Last week was one of the busiest of the year for financial markets, with a plethora of economic data, a Fed meeting, and significant market volatility. A strong GDP rebound and the Federal Reserve's decision to hold rates steady were quickly overshadowed by a weaker-than-expected jobs report and hotter-than-anticipated inflation.
This article offers a top-down analysis of the S&P 500 Index based on sector metrics versus historical averages. Energy remains the top sector for value and quality, while materials, technology, and industrials are deeply overvalued. Invesco S&P 500 Equal Weight ETF (RSP) offers value characteristics, but has underperformed SPY recently due to mega-cap outperformance.
Designed to provide broad exposure to the Style Box - Large Cap Blend category of the market, the Invesco S&P 500 Equal Weight ETF (RSP) is a smart beta exchange traded fund launched on 04/24/2003.
Index investing has grown increasingly popular in recent years, as more and more retail investors learn about the simplicity and low fees associated with the strategy.
Looking for broad exposure to the Large Cap Blend segment of the US equity market? You should consider the Invesco S&P 500 Equal Weight ETF (RSP), a passively managed exchange traded fund launched on 04/24/2003.
Last week, the U.S. labor market took center stage, delivering conflicting signals, all while the S&P 500 reached multiple record highs during the shortened trading week. While the official U.S. employment report for June showed stronger-than-expected job additions and a surprising drop in the unemployment rate, underlying details suggested a more nuanced story.
Holding too much cash feels safe, but it destroys purchasing power. Inflation has cut savings in half since 2000, making wealth-building essential today. Becoming financially independent means living below your means, saving enough, and investing wisely, not flashy lifestyles or quick riches. Today's market demands smarter investing beyond the S&P 500. Diversify globally and focus on dividend growth to grow wealth and beat inflation.
Last week's economic data presented a mixed picture, emerging against the backdrop of a record market rally. Inflation surprisingly heated up in May, reports on consumer attitudes showed conflicting signals, and the economy's first quarter contraction was deeper than expected.
RSP offers balanced S&P 500 exposure, reducing concentration risk but sacrificing upside from mega-cap growth, especially in tech-heavy rallies. Over the past five years, RSP has underperformed SPY by 22%, and I expect this trend to persist given current market dynamics. Equal weighting increases exposure to smaller, more volatile companies, and does not sufficiently mitigate downside risk compared to market-cap-weighted funds.
RSP's equal-weight methodology forces it to sell winners and buy losers, limiting its ability to capture outsized gains from top-performing stocks. While RSP reduces concentration risk and offers sector diversification, its tilt toward smaller stocks increases volatility and drawdowns compared to SPY. Recent underperformance is likely to end as the earnings gap between 'Mag 7' and other S&P 500 stocks narrows, potentially setting up RSP for better relative returns in 2025.
Last week, the labor market took center stage, presenting a nuanced picture of continued resilience alongside subtle signs of softening. While the U.S.
Last week's economic data presented a mixed but generally more positive outlook. Inflation continued its downward trend in April, reaching its lowest point in over four years.