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Is Invesco S&P 500 High Dividend Low Volatility ETF (SPHD) a Strong ETF Right Now?
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The Invesco S&P 500 High Dividend Low Volatility ETF (SPHD - Free Report) made its debut on 10/18/2012, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Large Cap Value category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
SPHD is managed by Invesco, and this fund has amassed over $3.07 billion, which makes it one of the average sized ETFs in the Style Box - Large Cap Value. Before fees and expenses, SPHD seeks to match the performance of the S&P 500 Low Volatility High Dividend Index.
The S&P 500 Low Volatility High Dividend Index comprises of 50 securities traded on the S&P 500 Index that historically have provided high dividend yields and low volatility.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for this ETF are 0.30%, making it on par with most peer products in the space.
SPHD's 12-month trailing dividend yield is 3.96%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
For SPHD, it has heaviest allocation in the Utilities sector --about 19.80% of the portfolio --while Consumer Staples and Real Estate round out the top three.
Taking into account individual holdings, Altria Group Inc (MO - Free Report) accounts for about 3.17% of the fund's total assets, followed by Kinder Morgan Inc (KMI - Free Report) and At&t Inc (T - Free Report) .
Its top 10 holdings account for approximately 27% of SPHD's total assets under management.
Performance and Risk
The ETF return is roughly 12% and is up about 16.22% so far this year and in the past one year (as of 07/19/2024), respectively. SPHD has traded between $37.32 and $46.87 during this last 52-week period.
The ETF has a beta of 0.87 and standard deviation of 14.73% for the trailing three-year period, making it a medium risk choice in the space. With about 52 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P 500 High Dividend Low Volatility ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Russell 1000 Value ETF (IWD - Free Report) tracks Russell 1000 Value Index and the Vanguard Value ETF (VTV - Free Report) tracks CRSP U.S. Large Cap Value Index. IShares Russell 1000 Value ETF has $58.04 billion in assets, Vanguard Value ETF has $120.11 billion. IWD has an expense ratio of 0.19% and VTV charges 0.04%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Value.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Is Invesco S&P 500 High Dividend Low Volatility ETF (SPHD) a Strong ETF Right Now?
The Invesco S&P 500 High Dividend Low Volatility ETF (SPHD - Free Report) made its debut on 10/18/2012, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Large Cap Value category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
SPHD is managed by Invesco, and this fund has amassed over $3.07 billion, which makes it one of the average sized ETFs in the Style Box - Large Cap Value. Before fees and expenses, SPHD seeks to match the performance of the S&P 500 Low Volatility High Dividend Index.
The S&P 500 Low Volatility High Dividend Index comprises of 50 securities traded on the S&P 500 Index that historically have provided high dividend yields and low volatility.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for this ETF are 0.30%, making it on par with most peer products in the space.
SPHD's 12-month trailing dividend yield is 3.96%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
For SPHD, it has heaviest allocation in the Utilities sector --about 19.80% of the portfolio --while Consumer Staples and Real Estate round out the top three.
Taking into account individual holdings, Altria Group Inc (MO - Free Report) accounts for about 3.17% of the fund's total assets, followed by Kinder Morgan Inc (KMI - Free Report) and At&t Inc (T - Free Report) .
Its top 10 holdings account for approximately 27% of SPHD's total assets under management.
Performance and Risk
The ETF return is roughly 12% and is up about 16.22% so far this year and in the past one year (as of 07/19/2024), respectively. SPHD has traded between $37.32 and $46.87 during this last 52-week period.
The ETF has a beta of 0.87 and standard deviation of 14.73% for the trailing three-year period, making it a medium risk choice in the space. With about 52 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P 500 High Dividend Low Volatility ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Russell 1000 Value ETF (IWD - Free Report) tracks Russell 1000 Value Index and the Vanguard Value ETF (VTV - Free Report) tracks CRSP U.S. Large Cap Value Index. IShares Russell 1000 Value ETF has $58.04 billion in assets, Vanguard Value ETF has $120.11 billion. IWD has an expense ratio of 0.19% and VTV charges 0.04%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Value.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.