It tracks the S&P 500 Growth at a Reasonable Price Index. It measures growth through 3-year EPS and revenue growth rates, and it evaluates profitability and valuation at the same time using leverage, return on equity and the price-to-earnings ratio, building a balanced portfolio.

It suits medium- to long-term investors who want to participate in growth without the heavy valuation burden of high-growth tech stocks.

Launched by Invesco in 2011, it is a passively managed (index-tracking) ETF.

From the stocks in the S&P 500, it selects about 75 names that show strong 3-year EPS growth and revenue growth, while also having low debt ratios, high return on equity and valuations that are not excessive. It applies a growth-weighted approach that assigns higher weights to stocks with higher growth scores.

• Applies a three-layer filter of growth, profitability and valuation
• Unlike large-cap growth ETFs, it offers diversified exposure to upper-mid growth stocks rather than a focus on mega-caps

Assets under management (AUM) stand at $2.1B, and the expense ratio is 0.36% per year.

Among growth at a reasonable price ETFs, SPGP is distinctive for its focus on selection within the U.S. large-cap range, based on the S&P 500 universe.

It tends to perform relatively well when the preference cycle for growth stocks is strong. In periods of rising interest rates, its lighter valuation burden tends to limit drawdowns compared with pure growth ETFs.

The growth at a reasonable price strategy tends to draw attention as an alternative when concerns about overvalued growth stocks increase, and inflows can appear when the market is selecting earnings-based growth stocks.

The balance between growth and valuation is its core strength, while the concentrated number of holdings and the expense level are points to consider when comparing.

As comparison targets for SPGP, you can first look at the large-cap growth ETFs IVW, VUG and SCHG. They are growth-focused but have no valuation filter, so they are more concentrated in mega-cap tech stocks than SPGP. SPYG, which follows the same S&P 500 growth axis, is similar, but it differs in that it broadly holds stocks classified as growth without a valuation screen. Invesco's RPG (S&P 500 Pure Growth ETF) applies a purer growth filter and tends to be more volatile than SPGP.

Here are the points to review before investing in SPGP. Given the nature of the growth at a reasonable price strategy, it is important to fully understand the holdings, index criteria and expense ratio in advance.

Because of the concentrated holdings, weak earnings in a particular sector or stock can directly affect performance. In addition, given the nature of the strategy, the performance gap versus broad indexes can widen significantly depending on the market phase.

It is a viable option for investors who want a balance of growth and valuation. It suits those who feel the burden of overvaluation in pure growth ETFs but do not want to switch fully to value ETFs, and instead want a middle position.