Invesco S&P 500 Momentum ETF

SPMO

Market cap $13.4B

In a notable shift for the start of 2026, the S&P 500 is experiencing a divergence in factor performance. Typically, high beta (aggressive, high-risk) and low volatility (defensive, safe-haven) factors sit on opposite sides of the seesaw.

The S&P 500 has been on a roll ever since the 2022 selloff started moderating, and this is a rally that has only been beaten by tech-centric ETFs

The Investment Committee debate the software volatility and how you should position your portfolio.

Invesco S&P SmallCap Momentum ETF offers structural alpha over IWM, thriving on persistent dispersion and balanced concentration in the small-cap universe. XSMO consistently generates alpha across market regimes, outperforming in both rallies and downturns, unlike SPMO which relies on narrow, mega-cap momentum. SPMO remains a Hold due to expected underperformance versus SPY, as its concentrated structure loses edge amid rising dispersion and slowing momentum.

On this episode of the “ETF of the Week” podcast, VettaFi's Head of Research, Todd Rosenbluth, discussed the Invesco S&P MidCap Momentum ETF (XMMO) with Chuck Jaffe of Money Life. The pair discussed several topics related to the fund to give investors a deeper understanding of the ETF.

The final trades of the day with CNBC's Melissa Lee and the Fast Money traders.

The AI boom has been a driving force for the tech-heavy indices, and while a correction could have the potential to be more painful for the growth- and AI innovation-heavy Invesco QQQ Trust (NASDAQ:QQQ) and other similar ETFs out there, longer-term investors who can weather a storm without breaking a sweat might be in for greater rewards over the long run.

Invesco S&P 500 Momentum ETF offers strong long-term growth potential, with a focus on high-momentum U.S. equities, especially technology. SPMO's semi-annual rebalancing recently increased tech exposure and removed underperformers, positioning the fund to benefit from AI and lower interest rates. The ETF has outperformed key peers over the past year, boasts a 5-year CAGR of 18.53%, but carries valuation risk with a P/E of 31.51x.

The Invesco S&P 500 Momentum ETF is reiterated as a strong buy for its proven momentum-based strategy and consistent outperformance. SPMO's recent rebalancing increased technology exposure and reduced underperforming consumer defensive holdings, enhancing its sector allocation for current market conditions. SPMO delivered a 35.57% return over the past year, nearly doubling the S&P 500's 18.21%, showcasing its effectiveness in volatile markets.

Invesco S&P 500® Momentum ETF (SPMO) underwent a major September rebalancing, with significant changes to its top holdings. SPMO's methodology focuses strictly on momentum factors, ignoring valuations, and has delivered strong outperformance with less tech concentration than SPY or QQQ. Recent rebalancing saw additions like ORCL, V, CSCO, and CRWD, while AMZN, TSLA, COST, BAC, and AXP were removed.