Is the Invesco RAFI Developed Markets ex-U.S. ETF (PXF) Currently a Top ETF Choice?

Overview of Invesco RAFI Developed Markets ex-U.S. ETF (PXF)

The Invesco RAFI Developed Markets ex-U.S. ETF (PXF) was launched on June 25, 2007. This fund provides investors with broad access to the Foreign Large Value ETF sector.

Understanding Smart Beta ETFs

Traditionally, most ETFs have tracked indexes weighted by market capitalization, aiming to mirror the performance of the overall market or specific market segments. These cap-weighted funds are popular for their low costs, simplicity, and transparency, making them a solid choice for those who believe in efficient markets.

On the other hand, some investors seek to outperform the market by using alternative strategies. Smart beta ETFs, which do not rely on market cap weighting, instead select stocks based on specific fundamental factors or a combination of them. These strategies might include equal weighting, fundamental weighting, or approaches based on volatility and momentum. While these methods offer different ways to construct a portfolio, not all guarantee better returns.

About the Fund and Its Benchmark

Invesco manages PXF, which has accumulated over $2.61 billion in assets, ranking it among the larger funds in its category. The ETF aims to replicate the performance of the FTSE RAFI Developed ex-U.S. Index, before fees and expenses.

The RAFI Fundamental Select Developed ex US 1000 Index, which the fund tracks, measures the performance of major developed market stocks outside the United States. It selects companies based on four key fundamentals: book value, cash flow, sales, and dividends.

Fees and Expenses

Expense ratios are a crucial consideration for ETF investors, as lower costs can lead to better net returns. PXF charges an annual operating expense of 0.43%, which is comparable to other funds in this segment.

The ETF also offers a trailing 12-month dividend yield of 3.31%.

Portfolio Composition and Top Holdings

ETFs provide diversification, helping to reduce the risk associated with individual stocks. Most ETFs, including PXF, are transparent about their holdings, updating them daily.

Among its largest positions, Samsung Electronics Co Ltd represents about 4.34% of assets, followed by Shell Plc and TotalEnergies SE. The top ten holdings make up roughly 14.48% of the fund’s total assets.

Performance and Risk Profile

Year-to-date, PXF has gained approximately 9.77%, and over the past year (as of March 4, 2026), it has returned about 43.23%. During the last 52 weeks, its price has ranged from $46.22 to $76.15.

With a beta of 0.71 and a three-year standard deviation of 14.28%, PXF is considered a moderate-risk investment. The fund holds around 1,013 stocks, providing broad diversification and reducing company-specific risk.

Other Options to Consider

PXF is a solid choice for those aiming to outperform the Foreign Large Value ETF category, but there are alternative funds worth exploring. For example, the Vanguard International High Dividend Yield Index Fund ETF Shares (VYMI) tracks the FTSE All-World ex US High Dividend Yield Index and manages $17.26 billion in assets with a 0.07% expense ratio. The Schwab Fundamental International Equity ETF (FNDF) tracks the Russell RAFI Developed ex US Large Co. Index (Net), has $21.99 billion in assets, and charges a 0.25% expense ratio.

Investors seeking lower costs and reduced risk may prefer traditional market cap weighted ETFs that aim to match the performance of the Foreign Large Value ETF segment.

Conclusion

To further explore PXF and other ETF options, use screening tools to find funds that align with your investment goals and stay updated with the latest ETF news and analysis at the Zacks ETF Center.

Enhance Your Investment Strategy with Expert ETF Insights

Subscribe to Zacks' exclusive Fund Newsletter for weekly updates, expert analysis, and top-performing ETF recommendations delivered straight to your inbox—free of charge.

Looking for the latest stock picks from Zacks Investment Research? Download the "7 Best Stocks for the Next 30 Days" report for free: Get your copy here.

Invesco RAFI Developed Markets ex-U.S. ETF (PXF): ETF Research Reports

This article was originally published by Zacks Investment Research.

Zacks Investment Research