SPHB ETF

SPHB, with a high beta strategy, targets 100 volatile S&P 500 stocks, offering potential short-term outperformance but higher downside risk. The fund's expense ratio is 0.25%, higher than similar ETFs, and it rebalances quarterly. SPHB rebounds faster post-market corrections but lags the S&P 500 in long-term returns due to its high beta stock selection.

SPHB tracks the S&P 500 High Beta Index, providing exposure to high-beta stocks in the S&P 500. High-beta stocks can amplify gains and losses, so exposure to them is suitable for only under certain circumstances. Right now, investing in this fund is too risky, but it can have its use when the market is in recovery, so familiarizing yourself with it is a good idea.

The Invesco S&P 500 High Beta ETF contains approximately 100 stocks from the S&P 500 index that have higher volatility. This ETF exhibits traits that indicate a mix of growth and value investment styles. Despite its high-risk, high-reward approach, SPHB has not delivered additional returns during a bullish market and is unlikely to outperform throughout a full market cycle.

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 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.

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.

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.

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.

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.