Looking for broad exposure to the Small Cap Value segment of the US equity market? You should consider the Invesco S&P SmallCap 600 Pure Value ETF (RZV), a passively managed exchange traded fund launched on 03/01/2006.
The fund is sponsored by Invesco. It has amassed assets over $206.50 million, making it one of the average sized ETFs attempting to match the Small Cap Value segment of the US equity market.
Why Small Cap Value
Sitting at a market capitalization below $2 billion, small cap companies tend to be high-potential stocks compared to its large and mid cap counterparts, but come with higher risk.
Carrying lower than average price-to-earnings and price-to-book ratios, value stocks also have lower than average sales and earnings growth rates. Looking at their long-term performance, value stocks have outperformed growth stocks in almost all markets. They are however likely to underperform growth stocks in strong bull markets.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.35%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.96%.
Sector Exposure and Top Holdings
ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Consumer Discretionary sector--about 26.80% of the portfolio. Financials and Energy round out the top three.
Looking at individual holdings, Par Pacific Holdings Inc (PARR) accounts for about 2.49% of total assets, followed by Dana Inc (DAN) and Titan International Inc (TWI).
The top 10 holdings account for about 17.72% of total assets under management.
Performance and Risk
RZV seeks to match the performance of the S&P SmallCap 600 Pure Value Index before fees and expenses. The S&P SmallCap 600 Pure Value Index measures the performance of securities that exhibit strong value characteristics in the S&P SmallCap 600 Index.
The ETF has lost about -3.48% so far this year and is down about -0.25% in the last one year (as of 07/17/2025). In the past 52-week period, it has traded between $83.11 and $119.36.
The ETF has a beta of 1.20 and standard deviation of 24.57% for the trailing three-year period, making it a high risk choice in the space. With about 147 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P SmallCap 600 Pure Value ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, RZV is a sufficient option for those seeking exposure to the Style Box - Small Cap Value area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Russell 2000 Value ETF (IWN) and the Vanguard Small-Cap Value ETF (VBR) track a similar index. While iShares Russell 2000 Value ETF has $10.92 billion in assets, Vanguard Small-Cap Value ETF has $29.95 billion. IWN has an expense ratio of 0.24% and VBR charges 0.07%.
Bottom-Line
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Invesco S&P SmallCap 600 Pure Value ETF (RZV): ETF Research Reports Dana Incorporated (DAN): Free Stock Analysis Report Par Pacific Holdings, Inc. (PARR): Free Stock Analysis Report Vanguard Small-Cap Value ETF (VBR): ETF Research Reports iShares Russell 2000 Value ETF (IWN): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
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