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Is Invesco S&P 500 Equal Weight Health Care ETF (RSPH) a Strong ETF Right Now?
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The Invesco S&P 500 Equal Weight Health Care ETF (RSPH - Free Report) made its debut on 11/01/2006, and is a smart beta exchange traded fund that provides broad exposure to the Health Care ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
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.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other 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
Managed by Invesco, RSPH has amassed assets over $970.33 million, making it one of the larger ETFs in the Health Care ETFs. This particular fund, before fees and expenses, seeks to match the performance of the S&P 500 EQUAL WEIGHT HEALTH CARE INDEX .
The S&P 500 Equal Weight Health Care Index equally weights stocks in the health care sector of the S&P 500 Index.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for RSPH are 0.40%, which makes it one of the cheaper products in the space.
RSPH's 12-month trailing dividend yield is 0.65%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
RSPH's heaviest allocation is in the Healthcare sector, which is about 100% of the portfolio.
Taking into account individual holdings, Eli Lilly & Co (LLY - Free Report) accounts for about 1.89% of the fund's total assets, followed by Align Technology Inc (ALGN - Free Report) and Viatris Inc (VTRS - Free Report) .
The top 10 holdings account for about 17.64% of total assets under management.
Performance and Risk
The ETF has lost about -1.76% and it's up approximately 2.61% so far this year and in the past one year (as of 09/11/2023), respectively. RSPH has traded between $25 and $30.58 during this last 52-week period.
The fund has a beta of 0.85 and standard deviation of 16.68% for the trailing three-year period. With about 66 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P 500 Equal Weight Health Care ETF is an excellent option for investors seeking to outperform the Health Care ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
Vanguard Health Care ETF (VHT - Free Report) tracks MSCI US Investable Market Health Care 25/50 Index and the Health Care Select Sector SPDR ETF (XLV - Free Report) tracks Health Care Select Sector Index. Vanguard Health Care ETF has $16.80 billion in assets, Health Care Select Sector SPDR ETF has $40.17 billion. VHT has an expense ratio of 0.10% and XLV charges 0.10%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Health Care ETFs.
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 Health Care ETF (RSPH) a Strong ETF Right Now?
The Invesco S&P 500 Equal Weight Health Care ETF (RSPH - Free Report) made its debut on 11/01/2006, and is a smart beta exchange traded fund that provides broad exposure to the Health Care ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
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.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other 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
Managed by Invesco, RSPH has amassed assets over $970.33 million, making it one of the larger ETFs in the Health Care ETFs. This particular fund, before fees and expenses, seeks to match the performance of the S&P 500 EQUAL WEIGHT HEALTH CARE INDEX .
The S&P 500 Equal Weight Health Care Index equally weights stocks in the health care sector of the S&P 500 Index.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for RSPH are 0.40%, which makes it one of the cheaper products in the space.
RSPH's 12-month trailing dividend yield is 0.65%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
RSPH's heaviest allocation is in the Healthcare sector, which is about 100% of the portfolio.
Taking into account individual holdings, Eli Lilly & Co (LLY - Free Report) accounts for about 1.89% of the fund's total assets, followed by Align Technology Inc (ALGN - Free Report) and Viatris Inc (VTRS - Free Report) .
The top 10 holdings account for about 17.64% of total assets under management.
Performance and Risk
The ETF has lost about -1.76% and it's up approximately 2.61% so far this year and in the past one year (as of 09/11/2023), respectively. RSPH has traded between $25 and $30.58 during this last 52-week period.
The fund has a beta of 0.85 and standard deviation of 16.68% for the trailing three-year period. With about 66 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P 500 Equal Weight Health Care ETF is an excellent option for investors seeking to outperform the Health Care ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
Vanguard Health Care ETF (VHT - Free Report) tracks MSCI US Investable Market Health Care 25/50 Index and the Health Care Select Sector SPDR ETF (XLV - Free Report) tracks Health Care Select Sector Index. Vanguard Health Care ETF has $16.80 billion in assets, Health Care Select Sector SPDR ETF has $40.17 billion. VHT has an expense ratio of 0.10% and XLV charges 0.10%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Health Care ETFs.
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.