Although PSCM tracks small-caps in high-beta cyclical sector, traits that could be seen as a sign of higher valuations, the ETF has a P/E ratio of 25.83 and a price-to-book ratio of just over two. Those numbers compare favorably with the P/E of 29.6 and the price-to-book ratio of almost 4.3 on the iShares Russell 2000 ETF (NYSEArca: IWM).

PSCM has recently been in rally mode, gaining over 10% in the past three month. On Monday, the ETF touched an all-time high on volume that was more than double the daily average.

PowerShares S&P SmallCap Materials Portfolio

 

Tom Lydon’s clients own shares of IWM.