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Is Invesco S&P 500 Equal Weight Financials ETF (RSPF) a Strong ETF Right Now?
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Making its debut on 11/01/2006, smart beta exchange traded fund Invesco S&P 500 Equal Weight Financials ETF (RSPF - Free Report) provides investors broad exposure to the Financials ETFs category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
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.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
Managed by Invesco, RSPF has amassed assets over $268.31 million, making it one of the average sized ETFs in the Financials ETFs. This particular fund, before fees and expenses, seeks to match the performance of the S&P 500 EQUAL WEIGHT FINANCIALS INDEX .
The S&P 500 Equal Weight Financials Index equally weights stocks in the financial sector of the S&P 500 Index.
Cost & Other Expenses
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 cousins, other things remaining the same.
Operating expenses on an annual basis are 0.40% for this ETF, which makes it on par with most peer products in the space.
RSPF's 12-month trailing dividend yield is 2.14%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
RSPF's heaviest allocation is in the Financials sector, which is about 100% of the portfolio.
When you look at individual holdings, Franklin Resources Inc (BEN - Free Report) accounts for about 1.53% of the fund's total assets, followed by Invesco Ltd (IVZ - Free Report) and Blackstone Inc (BX - Free Report) .
The top 10 holdings account for about 14.91% of total assets under management.
Performance and Risk
So far this year, RSPF has gained about 0.94%, and was up about 0% in the last one year (as of 01/24/2024). During this past 52-week period, the fund has traded between $48.10 and $59.19.
RSPF has a beta of 1.08. With about 73 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P 500 Equal Weight Financials ETF is not a suitable option for investors seeking to outperform the Financials ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.
Vanguard Financials ETF (VFH - Free Report) tracks MSCI US Investable Market Financials 25/50 Index and the Financial Select Sector SPDR ETF (XLF - Free Report) tracks Financial Select Sector Index. Vanguard Financials ETF has $9.30 billion in assets, Financial Select Sector SPDR ETF has $35.02 billion. VFH has an expense ratio of 0.10% and XLF 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 Financials 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 Financials ETF (RSPF) a Strong ETF Right Now?
Making its debut on 11/01/2006, smart beta exchange traded fund Invesco S&P 500 Equal Weight Financials ETF (RSPF - Free Report) provides investors broad exposure to the Financials ETFs category of the market.
What Are Smart Beta ETFs?
Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.
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.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
Managed by Invesco, RSPF has amassed assets over $268.31 million, making it one of the average sized ETFs in the Financials ETFs. This particular fund, before fees and expenses, seeks to match the performance of the S&P 500 EQUAL WEIGHT FINANCIALS INDEX .
The S&P 500 Equal Weight Financials Index equally weights stocks in the financial sector of the S&P 500 Index.
Cost & Other Expenses
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 cousins, other things remaining the same.
Operating expenses on an annual basis are 0.40% for this ETF, which makes it on par with most peer products in the space.
RSPF's 12-month trailing dividend yield is 2.14%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
RSPF's heaviest allocation is in the Financials sector, which is about 100% of the portfolio.
When you look at individual holdings, Franklin Resources Inc (BEN - Free Report) accounts for about 1.53% of the fund's total assets, followed by Invesco Ltd (IVZ - Free Report) and Blackstone Inc (BX - Free Report) .
The top 10 holdings account for about 14.91% of total assets under management.
Performance and Risk
So far this year, RSPF has gained about 0.94%, and was up about 0% in the last one year (as of 01/24/2024). During this past 52-week period, the fund has traded between $48.10 and $59.19.
RSPF has a beta of 1.08. With about 73 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P 500 Equal Weight Financials ETF is not a suitable option for investors seeking to outperform the Financials ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.
Vanguard Financials ETF (VFH - Free Report) tracks MSCI US Investable Market Financials 25/50 Index and the Financial Select Sector SPDR ETF (XLF - Free Report) tracks Financial Select Sector Index. Vanguard Financials ETF has $9.30 billion in assets, Financial Select Sector SPDR ETF has $35.02 billion. VFH has an expense ratio of 0.10% and XLF 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 Financials 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.