We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Should You Invest in the Invesco S&P 500 Equal Weight Materials ETF (RTM)?
Read MoreHide Full Article
Launched on 11/01/2006, the Invesco S&P 500 Equal Weight Materials ETF is a passively managed exchange traded fund designed to provide a broad exposure to the Materials - Broad segment of the equity market.
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Materials - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 7, placing it in top 44%.
Index Details
The fund is sponsored by Invesco. It has amassed assets over $664.72 million, making it one of the average sized ETFs attempting to match the performance of the Materials - Broad segment of the equity market. RTM seeks to match the performance of the S&P 500 Equal Weight Materials Index before fees and expenses.
The S&P 500 Equal Weight Materials Index is an unmanaged equal weighted version of the S&P 500 Materials Index that consists of the common stocks of the following industries: chemicals, construction materials, containers and packaging, metals and mining, and paper and forest products that comprise the Materials sector of the S&P 500 Index.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.40%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 1.29%.
Sector Exposure and Top Holdings
ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Materials sector--about 99.40% of the portfolio.
Looking at individual holdings, Newmont Corp (NEM - Free Report) accounts for about 3.73% of total assets, followed by Air Products And Chemicals Inc (APD - Free Report) and International Flavors & Fragrances Inc (IFF - Free Report) .
The top 10 holdings account for about 36.60% of total assets under management.
Performance and Risk
Year-to-date, the Invesco S&P 500 Equal Weight Materials ETF return is roughly 26.76% so far, and it's up approximately 74.80% over the last 12 months (as of 05/28/2021). RTM has traded between $98.08 and $177.38 in this past 52-week period.
The ETF has a beta of 1.12 and standard deviation of 27.99% for the trailing three-year period, making it a medium risk choice in the space. With about 30 holdings, it has more concentrated exposure than peers.
Alternatives
Invesco S&P 500 Equal Weight Materials ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, RTM is a great option for investors seeking exposure to the Materials ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
FlexShares Morningstar Global Upstream Natural Resources ETF (GUNR - Free Report) tracks Morningstar Global Upstream Natural Resources Index and the Materials Select Sector SPDR ETF (XLB - Free Report) tracks Materials Select Sector Index. FlexShares Morningstar Global Upstream Natural Resources ETF has $5.45 billion in assets, Materials Select Sector SPDR ETF has $9.61 billion. GUNR has an expense ratio of 0.46% and XLB charges 0.12%.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Should You Invest in the Invesco S&P 500 Equal Weight Materials ETF (RTM)?
Launched on 11/01/2006, the Invesco S&P 500 Equal Weight Materials ETF is a passively managed exchange traded fund designed to provide a broad exposure to the Materials - Broad segment of the equity market.
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Materials - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 7, placing it in top 44%.
Index Details
The fund is sponsored by Invesco. It has amassed assets over $664.72 million, making it one of the average sized ETFs attempting to match the performance of the Materials - Broad segment of the equity market. RTM seeks to match the performance of the S&P 500 Equal Weight Materials Index before fees and expenses.
The S&P 500 Equal Weight Materials Index is an unmanaged equal weighted version of the S&P 500 Materials Index that consists of the common stocks of the following industries: chemicals, construction materials, containers and packaging, metals and mining, and paper and forest products that comprise the Materials sector of the S&P 500 Index.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.40%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 1.29%.
Sector Exposure and Top Holdings
ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Materials sector--about 99.40% of the portfolio.
Looking at individual holdings, Newmont Corp (NEM - Free Report) accounts for about 3.73% of total assets, followed by Air Products And Chemicals Inc (APD - Free Report) and International Flavors & Fragrances Inc (IFF - Free Report) .
The top 10 holdings account for about 36.60% of total assets under management.
Performance and Risk
Year-to-date, the Invesco S&P 500 Equal Weight Materials ETF return is roughly 26.76% so far, and it's up approximately 74.80% over the last 12 months (as of 05/28/2021). RTM has traded between $98.08 and $177.38 in this past 52-week period.
The ETF has a beta of 1.12 and standard deviation of 27.99% for the trailing three-year period, making it a medium risk choice in the space. With about 30 holdings, it has more concentrated exposure than peers.
Alternatives
Invesco S&P 500 Equal Weight Materials ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, RTM is a great option for investors seeking exposure to the Materials ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
FlexShares Morningstar Global Upstream Natural Resources ETF (GUNR - Free Report) tracks Morningstar Global Upstream Natural Resources Index and the Materials Select Sector SPDR ETF (XLB - Free Report) tracks Materials Select Sector Index. FlexShares Morningstar Global Upstream Natural Resources ETF has $5.45 billion in assets, Materials Select Sector SPDR ETF has $9.61 billion. GUNR has an expense ratio of 0.46% and XLB charges 0.12%.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.