Launched on 11/01/2006, the Invesco S&P 500 Equal Weight Materials ETF (RSPM) is a passively managed exchange traded fund designed to provide a broad exposure to the Materials - Broad segment of the equity market.

An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.

Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Materials - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 15, placing it in bottom 6%.

Index Details

The fund is sponsored by Invesco. It has amassed assets over $267.84 million, making it one of the average sized ETFs attempting to match the performance of the Materials - Broad segment of the equity market. RSPM seeks to match the performance of the S&P 500 EQUAL WEIGHT MATERIALS INDEX before fees and expenses.

The S&P 500 Equal Weight Materials Index equally weights stocks in the materials 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 one of the cheaper products in the space.

It has a 12-month trailing dividend yield of 1.95%.

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 Materials sector--about 100% of the portfolio.

Looking at individual holdings, Newmont Corp (NEM) accounts for about 4.20% of total assets, followed by Sherwin-Williams Co/the (SHW) and Fmc Corp (FMC).

The top 10 holdings account for about 38.49% of total assets under management.

Performance and Risk

Year-to-date, the Invesco S&P 500 Equal Weight Materials ETF has gained about 3.91% so far, and it's up approximately 9.64% over the last 12 months (as of 09/09/2024). RSPM has traded between $28.92 and $36.50 in this past 52-week period.

The ETF has a beta of 1.10 and standard deviation of 20.13% for the trailing three-year period. With about 29 holdings, it has more concentrated exposure than peers.

Alternatives

Invesco S&P 500 Equal Weight Materials 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, RSPM is a sufficient option for those seeking exposure to the Materials ETFs area of the market. Investors might also want to consider some other ETF options in the space.