If you're interested in broad exposure to the Large Cap Blend segment of the US equity market, look no further than the Invesco S&P 500 Low Volatility ETF (
SPLV Quick Quote SPLV - Free Report) , a passively managed exchange traded fund launched on 05/05/2011.
The fund is sponsored by Invesco. It has amassed assets over $8.63 billion, making it one of the largest ETFs attempting to match the Large Cap Blend segment of the US equity market.
Why Large Cap Blend
Large cap companies usually have a market capitalization above $10 billion. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.
Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.25%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 2.41%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Consumer Staples sector--about 27% of the portfolio. Utilities and Financials round out the top three.
Looking at individual holdings, Coca-Cola Co/the (
KO Quick Quote KO - Free Report) accounts for about 1.40% of total assets, followed by Mcdonald's Corp ( MCD Quick Quote MCD - Free Report) and Pepsico Inc ( PEP Quick Quote PEP - Free Report) .
The top 10 holdings account for about 12.19% of total assets under management.
Performance and Risk
SPLV seeks to match the performance of the S&P 500 Low Volatility Index before fees and expenses. The S&P 500 Low Volatility Index consists of the 100 stocks from the S&P 500 Index with the lowest realized volatility over the past 12 months.
The ETF has lost about -3.43% so far this year and it's up approximately 1.13% in the last one year (as of 09/22/2023). In the past 52-week period, it has traded between $56.92 and $65.36.
The ETF has a beta of 0.69 and standard deviation of 13.32% for the trailing three-year period, making it a medium risk choice in the space. With about 101 holdings, it effectively diversifies company-specific risk.
Invesco S&P 500 Low Volatility 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, SPLV is a reasonable option for those seeking exposure to the Style Box - Large Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Core S&P 500 ETF (
IVV Quick Quote IVV - Free Report) and the SPDR S&P 500 ETF ( SPY Quick Quote SPY - Free Report) track a similar index. While iShares Core S&P 500 ETF has $344.29 billion in assets, SPDR S&P 500 ETF has $401.29 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%. 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.