Megaphone icon ETF Database is now VettaFi. Read More >
ETFdb Logo
ETFdb Logo
  • ETF Database
  • Channels
    • Active ETF
    • Alternatives
    • Beyond Basic Beta
    • China Insights
    • Climate Insights
    • Commodities
    • Core Strategies
    • Crypto
    • Disruptive Technology
    • Dividend
    • Dual Impact
    • Emerging Markets
    • Energy Infrastructure
    • ESG
    • ETF Building Blocks
    • ETF Education
    • ETF Strategist
    • Fixed Income
    • Free Cash Flow
    • Future ETFs
    • Gold & Silver Investing
    • Innovative ETFs
    • Institutional Income Strategies
    • Leveraged & Inverse
    • Managed Futures
    • Modern Alpha
    • Multi-Asset
    • Portfolio Strategies
    • Retirement Income
    • Thematic Investing
    • Volatility Resource
  • 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
    • ETF Data for Journalists
    • ETF Nerds
  • Research
    • First Bitcoin ETF
    • ETF Education
    • Equity Investing
    • Dividend ETFs
    • Leveraged ETFs
    • Inverse ETFs
    • 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
  • Videos & Podcasts
    • ETF 360 Video Series
    • ETF Trends on Videos
    • ETF Trends on Podcasts
    • ETF Prime Podcast
  • PRO
    • Pro Content
    • Pro Tools
    • Advanced
    • FAQ
    • Pricing
    • Free Sign Up
    • Login
  1. Portfolio Strategies Channel
  2. Seeking Calmer Waters Amidst Choppy Markets With RSP
Portfolio Strategies Channel
Share

Seeking Calmer Waters Amidst Choppy Markets With RSP

Karrie GordonNov 19, 2021
2021-11-19

The technology sector is on the rise again and has been catapulted upwards by Nvidia’s (NVDA) earnings report, which beat both sales and earnings for the third quarter. However, despite big earnings reports by many industry giants recently, markets remain uncertain and choppy, reports CNBC.

It’s pretty typical for markets to hit a period of fairly quiet activity after earnings season is done. The major indexes have been pushed upwards recently by positive earnings reports from Walmart, Nvidia, and other major market movers, but they continue to feel the downward pull of inflationary pressures and looming interest rate increases.

Misses in earnings reports from companies such as Cisco are also weighing down growth; Cisco Systems was down almost 6% yesterday because of reported missed revenue and less optimistic forecasting than analysts had expected.

“For a second consecutive session the underlying price action is a lot weaker than the headline indices make it seem with a handful of large stocks masking selling elsewhere,” said Vital Knowledge’s Adam Crisafulli. “It seems the same worries are before are still present – COVID, the debt ceiling, Fed staffing uncertainty, the Fed will tighten too soon, the Fed isn’t tightening fast enough. Actual news is relatively bullish … Even ‘bad’ reports, like Cisco, still have bullish implications for the underlying economy.”

Equal Weighting Can Capture Movement While Dampening Volatility

Invesco Equal Weight ETF

Content continues below advertisement

For investors looking to harness the growth and positive movement of major performers such as Nvidia while also potentially hedging against underperformance, the Invesco S&P 500 Equal Weight ETF (RSP A-) can be a good solution.

RSP seeks to invest at least 90% of its assets in the securities within the S&P 500 Equal Weight Index, an index comprised of all the securities within the S&P 500 but balanced evenly as to their weightings. This allows investors to gain exposure to the broad performance of the S&P 500, but because no single security is weighted heavier because of its market cap, it naturally hedges against underperformance and volatility.

By balancing the weighting across all market caps with sector weighting only being concentrated heavier because of the composition of the S&P 500 itself, the fund can capture the growth of sectors that are overperforming, such as retail, while balancing out any underperformance by other sectors. Broad investment can be a natural hedge to volatility, and RSP capitalizes on that.

Current top sector allocations include information technology at 15.24%, industrials at 14.63%, financials at 13.24%, consumer discretionary at 12.89%, and healthcare at 11.97%.

RSP has an expense ratio of 0.20% and currently has 506 holdings.

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

Loading Articles...
Help & Info
  • Contact Us
  • Mission Statement
  • Press
Tools
  • ETF Screener
  • ETF Analyzer
  • Mutual Fund to ETF Converter
  • Head-To-Head ETF Comparison
  • ETF Country Exposure Tool
  • ETF Stock Exposure Tool
  • ETF Performance Visualizer
  • ETF Database Model Portfolios
  • ETF Database Realtime Ratings
  • ETF Database Pro
More Tools
  • ETF Launch Center
  • Financial Advisor & RIA Center
  • ETF Database RSS Feed
Explore ETFs
  • ETF News
  • ETF Picks of the Month
  • ETF Category Reports
  • Premium Articles
  • Alphabetical Listing of ETFs
  • Best ETFs
  • Browse ETFs by ETF Database Category
  • Browse ETFs by Index
  • Browse ETFs by Issuer
  • Compare ETFs
Legal
  • Terms of Use and Privacy Policy
  • © ETF Flows LLC
Follow ETF Database
Follow ETF Database

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