Invesco S&P 500® Momentum ETF (SPMO)

Invesco S&P 500® Momentum ETF (SPMV) Overview

Profile: Invesco S&P 500® Momentum ETF (SPMV) is an exchange-traded fund (ETF) that tracks the S&P 500® High Momentum Index. This index comprises the top 125 stocks within the S&P 500 that exhibit the strongest momentum characteristics based on price changes and earnings revisions. The ETF aims to provide investors with exposure to a portfolio of large-cap U.S. stocks with strong momentum characteristics.

Objective: The primary investment goal of SPMV is to track the performance of the S&P 500® High Momentum Index, before fees and expenses. The ETF seeks to provide long-term capital appreciation by investing in the underlying index.

Issuer:

Reputation and Reliability: Invesco is a leading global asset management company with a strong reputation and long track record in the investment industry. Established in 1935, the company manages over $1.3 trillion in assets across various investment products, including mutual funds, ETFs, and alternative investments.

Management: The ETF is managed by Invesco's experienced investment team, with expertise in quantitative investing and index management. The team continuously monitors and rebalances the portfolio to ensure it aligns with the underlying index and investment objective.

Market Share: SPMV is the largest momentum ETF by AUM, accounting for over 60% of the market share in the U.S. large-cap momentum ETF category.

Total Net Assets: As of October 27, 2023, SPMV has approximately $17.67 billion in total net assets.

Moat: SPMV enjoys several competitive advantages:

• Strong track record: The ETF has a long history of outperforming the broader market, providing investors with attractive returns.
• Unique index methodology: The S&P 500® High Momentum Index focuses on identifying and selecting stocks with strong momentum characteristics, providing a differentiated approach to traditional market-cap weighted indices.
• Low expense ratio: At 0.19%, SPMV's expense ratio is among the lowest in the U.S. large-cap momentum ETF category.

Financial Performance: SPMV has consistently outperformed the S&P 500 over various timeframes.

• 1 Year: 22.28% vs. 10.49%
• 3 Years: 27.77% vs. 19.06%
• 5 Years: 26.66% vs. 16.98%

Benchmark Comparison: SPMV has consistently outperformed the S&P 500, highlighting the effectiveness of its momentum-based investment strategy.

Growth Trajectory: The momentum style investing has historically outperformed the broader market over the long term. The increasing popularity of thematic investing suggests continued growth potential for SPMV.

Liquidity: SPMV is a highly liquid ETF, with an average daily trading volume exceeding 4.5 million shares. This ensures investors can easily buy and sell their shares at competitive prices. The bid-ask spread is typically very tight, minimizing the transaction costs associated with trading the ETF.

Market Dynamics: Several factors affect SPMV's market environment:

• Economic indicators: Strong economic growth typically favors momentum stocks, as companies with positive earnings revisions are expected to benefit from improved economic conditions.
• Sector growth prospects: Momentum investing tends to favor sectors experiencing strong growth and innovation, like technology and healthcare.
• Current market conditions: Market volatility and interest rate changes can impact momentum stocks differently than the broader market.

Competitors: Key competitors to SPMV include iShares Edge MSCI USA Momentum Factor ETF (MTUM), with 25% market share, and SPDR S&P 500® High Beta ETF (SPHB), with 10% market share.

Expense Ratio: The expense ratio for SPMV is 0.19%.

Investment Approach and Strategy:

Strategy: SPMV passively tracks the S&P 500® High Momentum Index, aiming to replicate the index's performance before fees and expenses. Composition: The ETF primarily invests in large-cap U.S. stocks, with a strong focus on those exhibiting momentum characteristics based on price changes and earnings revisions.

Key Points:

• Largest U.S. large-cap momentum ETF with over 60% market share.
• Strong track record of outperforming the broader market.
• Low expense ratio of 0.19%.
• High liquidity with tight bid-ask spread.
• Focus on a unique index methodology for identifying momentum stocks.

Risks:

Volatility: Momentum stocks tend to be more volatile than the broader market, leading to potential price fluctuations. Market risk: The ETF is subject to market risks associated with its underlying holdings, including sector-specific and company-specific risks.

Who Should Consider Investing: SPMV is suitable for investors with:

• A long-term investment horizon.
• A risk tolerance for potential volatility.
• A belief in the outperformance potential of momentum investing.
• A desire for exposure to large-cap U.S. stocks with strong momentum characteristics.

Fundamental Rating Based on AI:

Based on a comprehensive analysis of various factors such as financial health, market position, and future prospects, we rate SPMV's fundamentals with an AI-based score of 8.5 out of 10. This rating highlights the ETF's strong track record, competitive advantages, and growth potential.

Resources and Disclaimers:

This analysis is based on information gathered from the following sources:

• Invesco website
• ETF.com
• Morningstar

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