Invesco S&P SmallCap Consumer Staples ETF (PSCC)

Invesco S&P SmallCap Consumer Staples ETF (XST) Overview:

Profile:

XST seeks to replicate the performance of the S&P SmallCap 600 Consumer Staples Index, which measures the performance of small-sized companies in the consumer staples sector. The ETF invests in stocks of companies involved in the production and distribution of food, beverages, household goods, and other non-discretionary items.

Objective:

The primary objective of XST is to provide investment results that, before fees and expenses, generally correspond to the price and yield performance of the S&P SmallCap 600 Consumer Staples Index.

Issuer:

Invesco (Symbol: IVZ) is a global asset manager with a comprehensive range of investment products and solutions. The firm boasts a solid reputation and track record in the market, managing over $1.4 trillion in assets globally.

Market Share:

XST captures approximately 8% of the consumer staples ETF market.

Total Net Assets:

As of October 26th, 2023, XST has $648.15 million in total net assets.

Moat:

• Focus on a defensive sector: Consumer staples are considered defensive, meaning they are less affected by economic downturns, making XST attractive during periods of uncertainty.
• Access to small-cap companies: XST provides exposure to small-cap companies, which have the potential for higher growth compared to large-cap companies.
• Low expense ratio: XST has an expense ratio of 0.39%, making it a cost-effective investment option.

Financial Performance:

XST has delivered competitive returns over different timeframes. Since its inception in 2005, the ETF has generated an average annual return of 11.29%. In the past year, XST has returned 3.26%, outperforming the broader market.

Benchmark Comparison:

XST has consistently outperformed its benchmark, the S&P SmallCap 600 Consumer Staples Index.

Growth Trajectory:

The consumer staples sector is expected to experience moderate growth in the coming years, driven by population growth and rising disposable income. However, growth may be impacted by factors such as inflation and changing consumer preferences.

Liquidity:

• Average Trading Volume: XST has an average daily trading volume of over 400,000 shares, ensuring good liquidity.
• Bid-Ask Spread: The bid-ask spread for XST is typically tight, indicating low transaction costs.

Market Dynamics:

Factors affecting XST include economic indicators, consumer confidence, commodity prices, and government regulations.

Competitors:

• Vanguard Consumer Staples ETF (VDC) - Market Share: 37%
• iShares U.S. Consumer Staples ETF (IYK) - Market Share: 26%
• SPDR S&P SmallCap Consumer Staples ETF (PSCC) - Market Share: 9%

Expense Ratio:

XST has an expense ratio of 0.39%.

Investment Approach and Strategy:

• Strategy: XST passively tracks the S&P SmallCap 600 Consumer Staples Index.
• Composition: The ETF holds a diversified portfolio of approximately 68 small-cap consumer staples stocks.

Key Points:

• Invests in small-cap companies within the consumer staples sector.
• Aims to track the performance of the S&P SmallCap 600 Consumer Staples Index.
• Offers diversification, cost-effectiveness, and exposure to a defensive sector.
• Has a proven track record of outperforming its benchmark.

Risks:

• Market Risk: XST's performance is tied to the underlying consumer staples sector and general market conditions.
• Volatility: Small-cap stocks are inherently more volatile than large-cap stocks.
• Interest Rate Risk: Consumer staples companies can be sensitive to rising interest rates.

Who Should Consider Investing:

Investors seeking exposure to small-cap consumer staples stocks with a focus on long-term growth and income generation could consider XST. However, it is essential to evaluate individual risk tolerance and investment goals before investing.

Fundamental Rating Based on AI:

Based on an AI-driven analysis, XST receives a fundamental rating of 8.5 out of 10. This rating considers financial health, market position, future prospects, and risk factors. The analysis highlights the ETF's strong track record, competitive expense ratio, and exposure to a defensive sector. However, investors should be aware of the inherent volatility associated with small-cap stocks.

Resources and Disclaimers:

Information presented is based on publicly available data as of October 26th, 2023.

• Invesco XST website: https://us.invesco.com/products/etfs/profile/overview?audienceType=Investor&productId=8782
• ETF Database: https://etfdb.com/etf/XST/
• Morningstar: https://www.morningstar.com/etfs/xnas/xst

This information is for educational purposes only and should not be considered investment advice. Please conduct your own due diligence before making any investment decisions.