Invesco S&P SmallCap Low Volatility ETF

XSLV

Market cap $249M

Current market valuations and cycles signal an elevated risk of a downturn, reminiscent of past bubbles like the late 1990s tech boom. Multiple historical cycles (Benner, Shmita, Metonic, Kitchin) all point to unfavorable market conditions from 2027 through 2030. The Invesco S&P SmallCap Low Volatility ETF historically outperforms in down markets, offering strong risk-adjusted returns and downside protection.

Just three months ago, it felt like the U.S. was headed straight for a recession as tariffs threatened to take a stride out of the step of an otherwise fast-running economy.

Volatility in the stock market has intensified due to rising inflation fears, uncertainty surrounding rate cuts and ambiguity over Trump's tariff policies.

Invesco S&P SmallCap Low Volatility ETF targets low-volatility small-cap stocks, focusing on financials, real estate, and industrials. XSLV has underperformed its parent index, S&P 600 since inception, despite outperforming it between 2013 and 2020. Lower volatility doesn't seem to translate into a lower risk in drawdown, and XSLV has lagged three of its competitors since April 2020.

Wall Street falters at the start of September, raising the appeal for low-volatility products.

The anticipation of interest rate cuts may skew equities market strength toward the upside. But interest rate news will continue to sway small-cap indexes.