ETF Trends publisher Tom Lydon discussed the Guggenheim S&P 500 Equal Weight Technology ETF (RYT) on this week’s “ETF of the Week” podcast with Chuck Jaffe on the MoneyLife Show.
RYT is an ETF play for investors looking to diminish unforeseen risks of traditional market cap-weighted funds with an equal-weight strategy.
The recent pullback in technology stocks reveals risks associated with being overweight an overcrowded trade.
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RYT tracks an equally weighted version of the S&P 500 information technology sector – it systematically reallocates from outperforming to underperforming stocks and market segments to maintain its equal weight.
Its equal weighting means reduced potential for single-stock risk. Top holdings includes 1.6% Micron Technology, 1.5% Western Digital, 1.5% Verisign, 1.5% CSRA, and 1.5% Xerox.