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If you're interested in broad exposure to the Industrials - Broad segment of the equity market, look no further than the Invesco S&P 500 Equal Weight Industrials ETF (RSPN), a passively managed exchange traded fund launched on 11/01/2006.
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
Sector ETFs are also funds of convenience, offering many ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Industrials - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 1, placing it in top 6%.
Index Details
The fund is sponsored by Invesco. It has amassed assets over $481.18 million, making it one of the average sized ETFs attempting to match the performance of the Industrials - Broad segment of the equity market. RSPN seeks to match the performance of the S&P 500 EQUAL WEIGHT INDUSTRIALS INDEX before fees and expenses.
The S&P 500 Equal Weight Industrials Index equally weights stocks in the industrials sector of the S&P 500 Index.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.40%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.09%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Industrials sector--about 100% of the portfolio.
Looking at individual holdings, Copart Inc (CPRT) accounts for about 1.69% of total assets, followed by Verisk Analytics Inc (VRSK) and Costar Group Inc (CSGP).
The top 10 holdings account for about 15.32% of total assets under management.
Performance and Risk
So far this year, RSPN return is roughly 4.36%, and is up about 0% in the last one year (as of 06/28/2023). During this past 52-week period, the fund has traded between $191.92 and $200.49.
The ETF has a beta of 1.16. With about 76 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P 500 Equal Weight Industrials ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, RSPN is a reasonable option for those seeking exposure to the Industrials ETFs area of the market. Investors might also want to consider some other ETF options in the space.