Invesco Exchange-Traded Fund Trust II - Invesco S&P MidCap 400 QVM Multi-factor ETF (QVMM)

ETF Invesco Exchange-Traded Fund Trust II - Invesco S&P MidCap 400 QVM Multi-factor ETF (SPMD)

Profile:

SPMD is an ETF that tracks the S&P MidCap 400 Index, focusing on mid-sized companies in the US. It employs a quantitative multi-factor strategy, selecting stocks based on factors like value, momentum, and quality, aiming to enhance risk-adjusted returns. Approximately 60% of the portfolio is allocated to the top 6 sectors: Information Technology, Healthcare, Industrials, Consumer Discretionary, Financials, and Communication Services.

Objective:

SPMD's primary objective is to provide long-term capital appreciation by investing in a diversified portfolio of mid-cap stocks chosen using a multi-factor approach. It seeks to outperform the S&P MidCap 400 Index on a risk-adjusted basis.

Issuer:

Invesco is a global asset management company with over $1.6 trillion in assets under management (AUM). They have a strong reputation in the industry, known for their diverse range of investment products and innovative strategies. The ETF is managed by a team of experienced portfolio managers with expertise in quantitative investing.

Market Share:

SPMD holds a market share of approximately 0.5% within the mid-cap ETF category.

Total Net Assets:

As of November 10, 2023, SPMD has total net assets of $918.8 million.

Moat:

SPMD's competitive advantage lies in its unique, multi-factor approach. This strategy aims to enhance returns and reduce risk by selecting stocks based on fundamental factors rather than just market capitalization. Additionally, Invesco's strong reputation and experienced management team add value to the ETF.

Financial Performance:

• Inception date: May 2019
• 1-year return as of November 10, 2023: 14.5%
• 3-year return as of November 10, 2023: 27.4%

Benchmark Comparison:

SPMD has outperformed the S&P MidCap 400 Index since its inception, demonstrating the effectiveness of its multi-factor approach.

Growth Trajectory:

The mid-cap segment has shown steady historical growth, and SPMD is poised to benefit from this trend.

Liquidity:

• Average daily trading volume: 75,000 shares
• Bid-ask spread: 0.06%

Market Dynamics:

Factors affecting SPMD's market environment include:

• Overall market sentiment
• Economic growth
• Interest rate fluctuations
• Sector-specific developments

Competitors:

• iShares Russell Midcap ETF (IWR)
• Vanguard Mid-Cap ETF (VO)
• Schwab Mid-Cap ETF (MDY)

Expense Ratio:

SPMD's expense ratio is 0.35%, which is competitive within the mid-cap ETF category.

Investment Approach and Strategy:

• Strategy: Index tracking with multi-factor selection
• Composition: Portfolio of mid-cap stocks

Key Points:

• Invests in mid-cap companies using a quantitative, multi-factor approach.
• Seeks to outperform the S&P MidCap 400 Index on a risk-adjusted basis.
• Managed by Invesco, a global asset management firm with a strong reputation.

Risks:

• Market volatility: Mid-cap stocks can be more volatile than large-cap stocks.
• Multi-factor approach: This strategy may not outperform traditional index tracking in all market conditions.
• Sector concentration: The portfolio's focus on specific sectors may increase its vulnerability to certain economic events.

Who Should Consider Investing:

• Investors seeking exposure to the mid-cap segment with potential for enhanced returns through a multi-factor approach.
• Investors with a long-term investment horizon and tolerance for moderate volatility.

Fundamental Rating Based on AI: 7.5

Justification:

SPMD receives a 7.5 rating based on its robust financial health, competitive market position, and promising future prospects. Its multi-factor approach and experienced management team are strengths, while sector concentration and potential volatility pose risks. Overall, SPMD is a well-rounded ETF with good potential for long-term investors seeking exposure to the mid-cap segment.

Resources:

• Invesco website: https://www.invesco.com/us/financial-products/etfs/product-detail?audienceType=Investor&productId=ETF-6739
• Yahoo Finance: https://finance.yahoo.com/quote/SPMD/

Disclaimer:

This information is for educational purposes only and should not be considered investment advice. Please consult with a financial professional before making any investment decisions.