Should Invesco S&P MidCap Quality ETF (XMHQ) Be on Your Investing Radar?

If you're interested in broad exposure to the Mid Cap Blend segment of the US equity market, look no further than the Invesco S&P MidCap Quality ETF (XMHQ), a passively managed exchange traded fund launched on 12/01/2006.The fund is sponsored by Invesco. It has amassed assets over $5.66 billion, making it one of the larger ETFs attempting to match the Mid Cap Blend segment of the US equity market.Why Mid Cap BlendMid cap companies have market capitalization between $2 billion and $10 billion. They usually have higher growth prospects than large cap companies and are less volatile than small cap companies. Thus they have a nice balance of growth potential and stability.Blend ETFs are aptly named, since they tend to hold a mix of growth and value stocks, as well as show characteristics of both kinds of equities.CostsWhen 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 0.25%, putting it on par with most peer products in the space.It has a 12-month trailing dividend yield of 5.45%.Sector Exposure and Top HoldingsEven though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.This ETF has heaviest allocation to the Industrials sector--about 32.40% of the portfolio. Consumer Discretionary and Financials round out the top three.Looking at individual holdings, Williams-Sonoma Inc (WSM) accounts for about 4.92% of total assets, followed by Carlisle Cos Inc (CSL) and Emcor Group Inc (EME).The top 10 holdings account for about 28.68% of total assets under management.Performance and RiskXMHQ seeks to match the performance of the S&P MIDCAP 400 QUALITY INDEX before fees and expenses. The S&P MidCap 400 Quality Index is designed to provide equal-weighted exposure to approximately 800 securities of medium-sized companies in the larger US equity market.The ETF has lost about -4.71% so far this year and is down about -9.13% in the last one year (as of 03/27/2025). In the past 52-week period, it has traded between $89.18 and $110.05.The ETF has a beta of 1.07 and standard deviation of 20.82% for the trailing three-year period. With about 81 holdings, it effectively diversifies company-specific risk.AlternativesInvesco S&P MidCap Quality 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, XMHQ is a sufficient option for those seeking exposure to the Style Box - Mid Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.The Vanguard Mid-Cap ETF (VO) and the iShares Core S&P Mid-Cap ETF (IJH) track a similar index. While Vanguard Mid-Cap ETF has $73.46 billion in assets, iShares Core S&P Mid-Cap ETF has $91.25 billion. VO has an expense ratio of 0.04% and IJH charges 0.05%.Bottom-LineRetail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.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.Want key ETF info delivered straight to your inbox?Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.Get it free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Invesco S&P MidCap Quality ETF (XMHQ): ETF Research Reports EMCOR Group, Inc. (EME): Free Stock Analysis Report Carlisle Companies Incorporated (CSL): Free Stock Analysis Report Williams-Sonoma, Inc. (WSM): Free Stock Analysis Report iShares Core S&P Mid-Cap ETF (IJH): ETF Research Reports Vanguard Mid-Cap ETF (VO): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks