Invesco PowerShares jumped on board the recent trend in the ETF industry, drastically lowering fees for six of their international and domestic equity funds. PowerShares, one of the largest ETF issuers by assets and creator of the notable QQQ, has 170 exchange-traded products on the market, including the ultra popular RAFI-weighted funds. After joining the long list of issuers who have reduced fees in an effort to sway investors, the powerhouse issuer has now made their products even more appealing.
Though PowerShares ETFs generally maintain low expense ratios to begin with, some of the cuts were quite substantial. For example, expenses on the S&P 500 High Quality Portfolio (SPHQ) declined by more than 40%, dropping from 0.50% to 0.29%. One of PowerShares’ most expensive ETFs, the FTSE RAFI Emerging Markets Portfolio (PXH), is now 36 basis points cheaper, making the RAFI family of funds even more affordable.
The new expense structures for these PowerShares ETFs are as follows [see Free Member Report: How To Pick The Right ETF Every Time]:
|ETF||New ER||Old ER|
|FTSE RAFI Developed Markets ex-U.S. Portfolio (PXF)||0.45%||0.75%|
|FTSE RAFI Emerging Markets Portfolio (PXH)||0.49%||0.85%|
|FTSE RAFI Asia Pacific ex-Japan Portfolio (PAF)||0.49%||0.80%|
|FTSE RAFI Developed Markets ex-U.S. Small-Mid Portfolio (PDN)||0.49%||0.75%|
|S&P International Developed High Quality Portfolio (IDHQ)||0.45%||0.75%|
|S&P 500 High Quality Portfolio (SPHQ)||0.29%||0.50%|
“We continuously analyze ways to improve our overall ETF product lineup for investors,” said Ben Fulton, Invesco PowerShares managing director of global ETFs. “We believe the lower fees better align the six funds with our existing offerings, and help position the PowerShares family of ETFs for continued growth.”
With these significant price cuts, our RAFI ETFdb Portfolio may be even more appealing to those investors looking to construct a well-balanced and cost-efficient equity portfolio while avoiding traditional weighting methodologies that determine individual security allocations based on market capitalization. The complete RAFI ETFdb Portfolio is available to ETFdb Pro members or with a free 7-day trial to ETFdb Pro.
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Disclosure: No positions at time of writing.