A small cap ETF is an exchange traded fund that invests in smaller listed companies.

MVS is an Australian small- cap ETF that gives investors exposure to 60 ASX-listed small companies in a single ASX trade. Small cap exchange traded funds like MVS invest solely in small companies, which can offer higher growth potential than more established large companies but can also be more volatile and carry greater business and liquidity risks.

Unlike small cap exchange traded funds that simply weight companies by size, MVS follows a smart beta, rules-based approach. The approach utilised by MVS, a small cap ETF, aims to capture emerging company opportunities by focusing on small-caps with growth at a reasonable price (GARP)  attributes.

Read more about Australian small companies.

MVS, an Australian small cap ETF, invests across a wide range of sectors and emerging companies listed on the ASX. The portfolio can include healthcare, industrials, resources, technology, energy, consumer and financial companies.

Example companies held by MVS, a small cap ETF, include Zip Co Ltd, Superloop Ltd and Tasmea Ltd. Because holdings and weights change over time, investors should view MVS's latest holdings and allocations for current exposures. View MVS's latest holdings and allocations.

Investors interested in small cap exchange traded funds may consider small-cap companies because they provide emerging opportunities that incur higher risk but offer potentially higher growth. Smaller companies may benefit from expanding markets, innovation, takeover activity or improving profitability as they scale.

Investing in a small-cap ETF can help diversify exposure across a portfolio of small companies, reducing reliance on any single stock. MVS. an Australian small cap ETF, provides a systematic approach to investing in ASX-listed small companies.

Explore our small and mid-cap insights

Small-cap shares, and by extension small cap exchange traded funds, have historically performed best when economic growth is improving, earnings expectations are being upgraded and investors are willing to take more risk.

They may also benefit when access to capital is healthy and interest rate conditions support business investment. Conversely, small-caps can struggle when liquidity tightens, rates rise sharply or markets become risk averse. A diversified small cap ETF, like MVS, can help spread company-specific risk.

View MVS’s performance.

MVS, an Australian small cap ETF, may be suited to investors seeking capital growth and income distribution from Australian small companies. MVS's Target Market Determination indicates this small cap ETF may be appropriate as a minor or satellite allocation within a portfolio for investors with a minimum suggested timeframe of five years and a high risk/return profile.