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Should Invesco S&P SmallCap Value with Momentum ETF (XSVM) Be on Your Investing Radar?
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The Invesco S&P SmallCap Value with Momentum ETF (XSVM - Free Report) was launched on 03/03/2005, and is a passively managed exchange traded fund designed to offer broad exposure to the Small Cap Value segment of the US equity market.
The fund is sponsored by Invesco. It has amassed assets over $684.73 million, making it one of the average sized ETFs attempting to match the Small Cap Value segment of the US equity market.
Why Small Cap Value
With more potential comes more risk, and small cap companies, with market capitalization below $2 billion, epitomizes this way of thinking.
While 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. Value stocks have outperformed growth stocks in nearly all markets when you consider long-term performance, growth stocks are more likely to outpace value stocks in strong bull markets.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.36%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.79%.
Sector Exposure and Top Holdings
ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Financials sector--about 29.60% of the portfolio. Consumer Discretionary and Industrials round out the top three.
Looking at individual holdings, Conn's Inc (CONN - Free Report) accounts for about 1.96% of total assets, followed by Atlas Air Worldwide Holdings Inc and Cross Country Healthcare Inc (CCRN - Free Report) .
The top 10 holdings account for about 15.22% of total assets under management.
Performance and Risk
XSVM seeks to match the performance of the S&P 600 HIGH MOMENTUM VALUE INDEX before fees and expenses. The S&P 600 High Momentum Value Index is composed of securities with strong value characteristics selected from the Russell 2000 Index.
The ETF has lost about -14.91% so far this year and is down about -13.36% in the last one year (as of 01/02/2023). In the past 52-week period, it has traded between $41.20 and $55.63.
The ETF has a beta of 1.23 and standard deviation of 35.52% for the trailing three-year period. With about 121 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P SmallCap Value with Momentum 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, XSVM is a reasonable option for those seeking exposure to the Style Box - Small Cap Value area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 2000 Value ETF (IWN - Free Report) and the Vanguard SmallCap Value ETF (VBR - Free Report) track a similar index. While iShares Russell 2000 Value ETF has $11.93 billion in assets, Vanguard SmallCap Value ETF has $23.68 billion. IWN has an expense ratio of 0.23% and VBR charges 0.07%.
Bottom-Line
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.
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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Should Invesco S&P SmallCap Value with Momentum ETF (XSVM) Be on Your Investing Radar?
The Invesco S&P SmallCap Value with Momentum ETF (XSVM - Free Report) was launched on 03/03/2005, and is a passively managed exchange traded fund designed to offer broad exposure to the Small Cap Value segment of the US equity market.
The fund is sponsored by Invesco. It has amassed assets over $684.73 million, making it one of the average sized ETFs attempting to match the Small Cap Value segment of the US equity market.
Why Small Cap Value
With more potential comes more risk, and small cap companies, with market capitalization below $2 billion, epitomizes this way of thinking.
While 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. Value stocks have outperformed growth stocks in nearly all markets when you consider long-term performance, growth stocks are more likely to outpace value stocks in strong bull markets.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.36%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.79%.
Sector Exposure and Top Holdings
ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Financials sector--about 29.60% of the portfolio. Consumer Discretionary and Industrials round out the top three.
Looking at individual holdings, Conn's Inc (CONN - Free Report) accounts for about 1.96% of total assets, followed by Atlas Air Worldwide Holdings Inc and Cross Country Healthcare Inc (CCRN - Free Report) .
The top 10 holdings account for about 15.22% of total assets under management.
Performance and Risk
XSVM seeks to match the performance of the S&P 600 HIGH MOMENTUM VALUE INDEX before fees and expenses. The S&P 600 High Momentum Value Index is composed of securities with strong value characteristics selected from the Russell 2000 Index.
The ETF has lost about -14.91% so far this year and is down about -13.36% in the last one year (as of 01/02/2023). In the past 52-week period, it has traded between $41.20 and $55.63.
The ETF has a beta of 1.23 and standard deviation of 35.52% for the trailing three-year period. With about 121 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P SmallCap Value with Momentum 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, XSVM is a reasonable option for those seeking exposure to the Style Box - Small Cap Value area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 2000 Value ETF (IWN - Free Report) and the Vanguard SmallCap Value ETF (VBR - Free Report) track a similar index. While iShares Russell 2000 Value ETF has $11.93 billion in assets, Vanguard SmallCap Value ETF has $23.68 billion. IWN has an expense ratio of 0.23% and VBR charges 0.07%.
Bottom-Line
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.
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.