XSMO - XSMO: A Small-Cap Outperformer

2024-03-22 06:40:28 ET

Summary

• The Invesco S&P SmallCap Momentum ETF has performed better than other small-cap proxies in the market.
• The ETF has a well-diversified portfolio with a focus on small-cap companies in the Industrials, Consumer Discretionary, and Information Technology sectors.
• Investing in the ETF offers exposure to small-cap growth stocks but comes with higher volatility and a relatively high expense ratio.

Small caps have been and continue to be a challenged part of the marketplace. The broad based averages like the Russell 2000 have gone nowhere for a year and haven't made new highs. Does that means small caps are uninvestable? Of course not. There have been some small-cap proxies that have fared decently well, though far less so than large-caps in this cycle. One fund that's done better than others is the Invesco S&P SmallCap Momentum ETF ( XSMO ). This is a passively managed fund that seeks to replicate the performance of the S&P SmallCap 600 Momentum Index. This index encompasses 120 securities from the S&P SmallCap 600 Index that exhibit the highest momentum scores. These scores are calculated by measuring the upward price movements of each security compared to other eligible stocks within the S&P SmallCap 600 Index....

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