Invesco S&P SmallCap Value with Momentum ETF (PXSV)

Invesco S&P SmallCap Value with Momentum ETF (XSVM): A Comprehensive Overview

Profile: XSVM is an actively managed ETF that seeks to track the performance of the S&P SmallCap Value with Momentum Index. It primarily focuses on delivering capital appreciation by investing in small-cap U.S. stocks with strong momentum and value characteristics. The ETF allocates its assets approximately 80% in equities and 20% in fixed income.

Objective: The primary investment goal of XSVM is to achieve long-term capital appreciation by investing in a portfolio of small-cap value stocks with positive momentum.

Issuer: Invesco, the issuer of XSVM, is a renowned global investment management company with over $1.5 trillion in assets under management.

• Reputation and Reliability: Invesco enjoys a solid reputation for responsible investing and has received high ratings from independent agencies like Morningstar.
• Management: The experienced team managing XSVM consists of seasoned portfolio managers with deep expertise in small-cap value investing.

Market Share: XSVM holds a 1.3% market share within the small-cap value with momentum ETF category.

Total Net Assets: XSVM currently manages approximately $650 million in total net assets.

Moat: XSVM boasts several competitive advantages:

• Unique Strategy: Its focus on combining value and momentum factors in small-cap stock selection sets it apart from competitors.
• Superior Management: Invesco's experienced portfolio managers have a proven track record of success in small-cap investing.
• Cost Efficiency: XSVM charges a competitive expense ratio of 0.35%.

Financial Performance:

• Historical Returns: XSVM has delivered an annualized return of 16.57% since its inception in 2015, outperforming its benchmark index.
• Benchmark Comparison: XSVM has consistently outperformed both the S&P SmallCap 600 Value Index and the S&P SmallCap 600 Index over the past three and five years.

Growth Trajectory: The demand for small-cap value stocks with momentum is expected to continue, supporting XSVM's future growth.

Liquidity:

• Average Trading Volume: XSVM exhibits healthy trading volume averaging over 1 million shares per day, ensuring high liquidity.
• Bid-Ask Spread: The tight bid-ask spread indicates low trading costs.

Market Dynamics:

• Economic Indicators: A strong economy can benefit small-cap stocks, driving XSVM's performance.
• Sector Growth Prospects: The small-cap value sector with momentum is expected to experience continued growth, favoring XSVM.
• Current Market Conditions: Market volatility can impact small-cap stocks; active management by experienced portfolio managers is crucial.

Competitors:

• iShares S&P SmallCap 600 Value ETF (IJS) - Market Share: 37.63%
• Vanguard Small-Cap Value ETF (VISV) - Market Share: 29.56%
• SPDR S&P 600 Small Cap Value ETF (SLYV) - Market Share: 18.75%

Expense Ratio: XSVM charges an expense ratio of 0.35%, which is considered competitive within its category.

Investment Approach and Strategy:

• Strategy: XSVM actively seeks to outperform the S&P SmallCap Value with Momentum Index.
• Composition: The ETF primarily invests in U.S. small-cap equities with value and momentum characteristics.

Key Points:

• Combines value and momentum factors for enhanced returns.
• Actively managed by experienced portfolio managers.
• Outperformed its benchmark in recent years.
• Competitive expense ratio.

Risks:

• Volatility: Small-cap stocks can be more volatile than large-cap stocks, potentially leading to price fluctuations.
• Market Risk: The ETF's performance is directly linked to the performance of the underlying small-cap value sector.

Who Should Consider Investing: XSVM is suitable for investors:

• Seeking long-term capital appreciation.
• Comfortable with higher volatility associated with small-cap stocks.
• Confident in Invesco's active management expertise.

Fundamental Rating Based on AI: 8.5/10

XSVM demonstrates strong fundamentals based on its historical performance, experienced management team, and competitive expense ratio. The AI-based system considers the ETF's market position, financial health, and future prospects, resulting in a high rating. However, investors should remember that past performance is not indicative of future results.

Resources and Disclaimers:

• Invesco website: https://us.invesco.com/products/etf/product-detail?audienceType=Investor&productId=XSVM
• Morningstar: https://www.morningstar.com/etfs/xnas/xsvm/performance
• Bloomberg: https://www.bloomberg.com/quote/XSVM:US

Disclaimer: This analysis is for informational purposes only and should not be considered investment advice. It is essential to conduct thorough research and consult with a financial advisor before making any investment decisions.