The Invesco S&P 500 Low Volatility ETF (SPLV) is one of Wall Street’s most popular ways to deal with a roller-coaster market.
Historically speaking, volatility is usually a dour omen for equity returns. While some people simply choose to wait out periods of seesawing prices, others try to smooth out their portfolio’s performance by adding companies that are prone to less volatility. You can get the same effect with less single-stock risk by investing in low-volatility funds that own entire baskets of Wall Street’s coolest cucumbers.
Today, I’ll give you a rundown of one of the most popular ways to do so: the Invesco S&P 500 Low Volatility ETF.
Disclaimer: This article does not constitute individualized investment advice. Individual securities, funds, and/or other investments appear for your consideration and not as personalized investment recommendations. Act at your own discretion.
Why Should We Invest in Low-Volatility ETFs?
When people say the market “is volatile,” what they typically mean is that the market “is highly volatile.” In other words, stocks are moving up and down rapidly.
And that—high volatility—is when things tend to turn sour for stocks.
You can get the full details in my story about the best low- and minimum-volatility ETFs, but a Crestmont Research analysis evaluating S&P 500 Index data from 1962 through the end of 2024 found that, broadly speaking, years with low volatility were more likely to be positive (and when they weren’t, the damage was relatively more contained) than years with high volatility. Up years could be more productive during periods of relatively high volatility, but they were less productive when the markets were extremely volatile.
Related: 10 Monthly Dividend Stocks for Frequent, Regular Income
And that’s why some investors look toward funds that aren’t as prone to big swings.
Low-volatility ETFs hold the lowest-volatility stocks within a selection universe. For instance, an S&P 500 low-vol ETF would try to hold the lowest-volatility stocks in the S&P 500, based on, say, beta or standard deviation (two common measures of volatility).
There are numerous twists on this, of course: low-vol ETFs focus on stocks of varying sizes, or stocks that pay high dividends, or stocks in other countries.
Consider this from TD Asset Management, which studied low- and minimum-volatility strategies:
“While low volatility is not the top-performing factor all the time, when we average across multiple periods, the low volatility style remains the best alternative for capital preservation and downside portfolio protection within equities, in times of market stress.”
Just understand that while low- and min-vol strategies are highly effective during down markets, that same lack of volatility can be a liability in bull markets. Remember: These stocks don’t move as much as the S&P 500, and that often cuts both ways—they move less on the way down, but they also move less on the way back up. It makes sense: When investors regain their optimism and aggressiveness, they often shed their defensive investments so they can buy more cyclical stocks with higher upside.
Related: The 16 Best ETFs to Buy for a Prosperous 2026
What Is the SPLV?
The Invesco S&P 500 Low Volatility ETF (SPLV) is an index fund that tracks the S&P 500 Low Volatility Index.
This index starts with the S&P 500’s components, narrows it down to the hundred components with the lowest realized volatility over the past 12 months, then “weights” each stock based on its lack of volatility. (Weighting refers to the percentage of fund assets invested in something, be it an asset, industry, sector, country, etc.)
What Does SPLV Hold?
Right now, the Invesco S&P 500 Low Volatility ETF’s portfolio is high on utilities (27%), financials (17%), real estate (15%), and consumer staples (11%).
The utility sector’s dominance over the past couple months have brought names such as CenterPoint Energy (CNP) and Southern Co. (SO) into the top holdings. However, the fund is also loaded with blue chips from across the market, including Dividend Aristocrats Coca-Cola (KO), Johnson & Johnson (JNJ), Realty Income (O), and McDonald’s (MCD).
Let’s quickly look at the top 10 holdings:
| Company | Ticker | Weight in SPLV |
|---|---|---|
| Pinnacle West Capital | PNW | 1.3% |
| CenterPoint Energy | CNP | 1.3% |
| WEC Energy Group | WEC | 1.3% |
| Atmos Energy | ATO | 1.3% |
| Ameren | AEE | 1.3% |
| Southern Co. | SO | 1.3% |
| DTE Energy | DTE | 1.3% |
| Evergy | EVRG | 1.3% |
| Alliant Energy | LNT | 1.3% |
| Duke Energy | DUK | 1.3% |
| Total in Top 10 Holdings | 13% | |
A lot of index funds are weighted by market cap, which means the greater the size of the stock, the more assets the fund will invest in that stock … and thus the more influence that stock exerts over the fund’s performance. It’s not unusual for the top holdings of a cap-weighted fund to account for 5%, 7%, even 10% of assets, while the smallest holdings account for a tenth, even a hundredth of a percent.
While SPLV is technically volatility-weighted, the practical result is a portfolio that often looks equal weighted—all the stocks start off at the same weight, but they can vary a little as their prices rise and fall between rebalancings. To wit, top component PNW accounts for 1.3% of assets, while the smallest position, General Mills (GIS), accounts for 0.6%. That’s not nothing, but for the endpoints of a fund’s holdings list, that’s a pretty small difference.
Related: What Is VOO? A Quick Guide to the Vanguard S&P 500 ETF
So, what about that low volatility?
Let’s look at beta, which is a common measure of volatility that compares an investment to a benchmark. For stocks, the benchmark is typically the S&P 500, and the benchmark is set at 1. A beta of less than 1 implies something is less volatile than the benchmark; a beta of more than 1 implies more volatility. SPLV has a beta of 0.51 right now, which implies that the ETF is roughly half as volatile than the broader stock market.
That low volatility often works out in its favor during downturns and extended periods of market sluggishness. For instance, during the 2022 bear market, Invesco S&P 500 Low Volatility only lost 15% on a total-return basis (price plus dividends) compared to 24% for the S&P 500. It fared very well during 2025’s near-bear market, declining by just about 6% between the Feb. 19 market high and April 8 market low, while the S&P 500 lost nearly 20%.
But be aware that SPLV doesn’t always hold up. On rare occasions (such as the COVID bear market), SPLV will fall every bit as much as the market. Indeed, SPLV dropped pretty swiftly in the monthlong market drop after the U.S. started its war in Iran … but to be fair, that did follow a couple of months of stark outperformance compared to the S&P 500.
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How Much Does SPLV Cost?
The Invesco S&P 500 Low Volatility ETF charges 0.25% in annual fees, or $2.50 for every $1,000 invested.
That’s lower than the average expense ratio for index equity ETFs (0.40%), but it’s not particularly low within the world of low- and min-vol strategies, nor among large-cap low-vol strategies more specifically. It likely carries its (relative) premium because it’s tethered to the S&P 500, unlike other large-cap products that are attached to other indexes.
In other words: It’s hardly a bargain, but it’s not expensive, either.
Related: Direct Indexing: A (Tax-)Smarter Way to Index Your Investments
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