Designed to provide broad exposure to the Large Cap Value segment of the US equity market, the Invesco RAFI US 1000 ETF (PRF) is a passively managed exchange traded fund launched on 12/19/2005.
The fund is sponsored by Invesco. It has amassed assets over $7.83 billion, making it one of the larger ETFs attempting to match the Large Cap Value segment of the US equity market.
Why Large Cap Value
Companies that fall in the large cap category tend to have a market capitalization above $10 billion. Overall, they are usually a stable option, with less risk and more sure-fire cash flows than mid and small cap companies.
Value stocks have lower than average price-to-earnings and price-to-book ratios. They also have lower than average sales and earnings growth rates. Considering long-term performance, value stocks have outperformed growth stocks in almost all markets; however, they are more likely to underperform growth stocks in strong bull markets.
Costs
Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.
Annual operating expenses for this ETF are 0.33%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.76%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Financials sector--about 21.80% of the portfolio. Information Technology and Healthcare round out the top three.
Looking at individual holdings, Microsoft Corp (MSFT) accounts for about 2.39% of total assets, followed by Berkshire Hathaway Inc (BRK/B) and Apple Inc (AAPL).
The top 10 holdings account for about 19.42% of total assets under management.
Performance and Risk
PRF seeks to match the performance of the FTSE RAFI US 1000 Index before fees and expenses. The RAFI Fundamental Select US 1000 Index tracks the performance of the largest US equities, selected based on the following four fundamental measures of firm size: book value, cash flow, sales and dividends.
The ETF return is roughly 6.18% so far this year and was up about 8.97% in the last one year (as of 07/17/2025). In the past 52-week period, it has traded between $35.77 and $43.05.
The ETF has a beta of 0.91 and standard deviation of 15.22% for the trailing three-year period, making it a medium risk choice in the space. With about 1092 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco RAFI US 1000 ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, PRF is a good option for those seeking exposure to the Style Box - Large Cap Value area of the market. Investors might also want to consider some other ETF options in the space.
The Schwab U.S. Dividend Equity ETF (SCHD) and the Vanguard Value ETF (VTV) track a similar index. While Schwab U.S. Dividend Equity ETF has $70.27 billion in assets, Vanguard Value ETF has $138.73 billion. SCHD has an expense ratio of 0.06% and VTV charges 0.04%.
Bottom-Line
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Invesco RAFI US 1000 ETF (PRF): ETF Research Reports Apple Inc. (AAPL): Free Stock Analysis Report Microsoft Corporation (MSFT): Free Stock Analysis Report Vanguard Value ETF (VTV): ETF Research Reports Schwab U.S. Dividend Equity ETF (SCHD): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
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