ETFdb Logo
ETFdb Logo
  • ETF Database
  • Channels
    • Themes
      • Active ETF
      • Artificial Intelligence
      • Beyond Basic Beta
      • China Insights
      • Climate Insights
      • Core Strategies
      • Crypto
      • Disruptive Technology
      • Energy Infrastructure
      • ETF Building Blocks
      • ETF Investing
      • ETF Education
      • ETF Strategist
      • Financial Literacy
      • Fixed Income
      • Free Cash Flow
      • Innovative ETFs
      • Institutional Income Strategies
      • Leveraged & Inverse
      • Managed Futures
      • Market Insights
      • Modern Alpha
      • Responsible Investing
      • Retirement Income
      • Tax Efficient Income
    • Asset Class
      • Equity
        • U.S. Equity
        • Int'l Developed
        • Emerging Market Equities
      • Alternatives
        • Commodities
        • Gold/Silver/Critical Minerals
        • Currency
        • Volatility
      • Fixed Income
        • Investment Grade Corporates
        • US Treasuries & TIPS
        • High Yield Corporates
        • Int'l Fixed Income
    • ETF Ecosystem
    • ETFs in Canada
    • Market Outlook Channel
  • Tools
    • ETF Screener
    • ETF Country Exposure Tool
    • ETF Sector Tracker Tool
    • ETF Database Categories
    • Head-To-Head ETF Comparison Tool
    • ETF Stock Exposure Tool
    • ETF Issuer Fund Flows
    • Indexes
    • Mutual Fund To ETF Converter
  • Research
    • ETF Education
    • Equity Investing
    • Dividend ETFs
    • Leveraged ETFs
    • Inverse ETFs
    • Index Education
    • Index Insights
    • Top ETF Sectors
    • Top ETF Issuers
    • Top ETF Industries
  • Webcasts
  • Themes
    • AI ETFs
    • Blockchain ETFs
    • See all Thematic Investing ETF themes
    • ESG Investing
    • Marijuana ETFs
  • Multimedia
    • ETF 360 Video Series
    • ETF of the Week Podcast
    • ETF Prime Podcast
    • Video
  • Company
    • About VettaFi
    • Get VettaFi’ed
  • PRO
    • Pro Content
    • Pro Tools
    • Advanced
    • FAQ
    • Pricing
    • Free Sign Up
    • Login
  1. Portfolio Strategies Channel
  2. Happy Birthday to RSP: The First Smart Beta ETF
Portfolio Strategies Channel
Share

Happy Birthday to RSP: The First Smart Beta ETF

Elle CarusoMay 01, 2023
2023-05-01

Since its launch 20 years ago, the Invesco S&P 500® Equal Weight ETF (RSP A-) has generated 10,500 basis points in excess returns for investors compared to the S&P 500.

When RSP launched in April 2003, it reinvented the ways that investors were able to access the S&P 500. RSP continues to add value to portfolios, helping mitigate concentration risk with an equal-weight strategy, and has provided the potential for higher returns in a cost-effective and tax-efficient way.

RSP gives every security in the S&P 500 an equal weight at each quarterly rebalance. Equal weight’s methodology of selling relative winners and buying relative losers adds the small size and value factor tilts to a portfolio.

“When individuals think about investing in the S&P 500, they probably think about their exposure being more equal weight-like than cap weight. They probably don’t think about the fact that when they allocate, they’re allocating more of their money to a smaller proportion of the index due to cap weighting as opposed to more of a broad exposure,” Nick Kalivas, head of factor and core equity product strategy for Invesco, told VettaFi.

“One of the problems that RSP solved was it provided a broader exposure to the S&P 500 – a more diversified exposure to the S&P 500 – without being so concentrated in some of those big names,” Kalivas said. “I think as history has shown, as you go across time, the top names kind of come in and out. There’s new leadership, new top names over time, and so being more dispersed in your allocation like equal weight really avoids the potential shortcomings in cap weighting.”

With over $33 billion in assets under management, RSP is the world’s largest equal-weight ETF. The fund’s launch was pivotal for the ETF industry as it was the first smart beta ETF, an area that Invesco expects to hit a milestone of $1 trillion in assets under management by the end of 2023.

The fund has outperformed the S&P 500 over various market conditions, most recently in 2022, when RSP declined 11.6% compared to the S&P 500’s 18.1% plunge.

RSP has significantly outperformed for buy-and-hold investors since its inception. In the 20 years following the fund’s launch on April 24, 2003, RSP has gained 679.2% while the S&P 500 has climbed 574.2%.

Happy Birthday to RSP: The First Smart Beta ETF

For more news, information, and analysis, visit our Portfolio Strategies Channel.


Content continues below advertisement

Loading Articles...
Our Sites
  • VettaFi
  • Advisor Perspectives
  • ETF Trends
Tools
  • ETF Screener
  • Mutual Fund to ETF Converter
  • Head-To-Head ETF Comparison
  • ETF Country Exposure Tool
  • ETF Stock Exposure Tool
  • ETF Database Pro
More Tools
  • Financial Advisor & RIA Center
Explore ETFs
  • ETF News
  • ETF Category Reports
  • Premium Articles
  • Alphabetical Listing of ETFs
  • Browse ETFs by ETF Database Category
  • Browse ETFs by Index
  • Browse ETFs by Issuer
  • Compare ETFs
Information
  • Contact Us
  • Terms of Use and Privacy Policy
  • © 2023 VettaFi LLC. All rights reserved.

Advertisement

Is Your Portfolio Positioned With Enough Global Exposure?

ETF Education Channel

How to Allocate Commodities in Portfolios

Tom LydonApr 26, 2022
2022-04-26

A long-running debate in asset allocation circles is how much of a portfolio an investor should...

Core Strategies Channel

Why ETFs Experience Limit Up/Down Protections

Karrie GordonMay 13, 2022
2022-05-13

In a digital age where information moves in milliseconds and millions of participants can transact...

}
X