Low-vol ETFs diverge as tech rout hits Nasdaq
With the Nasdaq 100 down about 3% this week, Invesco’s SPLV has under 1% in tech while BlackRock’s USMV holds roughly 33% tech.
The Nasdaq 100 fell about 3% over the past week, and two large low-volatility ETFs offer very different exposures to the tech sector. Invesco’s SPLV and BlackRock’s USMV follow distinct index rules that produce contrasting sector weightings and portfolio profiles.
Invesco’s SPLV, the S&P 500 Low Volatility ETF, tracks an index that selects the 100 S&P 500 stocks with the lowest realized volatility over the trailing 12 months. The fund is sector-agnostic and currently holds less than 1% in technology. SPLV shifts weight into sectors with lower recent price swings, including utilities, consumer staples and financials. The fund lists about 101 securities, has an effective holdings ratio near 0.97, a top-10 weight around 12.6% and an expense ratio of about 0.25%.
BlackRock’s USMV, the iShares MSCI USA Minimum Volatility ETF, follows the MSCI USA Minimum Volatility Index, which selects large- and mid-cap stocks with lower volatility and applies value metrics. Constituents are then normalized to match the sector profile of the MSCI USA parent index, which is heavily weighted to large-cap technology firms. That normalization leaves USMV with roughly a one-third allocation to technology. USMV holds about 166 securities, uses optimization rules that produce a more top-heavy mix with an effective holdings ratio near 0.67, carries a top-10 weight close to 15.0%, and had a largest single holding of about 1.7% as of June 22, 2026. Its expense ratio is about 0.15%.
Year-to-date performance for the two ETFs began to diverge in early June, and the gap widened during the recent tech-led decline. Over a multi-year stretch, USMV has outpaced SPLV by roughly 10 percentage points.
The funds’ index construction and sector constraints determine how much technology exposure each fund maintains during a sector-specific sell-off. SPLV’s sector-agnostic, nearly equal-weighted approach produces minimal tech exposure, while USMV’s normalization to the parent index preserves a significant technology weighting even as it targets lower-volatility names within that sector.
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