At a glance
HSMV charges 0.8% a year, above the 0.19% average of the 8 funds most like it (the most expensive of 9). It has $35.2M in assets, the 8th largest of that group; it paid 4.5% of its price in distributions over the past 12 months, quarterly. Over the past year it returned +5.2% with distributions reinvested (S&P 500: +11.5%), the weakest of those 9 funds; over three years it returned +11.7% a year. At its worst it fell 19.2% in the 2022 bear market (S&P 500: 24.5%), and was back at its earlier high 19 months after the low. Its ten largest positions make up 15.7% of the fund, out of 150 in all.
The short version
First Trust Horizon Managed Volatility Small/Mid ETF (HSMV) is an actively managed fund of U.S. small- and mid-sized company stocks. Its sub-advisor, Horizon Investments, gives more weight to stocks its models expect to swing less. Its top holdings lean toward real estate trusts, utilities and financial companies, and it yielded 4.5% over the 12 months to October 27, 2026. Its 0.80% expense ratio is the highest of the nine similar funds compared.
Price history
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HSMV +5.2% over the year to Oct 27, 2026, total return with distributions reinvested.
How it has behaved
| YTD | 1 yr | 3 yr | 5 yr | 10 yr | Since start | |
|---|---|---|---|---|---|---|
| HSMV official prospectus, to Dec 31, 2024 | — | +13.34% | — | — | — | +13.24% |
| HSMV price data to Oct 27, 2026 | +5.3% | +5.2% | +11.7% | +3.9% | — | +5.1% |
- Over the year to Oct 27, 2026, HSMV returned +5.2%, 9th of 9 among similar funds.
- Its 5-year annualized return was +3.9%.
- Its worst full calendar year was 2022 (-9.4%); its best was 2024 (+13.2%).
- The deepest fall in its price history was 19.2% (Jan 4, 2022 to Sep 30, 2022), recovered by May 10, 2024.
Show as a table
| Year | Price data | Prospectus (official) |
|---|---|---|
| 2026 (to date) | +5.3% | — |
| 2025 | +1.6% | — |
| 2024 | +13.2% | +13.34% |
| 2023 | +5.0% | +4.99% |
| 2022 | -9.4% | -9.37% |
| 2021 | — | +23.59% |
| 2008 financial crisis stocks fell Oct 9, 2007 – Mar 9, 2009 | Before this security existed |
|---|---|
| 2020 COVID crash stocks fell Feb 19, 2020 – Mar 23, 2020 | Before this security existed |
| 2022 bear market stocks fell Jan 3, 2022 – Oct 12, 2022 | Lost 17.6% over that stretch · deepest drop along the way 19.2%, back to its old high 19.3 months after the low |
Dividends and income
Show as a table
| Year | Per share | Change |
|---|---|---|
| 2026 (to date) | $1.3200 | |
| 2025 | $0.7100 | +36.5% |
| 2024 | $0.5200 | +13.0% |
| 2023 | $0.4600 | +17.9% |
| 2022 | $0.3900 |
What's inside
As of Jul 31, 2026, the fund held 150 securities; the ten largest made up 15.71% of assets.
| Holding | Weight | |
|---|---|---|
| PHILLIPS EDISON & COMPANY INC | 2.18% | |
| OGE ENERGY CORP | 1.97% | |
| INGREDION INC | 1.59% | |
| NNN REIT INC | 1.54% | |
| ELLINGTON FINANCIAL INC | 1.54% | |
| IDACORP INC | 1.47% | |
| AGREE REALTY CORP | 1.39% | |
| FOUR CORNERS PROPERTY TRUST INC | 1.39% | |
| STARWOOD PROPERTY TRUST INC | 1.39% | |
| HANOVER INSURANCE GROUP INC (THE) | 1.25% | |
| GRACO INC | 1.24% | |
| RELIANCE INC | 1.24% | |
| SERVICE CORPORATION INTERNATIONAL | 1.19% | |
| PENSKE AUTOMOTIVE GROUP INC | 1.19% | |
| DT MIDSTREAM INC | 1.18% |
By country
United States 97.11%Bermuda 2.07%Cayman Islands 0.58%By asset type
Stocks 99.75%What changed recently
- Over the three months to Jul 31, 2026, investors added a net $3.7M (creations minus redemptions, per the N-PORT report).
- Monthly total returns reported for that quarter: -2.66%, +3.98%, +2.17%.
How it works
HSMV does not track an index. First Trust runs the fund, and Horizon Investments, LLC, as sub-advisor, picks the stocks. In normal markets, at least 80% of net assets goes into small- and mid-sized company stocks listed on U.S. exchanges. As of October 31, 2025, the fund counted companies with a market value between $100 million and $35 billion as being in that range. It may also own real estate investment trusts (REITs). These are companies that own property and pass most of their income to shareholders.
Horizon's process is mostly quantitative and rules-based. It collects price histories for the starting universe and feeds them into volatility forecasting models. Volatility measures how sharply a price moves, up or down. The models estimate each stock's future volatility from its returns over several time frames. Stocks are then ranked from low to high, and those with lower expected volatility get larger weights. Horizon can still use judgment on the number of holdings and on individual weights, and it may depart from the ranking depending on conditions in different sectors.
The portfolio is rebalanced periodically. The prospectus reports 66% portfolio turnover, which means a large share of holdings changes over a year. As of July 31, 2026, the fund held about 150 stocks, and the top 10 made up 15.7% of assets. Phillips Edison & Company (2.2%) and OGE Energy (2.0%) led the list. The fund held no derivatives and used no options or leverage.
What it really costs
- HSMV charges 0.8% a year, versus an average of 0.19% for the similar funds below (9th of 9, cheapest first).
In a retirement portfolio
It adds U.S. small- and mid-cap stocks that its manager selects for lower expected volatility, so it moved much less in step with the broad market than a typical stock fund.
HSMV could add small- and mid-sized company stocks with a calmer ride than the broad market. Its beta, which measures how much a fund moves with the market, was 0.24 for the year to October 27, 2026. The fund launched in April 2020, so it has no record from the 2008 crisis or the 2020 crash. In the 2022 bear market it fell 19.2% from peak to low. It recovered by May 2024, 19.3 months after the low. Its worst calendar year was 2022, at about -9.4%. Anyone who had to sell shares then would have locked in losses.
The fund pays quarterly and yielded 4.5% over the 12 months to October 27, 2026. Its 0.80% expense ratio is well above the 0.19% average for similar funds. Past results don't predict the future, and a plan should look at the whole portfolio, not one fund.
Who it may suit — and who should look elsewhere
May suit
- Investors wanting U.S. small- and mid-cap stocks with smaller swings; one-year volatility was 10.8% and beta 0.24 as of October 27, 2026.
- Investors who want stock-fund income paid quarterly; the 12-month yield was 4.5% as of October 27, 2026, with REITs and utilities among top holdings.
- Those who prefer Horizon Investments' active, model-driven stock selection to a fixed index and accept 66% annual portfolio turnover.
Look elsewhere if
- Cost-focused investors: the 0.80% expense ratio is the highest of nine similar funds, while XMLV charges 0.25% and SMMV 0.20%.
- Investors focused on returns: HSMV ranked last of nine similar funds on one- and three-year returns as of October 27, 2026.
- Investors who prefer large funds; HSMV had about $35.2 million in net assets as of July 31, 2026, far less than most similar funds.
Close alternatives
Matched by holdings overlap from the latest N-PORT reports.
| Fund | Overlap | Cost | Net assets | 1 yr | 3 yr |
|---|---|---|---|---|---|
| HSMV this fund | — | 0.8% | $35.2M | +5.2% | +11.7% |
| XMLV Invesco S&P MidCap Low Volatility ETF | 42% | 0.25% | $739.9M | +7.1% | +14.4% |
| SMMV iShares MSCI USA Small-Cap Min Vol Factor E… | 31% | 0.2% | $289.0M | +9.7% | +15.2% |
| IVOV Vanguard S&P Mid-Cap 400 Value ETF | 25% | 0.1% | $1.49B | +12.2% | +17.9% |
| IJJ iShares S&P Mid-Cap 400 Value ETF | 24% | 0.18% | $8.73B | +12.0% | +17.8% |
| MDYV SPDR S&P 400 Mid Cap Value ETF | 24% | 0.15% | $2.68B | +12.1% | +17.8% |
| DON WisdomTree U.S. MidCap Dividend Fund | 24% | 0.38% | $3.96B | +12.2% | +16.5% |
| QVMM Invesco S&P MidCap 400 QVM Multi-factor ETF | 23% | 0.15% | $426.1M | +12.5% | +18.3% |
Questions investors ask
Is HSMV good for retirement income?
HSMV can provide some income, but it is a stock fund, not a dedicated income fund. Its yield was 4.5% over the 12 months to October 27, 2026, and it pays quarterly. REITs and utilities are among its largest holdings. Payouts are not fixed, and the share price can fall. The fund dropped 19.2% in 2022 and took 19.3 months after the low to recover. Its 0.80% expense ratio also reduces returns.
What's the difference between HSMV and XMLV?
XMLV, the Invesco S&P MidCap Low Volatility ETF, costs much less and has returned more. Both favor lower-volatility stocks, and about 42% of their holdings overlap. HSMV is actively managed by Horizon Investments and can own small companies as well as mid-sized ones. XMLV charges 0.25% a year against HSMV's 0.80%. Through October 27, 2026, XMLV returned 7.1% over one year and 14.4% a year over three years. HSMV returned 5.2% and 11.7%.
Does HSMV pay dividends?
Yes. HSMV pays dividends quarterly. Over the 12 months to October 27, 2026, it paid $1.63 per share, a yield of 4.5%. Much of that income comes from holdings such as REITs, utilities and financial companies, including Phillips Edison & Company, OGE Energy and NNN REIT. Dividends from a stock fund can change from quarter to quarter and are not guaranteed.
Does HSMV actually reduce volatility?
Partly. HSMV has moved less than the market, but it can still lose money. As of October 27, 2026, its one-year volatility was 10.8% and its beta was 0.24. Still, it lost 9.37% in calendar 2022 according to its prospectus, with a worst quarter of -10.15% in the second quarter of that year. The prospectus also warns that low-volatility stocks may lag when markets are rising.
What is HSMV's expense ratio?
HSMV's expense ratio is 0.80%, according to its prospectus filed November 28, 2025. That is the full management fee, with no fee waiver. The fund is the most expensive of nine similar funds compared, where the average is 0.19%. For example, the iShares MSCI USA Small-Cap Min Vol Factor ETF (SMMV) charges 0.20%. Over many years, a gap like that can add up.