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Should Invesco S&P 500 Pure Growth ETF (RPG) Be on Your Investing Radar?
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Launched on 03/01/2006, the Invesco S&P 500 Pure Growth ETF (RPG - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Large Cap Growth segment of the US equity market.
The fund is sponsored by Invesco. It has amassed assets over $2.28 billion, making it one of the average sized ETFs attempting to match the Large Cap Growth segment of the US equity market.
Why Large Cap Growth
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.
Growth stocks have higher than average sales and earnings growth rates. While these are expected to grow faster than the broader market, they also have higher valuations. Additionally, growth stocks have a greater level of risk associated with them. They are likely to outperform value stocks in strong bull markets but over the longer-term, value stocks have delivered better returns than growth stocks in almost all markets.
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 0.35%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.47%.
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 Information Technology sector--about 37.60% of the portfolio. Healthcare and Consumer Discretionary round out the top three.
Looking at individual holdings, Nrg Energy Inc (NRG - Free Report) accounts for about 3.70% of total assets, followed by Fortinet Inc (FTNT - Free Report) and Enphase Energy Inc (ENPH - Free Report) .
The top 10 holdings account for about 28.5% of total assets under management.
Performance and Risk
RPG seeks to match the performance of the S&P 500 Pure Growth Index before fees and expenses. The S&P 500 Pure Growth Index measures the performance of securities that exhibit strong growth characteristics in the S&P 500 Index.
The ETF has lost about -25.98% so far this year and is down about -21.61% in the last one year (as of 09/21/2022). In the past 52-week period, it has traded between $142.53 and $220.95.
The ETF has a beta of 1.16 and standard deviation of 29.67% for the trailing three-year period, making it a medium risk choice in the space. With about 59 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P 500 Pure Growth 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, RPG is an excellent option for investors seeking exposure to the Style Box - Large Cap Growth segment of the market. There are other additional ETFs in the space that investors could consider as well.
The Vanguard Growth ETF (VUG - Free Report) and the Invesco QQQ (QQQ - Free Report) track a similar index. While Vanguard Growth ETF has $71.87 billion in assets, Invesco QQQ has $157.63 billion. VUG has an expense ratio of 0.04% and QQQ charges 0.20%.
Bottom-Line
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
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 Pure Growth ETF (RPG) Be on Your Investing Radar?
Launched on 03/01/2006, the Invesco S&P 500 Pure Growth ETF (RPG - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Large Cap Growth segment of the US equity market.
The fund is sponsored by Invesco. It has amassed assets over $2.28 billion, making it one of the average sized ETFs attempting to match the Large Cap Growth segment of the US equity market.
Why Large Cap Growth
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.
Growth stocks have higher than average sales and earnings growth rates. While these are expected to grow faster than the broader market, they also have higher valuations. Additionally, growth stocks have a greater level of risk associated with them. They are likely to outperform value stocks in strong bull markets but over the longer-term, value stocks have delivered better returns than growth stocks in almost all markets.
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 0.35%, putting it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.47%.
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 Information Technology sector--about 37.60% of the portfolio. Healthcare and Consumer Discretionary round out the top three.
Looking at individual holdings, Nrg Energy Inc (NRG - Free Report) accounts for about 3.70% of total assets, followed by Fortinet Inc (FTNT - Free Report) and Enphase Energy Inc (ENPH - Free Report) .
The top 10 holdings account for about 28.5% of total assets under management.
Performance and Risk
RPG seeks to match the performance of the S&P 500 Pure Growth Index before fees and expenses. The S&P 500 Pure Growth Index measures the performance of securities that exhibit strong growth characteristics in the S&P 500 Index.
The ETF has lost about -25.98% so far this year and is down about -21.61% in the last one year (as of 09/21/2022). In the past 52-week period, it has traded between $142.53 and $220.95.
The ETF has a beta of 1.16 and standard deviation of 29.67% for the trailing three-year period, making it a medium risk choice in the space. With about 59 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P 500 Pure Growth 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, RPG is an excellent option for investors seeking exposure to the Style Box - Large Cap Growth segment of the market. There are other additional ETFs in the space that investors could consider as well.
The Vanguard Growth ETF (VUG - Free Report) and the Invesco QQQ (QQQ - Free Report) track a similar index. While Vanguard Growth ETF has $71.87 billion in assets, Invesco QQQ has $157.63 billion. VUG has an expense ratio of 0.04% and QQQ charges 0.20%.
Bottom-Line
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
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.