A sound investment process and strong management team underpin Invesco S&P 500® High Beta ETF's Morningstar Medalist Rating of Silver. The portfolio maintains a cost advantage over competitors, priced within the least expensive fee quintile among peers.  

 The strategy's investment process inspires confidence and earns an Above Average Process Pillar rating. Independent of the rating, analysis of the strategy's portfolio shows it has maintained a significant overweight position in liquidity exposure and volatility exposure compared with category peers. High liquidity exposure is attributed to stocks with a high trading volume, lending managers more flexibility. And high volatility exposure is rooted in stocks that have a higher standard deviation of returns. The strategy’s management team earns an Above Average People Pillar rating. The strategy's parent organization earns the firm an Average Parent Pillar rating. People Pillar and Parent Pillar ratings for this strategy are indirectly assigned by a Morningstar analyst rather than algorithmically derived. Please see the notes following each pillar section for more details. The details of assigning methods can be found in each pillar section.

Analyst Rating

Comerica

NVIDIA

Generac Holdings

Align Technology

KeyCorp

Norwegian Cruise Line

Carnival

Citizens Financial Group

Enphase Energy

Truist Financial

Morningstar's evaluation of this security's process aims to determine the likelihood that it will outperform its Morningstar Category benchmark on a risk-adjusted basis over the long term. Invesco S&P 500® High Beta ETF earns an Above Average Process Pillar rating. 

The predominant contributor to the rating is that this fund tracks an index. Historical data, such as Morningstar's Active/Passive Barometer, finds that passively managed funds have generally outperformed their active counterparts, especially over longer time horizons. 

 This strategy targets smaller plays than its peers’ average in the Large Blend Morningstar Category. But in terms of style (value/growth) exposure, it is similar. Looking at additional factor exposure, this fund has constantly tilted toward stocks with higher trading volumes than its Morningstar Category Peers over the past few years. More-liquid assets are easier to buy and sell without adversely moving their prices and tend to provide some ballast during market selloffs. They also are easier to sell to meet redemptions if a host of investors decide to leave the fund in a short period of time. In recent months, the strategy was more exposed to the Liquidity factor compared with its Morningstar Category peers as well. This strategy also has had an overweight bias to the volatility factor over these years, meaning it has owned companies that have a higher historical standard deviation of returns. This contributes to a higher-risk, higher-reward approach. Compared with category peers, the strategy also had more exposure to the Volatility factor in the most recent month. Additionally, this strategy has demonstrated a bias away from momentum stocks during these years. Momentum investors tend to expect stocks that have done well recently to continue to do so in the short term. Momentum approaches can entail higher turnover and trading costs since the top stocks can often change. In recent months, the strategy also had less Momentum factor exposure than its peers. More information on a fund and its respective category's factor exposure can be found in the Factor Profile module within the Portfolio section. 

 The portfolio is overweight in consumer cyclical and financial services relative to the category average by 8.2 and 8.1 percentage points, respectively. The sectors with low exposure compared to category peers are healthcare and consumer defensive, underweight the average by 6.7 and 5.3 percentage points of assets, respectively. The portfolio is composed of 101 holdings and its assets are more dispersed than peers in the category. In particular, 13.7% of the strategy's assets are concentrated in the top 10 fund holdings, as opposed to the category average's 48.8%. And finally, in terms of portfolio turnover, looking at year-over-year movements, 66% of the fund's holdings have changed, whether through increasing, decreasing, or changing a position.

Above Average

Process

Invesco S&P 500® High Beta ETF benefits considerably from its team, earning it an Above Average People Pillar rating. There are four managers listed on the fund: Michael Jeanette, Peter Hubbard, Tony Seisser, Pratik Doshi. Experience on the team is abundant, with 12 years of average portfolio management experience. Together, they manage a total of 144 strategies, with a Bronze asset-weighted average Morningstar Medalist Rating, demonstrating their potential to deliver positive alpha relative to the category median in aggregate. This group has been working together for a while and has been successful in retaining talent compared to peers, with no departures in the last five years.  

 Note: This People Pillar rating is indirectly assigned by an analyst. Morningstar analysts evaluate the People Pillar for passive products at the brand level and may also differentiate by asset class. There is at least one other passive strategy at the firm that is covered by a Morningstar analyst, so the People Pillar rating of the fund is inherited from the rating that the Morningstar analyst assigned to investment vehicles under the same brand name.

People

Invesco succeeds in a number of areas but also has its share of subpar offerings, along with many others that land somewhere in the middle. A mid-2023 change of CEO, from longtime chief Marty Flanagan to veteran Invesco executive Andrew Schlossberg, is noteworthy, and several other executives retired or departed in 2023. Portfolio-manager shuffles aimed at bolstering poor performers, which began under Flanagan, have continued under Schlossberg, who told Morningstar his most important aim is bolstering “investment quality.” However, major changes of direction or approach are unlikely. The firm retains a Morningstar Parent rating of Average. 
Invesco’s international-equity teams in Texas and New York remain solid. However, the extensive U.S.-equity lineup needs improvement. Fixed-income offerings run the gamut: The multisector and short-term-bond areas are good, but corporate high-yield is less impressive. The firm’s exchange-traded fund lineup includes the popular Nasdaq-focused QQQ; passive strategies make up around 37% of Invesco’s assets under management. Invesco has not been averse to trying new types of strategies, and it was among the firms that immediately launched a spot bitcoin ETF after SEC approval in early 2024.
The picture outside the United States is mixed. Fund performance has been subpar in Asia, and while the picture has brightened in the United Kingdom and Europe, that region still can’t be considered a strength.

Average

Parent

Invesco S&P 500 High Beta ETF

SPHB tracks a beta-weighted index of the 100 highest-beta stocks in the S&P 500.

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The S&P 500 is on the verge of reaching the 5,000 milestone mark for the first time ever. High-beta ETFs seem a perfect bet at present to make huge profits amid the bullish backdrop.

S&P 500 Nears 5,000: Bet on High-Beta ETFs

Stocks have rallied since October 27, but one indicator suggests the recovery may be on shaky ground. Invesco S&P 500® High Beta ETF has technical risks and a high allocation to the Information Technology sector. The chart for the SPHB ETF shows possible problems for the bulls, with resistance at previous all-time highs and potential for a pullback.

SPHB: High Beta Underperforming The Low Vol Factor, Near-Term Risks

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High-beta and high-momentum products are expected to outperform during Santa Claus rally and are intriguing choices for a short spell.

Bet on High Beta & Momentum ETFs to Cash In On Santa Rally

SPHB tracks 100 high-beta S&P 500 stocks. Launched in May 2011, the ETF has a reasonable 0.25% expense ratio, but has failed to gain much interest from an AUM perspective. Despite an upward-trending market over the last ten years, SPHB has lagged behind SPY by 30% while featuring, as expected, much higher volatility. Higher risk did not equal higher rewards. One likely reason is poor quality. I calculated a 8.26/10 profit score for SPHB, well behind SPY's 9.43/10 score, and backed by significant differences in ROTC and ROE margins.

SPHB: High Risk, Low Returns, And Questionable Quality

The Invesco S&P 500 High Beta ETF seeks to track the S&P 500 High Beta Index, consisting of the 100 stocks with the highest beta. SPHB has underperformed the S&P 500 on both an absolute and risk-adjusted basis, but its exposure to mid-cap and small cap companies has been a key driver. SPHB has underperformed a blend of large cap, mid-cap, and small cap companies on a risk adjusted basis since inception.

SPHB: Risk Adjusted Underperformance Set To Continue

Low-beta, steady stocks tend to have better risk-adjusted returns over time compared to high-beta stocks. The Invesco S&P 500 High Beta ETF focuses on high-beta stocks in the S&P 500 Index. Investing in SPHB can be rewarding during bull markets, but it comes with a high level of risk, especially in extended sectors like Technology.

SPHB: Poor Risk/Return Right Here

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High-beta stocks have outperformed defensive stocks in the stock market recently, raising questions about the effectiveness of low-volatility and dividend growth investing. ROBECO's research shows that low-volatility investing can significantly improve long-term performance, particularly in market environments with increased retail investor participation. Low-risk ETFs, such as healthcare names and dividend aristocrats, offer exposure to fundamentally strong factors and tend to perform well during periods of stagflation, high inflation, and decent economic growth.

Time To Go Defensive With These ETFs

High beta sustained its rally and handily outpaced the S&P 500 in July, underscoring the continued risk-on sentiment in the market. U.S. stocks rallied in July, as Wall Street celebrated rosy earnings and upbeat macroeconomic updates, including softening inflation and better-than-expected second-quarter GDP.

High Beta SPHB Continues Rally, Outpaced S&P 500 in July

Invesco S&P 500 Quality ETF

The two top-performing factors stood out during the first half for impressive outperformance over the benchmark. The S&P 500 High Beta Index and the S&P 500 Growth Index handily outpaced the parent S&P 500 during the first six months of 2023.

Under the Hood of the 2 Top-Performing Factors YTD

High beta stocks can provide leverage-like effects on returns, performing well during market upswings and worse during downturns. The Invesco S&P 500 High Beta ETF is a good investment during volatile market rebounds, using the VIX as an indicator. When the VIX is above 20, but below its level from 20 days ago, buy SPHB; hold until the VIX rises above its level from 20 days ago or falls below 20.

SPHB: Extra Returns When Timed Properly

The Invesco S&P 500 High Beta ETF focuses on the highest beta stocks in the S&P 500 Index and has outperformed the S&P 500 this year. High beta stocks tend to outperform in bull markets and market rallies but exhibit larger drawdowns during risk-off events. The rally in the S&P 500 this year has been driven by only a handful of names, suggesting a potential risk-off event later this year, making it a good time for retail investors to sell SPHB and crystalize gains.

SPHB: Time To Sell The S&P 500 High Beta Components

High beta has been a top-performing factor year to date, with its strong showing continuing into June. The Invesco S&P 500 High Beta ETF (SPHB), which tracks the S&P 500 High Beta Index, is up 13.6% over one month, while the parent S&P 500 has climbed 5.4%.

High Beta Factor ETF SPHB Rallies 14% in Past Month

High beta was a leader among factor indexes in May, lifted by its heavy tilt toward the information technology sector. Uncertainty weighed heavily on U.S. markets in May.

High Beta ETF ‘SPHB' Lifted by Heavy Tech Sector Tilt

Defensive strategies lagged while high beta and growth led among factors during the first quarter. What worked best during the first quarter was a sharp pivot from what worked in 2023.

High Beta, Growth Factors Lead in Q1 Performance

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Profiling trends through pairs of ETFs continue to tell a story of failed breakouts and frustrated expectations. The trend barely wavered for US stocks over shares in emerging markets.

Trend Profiles Revive Outlook For U.S., Big-Cap And Growth Equities

After being bullish in late 2020, I now turn bearish on the Invesco S&P 500 High Beta ETF relative to the broader equities market. An economic slowdown is a near certainty, and I don't think that a recession has been this obviously telegraphed in many decades.

SPHB: Downgrading To Sell Relative To The S&P 500

Despite last week's sharp losses, high beta maintains its position as the top-returning S&P factor index in 2023. The S&P 500 suffered its biggest percentage drop since September last week, declining 4.6%.

SPHB Maintains Leads Among S&P Factor Index Returns YTD

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The markets finally woke up to reality in February that inflation isn't retreating as fast as expected. Best ETFs for bonds and stocks fell.

Investors Learned A Big Lesson In February

Cathie Wood's ARK Innovation is in a league of its own this year. But at least one diversified ETF is giving it a run for its money — using high beta S&P 500 stocks.

One Fund Gives Cathie Wood A Run For The Money

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Stock markets started 2023 with a bang, as major indexes posted solid gains in January. Some of the best ETFs and mutual funds jumped.

Stocks Are Off To Stellar Start This Year; Can It Continue?

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You might be wowed with the Invesco QQQ Trust's 8.3% gain this year. Until you see the ETFs beating it, including those tied to the S&P 500.

Think The Nasdaq Is Soaring? Check Out 14 ETFs Doing Even Better

The S&P 500 High beta outperformed the S&P 500 Index on a relative basis again on Wednesday, off to a hot start this year after a dismal showing in 2022. The S&P 500 suffered its biggest drop in over a month on Wednesday, declining 1.6%.

SPHB Provides Exposure to Top-Performing Factor YTD: High Beta

High beta has been off to a strong start this year after being one of the worst-performing factors in 2022. The S&P 500 increased by 0.7% on Tuesday, as yesterday's data on rising wholesale inventories and falling trade sales bolstered hopes for easing of inflationary pressures, according to the S&P Dow Jones Indices daily dashboard.

SPHB Rallies as High Beta Is Second Top-Performing Factor YTD

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In a livecast event this Friday, I'm going to be recapping the past year in ETFs and previewing what is likely ahead of us with one of my favorite people in the ETF industry that does not work for VettaFi, Cinthia Murphy.

Smart Beta Is Alive and Well

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Vanguard High Dividend Yield (VYM) is now posting a modest 1.7% year-to-date gain through Tuesday's close (Dec. 13). VYM has enjoyed a strong recovery in the past two months and currently trades just below a record high.

Dividend Yield Is 2022's Upside Outlier For Equity Factor Returns

News for Invesco S&P 500 High Beta ETF ETF (SPHB)