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Summary Americans are spending more. However, consumers are putting more money into experiences instead of physical goods. A leisure and entertainment ETF that targets companies like resorts, hotels and restaurants. Americans are getting into the festive spirit and increased spending this holiday season. More notably, consumers were inclined to spend on “experiences,” potentially lifting discretionary-sector exchange traded funds with large exposures to hotels and restaurants. For instance, the PowerShares Dynamic Leisure and Entertainment Portfolio (NYSEArca: PEJ ) targets U.S. leisure and entertainment companies, such as resorts, hotels, cruises and restaurants, and also weights components based on price momentum, earnings momentum, quality, management action, and value. PEJ is up 4.7% year-to-date. In a holiday spending report, MasterCard (NYSE: MA ) found that consumers increased spending on lodging and restaurants during this holiday season, Reuters reports. Sarah Quinlan, a senior vice president at MasterCard, said that casual dining and lodging were among the best areas this season, posting double-digit and nearly double-digit year-over-year sales growth, respectively, from Black Friday through December 24. The data is pointing to an ongoing trend of “the consumer wanting experience” over goods, and the “economy is very strong but they are spending in a different way,” Quinlan said in the Reuters article. PEJ includes large exposure to companies that provide experiences. For instance, among the ETF’s top holdings, Royal Caribbean Cruises (NYSE: RCL ) is 4.4%, Restaurant Brands International (NYSE: QSR) is 5.2%, Carnival Corp. (NYSE: CCL ) 5.0%, The Walt Disney Co. (NYSE: DIS ) is 5.0% and Chipotle Mexican Grill (NYSE: CMG ) is 4.9%. Alternatively, broad consumer discretionary ETFs also include some exposure to the sub-sector. For instance, hotel, restaurants and leisure make up 13.6% of the Consumer Discretionary Select Sector SPDR (NYSEArca: XLY ) , 10.0% of the First Trust Consumer Discretionary AlphaDEX Fund (NYSEArca: FXD ) , 13.0% of Guggenheim S&P Equal Weight Consumer Discretionary ETF (NYSEArca: RCD ) and 10.2% of PowerShares DWA Consumer Cyclicals Momentum Portfolio (NYSEArca: PEZ ) . PowerShares Dynamic Leisure and Entertainment Portfolio (click to enlarge) For more information on the consumer sector, visit our consumer discretionary category . Max Chen contributed to this article . Additional disclosure: Mr. Lydon serves as an independent trustee of certain mutual funds and ETFs that are managed by Guggenheim Investments; however, any opinions or forecasts expressed herein are solely those of Mr. Lydon and not those of Guggenheim Funds, Guggenheim Investments, Guggenheim Specialized Products, LLC or any of their affiliates. Scalper1 News
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