This week’s ETF spotlight features a relatively new, but already popular fund that goes by the symbol PAWZ.  The PAWZ ETF, or “ProShares Pet Care ETF” is a passively managed equity ETF that uses the benchmark index of FactSet Pet Care Index.  The fund has a global geographic objective and focuses on consumer, non-cyclical sector and multi-cap companies.

The Upside of Investing in PAWZ

Many investors love this fund and are excited about the opportunity to be able to invest in this niche. As pet owners spend more and more on pet care every year, this fund is primed for growth.  Additionally, younger Americans are waiting longer to have children and many are treating their pets as their babies, which helps drive the growth in this vertical.

The Downside of Investing in PAWZ

For the time being, investing in PAWZ feels like a smart idea.  Particularly with markets at an all-time high and a strong level of consumer confidence. When we see the next pullback and are headed towards a recession, however, this will be an interesting fund to watch. While many pet owners will dial back on their pet care spending – for many it is likely built in to budgets and treated more like a consumer staple.

Top 10 PAWZ ETF Holdings

as of July 3, 2019 (27 total basket holdings)

IDXX (IDEXX Laboratories Inc) 10.15%
DPH:GB (Dechra Pharmaceuticals PLC) 9.77%
CVET (Covetrus Inc) 9.67%
CHWY (Chewy Inc) 7.52%
FRPT (Freshpet Inc) 6.82%
PETS:GB (Pets at Home Group PLC) 4.92%
TRUP (Trupanion Inc) 4.61%
MRK (Merck & Co Inc) 4.56%
NESN:CH (Nestle SA) 4.49%
CENTA (Central Garden & Pet Co) 4.45%

At the time of this article being published (July 3, 2019), I have a lot of good things to say about PAWZ.  While the fund may only be about 8 months old, so far it’s year to date returns are up 18.48%.  The net expense ratio is acceptable at 0.50% and the volume is pretty good with a 90-day average volume of 12,117.

While this ETF is currently at its 52-week high (and I usually don’t like buying anything at its 52-week high) – I still think this is a good time to buy as I’m very bullish on the growth opportunities over the long-term.

Current PAWZ ETF Performance

52 Week Range

ETF Jeff's Final Thoughts

Final Thoughts 

I really like this ETF for the time being.  My ETF investing strategy is almost always for the long-term, and I think the PAWZ pet care ETF has nowhere to go but up over time.  I imagine we will see quite a few ups and downs with this relatively new fund, but if your plan is to invest in an ETF for the long-term – this one is definitely on my list of recommended picks.