A Look Under The Hood: PowerShares Private Equity ETF

After a little break induced by the financial crisis, private equity appears to be on its way back. Take a look at the headlines involving the auction for Radio Shack

and you'll see a variety of private equity titans standing by ready to acquire the electronics retailer. M&A activity has picked up in 2010 and private equity firms have not stood on the sidelines. That could mean good things are afoot for the PowerShares Listed Private Equity ETF

, which tracks publicly traded PE and leveraged buyout firms. PSP holds over 60 stocks, both domestic and global, with about 84% of its weight devoted to finanicals. There are curious allocations to infrastructure and consumer discretionary and staples stocks, but this is a financials ETF to be sure. The average market cap of PSP's holdings is around $2.67 billion, indicating the ETF has a nice mix of small- and mid-cap names. PSP has an expense ratio of 0.60%. PSP tracks the Global Listed Private Equity Index and top holdings include Blackstone Group

, Apollo Investment

, Leucadia National

and Prospect Capital

. Of course, PSP is not immune to the high-beta nature of the financial sector, as highlighted by the ETF's almost 14% decline in May compared to an 11% decline for the Financial Select SPDR

. That said, if you're feeling bullish on M&A activity and financials at large, PSP might be worth a look.