RWL also provides investors with different sector views on the S&P 500. Whereas technology, financial services and healthcare are the top three sector weights in the S&P 500, consumer discretionary, healthcare and consumer staples are RWL’s top three sector weights, according to Oppenheimer data.
As the bull market extends, investors tend to forget about valuations and continue to ride high-flying stocks, which may potentially expose investors to risks, such as a quick drawdown. Additionally, in an extended bull run, traditional market capitalization-weighted indices become top heavy and expose investors to some of the most high-flying stocks of the current market.
Over the past three years, RWL has posted a compound annual growth rate (CAGR) of 8.1%. The ETF’s standard deviation is inline with that of the cap-weighted S&P 500.
For more on smart beta ETFs, visit our Smart Beta Channel.
Tom Lydon’s clients own shares of Apple.