What an advisor’s $12 million Momentum ETF drawdown could indicate for growth stocks

What an advisor’s  million Momentum ETF drawdown could indicate for growth stocks
What an advisor’s  million Momentum ETF drawdown could indicate for growth stocks

On May 8, 2026, NewSquare Capital filed with the SEC to report the sale of 97,285 shares of the Invesco Dorsey Wright Momentum ETF (NASDAQ:PPD)an estimated trade of $12.07 million based on the quarterly average price.

What happened

According to a Securities and Exchange Commission (SEC) filing on May 8, 2026, NewSquare Capital sold 97,285 shares of Invesco Dorsey Wright Momentum ETF (NASDAQ:PPD) during the first trimester. The estimated value of the transaction was $12.07 million, calculated using the average closing price for the quarter. The fund reported holding 108,116 shares, worth $13.05 million, at the end of the quarter.

what else to know

  • The sale reduced PDP’s stake to 1.13% of 13F reportable assets under management.

  • Main participations after the presentation:

    • NYSEMKT:VTI: $116.94 million (10.2% of assets under management)

    • NYSEMKT:VEU: $66.55 million (5.8% of assets under management)

    • NYSEMKT:SCHX: $60.30 million (5.3% of assets under management)

    • NYSEMKT:IJH: $33.46 million (2.9% of assets under management)

    • NASDAQ:BND: $31.75 million (2.8% of assets under management)

  • As of May 7, 2026, PDP shares were priced at $139.28, up 37% year-over-year, with an alpha of 7 percentage points versus the S&P 500.

ETF Overview

Metric

Worth

Price (at market close on May 7, 2026)

$139.28

One-year total return

37%

Dividend yield (TTM)

0.1%

AUM

1.5 billion dollars

ETF Snapshot

  • Investment Strategy: PDP seeks to replicate the Dorsey Wright Technical Leaders Index, focusing on US stocks that exhibit strong relative momentum characteristics.

  • Underlying Holdings: The portfolio consists of approximately 100 US companies selected and rebalanced quarterly based on a proprietary momentum assessment.

  • Expense Ratio and Structure: Has a passively managed ETF structure, designed for efficient exposure to momentum stocks; See prospectus for fee details.

The Invesco Dorsey Wright Momentum ETF offers investors systematic exposure to U.S. stocks demonstrating strong relative strength, using a rules-based methodology to capture momentum-driven performance. The fund’s quarterly rebalancing ensures that the portfolio remains aligned with prevailing market leadership trends. This disciplined approach provides access to a diversified set of high-momentum stocks while taking advantage of the liquidity and transparency of the ETF structure.

What this transaction means for investors

PDP delivered a one-year NAV return of 36.6% through April 30 and outperformed the Russell 3000 Growth Index over one-, three-, and five-year periods, and that strong momentum-driven rally could be part of why NewSquare decided to trim its stake here. PDP’s strategy focuses on approximately 100 U.S. companies that exhibit strong relative strength characteristics, with quarterly rebalancing designed to keep the portfolio tilted toward market leaders. Current top holdings include names like Comfort Systems USA, Apple, Amphenol, Quanta Services and Western Digital.

For long-term investors, it is important to remember that momentum strategies can work extremely well during strong bull markets, but they also tend to reverse quickly when leadership changes. PDP’s concentration on higher-growth sectors and its relatively high valuation metrics, including a price-to-earnings ratio above 33, could leave the fund more vulnerable if market sentiment changes. And ultimately, NewSquare Capital was still holding on to more than $13 million worth of shares at the end of the quarter, suggesting the company is likely simply trimming its exposure after outsized earnings.

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Jonathan Ponciano has no position in any of the stocks mentioned. The Motley Fool holds and recommends the Vanguard International Equity Index funds: Vanguard Ftse All-World ex-US ETF and Vanguard Total Bond Market ETF. The Motley Fool has a disclosure policy.

What One Advisor’s $12 Million Momentum ETF Drawdown Might Indicate for Growth Stocks was originally published by The Motley Fool

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