What Is the USVM ETF? A Complete Guide — Returns, Expense Ratio, Holdings, and Alternative ETFs
A multi-factor ETF that selects U.S. small- and mid-cap stocks with superior value and momentum characteristics while incorporating risk management.
SubscribeWhat is this ETF?
USVM tracks the Nasdaq Victory U.S. Small Mid Cap Value Momentum Index, simultaneously capturing stocks that are cheap relative to their intrinsic value and those showing strength in the market. It combines the high growth potential typical of small and mid-cap stocks with a sophisticated factor-based stock selection strategy.
It is suited for investors seeking a strategy one step above plain small- and mid-cap index investing, pursuing market-beating alpha through the complementary factors of value and momentum.
The ETF was launched in 2017 by Victory Capital and operates on a passive (index-tracking) basis.
How does it invest?
| Item | Details |
|---|---|
| Tracking Index | Nasdaq Victory US Small Mid Cap Value Momentum Index |
| Management Style | Passive (multi-factor smart beta) |
| Stock Selection Factors | Value (P/E, P/B) + Momentum (price trend) |
| Weighting Method | Risk-weighted (volatility-weighted) |
| Total Expense Ratio | 0.29% |
From the Nasdaq U.S. small- and mid-cap universe, candidates are screened by analyzing fundamental scores and price performance. In particular, rather than using a market-cap-weighted approach, the portfolio adjusts weights according to each stock's volatility, allocating larger weights to lower-volatility stocks to enhance portfolio stability.
- Synergistic value and momentum strategy
- Risk management through volatility-based weighting
Size and Costs
Assets under management (AUM) stand at $1.9B, with a total expense ratio of 0.29% annually.
The strategy aims for a complementary structure in which the momentum factor offsets weakness in value stocks, while value provides a defensive cushion when momentum falters.
Performance and Flows
1-Year Price Performance
Dividend & Yield
52-Week Price RangeThe momentum factor's influence increases when small- and mid-cap stocks are in favor or when capital concentrates on specific themes. Conversely, during periods of elevated market volatility, the value factor and the volatility-weighted approach help support performance.
Capital is flowing in amid demand for multi-factor strategies designed to reduce the volatility of any single factor. Smart-beta investors who prefer qualitatively proven names within the small- and mid-cap space are showing strong interest.
Strengths and Weaknesses
The combination of two complementary factors and a risk-focused weighting method are key strengths, but investors should note the inherently high volatility of small- and mid-cap stocks and the complexity of the strategy.
💪 Key Strengths
⚠️ Points to Watch
Alternative ETFs and Related Products
MTUM and SPMO shown in the table are momentum products focused on large caps, while XMMO and XSMO specialize in mid-cap and small-cap momentum, respectively. USVM differentiates itself by combining the value factor and employing a volatility-weighted approach. A similar alternative is XSVM; for pure value or growth exposure, consider IVOV or IVOG, and for the full mid-cap index, IVOO is also worth examining.
Peer Comparison ETFs| Ticker | Name | Price | Change | AUM | Total Expense Ratio | Dividend Yield | 1Y |
|---|---|---|---|---|---|---|---|
 SPMO | Invesco S&P 500 Momentum ETF | $136.27 | -4.3% | $22.3B | 0.13% | 0.81% | +11.9% |
 MTUM | iShares MSCI USA Momentum Factor ETF | $284.10 | -4.8% | $18.6B | 0.15% | 0.65% | +12.0% |
 XMMO | Invesco S&P MidCap Momentum ETF | $136.13 | -2.4% | $6.7B | 0.34% | 0.72% | +0.8% |
 XSMO | Invesco S&P SmallCap Momentum ETF | $80.98 | -1.9% | $2.9B | 0.35% | 0.63% | +13.4% |
 JMOM | JPMorgan U.S. Momentum Factor ETF | $79.52 | -3.2% | $2.8B | 0.12% | 0.78% | +16.1% |
Top Holdings| Ticker | Name | Weight | Price | Change | Market Cap | P/E | Dividend Yield |
|---|---|---|---|---|---|---|---|
 IVZ | Invesco Ltd | 0.01% | $27.76 | -4.3% | $12.3B | - | 3.09% |
 MSBT | Morgan Stanley Bitcoin Trust | 0.01% | $21.99 | -4.9% | $0.0M | - | - |
 GBND | Goldman Sachs Core Bond ETF | 0.01% | $48.99 | +0.3% | $0.0M | - | 3.89% |
 PNW | Pinnacle West Capital Corp | 0.01% | $106.28 | -0.3% | $12.9B | 20.4 | 3.47% |
 OGS | ONE Gas Inc | 0.01% | $78.54 | +0.6% | $4.9B | 16.9 | 3.46% |
 AVA | Avista Corp | 0.01% | $37.57 | +0.3% | $3.1B | 13.6 | 5.3% |
 DX | Dynex Capital Inc | 0.01% | $10.65 | -2.2% | $2.8B | 53.3 | 19.15% |
 SR | Spire Inc | 0.01% | $88.00 | +1.5% | $5.2B | 9.8 | 3.75% |
 NJR | New Jersey Resources Corp | 0.01% | $53.21 | +0.2% | $5.4B | 14.7 | 3.63% |
Investor Checklist
USVM is a smart product that manages the risks inherent in small- and mid-cap investing through its factor and weighting methodology. Review the following items before investing.
| Checkpoint | What to Confirm | Current Status |
|---|---|---|
| 📈 Factor Understanding | Understanding of the operating principles combining value and momentum | Maintained |
| 📊 Weighting Method | Confirmation that the volatility-based weighting strategy is appropriate | Very Good |
| 💵 Operating Costs | Acceptance of the expense level typical of strategic ETFs | Needs Verification |
| 📉 Market Environment | Interest rate and economic conditions favorable to the small- and mid-cap sector | Adequate Level |
Multi-factor strategies require patience: investors should wait for the long-term process by which each factor's edge is validated, rather than focusing on short-term performance. In addition, because the portfolio is exposed to the inherent volatility of small- and mid-cap stocks, be aware that drawdowns can deepen during sharp market sell-offs.
It is a suitable choice for investors looking to implement sophisticated factor investing within the U.S. small- and mid-cap market. Its balanced exposure to value and momentum, along with a risk management strategy, makes it well-suited to enhancing portfolio efficiency.
SubscribeDisclaimer: This content is for informational purposes only and does not constitute investment advice. All investment responsibility lies with the investor.
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