-studs-utilities-etfs-look-to-extend-q3-brightness">and utilities stocks</a>.

	&ldquo;Value stocks tend to find favor when interest rates are rising. This makes sense then you consider that rates often rise behind strong economic growth, which typically benefit cyclical sectors like energy, industrials and financials. We have been in a zero interest rate environment since 2008, but given the correlation between value shares and interest rates, it would stand to reason that value shares could benefit should the Federal Reserve decided to take a less accommodative approach to monetary policy,&rdquo; said <a href="http://www.blog.invesco.us.com/economic-conditions-favor-value-stocks">Invesco PowerShares</a>, the fourth-largest U.S. ETF issuer, in a note out Wednesday.

	Although the aforementioned PWV, a $957.3 million ETF, has struggled this year, that fund has the potential to be a solid rising rates play. While PWV allocates a combined 21.5 percent of its weight to rate-sensitive utilities, telecom and consumer staples stocks, historically three of the worst-performing sectors following Fed liftoff, PWV&#39;s cyclical exposure is robust enough to endure rising rates. For example, the ETF devotes a <a href="http://www.benzinga.com/trading-ideas/long-ideas/15/09/5832788/these-sector-etfs-could-shine-after-a-rate-hike">combined 36 percent</a> of its weight to technology, energy and consumer discretionary names.

	&ldquo;It&rsquo;s been a rough ride for value investors, but there is reason for optimism. Within the consumer discretionary sector, analysts surveyed by Bloomberg are expecting strong third-quarter earnings growth from retailers and automakers to the tune of 14.0% and 30.2%, respectively, while the real estate industry is expected to provide a boost to financial stocks,&rdquo; adds Invesco PowerShares.

	Consumer discretionary is this year&#39;s top-performing sector with a healthy lead over second-place healthcare. Investors looking to access discretionary stocks via a broad market ETF with a value tilt can consider the $4.1 billion PowerShares FTSE RAFI US 1000 Portfolio (NYSE: <a class="ticker" href="/stock/prf#NYSE">PRF</a>).

	Viewed in some circles as <a href="http://www.benzinga.com/trading-ideas/long-ideas/15/09/5871033/the-survey-says-advisors-love-smart-beta-etfs">one of the godfathers</a> of the smart or strategic beta movement, PRF selects its 1,000-plus holdings based on book value, cash flow, sales and dividends. Consumer discretionary is PRF&#39;s third-largest sector allocation at a weight of 11.6 percent.

	PRF has outpaced the S&amp;P 500 in four of the past six years.

PowerShares Exchange Traded Fund FTSE RAFI US 1000 Portfolio

PowerShares Exchange Traded Fund Trust Dynamic Large Cap Value Portfolio

Value ETFs May Get Their Day In The Sun

Generating <a href="http://www.benzinga.com/topic/alpha">alpha</a>, or excess returns above a benchmark, is no easy task considering the level of consistency needed to prove a unique investment has merit.

	Most <a href="http://www.benzinga.com/topic/etf">ETF</a> investors have flocked to well-known benchmarks, such as the SPDR S&amp;P 500 ETF Trust (NYSE: <a class="ticker" href="/stock/spy#NYSE">SPY</a>), as core equity holdings in their portfolios. However, there are several strong fundamental or &ldquo;smart beta&rdquo; contenders that deserve a place on watch lists as well.
<h3>
	PowerShares Buyback Achievers Portfolio</h3>

	PowerShares Buyback Achievers Fund (ETF) (NYSE: <a class="ticker" href="/stock/pkw#NYSE">PKW</a>) is based on the NASDAQ U.S. BuyBack Achievers Index, which selects U.S.-listed stocks that are reducing their share float by at least 5 percent in the trailing 12 months.

	This ETF currently has $2.7 billion in total assets, 214 holdings and an expense ratio of 0.68 percent.

	The PKW portfolio is dominated by consumer discretionary and technology names such as Apple Inc. (NASDAQ: <a class="ticker" href="/stock/aapl#NASDAQ">AAPL</a>) and Home Depot Inc (NYSE: <a class="ticker" href="/stock/hd#NYSE">HD</a>). In addition, the underlying holdings are spread out among primarily large- and mid-cap companies.

	Over the last 12 months, PKW has returned 18.01 percent.

	<bzrelatedlink>Related Link: <a href="http://www.benzinga.com/etfs/sector-etfs/15/02/5210721/consumer-discretionary-etfs-receive-earnings-season-boost">Consumer Discretionary ETFs Receive Earnings Season Boost</a></bzrelatedlink>
<h3>
	First Trust Dorsey Wright Focus 5 ETF</h3>

	First Trust Exchange Traded Fund VI (NASDAQ: <a class="ticker" href="/stock/fv#NASDAQ">FV</a>) incorporates a unique take on momentum by selecting five underlying First Trust sector or industry-based ETFs with the greatest potential for outperformance. The index is constructed using a relative strength screening methodology to measure momentum across the entire market spectrum.

	The top five sectors are then selected and equal weighted according to index criteria.The current portfolio includes: <a href="http://www.benzinga.com/topic/biotechnology">biotechnology</a>, healthcare, consumer staples, Internet and consumer discretionary stocks.

	FV has $1.7 billion in total assets and charges a management fee of 0.30 percent. Over the last 10 months (since inception), it has returned 24.96 percent.

	<bzrelatedlink>Related Link: <a href="http://www.benzinga.com/etfs/sector-etfs/15/02/5221318/utility-russia-and-mid-cap-etfs-to-watch-this-week">Utility, Russia And Mid-Cap ETFs To Watch This Week</a></bzrelatedlink>
<h3>
	PowerShares DWA Momentum Portfolio</h3>

	PowerShares DWA Technical Ldrs Pf (ETF) (NYSE: <a class="ticker" href="/stock/pdp#NYSE">PDP</a>) is composed of 100 U.S.-listed stocks from a universe of 1,000 total companies with the highest relative performance among their peer groups. The end result is a diversified portfolio of publicly-traded companies across multiple sectors.

	The PDP portfolio is made up exclusively of large- and mid-cap companies, with a much different asset allocation than a traditional market-cap weighted index. This ETF has $1.66 billion in total assets and charges an expense ratio of 0.65 percent.

	Over the last 12 months, PDP has returned 14.85 percent.
<h3>
	Market Vectors Morningstar Wide Moat ETF</h3>

	Market Vectors ETF Trust (NYSE: <a class="ticker" href="/stock/moat#NYSE">MOAT</a>) is a concentrated mix of just 20 equal-weighted companies that Morningstar has identified as having a unique competitive advantage in their industry. This ETF also favors undervalued stocks, according to a proprietary valuation method implemented by the equity research team responsible for maintaining this index.

	Holdings include well-known companies such as Amazon.com, Inc. (NASDAQ: <a class="ticker" href="/stock/amzn#NASDAQ">AMZN</a>) and General Electric Company (NYSE: <a class="ticker" href="/stock/ge#NYSE">GE</a>). MOAT has over $900 million in total assets and charges an expense ratio of 0.49 percent.

	Over the last 12 months, MOAT has returned 7.56 percent.

Sector ETFs

MOAT

4 Alpha-Seeking ETFs To Add To Your Watch List

With the market in the midst of one of its most impressive rallies over the last decade, identifying stocks that are outperforming the market is crucial to capitalize on the current market environment.

	One of the best ways to take advantage of a <a href="http://www.benzinga.com/topic/bull-market">bull market</a> with such strength is to identify <a href="http://www.benzinga.com/topic/momentum-stocks">momentum stocks</a>.

	To fall into this category, a stock would have to show above average relative strength, which can be measured by the strength of a stock when compared to its peers.

	There are a number of momentum ETFs from a plethora of sectors that meet this criteria.

	Highlighted below are two momentum ETFs that could capitalize on the current market condition as long as the rally continues.
<h3>
	PowerShares DWA</h3>

	The PowerShares DWA Technical Ldrs Pf (ETF) (NYSE: <a class="ticker" href="/stock/pdp#NYSE">PDP</a>) consists of 100 publicly traded companies that have a relatively high price momentum and are predicated to sustain the momentum for the near future.

	The ETF is distributed across 10 sectors with the most heavily weighted being consumer discretionary at 26 percent, industrials at 19 percent and health care at 17 percent.

	The top individual holdings include:
<ul>
<li>
		Apple Inc. (NASDAQ: <a class="ticker" href="/stock/aapl#NASDAQ">AAPL</a>) with a 3.2 percent holding</li>
<li>
		Jazz Pharmaceuticals plc - Ordinary Shares (NASDAQ: <a class="ticker" href="/stock/jazz#NASDAQ">JAZZ</a>) making up 3.1 percent</li>
<li>
		O&rsquo;Reilly Automotive Inc (NASDAQ: <a class="ticker" href="/stock/orly#NASDAQ">ORLY</a>) coming in at 3 percent</li>
</ul>

	PDP is up 12 percent year over year and 11 percent over the last six months. The momentum ETF has an expense ratio of 0.65 percent.

	<bzrelatedlink>Related Link: <a href="http://www.benzinga.com/etfs/sector-etfs/14/11/5016138/here-are-a-few-preferred-stock-etfs-for-income-and-diversity">Here Are A Few Preferred Stock ETFs For Income And Diversity</a></bzrelatedlink>
<h3>
	iShares Trust</h3>

	The iShares Trust (NYSE: <a class="ticker" href="/stock/mtum#NYSE">MTUM</a>) follows 125 publicly traded companies that exhibit high momentum characteristics. Its holdings are spread across 11 sectors with the most heavily weighted being health care at 22 percent and industrials at 16 percent.

	The top individual holdings include:
<ul>
<li>
		Facebook Inc (NASDAQ: <a class="ticker" href="/stock/fb#NASDAQ">FB</a>) making at 5.7 percent</li>
<li>
		Wells Fargo &amp; Co (NYSE: <a class="ticker" href="/stock/wfc#NYSE">WFC</a>) with a 4.9 percent holding</li>
<li>
		Johnson &amp; Johnson (NYSE: <a class="ticker" href="/stock/jnj#NYSE">JNJ</a>) coming in at 4.8 percent</li>
</ul>

	It is up 13 percent year to date, beating the market by 2 percent during that time as compared to the SPDR S&amp;P 500 ETF Trust (NYSE: <a class="ticker" href="/stock/spy#NYSE">SPY</a>); it is also up 12 percent over the last six months. The ETF has an expense ratio of 0.15 percent.

Short Ideas

JAZZ

ORLY

Riding The Bull Market With These 2 Momentum ETFs

The world of dividend investing is being taken over by many large-cap technology companies, many of which are turning focus toward returning value to shareholders.

	Companies such as Apple Inc. (NASDAQ: <a class="ticker" href="/stock/aapl#NASDAQ">AAPL</a>) and Microsoft Corporation (NASDAQ: <a class="ticker" href="/stock/msft#NASDAQ">MSFT</a>) have committed a significant portion of its healthy balance sheets to share repurchases and dividend payments to entice both growth and income investors.

	Index providers have taken notice of this trend and responded by introducing funds such as the First Trust Exchange Traded Fd VI (NASDAQ: <a class="ticker" href="/stock/tdiv#NASDAQ">TDIV</a>). This ETF selects technology companies engaged in dividend activity and weighs them according to their yield rather than a traditional market-cap focus. The end result is a portfolio of nearly 100 companies with a 30-day SEC yield of 2.63 percent.

	While this focus on dividends is enticing, it may not be suitable for aggressive investors seeking a high monthly income stream or index that provides more growth opportunity.

	<bzrelatedlink>Related Link: <a href="http://www.benzinga.com/etfs/sector-etfs/14/10/4933676/technology-energy-and-inflation-protected-etfs-to-watch-this-week">Technology, Energy And Inflation Protected ETFs To Watch This Week</a></bzrelatedlink>

	One potential alternative is the Recon Capital NASDAQ-100 Covered Call ETF (NASDAQ: QYLD). This ETF seeks to track the CBOE NASDAQ-100 BuyWrite Index that generates income through a covered call options strategy.

	QYLD is able to collect dividends from holding the large, growth-oriented companies within the NASDAQ-100 Index along with monthly premiums from selling NASDAQ-100 Index options. Based on the recent price of QYLD and the last announced monthly dividend, the current yield on this ETF is 9.72 percent.

	Sophisticated ETF investors have often used covered calls to generate additional income for their portfolios. However, QYLD simplifies that process by doing the work for someone and charging an expense ratio of 0.60 percent for accessing this monthly income strategy.

	A competitive ETF in this space is the PowerShares S&amp;P 500 BuyWrite Portfolio (NYSE: <a class="ticker" href="/stock/pdp#NYSE">PDP</a>), which also implements the same covered call options methodology to generate income on stocks in the S&amp;P 500 Index.

	Whether a trader&#39;s focus is on generating yield or capital appreciation, these equity-income tools offer an advanced way to own both stocks and options within an ETF portfolio.

	Disclosure: At the time this article was published, the author owned TDIV.

MSFT

TDIV

Boost Your Technology Dividends With A Unique Covered Call ETF

The S&amp;P 500 is trading near an all-time high and the Nasdaq recently touched the highest level in 14 years. Stocks in all sectors are breaking out to new highs as the five-year-old bull market rages on. There is no surprise the <a href="http://www.benzinga.com/topic/etfs">ETFs</a> that attempt to track momentum are outperforming.

	Using a strategy that compares the performance of stock to the overall market and its sector tends to produce a basket of stocks that have been leading the market higher. As someone once said, &ldquo;new highs beget new highs,&rdquo; or buy high and sell higher. This strategy tends to do well when the bulls rule the overall market.

	Investors looking to catch the later years of this bull market could consider riding the momentum trade. PowerShares has a number of index-focused ETFs that use momentum strategies; a few interesting options are listed below.

	When considering them, investors should be aware of a momentum ETF-specific risk: eventually markets will suffer a pullback greater than 5 percent and the <a href="http://www.benzinga.com/topic/momentum-stocks">momentum stocks</a> could be the hardest hit.

	Related Link: <a href="http://www.benzinga.com/etfs/specialty-etfs/14/09/4836407/a-closer-look-at-2-new-actively-traded-etfs">A Closer Look At 2 New Actively Traded ETFs</a>
<h3>
	PowerShares DWA Momentum Portfolio (NYSE: <a class="ticker" href="/stock/pdp#NYSE">PDP</a>)</h3>

	The PowerShares DWA Momentum Portfolio includes 100 U.S mid- to large-cap companies that fit the bill of &ldquo;momentum&rdquo; stocks. The top holdings include Apple Inc. at 3.1 percent, TRW Automotive Holdings Corp at 2 percent and O&rsquo;Reilly Automotive Inc at 2.9 percent. With only 8 percent of the allocation in the top three holdings the fund is considered diverse.

	The ETF is up 23 percent over the last 12 months and 5 percent over the last six months. An expense ratio of 0.65 percent makes it slightly more expensive than the average ETF but in line with its niche peers.
<h3>
	PowerShares DWA Emerging Markets Momentum Portfolio (NYSE: <a class="ticker" href="/stock/pie#NYSE">PIE</a>)</h3>

	The PowerShares DWA Emerging Markets Momentum Portfolio consists of 100 companies that possess powerful relative strength characteristics and are part of <a href="http://www.benzinga.com/topic/emerging-markets">emerging market</a> economies. The fund is distributed throughout 10 sectors in 10 countries. The largest holdings in the fund are Hanssem Co Ltd at 2.8 percent, Universal Robina Corp at 2.3 percent and Coronation Fund Managers Ltd at 2.1 percent.

	PIE has been able to outperform the broad-based iShares MSCI Emerging Markets Indx (ETF) (NYSE: <a class="ticker" href="/stock/eem#NYSE">EEM</a>) by 300 basis points over the last 12 months, gaining 15 percent. The last six months have been solid with a gain of 11 percent and a new 52-week high. With an expense ratio of 0.9 percent it is one of the more expensive ETFs on the market.
<h3>
	The PowerShares DWA Basic Materials Momentum Portfolio (NYSE: <a class="ticker" href="/stock/pyz#NYSE">PYZ</a>)</h3>

	The PowerShares DWA Basic Materials Momentum Portfolio has the smallest number of holdings of the three with 36. Because the ETF is focused on a niche area of the market, it has a high sector concentration with 81.6 percent of the portfolio invested in the chemicals sector. The top three holdings in the fund include Westlake Chemical Corporation at 5.2 percent, W.R. Grace &amp; Co. with a 4.5 percent holding, and LyondellBasell Industries NV at 4.4 percent.

	Despite having the most consolidated holdings, PYZ has performed the best out of the three -- up 29 percent over the last 12 months and up 8 percent over the last six months. A 0.60 percent expense ratio puts it on par with its competition.

Emerging Market ETFs

PowerShares DWA Emerging Markets Technical Leaders

PowerShares Dynamic Basic Materials Sector Portfolio

Momentum ETFs To Play New Highs

ETF Outlook for Friday, February 14, 2014

	iPath Dow Jones-UBS Cocoa ETN (NYSE: <a class="ticker" href="/stock/nib#NYSE">NIB</a>)

	It Valentines Day and chocolate will be food of choice for many today as boxes of the sweet goodies are handed out as presents. Investors may have paid a little more for that box of chocolates today as demand for cocoa around the world increases.

	NIB, which tracks the futures price of cocoa is up 32 percent in the last 12 months and is trading near a multi-year high. What makes the move even more impressive is the fact that most other commodities have been in severe downtrends.

	iShares Dow Jones Transportation Index ETF (NYSE: <a class="ticker" href="/stock/iyt#NYSE">IYT</a>)

	The hits just keep on coming for the airlines and other transportation-related sectors as the inclement weather this winter continues. In the last week over 16,000 flights have been cancelled making it the worst situation since Hurricane Sandy.

	See also: <a href="http://www.benzinga.com/media/cnbc/14/02/4308131/10-things-most-people-dont-know-about-the-debt-ceiling#">10 Things Most People Don't Know About The Debt Ceiling</a>

	An independent research firm puts the losses at $150 million in January alone for the airline industry. IYT, which is composed of airline stocks as well as truckers, railroads, and more has held up fairly well, but the next few weeks could be important for the next quarter.

	PowerShares Dynamic Media ETF (NYSE: <a class="ticker" href="/stock/pbs#NYSE">PBS</a>)

	The news Comcast (NASDAQ: <a class="ticker" href="/stock/cmcsa#NASDAQ">CMCSA</a>) making a higher bid for Time Warner Cable (NYSE: <a class="ticker" href="/stock/twc#NYSE">TWC</a>) sent the entire cable industry higher yesterday, helping boost the media ETF. The top holdings of PBS include a couple cable companies as well as TV-related stocks.

	The move by CMCSA could prompt more consolidation in the sector, which would lead to higher prices for several stocks in the ETF. The ETF closed back above its 50-day moving average for the first time in a couple weeks yesterday and is not looking bullish again.

	PowerShares DWA Momentum Portfolio ETF (NYSE: <a class="ticker" href="/stock/pdp#NYSE">PDP</a>)

	The ETF that is composed of 100 U.S.-listed stocks is one of the first to claw its way back to a new all-time high. The S&amp;P 500 remains one percent below its historic high, but PDP charged to the best level ever yesterday. By investing in stocks that show strong relative strength the ETF will capture momentum and typically do well in bull markets.

	However, during the recent sell-off the momentum stocks took a big hit and many have yet to rebound to the old highs. The ETF is most heavily invested in consumer discretionary and health care and the mix of stocks has been able to outperform.

Pre-Market Outlook

CMCSA

iShares Dow Jones Transportation Average Index Fund

iPath DJ-UBScoa Subindex Total Return ETN

ETF Outlook For Friday, February 14, 2014 (NIB, IYT, PBS, PDP)

Investing based on momentum and relative strength has been a successful strategy the last few years as the market hit new all-time highs several times.

	A recent pullback in the stock market due to the government shutdown has brought the ETFs that following the concentrated strategy back to support levels. Keep in mind that even momentum ETFs will not move higher every day and that pullbacks are part of a long-term bull market.

	PowerShares DWA Momentum Portfolio ETF (NYSE: <a class="ticker" href="/stock/pdp#NYSE">PDP</a>)

	The ETF is up 21 percent in 2013 and is trading one percent below an all-time high. The ETF is based on the Dorsey Wright Technical Leaders Index and is composed of approximately 100 mid-cap and large-cap U.S. stocks. The index is based on a proprietary methodology that takes into stock account performance versus a benchmark as well as the relative performance of industry and sub-sectors. The universe begins with 3,000 of the largest U.S. stocks.

	Since 2007, the index has outperformed the S&amp;P 500 and trades more inline with the S&amp;P 500 Growth Index. The top holdings currently include tech darlings Priceline.com (NASDAQ: <a class="ticker" href="/stock/pcln#NASDAQ">PCLN</a>) and Apple (NASDAQ: <a class="ticker" href="/stock/aapl#NASDAQ">AAPL</a>).

	iShares MSCI USA Momentum Factor ETF (NYSE: <a class="ticker" href="/stock/mtum#NYSE">MTUM</a>)

	Launched in April of this year, MTUM has lagged PDP since its inception most likely due to a difference in how stocks are chosen for inclusion. The ETF is currently made up of 123 large-cap and mid-cap stocks based in the U.S. The portfolio is reallocated every quarter based on a formula that attempts to identify stock exhibiting relatively higher momentum characteristics.

	The ETF is heavily weighted in the health care and consumer staples sectors, which are not often viewed as momentum plays. The top two holdings are Johnson &amp; Johnson (NYSE: <a class="ticker" href="/stock/jnj#NYSE">JNJ</a>) and Gilead Sciences (NASDAQ: <a class="ticker" href="/stock/gild#NASDAQ">GILD</a>).

	PowerShares DWA Emerging Markets Momentum Portfolio ETF (NYSE: <a class="ticker" href="/stock/pie#NYSE">PIE</a>)

	Similar to PDP, this ETF tracks a Dorsey Wright Index, except the difference is that it only concentrates on stocks based in emerging market countries. Since the beginning of 2008 the ETF has lagged the S&amp;P 500 as well as the MSCI Emerging Markets Index. This is due to the emerging markets not enjoying the same bull market as the U.S. stocks.

	The ETF is diversified over several sectors and is most heavily weighted in Taiwan and China. Year-to-date the ETF is up less than 1 percent, but has been able to rally 15 percent from the late August low as the emerging markets are beginning to attract new buyers.

	The emerging markets momentum ETF is a perfect example of how this type of strategy tends to underperform in a non-bull market. That being said, the U.S. appears to be in the middle of a long-term bull market that should continue to see the momentum stocks outperform.

Playing Momentum With ETFs (PDP, PIE, MTUM)

Invesco's (NYSE: <a class="ticker" href="/stock/ivz#NYSE">IVZ</a>) PowerShares unit, the fourth-largest U.S. ETF issuer, said Thursday that its suite of ETFs based on Dorsey Wright &amp; Associates relative index methodology has topped a combined $2 billion in assets under management.

	PowerShares also said it is changing the names of the four ETFs.

	Related: <a href="http://www.benzinga.com/news/13/01/3245079/powershares-technical-leaders-etfs-cross-1b-in-aum">PowerShares Technical Leaders ETFs Cross $1B in AUM</a>.

	News of the DWA suite of ETFs hitting $2 billion in AUM comes just nine months after PowerShares said the funds reached a combined $1 billion in assets. Illinois-based PowerShares also said it is changing the names of the four ETFs.

	The $963.6 million PowerShares DWA Technical Leaders Portfolio (NYSE: <a class="ticker" href="/stock/pdp#NYSE">PDP</a>) will become the PowerShares DWA Momentum Portfolio while the $397.8 million PowerShares DWA SmallCap Technical Leaders Portfolio (NYSE: <a class="ticker" href="/stock/dwas#NYSE">DWAS</a>) will be referred to as the PowerShares DWA SmallCap Momentum Portfolio. Those name changes go into effect on October 4, 2013.

	The PowerShares DWA Emerging Markets Technical Leaders Portfolio (NYSE: <a class="ticker" href="/stock/pie#NYSE">PIE</a>), which has $313.9 million in assets, will become the PowerShares DWA Emerging Markets Momentum Portfolio while the PowerShares DWA Developed Markets Technical Leaders Portfolio (NYSE: <a class="ticker" href="/stock/piz#NYSE">PIZ</a>) is transitioning to the PowerShares DWA Developed Markets Momentum Portfolio. PIZ currently has $418.2 million in assets.

	"PowerShares DWA Momentum ETFs are based on ‘Relative Strength,' a measure of a stock's performance in relation to other investment options. Numerous studies have demonstrated that relative strength can be a powerful tool for stock selection. A key strength of this methodology is that it's based on unbiased, objective market data, as opposed to a more subjective forecasting and research models," according to a statement issued by PowerShares.

	The four PowerShares DWA funds are considered "smart beta" ETFs, a fast-growing sub-segment of the ETF space that eschews traditional market cap-weighting in favor of delivering returns by using fundamental or factors in the case of the DWA suite.

	The methodology used by the PowerShares DWA ETFs has proven successful. For example, DWAS, the newest of the four funds, <a href="http://www.benzinga.com/trading-ideas/long-ideas/13/07/3731768/two-broader-market-etfs-for-the-second-half">has outperformed larger rivals</a> in the small-cap ETF space this year. In more favorable environments for emerging markets funds, <a href="http://www.benzinga.com/trading-ideas/long-ideas/13/09/3927572/no-tapering-a-boon-for-these-em-etfs">PIE has also outpaced its larger competitors</a>.

	For more on ETFs, click <a href="http://www.benzinga.com/etfs">here</a>.

PowerShares DWA Developed Markets Technical Leaders

PowerShares DWA Leaders ETFs Hit $2B In AUM, Names To Be Changed

Invesco's (NYSE: <a class="ticker" href="/stock/ivz#NYSE">IVZ</a>) PowerShares unit, the fourth-largest ETF issuer, announced today that its suite of ETFs based on Dorsey Wright &amp; Associates relative index methodology has topped a combined $1 billion in assets under management. The PowerShares DWA Technical Leaders ETF were among the first factor-based funds made available to U.S. investors.

The PowerShares DWA Technical Leaders Portfolio (NYSE: <a class="ticker" href="/stock/pdp#NYSE">PDP</a>) is the largest of the four PowerShares ETF based on the Dorsey Wright relative strength methodology. That fund currently has $771 million in assets under management. 

PDP is home to 101 U.S. stocks, with about two-thirds of the fund's weight allocated to mid-cap growth and value names. Financial services and consumer discretionary names combine for over 40 percent of PDP's weight. PDP outperformed the S&amp;P 500 by 187 basis points in 2012, according to PowerShares.

The PowerShares DWA Emerging Markets Technical Leaders Portfolio (NYSE: <a class="ticker" href="/stock/pie#NYSE">PIE</a>) has $276 million in AUM, making it the second-largest PowerShares DWA ETF. PIE is also home to 101 stocks. Top country weights include Indonesia, South Africa, Thailand and Mexico.

PIE allocates nearly half its weight to mid-cap growth and value names while large-cap growth value names represent another 42 percent of the fund's weight. At almost 20.7 percent, industrials are the largest sector weight in PIE. Discretionary and staples names receive allocations of 18.6 and 15.3 percent, respectively.

PIE's developed market equivalent, the PowerShares DWA Developed Markets Technical Leaders Portfolio (NYSE: <a class="ticker" href="/stock/piz#NYSE">PIZ</a>), has $132.3 million in assets. The U.K. represents a quarter of that fund's country weight with Germany, Singapore and Australia all receiving weights greater than 10 percent. PIZ is also dominated by mid- and large-cap growth and value stocks.

The newest PowerShares DWA product is the PowerShares DWA SmallCap Technical Leaders Portfolio (NYSE: <a class="ticker" href="/stock/dwas#NYSE">DWAS</a>). DWAS, which debuted in July 2012, is now home to $18.1 million in AUM. About 90 percent of that ETF's weight goes to small-caps with the remainder going to mid-caps.

DWAS is home to 200 stocks consumer discretionary names leading the sector weights at 23.4 percent. Financials and health care issues receive allocations of 18.4 percent and 15.5 percent, respectively.

Since its debut, DWAS has gained 11.1 percent, outperforming the iShares Russell 2000 Index Fund by 110 basis points along the way.

For more on ETFs, click <a href="http://www.benzinga.com/etfs">here</a>.

Small Cap

PowerShares Technical Leaders ETFs Cross $1B in AUM

It may be data from just one issuer, but September inflows to Invesco's (NYSE: <a class="ticker" href="/stock/ivz#NYSE">IVZ</a>) PowerShares ETF arm highlight an already known trend: Investors are pouring cash <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/10/3015616/the-indomitable-rise-of-dividend-etfs">into income-oriented funds</a> at a rapid pace.

Of the 10 PowerShares ETFs that saw the largest inflows in September, <a href="http://www.invescopowershares.com/pdf/P-CONN-MR-46.pdf">four are clearly income products</a>. A case can be made that a fifth, the wildly popular PowerShares S&amp;P 500 Low Volatility Portfolio (NYSE: <a class="ticker" href="/stock/splv#NYSE">SPLV</a>), is a dividend ETF as well. SPLV, the largest low volatility ETF on the market, allocates a combined 75 percent of its weight to consumer staples, utilities and health care names. Those are all sectors prized by income investors.

SPLV also has a 30-day SEC yield of just over three percent. By comparison, the 30-day SEC yield on the SPDR S&amp;P 500 (NYSE: <a class="ticker" href="/stock/spy#NYSE">SPY</a>) is just 1.98 percent. SPLV ranked fourth among PowerShares ETFs in terms of September inflows. 

The PowerShares DB Commodity Index Tracking Fund (NYSE: <a class="ticker" href="/stock/dbc#NYSE">DBC</a>) lead the way in terms of September inflows to PowerShares ETFs with $322 million. The PowerShares Senior Loan Portfolio (NYSE: <a class="ticker" href="/stock/bkln#NYSE">BKLN</a>), one of the most <a href="http://www.benzinga.com/markets/bonds/12/10/2995308/etfs-with-amazing-asset-growth">prodigious gatherers of assets this year</a>, raked in $202 million to end September with $927 in AUM, according to PowerShares. Money has kept flowing to BKLN, which now has almost $1.2 billion in assets. BKLN, which pays a monthly dividend, has a 30-day SEC yield of 4.4 percent.

The PowerShares Preferred Portfolio (NYSE: <a class="ticker" href="/stock/pgx#NYSE">PGX</a>) was fifth-best among the firm's ETFs in terms of gaining assets in September. PGX haulded in $61 million in cash to end September with $1.99 billion in assets. As further proof the yield chase is still on and going strong, PGX is now close to $2.1 billion in AUM. PGX has a 30-day SEC yield of 6.43 percent and also pays a monthly dividend.

Not surprisingly, the PowerShares Emerging Markets Sovereign Debt Portfolio (NYSE: <a class="ticker" href="/stock/pcy#NYSE">PCY</a>) appears on the list as well. PCY, the second-largest ETF offering exposure to dollar-denominated emerging markets sovereign debt, <a href="http://www.benzinga.com/markets/bonds/12/10/3036081/investors-pouring-cash-into-em-bond-funds">has been prime beneficiary</a> of robust inflows to EM bond funds.

PCY hauled in $55 million in September to finish the month with $2.27 billion. As of October 31, PCY had over $2.8 billion in assets. Another monthly dividend payer, PCY has a 30-day SEC yield of four percent.

The 30-day SEC yield on the PowerShares Insured National Municipal Bond Portfolio (NYSE: <a class="ticker" href="/stock/pza#NYSE">PZA</a>) is just 2.98 percent, investors still poured $50 million into the ETF in September. PZA ended the month with $855 million in assets. October has been even better as PZA now has $931.7 million in assets.

The other ETFs to make the list of top-10 PowerShares asset gainers in September included two commodities funds, the PowerShares India Portfolio (NYSE: <a class="ticker" href="/stock/pin#NYSE">PIN</a>) and the PowerShares DWA Technical Leaders Portfolio (NYSE: <a class="ticker" href="/stock/pdp#NYSE">PDP</a>).

For more on dividend ETFs, click <a href="http://www.benzinga.com/markets/bonds/12/10/3036081/investors-pouring-cash-into-em-bond-funds">here</a>.

Bonds

Dividends

Commodities

After-Hours Center

BKLN

PowerShares DBmmodity Index Optimum Yield Diversified Fund

PowerShares Emerging Markets Sovereign  Portfolio

PowerShares Insured Municipal Bond Portfolio

Flows For This ETF Issuer Show Investors Love Dividends

On a historical basis, September is usually unkind to stocks and investors have been <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/09/2885573/3-inverse-etfs-for-september">reminded of that in ample doses</a> since the start of the month. The good news is September's sour reputation does not mean there are not opportunities to be had.

In fact, there are a few ETFs that can comfort investors this month. Perhaps the best thing is that the funds on this list are not leveraged, so conservative investors can embrace a couple of these picks, too.
Here are the ETFs to be involved with from the long side this month:

iShares Gold Trust (NYSE: <a class="ticker" href="/stock/iau#NYSE">IAU</a>)
Or the SPDR Gold Shares (NYSE: <a class="ticker" href="/stock/gld#NYSE">GLD</a>) or any ETF backed by physical gold for that matter. IAU makes the cut here because it has a lower expense ratio than GLD. Additionally, IAU has slightly outperformed GLD year-to-date. Regardless of which gold ETF investors choose, historical data indicate gold is a wise move from the long side this month.

In the past 25 Septembers, gold prices <a href="http://alletf.com/content/september-asset-class-returns">have increased 19 times</a>. Factoring in the six years when gold prices slid in September, gold's average September gain is almost 2.7 percent, according to Dorsey Wright.

iShares Dow Jones U.S. Real Estate Index Fund (NYSE: <a class="ticker" href="/stock/iyr#NYSE">IYR</a>)
The real estate sector has been a decent performer over the past 20 Septembers, rising 12 times and falling on eight occasions. The average gain in the 12 up Septembers outpaces the average loss by 50 basis points, according to Dorsey Wright. 

IYR is already up 17.3 percent year-to-date and that might imply the fund is due for a September pullback. Past performance probably is not the biggest near-term risk facing this ETF. Valuation might be. IYR sports a P/E ratio of almost 45 and a price/book ratio of nearly 3.5, <a href="http://us.ishares.com/product_info/fund/overview/IYR.htm?fundSearch=true&amp;qt=IYR">according to iShares data</a>. 

On the other hand, a 30-day SEC yield of 3.56 percent is decent in this environment and that could be enough to send yield-hungry investors into this fund as September moves along.

U.S. Oil Fund (NYSE: <a class="ticker" href="/stock/uso#NYSE">USO</a>)
Embracing a risky asset such as oil futures would appear to be the opposite of what would be deemed a practical September. The data support such a move. Over the past 16 Septembers, oil futures have risen nine times and fallen seven times. Not a big margin favor of the bulls, but the Dorsey Wright data indicate crude's average gain over those nine Septembers is 120 basis points better than the average loss. 

PowerShares DWA Technical Leaders Portfolio (NYSE: <a class="ticker" href="/stock/pdp#NYSE">PDP</a>)
The PowerShares DWA Technical Leaders Portfolio tracks an index based on relative strength methodology, which is to say the ETF is home to 101 stocks showing bullish relative strength characteristics. 

On the surface, PDP would be appear to be a fund more geared toward a risk on environment because consumer discretionary and financial services names combine for almost 50 percent of the ETF's weight. The index has jumped in 10 of the past 15 Septembers, though it should be noted the average loss in the five down Septembers is much higher than the average gain. PDP has almost $617 million in assets under management and Apple (NASDAQ: <a class="ticker" href="/stock/aapl#NASDAQ">AAPL</a>) is the ETF's largest holding with an allocation of 3.53 percent.

For more on ETFs, click <a href="http://www.benzinga.com/etfs">here</a>.

Futures

iShares Trust Dow Jones US Real Estate Fund Index

September Could be Kind to These ETFs

Invesco's (NYSE: <a class="ticker" href="/stock/ivz#NYSE">IVZ</a>) PowerShares unit, the fourth-largest U.S. ETF issuer, will introduce the PowerShares DWA SmallCap Technical Leaders Portfolio (NYSE: <a class="ticker" href="/stock/dwas#NYSE">DWAS</a>) on Thursday July 19, 2012. 

The PowerShares DWA SmallCap Technical Leaders Portfolio will be the fourth PowerShares ETF based on the technical leaders strategy from Dorsey Wright &amp; Associates (DWA). Technical Leaders are companies identified by the DWA selection methodology that possess strong relative strength characteristics compared to their peers and industry benchmarks, according to a statement issued by PowerShares.

DWAS will track the Dorsey Wright SmallCap Technical Leaders Index, which includes approximately 200 companies. The new ETF will be rebalanced on a quarterly basis. 

Other PowerShares funds employing the Dorsey Wright methodology include the PowerShares DWA Developed Markets Technical Leaders Portfolio (NYSE: <a class="ticker" href="/stock/piz#NYSE">PIZ</a>), the PowerShares DWA Emerging Markets Technical Leaders Portfolio (NYSE: <a class="ticker" href="/stock/pie#NYSE">PIE</a>) and the PowerShares DWA Technical Leaders Portfolio (NYSE: <a class="ticker" href="/stock/pdp#NYSE">PDP</a>). PDP is the largest of that trio with $553.7 million in assets under management.

Small Cap Analysis

PowerShares to List DWA Small-Cap ETF

With nearly 1,500 exchange-traded products on the market today, investors have plenty of options when it comes to finding market-based funds. Market-based funds do not track a specific sector or country. Rather these ETFs, also known as broader market funds, are designed to offer exposure to a large slice of or the entire U.S. equity market. 

Familiar examples would be the SPDR S&amp;P 500 (NYSE: <a class="ticker" href="/stock/spy#NYSE">SPY</a>), the iShares Russell 2000 Index Fund (NYSE: <a class="ticker" href="/stock/iwm#NYSE">IWM</a>) and the iShares Dow Jones U.S. Index Fund (NYSE: <a class="ticker" href="/stock/iyy#NYSE">IYY</a>). 

Those are all fine funds that do exactly what the names imply: Grant investors exposure to a broad swath of U.S. equities. However, investors that are willing to look off the beaten path can be rewarded with more obscure broader market ETFs. Here are a few that performing well that brokers probably have not been touting much.

ETRACS Fisher-Gartman Risk Off ETN (NYSE: <a class="ticker" href="/stock/off#NYSE">OFF</a>)
Plenty of new ETFs and ETNs fall victim to a "right idea, wrong time" scenario. That is to say the premise behind the new ETF is good, but the market environment when that fund debuts is not conducive to success. That has not been the case for the ETRACS Fisher-Gartman Risk Off ETN. 

Fisher-Gartman Off debuted in November, and while investors were quite ebullient in late 2011 and early 2012, they have remained pensive for most of OFF's short lifespan. Fisher Gartman Off is a long/short product with value-based target weightings for the long and short positions of 150 percent and 50 percent, respectively. The index is rebalanced quarterly to return the weightings to these target levels, according to the ETRACS Web site.

As of Thursday, Fisher Gartman Off<a href="http://www.ibb.ubs.com/mc/etracs_US/hybrid/fgr-off.shtml">was more short than long</a> with short positions in familiar ETFs such as the iShares MSCI Brazil Index Fund (NYSE: <a class="ticker" href="/stock/ewz#NYSE">EWZ</a>) and the Market Vectors Russia ETF (NYSE: <a class="ticker" href="/stock/rsx#NYSE">RSX</a>), among others. 

With an annual expense ratio of 1.15 percent accrued on a daily basis, OFF is not cheap. However, it cannot be ignored that OFF has jumped 6.6 percent in the past 90 days.

PowerShares DWA Technical Leaders Portfolio (NYSE: <a class="ticker" href="/stock/pdp#NYSE">PDP</a>)
The PowerShares DWA Technical Leaders Portfolio is based on the Dorsey Wright Technical Leaders Index. PDP is home to just 100 stocks, a total that is somewhat small for a market-based ETF, but what is not small about this ETF is the returns. Year-to-date, PDP is up 11.4 percent compared to 7.9 percent for the S&amp;P 500.

PDP focuses primarily on large-cap and mid-cap names and consumer discretionary names dominate the fund's sector weight with an allocation of 31.1 percent. Top holdings include American Tower (NYSE: <a class="ticker" href="/stock/amt#NYSE">AMT</a>), Apple (NASDAQ: <a class="ticker" href="/stock/aapl#NASDAQ">AAPL</a>) and Priceline.com (NASDQ: PCLN). PDP charges 0.7 percent and has almost $554 million in AUM.

Guggenheim Defensive Equity ETF (NYSE: <a class="ticker" href="/stock/def#NYSE">DEF</a>)
Like PDP, the Guggenheim Defensive Equity ETF is home to just 100 stocks, however the fund is true to the defensive nature it claims to have. Utilities and consumer staples names account for over 45 percent of DEF's weight and those have been fine places to hideout in recent months.

Guggenheim Defensive Equity, which has a beta of 0.58, has lagged the S&amp;P 500 year-to-date, but as volatility and anxiety have increased in recent months, Guggenheim Defensive Equity has beaten SPY over the past 30 and 90 days. No stock receives a weight larger than 1.22 percent in DEF. Top holdings include Wal-Mart (NYSE: <a class="ticker" href="/stock/wmt#NYSE">WMT</a>), Verizon (NYSE: <a class="ticker" href="/stock/vz#NYSE">VZ</a>) and Merck (NYSE: <a class="ticker" href="/stock/mrk#NYSE">MRK</a>).

Guggenheim Wilshire 5000 Total Market ETF (NYSE: <a class="ticker" href="/stock/wfvk#NYSE">WFVK</a>)
The Wilshire 5000 Total Market ETF will not win any volume contests with average daily turnover of just 850 shares. Nor does the ETF hold 5,000 stocks, its constituency is closer to 1,200. WFVK is small with just $5.9 million in AUM, but it is cheap with an expense ratio of 0.12 percent. The ETF is cap-weighted so Apple is its top holding, Exxon Mobil (NYSE: <a class="ticker" href="/stock/xom#NYSE">XOM</a>) is number two, etc.

Russell High Dividend Yield ETF (NYSE: <a class="ticker" href="/stock/hdiv#NYSE">HDIV</a>)
Another new dividend ETF, the Russell High Dividend Yield ETF came to market in March and has thus far hauled in $15.4 million in AUM. Home to 75 stocks, HDIV has a 30-day SEC yield of almost 3.7 percent. 

Russell High Dividend isn't the biggest or most heavily traded dividend ETF on the block, but it must be noted that over the past three months, the Russell fund has handily outperformed the Vanguard Dividend Appreciation ETF (NYSE: <a class="ticker" href="/stock/vig#NYSE">VIG</a>) and the SPDR S&amp;P Dividend ETF (NYSE: <a class="ticker" href="/stock/sdy#NYSE">SDY</a>).

Russell High Dividend's top holdings included Merck (NYSE: <a class="ticker" href="/stock/mrk#NYSE">MRK</a>), Verizon, Conoco-Phillips (NYSE: <a class="ticker" href="/stock/cop#NYSE">COP</a>) and Kimberly Clark (NYSE: <a class="ticker" href="/stock/kmb#NYSE">KMB</a>).

HDIV

Market Vectors Russia ETF Trust Shares of Beneficial Interest

WFVK

5 Market-Based ETFs Your Broker Forgot to Mention (HDIV, OFF, PDP)

Invesco's (NYSE: <a class="ticker" href="/stock/ivz#NYSE">IVZ</a>) PowerShares, the fourth-largest U.S. ETF sponsor, has filed plans with the Securities and Exchange Commission to possibly introduce the PowerShares DWA SmallCap Technical Leaders Portfolio, an ETF that would be based on an index of technically superior small-caps created by Dorsey-Wright Associates.

A ticker and expense ratio were not included in the filing.

PowerShares currently has several ETFs based on Dorsey-Wright indexes, including the PowerShares DWA Developed Markets Technical Leaders Portfolio (NYSE: <a class="ticker" href="/stock/piz#NYSE">PIZ</a>), the PowerShares DWA Emerging Markets Technical Leaders Portfolio (NYSE: <a class="ticker" href="/stock/pie#NYSE">PIE</a>) and the PowerShares DWA Technical Leaders Portfolio (NYSE: <a class="ticker" href="/stock/pdp#NYSE">PDP</a>). 

PDP is the large-cap equivalent of the small-cap fund PowerShares has filed for. Introduced in 2007, PDP has an expense ratio of 0.7% and $543.8 million in assets under management.

PowerShares had 122 ETFs with a combined $58.6 billion in AUM at the end of March, according data from the ETF Industry Association.

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PowerShares May List Dorsey-Wright Small-Cap ETF

Chipotle Mexican Grill (NYSE: <a class="ticker" href="/stock/cmg#NYSE">CMG</a>), whose shares are trading near an all-time high, is scheduled to report first-quarter 2012 results tomorrow, April 19, after the closing bell.

Chipotle has been raising its prices this year, which investors hope will lead to stronger margins. The company has enjoyed double-digit year-over-year percentage revenue growth for the past four quarters, and its net income has increased for three consecutive quarters. The fast casual restaurant operator has grown revenues and earnings every year of the past decade by opening additional restaurants.

Expectations

Analysts predict that Chipotle will post per-share earnings of $1.93 for the quarter and say that revenue totaled $630.6 million. In the same quarter of last year, the company reported $1.46 per share and $509.4 million in sales. The EPS estimate is two cents higher than it was 60 days ago. But note that Chipotle's EPS have fallen short of analysts' expectations -- by just a few pennies per share -- in two of the past four quarters.

In the fourth-quarter report, Chipotle reported net income of $57.5 million, or $1.81 per share. That was up 23.7% from the previous year but fell short of the consensus estimate of $1.83. Revenue also rose 23.7% year over year to $596.7 million, in line with analysts' expectations. The company also said it opened 67 restaurants in the quarter and plans to open 155 to 165 new restaurants in 2012. 

Looking ahead, analysts so far expect to see sequential and year-over-year growth of both per-share earnings and revenues in the current quarter. At this point, the full-year forecast has EPS up 22.2% from the previous year and revenue 21.5% higher.

The Company

Denver-based Chipotle Mexican Grill operates more than 1,200 fast-casual, fresh Mexican food restaurants in the United States, Canada and England. It also operates the ShopHouse Southeast Asian Kitchen. The company is known for using high-quality raw ingredients and classic cooking methods, and its distinctive interior design and claim to being mindful of the environmental and societal impact of its business. Chipotle was founded in 1993, and it now is a member of the S&amp;P 500 and sports a market cap of $13.7 billion.

Competitors include BJ's Restaurants (NASDAQ: <a class="ticker" href="/stock/bjri#NASDAQ">BJRI</a>), Buffalo Wild Wings (NASDAQ: <a class="ticker" href="/stock/bwld#NASDAQ">BWLD</a>) and Panera Bread (NASDAQ: <a class="ticker" href="/stock/pnra#NASDAQ">PNRA</a>). BJ's reported better-than expected EPS and year-over-year sales growth of nearly 30% in its most recent quarter. The first-quarter forecast for the other two calls for double-digit percentage growth of earnings and revenue. Buffalo Wild Wings and Panera are both scheduled to report April 24.

See also: <a href="http://www.benzinga.com/news/earnings/12/02/2328522/buffalo-wild-wings-surprises-the-street-panera-hit-by-profit-taking">Buffalo Wild Wings Surprises the Street; Panera Hit by Profit Taking</a>

During the three months that ended in March, Chipotle offered free burritos for Earth Day, released its first national commercial during the Grammys, announced a share buyback program, and its shares kept hitting new multiyear highs. 

See also: <a href="http://www.benzinga.com/news/12/02/2309515/chipotle-board-authorizes-buyback-of-100m-shares">Chipotle Board Authorizes Buyback of $100m Shares</a>

Performance

Chipotle's long-term earnings per share growth forecast is 22.2%. Its return on equity is 23.2% and the operating margin is higher than the industry average. But the P/E and PEG ratios are higher than the industry averages. And short interest is 7.8% of the float. Twelve of 29 analysts who follow the stock rate it a Buy or Strong Buy. The share price has outstripped their mean price target, but it is about 14% less than the highest price target.

See also: <a href="http://www.benzinga.com/analyst-ratings/analyst-color/12/04/2502269/update-deutsche-bank-raises-pt-to-480-on-chipotle-mexica">Deutsche Bank Raises PT to $480 on Chipotle Mexican Grill</a>

The stock is about 28% higher than at the beginning of the year, as well as more than 52% higher than a year ago. Shares have pulled back from the 52-week high on Friday. The price is well above the 50-day and 200-day moving averages. Year to date, the stock has outperformed the competitors mentioned above, as well as McDonald's (NYSE: <a class="ticker" href="/stock/mcd#NYSE">MCD</a>) and the broader markets.

<div id="action-items">ACTION ITEMS

Bullish: Investors interested in exchange traded funds invested in Chipotle might want to consider the following trades:

<ul><li>PowerShares Dynamic Leisure &amp; Entertainment (NYSE: <a class="ticker" href="/stock/pej#NYSE">PEJ</a>) is more than 17% higher year to date.</li>
<li>PowerShares DWA Technical Leaders (NYSE: <a class="ticker" href="/stock/pdp#NYSE">PDP</a>) is more than 15% higher year to date.</li>
<li>Consumer Discretionary Select Sector SPDR (NYSE: <a class="ticker" href="/stock/xly#NYSE">XLY</a>) is more than 15% higher year to date.</li>
<li>Vanguard Mid-Cap Growth ETF (NYSE: <a class="ticker" href="/stock/vot#NYSE">VOT</a>) is more than 14% higher year to date.</li>
</ul>Bearish: Traders may prefer to consider these alternative positions in the restaurant industry:

<ul><li>Ruth's Hospitality (NASDAQ: <a class="ticker" href="/stock/ruth#NASDAQ">RUTH</a>) is up more than 49% year to date.</li>
<li>Jamba (NASDAQ: <a class="ticker" href="/stock/jmba#NASDAQ">JMBA</a>) is up about 45% year to date.</li>
<li>Frisch's Restaurants (NYSE: <a class="ticker" href="/stock/frs#NYSE">FRS</a>) is up more than 44% year to date.</li>
</ul>Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.</div>

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