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Is Invesco S&P 500 Equal Weight ETF (RSP) a Strong ETF Right Now?
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The Invesco S&P 500 Equal Weight ETF (RSP - Free Report) made its debut on 04/24/2003, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
Because the fund has amassed over $36.53 billion, this makes it one of the largest ETFs in the Style Box - Large Cap Blend. RSP is managed by Invesco. RSP, before fees and expenses, seeks to match the performance of the S&P 500 Equal Weight Index.
The S&P 500 Equal Weight Index equally weights the stocks in the S&P 500 Index.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Operating expenses on an annual basis are 0.20% for this ETF, which makes it on par with most peer products in the space.
RSP's 12-month trailing dividend yield is 1.69%.
Sector Exposure and Top Holdings
ETFs offer 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.
For RSP, it has heaviest allocation in the Information Technology sector --about 15.40% of the portfolio --while Industrials and Financials round out the top three.
Looking at individual holdings, Halliburton Co (HAL - Free Report) accounts for about 0.23% of total assets, followed by Moderna Inc (MRNA - Free Report) and Schlumberger Ltd (SLB - Free Report) .
Its top 10 holdings account for approximately 2.17% of RSP's total assets under management.
Performance and Risk
The ETF return is roughly 7.53% and is down about -1.78% so far this year and in the past one year (as of 02/09/2023), respectively. RSP has traded between $127.28 and $161.12 during this last 52-week period.
The ETF has a beta of 1.06 and standard deviation of 26.65% for the trailing three-year period. With about 505 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P 500 Equal Weight ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core S&P 500 ETF (IVV - Free Report) tracks S&P 500 Index and the SPDR S&P 500 ETF (SPY - Free Report) tracks S&P 500 Index. IShares Core S&P 500 ETF has $310.66 billion in assets, SPDR S&P 500 ETF has $382.19 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Blend.
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.
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Is Invesco S&P 500 Equal Weight ETF (RSP) a Strong ETF Right Now?
The Invesco S&P 500 Equal Weight ETF (RSP - Free Report) made its debut on 04/24/2003, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Large Cap Blend category of the market.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
Because the fund has amassed over $36.53 billion, this makes it one of the largest ETFs in the Style Box - Large Cap Blend. RSP is managed by Invesco. RSP, before fees and expenses, seeks to match the performance of the S&P 500 Equal Weight Index.
The S&P 500 Equal Weight Index equally weights the stocks in the S&P 500 Index.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Operating expenses on an annual basis are 0.20% for this ETF, which makes it on par with most peer products in the space.
RSP's 12-month trailing dividend yield is 1.69%.
Sector Exposure and Top Holdings
ETFs offer 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.
For RSP, it has heaviest allocation in the Information Technology sector --about 15.40% of the portfolio --while Industrials and Financials round out the top three.
Looking at individual holdings, Halliburton Co (HAL - Free Report) accounts for about 0.23% of total assets, followed by Moderna Inc (MRNA - Free Report) and Schlumberger Ltd (SLB - Free Report) .
Its top 10 holdings account for approximately 2.17% of RSP's total assets under management.
Performance and Risk
The ETF return is roughly 7.53% and is down about -1.78% so far this year and in the past one year (as of 02/09/2023), respectively. RSP has traded between $127.28 and $161.12 during this last 52-week period.
The ETF has a beta of 1.06 and standard deviation of 26.65% for the trailing three-year period. With about 505 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P 500 Equal Weight ETF is a reasonable option for investors seeking to outperform the Style Box - Large Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core S&P 500 ETF (IVV - Free Report) tracks S&P 500 Index and the SPDR S&P 500 ETF (SPY - Free Report) tracks S&P 500 Index. IShares Core S&P 500 ETF has $310.66 billion in assets, SPDR S&P 500 ETF has $382.19 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Blend.
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.