Designed to provide broad exposure to the Small Cap Value segment of the US equity market, the Invesco S&P SmallCap Value with Momentum ETF (XSVM Quick QuoteXSVM - Free Report) is a passively managed exchange traded fund launched on March 3, 2005.

The fund is sponsored by Invesco. It has amassed assets over $602.42 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. Considering long-term performance, value stocks have outperformed growth stocks in almost all markets; however, they are more likely to underperform growth stocks in strong bull markets.

Costs

Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.

Annual operating expenses for this ETF are 0.37%, putting it on par with most peer products in the space.

It has a 12-month trailing dividend yield of 2.16%.

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 Financials sector -- about 50.8% of the portfolio. Consumer Discretionary and Industrials round out the top three.

Looking at individual holdings, Victoria's Secret & Co (VSCO) accounts for about 2.19% of total assets, followed by Sally Beauty Holdings Inc (SBH) and Marinemax Inc (HZO).

The top 10 holdings account for about 16.91% 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 added about 9.93% so far this year and was up about 5.15% in the last one year (as of 12/18/2025). In the past 52-week period, it has traded between $44.22 and $59.30.

The ETF has a beta of 1.01 and standard deviation of 21.69% for the trailing three-year period. With about 119 holdings, it effectively diversifies company-specific risk.

Alternatives

Invesco S&P SmallCap Value with Momentum ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, XSVM is an outstanding option for investors seeking exposure to the Style Box - Small Cap Value segment of the market. There are other additional ETFs in the space that investors could consider as well.

The iShares Russell 2000 Value ETF (IWN) and the Vanguard Small-Cap Value ETF (VBR) track a similar index. While iShares Russell 2000 Value ETF has $12.31 billion in assets, Vanguard Small-Cap Value ETF has $32.32 billion. IWN has an expense ratio of 0.24% and VBR charges 0.07%.

Bottom-Line

Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also 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.