NICO vs PEJ

NICODHexis Active Nicotine Engagement ETF

PEJBInvesco Dynamic Leisure and Entertainment ETF

In short

NICO Most staples funds own tobacco as a sliver next to soap and soda. This one makes it the whole trade: active management, a global mandate, and at least 80% of assets in tobacco and nicotine companies.

PEJ The travel-and-fun trade, run like a quant screen: roughly 30 US leisure and entertainment stocks re-ranked every quarter on momentum, quality, management action and value. Fee is 0.58%, with no waiver doing the work. Trading since 2005.

Stated mandate

NICO The Fund seeks long-term capital appreciation through active management, normally investing at least 80% of net assets in companies engaged in the global tobacco and nicotine sectors.

PEJ The fund seeks capital appreciation through an index that evaluates companies using multiple investment-merit criteria.

Why people hold it

• NICO Pure-play by design: at least 80% of net assets go to global tobacco and nicotine names, not a slice of a diversified staples basket.
• Actively managed rather than index-tracking, with a global remit, so the manager can pick across markets instead of following a fixed weighting.
• Standard 1940 Act ETF plumbing: it trades like any ordinary stock fund, and shareholders get a 1099 rather than a K-1.sec.gov

• PEJ Nearly two decades of live history, through a full shutdown-and-reopening cycle for travel, make this one of the originals in the niche and a strong one in its peer group.
• The index skips the usual mega-cap tilt: the eight largest constituents share 40% of the weight while 22 smaller names split 60%, so mid-size operators actually move the needle.sec.gov
• Holdings get re-screened quarterly on price momentum, earnings momentum, quality, management action and value, so names keep having to earn their slot.invesco.com
• Moderately traded for such a narrow theme, which makes getting in and out less of a chore, and it pays distributions quarterly.

Worth knowing

• NICO 0.70% a year is the price of active, single-theme access; the broad staples index funds in its group (XLP, VDC, FSTA) charge under a tenth of a percent.
• A small, thinly traded fund since its 2026 launch, so bid-ask spreads can run wider than on the giant staples funds.
• Income is not the mandate here: the objective is long-term capital appreciation, and regular payouts have not been a feature of the fund.

• PEJ Concentration is the point and the trade-off: about 30 stocks inside one corner of consumer discretionary, with no other sector to cushion a rough stretch for leisure spending.
• Quarterly reconstitution means real turnover. What the fund holds in February may look different by November, so this is not a buy-it-and-forget-the-names basket.sec.gov
• At 0.58% it sits near the typical fee for consumer-lifestyle thematics, and above the group's cheapest options: MILN and PAWZ each charge 0.50%, also without a waiver.

Full NICO profile⁠

Full PEJ profile⁠