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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?
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.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track 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.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is managed by Invesco. RSP has been able to amass assets over $69.99 billion, making it one of the largest ETFs in the Style Box - Large Cap Blend. Before fees and expenses, this particular fund 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
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 this ETF are 0.20%, making it on par with most peer products in the space.
RSP's 12-month trailing dividend yield is 0.70%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
For RSP, it has heaviest allocation in the Industrials sector --about 16.50% of the portfolio --while Financials and Information Technology round out the top three.
When you look at individual holdings, Vistra Corp (VST - Free Report) accounts for about 0.32% of the fund's total assets, followed by Constellation Energy Corp (CEG - Free Report) and Wynn Resorts Ltd (WYNN - Free Report) .
RSP's top 10 holdings account for about 2.51% of its total assets under management.
Performance and Risk
Year-to-date, the Invesco S&P 500 Equal Weight ETF has gained about 16.85% so far, and was up about 31.60% over the last 12 months (as of 11/14/2024). RSP has traded between $144.79 and $185.02 in this past 52-week period.
The ETF has a beta of 1.05 and standard deviation of 16.92% for the trailing three-year period. With about 504 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P 500 Equal Weight ETF is an excellent option for investors seeking to outperform the Style Box - Large Cap Blend segment of the market. There are other ETFs in the space which investors could consider as well.
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 $567.47 billion in assets, SPDR S&P 500 ETF has $632.47 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?
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.
A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track 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.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is managed by Invesco. RSP has been able to amass assets over $69.99 billion, making it one of the largest ETFs in the Style Box - Large Cap Blend. Before fees and expenses, this particular fund 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
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 this ETF are 0.20%, making it on par with most peer products in the space.
RSP's 12-month trailing dividend yield is 0.70%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
For RSP, it has heaviest allocation in the Industrials sector --about 16.50% of the portfolio --while Financials and Information Technology round out the top three.
When you look at individual holdings, Vistra Corp (VST - Free Report) accounts for about 0.32% of the fund's total assets, followed by Constellation Energy Corp (CEG - Free Report) and Wynn Resorts Ltd (WYNN - Free Report) .
RSP's top 10 holdings account for about 2.51% of its total assets under management.
Performance and Risk
Year-to-date, the Invesco S&P 500 Equal Weight ETF has gained about 16.85% so far, and was up about 31.60% over the last 12 months (as of 11/14/2024). RSP has traded between $144.79 and $185.02 in this past 52-week period.
The ETF has a beta of 1.05 and standard deviation of 16.92% for the trailing three-year period. With about 504 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P 500 Equal Weight ETF is an excellent option for investors seeking to outperform the Style Box - Large Cap Blend segment of the market. There are other ETFs in the space which investors could consider as well.
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 $567.47 billion in assets, SPDR S&P 500 ETF has $632.47 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.