ETF Trends
ETF Trends

We may as well take this opportunity to revisit RSP (Guggenheim S&P 500 Equal Weight, Expense Ratio 0.40%) this morning being that the fund had notable inflows last week (about $300 milllion in), and the fund itself now has north of $10.2 billion in overall assets under management.

Some lament nominally wider bid/ask spreads and generally lower visible “screen liquidity” in RSP compared to say SPY (SPDR S&P 500, Expense Ratio 0.09%) or IVV (iShares Core S&P 500, Expense Ratio 0.07%), and these managers likely have a point to some degree.

However, based on RSP’s index methodology, where the S&P 500 Index is “equal weighted,” the most liquid and largest market cap components of the S&P 500 Index like AAPL, XOM, and MSFT for example have weightings roughly in line with lesser known members of the index like NBR, DNR, RHT, ADT, and DVN for example, which rank among the top five components in this index which is regularly re-balanced on a periodic basis so as to maintain as close to equal weighted exposure across members as possible.

RSP has been around since April of 2003, and has enjoyed a strong trailing one year in terms of reeling in new assets. It has added more than $2.8 billion via creation flows in fact in the trailing one year period, vaulting it over that noted $10 billion mark where it has company with the likes of other $10 billion funds such as VGK (Vanguard FTSE Europe, Expense Ratio 0.12%) and IWB (iShares Russell 1000, Expense Ratio 0.15%) for example.

Since inception, RSP has posted notable out-performance to the market cap weighted S&P 500 Index benchmark, and from what we see has earned a 5-Star Morningstar rating based on more than 11 years of live performance history.

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