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Should Invesco S&P 500 Equal Weight ETF (RSP) Be on Your Investing Radar?
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Looking for broad exposure to the Large Cap Blend segment of the US equity market? You should consider the Invesco S&P 500 Equal Weight ETF (RSP - Free Report) , a passively managed exchange traded fund launched on 04/24/2003.
The fund is sponsored by Invesco. It has amassed assets over $34.24 billion, making it one of the largest ETFs attempting to match the Large Cap Blend segment of the US equity market.
Why Large Cap Blend
Large cap companies usually have a market capitalization above $10 billion. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.
Typically holding a combination of both growth and value stocks, blend ETFs also demonstrate qualities seen in value and growth investments.
Costs
Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.
Annual operating expenses for this ETF are 0.20%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 1.32%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Industrials sector--about 13.80% of the portfolio. Information Technology and Financials round out the top three.
Looking at individual holdings, Tesla Inc (TSLA - Free Report) accounts for about 0.30% of total assets, followed by Enphase Energy Inc (ENPH - Free Report) and Marathon Oil Corp (MRO - Free Report) .
The top 10 holdings account for about 2.74% of total assets under management.
Performance and Risk
RSP seeks to match the performance of the S&P 500 Equal Weight Index before fees and expenses. The S&P 500 Equal Weight Index equally weights the stocks in the S&P 500 Index.
The ETF has lost about -2.30% so far this year and is up roughly 12.95% in the last one year (as of 03/29/2022). In the past 52-week period, it has traded between $141.66 and $164.20.
The ETF has a beta of 1.09 and standard deviation of 24.58% for the trailing three-year period. With about 507 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P 500 Equal Weight ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, RSP is a sufficient option for those seeking exposure to the Style Box - Large Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Core S&P 500 ETF (IVV - Free Report) and the SPDR S&P 500 ETF (SPY - Free Report) track a similar index. While iShares Core S&P 500 ETF has $335.02 billion in assets, SPDR S&P 500 ETF has $417.31 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
Bottom-Line
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
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.
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Should Invesco S&P 500 Equal Weight ETF (RSP) Be on Your Investing Radar?
Looking for broad exposure to the Large Cap Blend segment of the US equity market? You should consider the Invesco S&P 500 Equal Weight ETF (RSP - Free Report) , a passively managed exchange traded fund launched on 04/24/2003.
The fund is sponsored by Invesco. It has amassed assets over $34.24 billion, making it one of the largest ETFs attempting to match the Large Cap Blend segment of the US equity market.
Why Large Cap Blend
Large cap companies usually have a market capitalization above $10 billion. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.
Typically holding a combination of both growth and value stocks, blend ETFs also demonstrate qualities seen in value and growth investments.
Costs
Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.
Annual operating expenses for this ETF are 0.20%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 1.32%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation to the Industrials sector--about 13.80% of the portfolio. Information Technology and Financials round out the top three.
Looking at individual holdings, Tesla Inc (TSLA - Free Report) accounts for about 0.30% of total assets, followed by Enphase Energy Inc (ENPH - Free Report) and Marathon Oil Corp (MRO - Free Report) .
The top 10 holdings account for about 2.74% of total assets under management.
Performance and Risk
RSP seeks to match the performance of the S&P 500 Equal Weight Index before fees and expenses. The S&P 500 Equal Weight Index equally weights the stocks in the S&P 500 Index.
The ETF has lost about -2.30% so far this year and is up roughly 12.95% in the last one year (as of 03/29/2022). In the past 52-week period, it has traded between $141.66 and $164.20.
The ETF has a beta of 1.09 and standard deviation of 24.58% for the trailing three-year period. With about 507 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P 500 Equal Weight ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, RSP is a sufficient option for those seeking exposure to the Style Box - Large Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.
The iShares Core S&P 500 ETF (IVV - Free Report) and the SPDR S&P 500 ETF (SPY - Free Report) track a similar index. While iShares Core S&P 500 ETF has $335.02 billion in assets, SPDR S&P 500 ETF has $417.31 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
Bottom-Line
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
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.