Momentum ETFs have seen widespread investor interest this year, with Invesco’s lineup getting considerable attention.
The popular Invesco S&P 500 Momentum ETF (SPMO) has seen strong inflows in 2024, accreting $3.2 billion in net flows year to date through November 18, according to ETF Database. In the past one-month period, SPMO has seen over $1 billion in net flows.
SPMO is a great way to enhance portfolios and overweight the momentum factor. However, momentum ETFs down the cap spectrum are also worth consideration. For momentum exposure to mid and small-cap companies, investors can look to the Invesco S&P MidCap Momentum ETF (XMMO) and the Invesco S&P SmallCap Momentum ETF (XSMO).
Comparing Invesco’s Momentum ETFs
SPMO tracks an index of the 100 stocks in the S&P 500 that have had better recent price performance compared to its peers. The methodology measures the percentage change in stock prices over the past year, and then adjusts for volatility. Calculations exclude the most recent month. Finally, the portfolio is weighted based on a combination of company size and momentum score.
XMMO has also seen strong interest among investors in 2024. The fund has seen $1.2 billion in net flows year to date through November 18.
The midcap momentum ETF tracks an index comprising 80 securities from the S&P Midcap 400 Index that have the highest momentum scores. These scores are computed by measuring the upward price movements of each security as compared to other eligible stocks within the S&P Midcap 400 Index.
Finally, XSMO offers small-cap exposure and has attracted $849 million in net flows year to date through November 12.
The small-cap momentum ETF includes 120 securities in the S&P SmallCap 600 Index that have the highest momentum scores. Like SPMO and XMMO, the momentum scores are calculated by measuring the upward price movements of each security as compared to other eligible stocks within the starting index.
SPMO charges 13 basis points, XMMO charges 34 basis points, and XSMO charges 39 basis points.
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