VIDEO: ETF of the Week: XMMO
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.
XMMO: A Momentum Play In Mid Caps, Above-Average Growth And Volatility
The Invesco S&P MidCap Momentum ETF (XMMO) offers a momentum-driven, growth-focused strategy with a strong tilt toward industrials and technology sectors. XMMO trades at a premium valuation, reflecting its above-average earnings and sales growth, but also carries higher volatility and downside risk than peers. The fund has delivered top-tier performance, outpacing the S&P Mid-Cap 400 and most peers, but amplifies both market gains and losses due to its momentum approach.
XMMO: Mid-Cap Momentum Investing Is The Way To Get Alpha
Invesco S&P MidCap Momentum ETF offers a momentum-driven approach to mid-cap investing, outperforming the S&P 400 benchmark with only slightly higher risk. XMMO's momentum strategy delivers superior risk-adjusted returns, evidenced by significantly higher Sharpe ratios compared to IJH, despite a modestly higher expense ratio and lower dividend yield. Current market conditions—declining interest rates and reasonable valuations—make XMMO especially attractive, but investors should monitor interest rates and valuation levels for potential risks.
Should Invesco S&P MidCap Momentum ETF (XMMO) Be on Your Investing Radar?
Looking for broad exposure to the Mid Cap Growth segment of the US equity market? You should consider the Invesco S&P MidCap Momentum ETF (XMMO), a passively managed exchange traded fund launched on March 3, 2005.
XMMO: Impressive Returns And Fundamentals For This Mid-Cap Momentum ETF
XMMO's strategy changed six years ago, and it has paid dividends for investors, delivering an impressive 132% return that trounced the S&P MidCap 400 Index. The strategy is straightforward in that it only uses one-year price returns to select 80 S&P MidCap 400 Index stocks, repeating the process twice annually in March and September. While XMMO guarantees strong exposure to momentum stocks, my analysis also revealed excellent GARP features. Notably, its estimated earnings growth rate is better than the S&P MidCap 400 Growth Index.
XMMO: Holding Out For More Data
I assign XMMO a Hold rating due to limited transparency and frequent methodology changes that hurt long-term performance analysis. XMMO's current momentum index underperforms its previous strategies, with negative alpha and risk-adjusted returns lagging the S&P 500. The ETF's risk metrics are reasonable, but it fails to deliver meaningful outperformance, making it less compelling for aggressive investors.
Should Invesco S&P MidCap Momentum ETF (XMMO) Be on Your Investing Radar?
Designed to provide broad exposure to the Mid Cap Growth segment of the US equity market, the Invesco S&P MidCap Momentum ETF (XMMO) is a passively managed exchange traded fund launched on 03/03/2005.
XMMO: A Huge Rally, The Valuation Now In Question Amid Technical Resistance
Momentum factor is currently leading US factor performance, but XMMO has underperformed, prompting a downgrade from buy to hold. XMMO's assets have grown, despite a negative return, reflecting net inflows; its expense ratio is moderate, and the ETF is diversified. Financials, the largest sector weight in XMMO, have underperformed, posing a risk to the ETF's rebound.
Should Invesco S&P MidCap Momentum ETF (XMMO) Be on Your Investing Radar?
Looking for broad exposure to the Mid Cap Growth segment of the US equity market? You should consider the Invesco S&P MidCap Momentum ETF (XMMO), a passively managed exchange traded fund launched on 03/03/2005.
XMMO: Using A Momentum Strategy For Midcaps To Outperform The Market
Mid-caps trade at lower multiples than large caps and have similar drawdowns, making them a compelling investment choice. Momentum strategies, as demonstrated by XMMO, outperform both mid-cap and large-cap indices, providing higher returns and a better Sharpe ratio. While momentum strategies are riskier due to higher volatility, they are suitable for investors seeking better returns than traditional mid-cap investments.
XMMO Is Poised To Outperform S&P 500 In 2025
Mid-caps are expected to generate strong returns in 2025 due to economic growth, rate cuts, and improved earnings, making them undervalued compared to large caps. Invesco S&P MidCap Momentum ETF is rated a buy, as it has outperformed the S&P 500 and mid-cap indices, driven by robust financial performance. XMMO's diversified portfolio, low valuation, and strong earnings growth potential make it an attractive investment option with a low expense ratio and high liquidity.
Should Invesco S&P MidCap Momentum ETF (XMMO) Be on Your Investing Radar?
Looking for broad exposure to the Mid Cap Growth segment of the US equity market? You should consider the Invesco S&P MidCap Momentum ETF (XMMO), a passively managed exchange traded fund launched on 03/03/2005.
