From Nvidia, Palantir to JPMorgan: Momentum’s banner year

The U.S. stock market’s momentum factor has been on a tear, with the S&P 500 Momentum Index gaining 30% in the year leading up to June 2025—outshining the S&P 500 and every other major investing style. For investors hoping to ride this wave, two ETFs stand out: the iShares MSCI USA Momentum Factor ETF (MTUM) and the Invesco S&P 500 Momentum ETF (SPMO). While both aim to capture the power of rising stocks, their approaches, holdings, and fees diverge in key ways.

SPMO: Focused, Heavily Weighted in Winners

Managed by Invesco, SPMO has swelled to over $10.7b in assets, proof of strong inflows and investor enthusiasm for the outperformance of U.S. momentum stocks. At its core, SPMO tracks the S&P 500 Momentum Index, focusing solely on large-cap stocks from the broader S&P 500 that have posted standout 12-month performance. Rebalanced twice per year in March and September, its portfolio is intentionally concentrated: of 100 current holdings, over half the fund is allocated to just its top 10 stocks.

Currently, the biggest weights are Nvidia (11.1%), Amazon (8.7%), and Meta Platforms (8.5%). Other prominent names include Broadcom (6.0%) and JPMorgan Chase (5.2%), while holdings like Tesla, Walmart, Palantir, and Netflix round out the leaders. This results in significant, high-conviction bets on recent outperformers—a double-edged sword should trends reverse. SPMO also tilts notably toward the financial and consumer sectors compared to its primary growth ETF peers.

One major draw: SPMO has a low expense ratio of just 0.13%, making it one of the cheapest options among factor-based ETFs for U.S. stocks.

MTUM: Broader Reach, Systematic Selection

As the behemoth of U.S. momentum factor funds, BlackRock’s MTUM manages about $17.7b in assets. Unlike SPMO’s S&P 500-only universe, MTUM scans both mid- and large-cap stocks in the U.S., bringing more diversified exposure. Its methodology looks at a combination of six- and 12-month price momentum, updating its portfolio quarterly; this means MTUM is typically more responsive to shifting trends within the market cycle.

MTUM’s current top holdings include Broadcom (6.0%), Meta Platforms (5.1%), JPMorgan Chase (4.8%), Netflix (4.5%), and Berkshire Hathaway (4.3%). Unlike SPMO, tech megacaps like Nvidia and Amazon are notably absent from the index this quarter—reflecting differences in the screening and weighting processes between ETFs.

MTUM positions are less concentrated, with the top 10 accounting for around 44% of the portfolio. This broader spread aims to balance performance with risk, possibly smoothing out volatility relative to more concentrated funds. MTUM charges a 0.15% expense ratio—still very competitive for a factor ETF, although slightly higher than SPMO.

Holdings and Fee Comparison Snapshot

SPMO: 100 large-cap U.S. stocks, top three (Nvidia, Amazon, Meta) = nearly 30% of assets; expense ratio 0.13%.

MTUM: 127 mid- and large-cap stocks, top names (Broadcom, Meta, JPMorgan) all under 6%; expense ratio 0.15%.

What Sets Them Apart—and Which to Pick?

Both ETFs offer a way to tap into the momentum factor, but investors should consider:

Concentration: SPMO’s high top-10 weights favor stocks with the hottest recent runs; MTUM is more diversified among winners.

Universe: MTUM includes more mid-cap names and can sometimes avoid outperformers that don’t fit its strict multi-period criteria.

Rebalancing: SPMO is semi-annual; MTUM is quarterly.

If you believe the mega-cap tech beneficiaries of AI and cloud spending will keep running, the cheaper but more concentrated SPMO is the purer momentum bet. If you’d rather own a more diversified, all-cap mix that adapts every quarter, MTUM deserves the nod even at a modestly higher fee. Either way, the first half of 2025 proved that riding the momentum wave can pay.

Compare SPMO vs. MTUM with our ETF Compare Tool