XRLV Profile
The Invesco S&P 500 ex-Rate Sensitive Low Volatility ETF is designed to offer investors exposure to a segment of the S&P 500 Index with minimized volatility and reduced sensitivity to interest rate fluctuations. The fund generally invests at least 90% of its total assets in the securities that make up its underlying index. This index is specifically engineered to measure the performance of the 100 least volatile stocks within the S&P 500 Index, while excluding those most sensitive to changes in 10-year U.S. Treasury rates.
The index targets companies with low price volatility and low correlation to interest rate movements, providing investors with a defensive equity exposure. It is particularly focused on those constituents of the S&P 500 Index that demonstrate stability in their stock prices and exhibit minimal impact from shifts in long-term interest rates. This is achieved by employing a volatility-weighted methodology, which emphasizes stocks with historically lower fluctuations in price.
In addition to its focus on low volatility, the index aims to exclude companies that are highly sensitive to interest rate changes, thus mitigating interest rate risk. This approach is designed to cater to investors seeking stability in their equity investments, especially in an environment where interest rates are expected to rise or exhibit significant fluctuations. By focusing on low volatility and reduced interest rate sensitivity, the fund seeks to provide a smoother investment experience compared to broader market indices.
Investors in the Invesco S&P 500 ex-Rate Sensitive Low Volatility ETF can expect to gain exposure to a subset of the S&P 500 Index that is both less volatile and less affected by interest rate changes. This makes the fund suitable for those looking to achieve equity exposure with potentially lower risk and reduced sensitivity to macroeconomic factors related to interest rates. The funds strategy aims to balance equity market exposure with risk management, catering to a more cautious investment approach.
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