Yield-First vs. Pure Defense: How SPHD & SPLV Differ Under the Hood

Investors who want smoother equity exposure have long been fans of the Invesco S&P 500 High Dividend Low Volatility ETF (SPHD C+) and the Invesco S&P 600 Low Volatility ETF (SPLV A+).SPHD’s current yield sits at 4.63%, well above the S&P 500’s current yield of 1.05%. That’s a historic low for the S&P, dropping even further than the 1.09% floor seen during the dot-com crash, according to a recent Forbes.com article. The fund, which has an expense ratio of 0.30%, selects 50 low-volatility, high-yielding securities from the S&P 500 Index and leans toward investing in utility stocks. SPLV, meanwhile, with its 0.25% expense ratio price tag, has delivered a 2.51% yield as of October 20.Key Takeaways: SPHD screens for yield first and volatility second, whereas SPLV is a pure volatility play for which yield is only a byproduct. SPLV holds 100 stocks with strict caps to minimize single-stock risk, while SPHD holds a concentrated 50-stock basket with heavier weights allowed for individual holdings. SPLV functions as a hyper-defensive anchor for downside protection, while SPHD delivers a dual-engine approach combining robust income with stability. Although the two funds are from the same issuer, with similar names and a shared low-volatility focus, they differ in performance. These differences look to be related to not only their construction, but also to the S&P 500’s record-low dividend yield. The index has seen strong market price appreciation and low dividend payouts relative to earnings from top megacap tech stocks. SPHD’s underlying index takes the 50 least-volatile names from a shortlist of the S&P 500’s 75 highest dividend-yielding stocks, then weights them by trailing 12-month dividend yield. Meanwhile, SPLV tracks a volatility-weighted index of the 100 least-volatile stocks in the S&P 500. To put this in layman’s terms, SPHD screens for yield first and volatility second, while SPLV is a pure volatility play that does not take yield into account in its index methodology.Risk Profile: Where the Funds DivergeAlthough both funds aim to reduce drawdowns, they go about it in different ways. SPLV manages risk by holding approximately 100 different positions, ensuring no single asset makes up more than 1.3% of the portfolio during rebalances. Its two top holdings are Berkshire Hathaway Inc. Class B and WEC Energy Group Inc., at 1.46% and 1.28%, respectively. Conversely, SPHD is more concentrated and holds 50 names. Its two largest positions run much heavier, with Williams Companies at 3.60% and Iron Mountain at 3.19%. Year-to-date, SPHD has had a return of 9.20%, compared to SPLV’s 6.34%—reflecting broader market trends where S&P factor performance highlights momentum over pure low-volatility strategies. See More: S&P Factor Performance Highlights Momentum in June & Q2 Sector exposure is another way the two funds are different. Both SPHD and SPLV favor traditionally defensive, rate-sensitive areas, but in different proportions. SPHD’s current sector mix is led by finance at 31.63%, followed by consumer non-durables at 18.71% and utilities at 16.25%. SPLV’s mix is also led by finance at 40.01%, followed by utilities at 26.78% and industrial services at 5.05%. While both funds rely heavily on finance and utilities as their primary anchors, SPLV leans much harder into both categories, such that they comprise more than 66% of the fund’s portfolio. It is a fairly concentrated, hyper-defensive shield relative to SPHD.Choosing Your Low-Volatility Edge: Yield vs. DefenseUltimately, choosing between SPHD and SPLV comes down to an investor’s core objective. SPLV functions as a pure defensive anchor, utilizing a broader 100-stock basket and heavy concentrations in financials and utilities that could provide a cushion against drawdowns. SPHD offers an aggressive income engine by filtering for yield first, allowing its concentrated 50-stock portfolio to capture stronger upside during market rebounds. SPLV is likely the better choice for investors prioritizing maximum volatility protection and broader diversification. Meanwhile, SPHD delivers a compelling combination of yield and stability for those willing to accept higher single-stock concentration in exchange for income. For more news, information, and analysis, visit the Innovative ETFs Content Hub. Invesco Distributors, Inc. is an independent company unaffiliated with VettaFi LLC (“VettaFi”). These articles do not form any kind of legal partnership, agency affiliation, or similar relationship between VettaFi and Invesco Distributors, Inc., nor is such a relationship created or implied by the articles herein. VettaFi LLC is the author and owner of these articles.