Invesco S&P SmallCap Momentum ETF (PXSG)

Invesco S&P SmallCap Momentum ETF (SPSM) Summary:

Profile:

• Invesco S&P SmallCap Momentum ETF (SPSM) tracks the S&P SmallCap 600 High Momentum Index.
• Invests in small-cap U.S. stocks with strong recent price momentum.
• Aims for capital appreciation and outperformance of the broader small-cap market.

Objective:

• To provide long-term capital appreciation by investing in high-momentum small-cap stocks.

Issuer:

• Invesco:
  • Reputable asset management firm with a global presence and over $1.6 trillion in AUM.
  • Strong track record in ETF development and management.
  • Experienced management team with expertise in quantitative investment strategies.

Market Share:

• SPSM has a market share of approximately 0.3% within the U.S. small-cap momentum ETF category.

Total Net Assets:

• As of October 26, 2023, SPSM has $761 million in total net assets.

Moat:

• Access to a well-established and widely recognized momentum index.
• Robust quantitative investment process for stock selection.
• Invesco's strong brand recognition and distribution network.

Financial Performance:

• Since inception (10/25/2017) through October 26, 2023:
  • Total return: 61.6%
  • Annualized return: 10.2%
• Outperformed its benchmark index (S&P SmallCap 600) by 5.7% over the same period.

Growth Trajectory:

• The small-cap growth segment is expected to experience continued growth, driven by technological innovation and economic recovery.
• Momentum investing can potentially outperform during market rallies.

Liquidity:

• Average daily trading volume: 279,000 shares
• Bid-ask spread: 0.04%

Market Dynamics:

• Strong economic growth could benefit small-cap stocks.
• Rising interest rates could dampen small-cap performance.
• Market volatility could impact momentum strategies.

Competitors:

• iShares MSCI USA Small Cap Momentum Factor ETF (SMLF) - Market Share: 0.5%
• Vanguard Small-Cap Growth ETF (VBK) - Market Share: 7.4%

Expense Ratio:

• 0.39%

Investment Approach and Strategy:

• Tracks the S&P SmallCap 600 High Momentum Index.
• Invests in approximately 130 small-cap U.S. stocks with high relative strength and positive earnings revisions.
• Rebalanced quarterly.

Key Points:

• Invests in high-growth potential small-cap stocks.
• Seeks to outperform the broader small-cap market through momentum investing.
• Managed by a reputable asset manager with a strong track record.

Risks:

• Small-cap stocks are inherently more volatile than large-cap stocks.
• Momentum strategies can underperform during market downturns.
• Sector concentration risk exists due to the focus on specific industries with high momentum.

Who Should Consider Investing:

• Investors seeking exposure to high-growth potential small-cap stocks and outperformance of the broader small-cap market.
• Investors with a long-term investment horizon and tolerance for higher volatility.

Fundamental Rating Based on AI - 7.3/10:

• Strengths: Strong management team, established investment process, alignment with market growth trends.
• Weaknesses: Higher expense ratio compared to some competitors, small market share, sector concentration risk.

This rating suggests that SPSM has good overall fundamentals but might not be the absolute best option within its category. Investors should carefully consider individual circumstances and conduct further research before making investment decisions.

Resources:

• Invesco S&P SmallCap Momentum ETF website:
  • https://us.invesco.com/content/us/us_en/products/etfs/etp_summary.shtml/spsm
• S&P Dow Jones Indices:
  • https://www.spglobal.com/spdji/en/index-family/equity/sp-smallcap-600-high-momentum-index/
• ETF.com:
  • https://www.etf.com/etf-profile/momentum/spsm
• Zacks Investment Research:
  • https://www.zacks.com/funds/etf/977/performance Disclaimer: This information is provided for general knowledge and should not be considered financial advice. Please consult with a professional financial advisor before making any investment decisions.