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The Mobile Payments ETF Is Breaking Out To The Upside

Monday, January 9, 2017 8:33
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From Zacks: For investors seeking momentum, PureFunds ISE Mobile Payments ETF (IPAYFree Report) is probably on radar now. The fund just hit a 52-week high and is up over 32% from its 52-week low price of $20.00/share.

But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:

IPAY in Focus

This ETF tracks the ISE Mobile Payments Index to provide exposure to the performance of companies engaged in the mobile/electronic payments business. This approach results in the fund holding a basket of 31 stocks. As far as geographical concentration is concerned, the fund is heavy on the U.S. with about 84% focus followed by U.K. (4.64%) and France (3.12%).It charges investors 75 basis points a year in fees (see all the technology ETFs here).

Why the Move?

The gradual shift to online from physical payments globally has benefitted this ETF. As per Global X, digital payments are expected to expand 58% from $635 billion in 2014 to $1 trillion in 2019. Also, the Indian government lately withdrew high-denomination banknotes – 500 rupee and 1000 rupee notes – in circulation, as part of a clampdown against illegal money and corruption. As a result, digital payments rose about 43% in December from November in India. All these are creating a great situation for those in the digital payment segment.

More Gains Ahead?

It seems that IPAY might continue with its strength given a positive weighted alpha of 17.60. Since a positive weighted alpha hints at more gains, there is definitely still some promise for investors who want to ride this surging ETF a little further.

The PureFunds ISE Mobile Payments ETF (NYSE:IPAY) was trading at $26.61 per share on Monday morning, up $0.07 (+0.26%). Year-to-date, IPAY has gained 3.99%, versus a 1.44% rise in the benchmark S&P 500 index during the same period.

IPAY currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #25 of 38 ETFs in the Financial Equities ETFs category.

This article is brought to you courtesy of Zacks Research.

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