IVW vs. RSP: What’s The Difference?

The iShares S&P 500 Growth ETF (IVW) and the Invesco S&P 500 Equal Weight ETF (RSP) are both among the Top 100 ETFs. IVW is a iShares Large Growth fund and RSP is a Invesco Large Blend fund. So, what’s the difference between IVW and RSP? And which fund is better?

The expense ratio of IVW is 0.02 percentage points lower than RSP’s (0.18% vs. 0.2%). IVW also has a higher exposure to the technology sector and a lower standard deviation. Overall, IVW has provided higher returns than RSP over the past ten years.

In this article, we’ll compare IVW vs. RSP. We’ll look at industry exposure and risk metrics, as well as at their holdings and portfolio growth. Moreover, I’ll also discuss IVW’s and RSP’s annual returns, fund composition, and performance and examine how these affect their overall returns.

Summary

IVW RSP
Name iShares S&P 500 Growth ETF Invesco S&P 500 Equal Weight ETF
Category Large Growth Large Blend
Issuer iShares Invesco
AUM 35.72B 28.62B
Avg. Return 16.74% 13.79%
Div. Yield 0.61% 1.31%
Expense Ratio 0.18% 0.2%

The iShares S&P 500 Growth ETF (IVW) is a Large Growth fund that is issued by iShares. It currently has 35.72B total assets under management and has yielded an average annual return of 16.74% over the past 10 years. The fund has a dividend yield of 0.61% with an expense ratio of 0.18%.

The Invesco S&P 500 Equal Weight ETF (RSP) is a Large Blend fund that is issued by Invesco. It currently has 28.62B total assets under management and has yielded an average annual return of 13.79% over the past 10 years. The fund has a dividend yield of 1.31% with an expense ratio of 0.2%.

IVW’s dividend yield is 0.70% lower than that of RSP (0.61% vs. 1.31%). Also, IVW yielded on average 2.95% more per year over the past decade (16.74% vs. 13.79%). The expense ratio of IVW is 0.02 percentage points lower than RSP’s (0.18% vs. 0.2%).

Fund Composition

Industry Exposure

IVW vs. RSP - Industry Exposure

IVW RSP
Technology 37.8% 14.73%
Industrials 5.72% 14.62%
Energy 0.06% 3.9%
Communication Services 15.44% 4.31%
Utilities 0.47% 5.58%
Healthcare 11.88% 13.69%
Consumer Defensive 3.84% 6.86%
Real Estate 1.11% 5.84%
Financial Services 6.78% 13.43%
Consumer Cyclical 15.25% 13.01%
Basic Materials 1.65% 4.04%

The iShares S&P 500 Growth ETF (IVW) has the most exposure to the Technology sector at 37.8%. This is followed by Communication Services and Consumer Cyclical at 15.44% and 15.25% respectively. Utilities (0.47%), Real Estate (1.11%), and Basic Materials (1.65%) only make up 3.23% of the fund’s total assets.

IVW’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Financial Services, Healthcare, and Consumer Cyclical stocks at 3.84%, 5.72%, 6.78%, 11.88%, and 15.25%.

The Invesco S&P 500 Equal Weight ETF (RSP) has the most exposure to the Technology sector at 14.73%. This is followed by Industrials and Healthcare at 14.62% and 13.69% respectively. Basic Materials (4.04%), Communication Services (4.31%), and Utilities (5.58%) only make up 13.93% of the fund’s total assets.

RSP’s mid-section with moderate exposure is comprised of Real Estate, Consumer Defensive, Consumer Cyclical, Financial Services, and Healthcare stocks at 5.84%, 6.86%, 13.01%, 13.43%, and 13.69%.

IVW is 23.07% more exposed to the Technology sector than RSP (37.8% vs 14.73%). IVW’s exposure to Communication Services and Consumer Cyclical stocks is 11.13% higher and 2.24% higher respectively (15.44% vs. 4.31% and 15.25% vs. 13.01%). In total, Utilities, Real Estate, and Basic Materials also make up 12.23% less of the fund’s holdings compared to RSP (3.23% vs. 15.46%).

Holdings

IVW - Holdings

IVW Holdings Weight
Apple Inc 11.46%
Microsoft Corp 10.75%
Amazon.com Inc 7.14%
Facebook Inc Class A 4.28%
Alphabet Inc Class A 4.06%
Alphabet Inc Class C 3.86%
Tesla Inc 2.65%
NVIDIA Corp 2.43%
PayPal Holdings Inc 1.62%
Adobe Inc 1.49%

IVW’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc Class A, and Alphabet Inc Class A at 11.46%, 10.75%, 7.14%, 4.28%, and 4.06%.

Alphabet Inc Class C (3.86%), Tesla Inc (2.65%), and NVIDIA Corp (2.43%) have a slightly smaller but still significant weight. PayPal Holdings Inc and Adobe Inc are also represented in the IVW’s holdings at 1.62% and 1.49%.

RSP - Holdings

RSP Holdings Weight
Chipotle Mexican Grill Inc 0.27%
Nike Inc Class B 0.25%
MSCI Inc 0.25%
Monolithic Power Systems Inc 0.25%
Enphase Energy Inc 0.25%
Advanced Micro Devices Inc 0.25%
ResMed Inc 0.24%
PerkinElmer Inc 0.24%
IDEXX Laboratories Inc 0.24%
Danaher Corp 0.24%

RSP’s Top Holdings are Chipotle Mexican Grill Inc, Nike Inc Class B, MSCI Inc, Monolithic Power Systems Inc, and Enphase Energy Inc at 0.27%, 0.25%, 0.25%, 0.25%, and 0.25%.

Advanced Micro Devices Inc (0.25%), ResMed Inc (0.24%), and PerkinElmer Inc (0.24%) have a slightly smaller but still significant weight. IDEXX Laboratories Inc and Danaher Corp are also represented in the RSP’s holdings at 0.24% and 0.24%.

Risk Analysis

IVW RSP
Mean Return 1.44 1.19
R-squared 93.82 94.47
Std. Deviation 13.77 15.36
Alpha 2.19 -2.45
Beta 0.98 1.1
Sharpe Ratio 1.21 0.89
Treynor Ratio 17.24 12.12

The iShares S&P 500 Growth ETF (IVW) has a R-squared of 93.82 with a Beta of 0.98 and a Mean Return of 1.44. Its Alpha is 2.19 while IVW’s Standard Deviation is 13.77. Furthermore, the fund has a Sharpe Ratio of 1.21 and a Treynor Ratio of 17.24.

The Invesco S&P 500 Equal Weight ETF (RSP) has a Sharpe Ratio of 0.89 with a Treynor Ratio of 12.12 and a Alpha of -2.45. Its Mean Return is 1.19 while RSP’s Standard Deviation is 15.36. Furthermore, the fund has a Beta of 1.1 and a R-squared of 94.47.

IVW’s Mean Return is 0.25 points higher than that of RSP and its R-squared is 0.65 points lower. With a Standard Deviation of 13.77, IVW is slightly less volatile than RSP. The Alpha and Beta of IVW are 4.64 points higher and 0.12 points lower than RSP’s Alpha and Beta.

Performance

Annual Returns

IVW vs. RSP - Annual Returns

Year IVW RSP
2020 33.21% 12.75%
2019 30.91% 28.94%
2018 -0.17% -7.77%
2017 27.2% 18.52%
2016 6.74% 14.34%
2015 5.33% -2.57%
2014 14.67% 14.02%
2013 32.48% 35.6%
2012 14.39% 17.04%
2011 4.49% -0.5%
2010 14.84% 21.3%

IVW had its best year in 2020 with an annual return of 33.21%. IVW’s worst year over the past decade yielded -0.17% and occurred in 2018. In most years the iShares S&P 500 Growth ETF provided moderate returns such as in 2012, 2014, and 2010 where annual returns amounted to 14.39%, 14.67%, and 14.84% respectively.

The year 2013 was the strongest year for RSP, returning 35.6% on an annual basis. The poorest year for RSP in the last ten years was 2018, with a yield of -7.77%. Most years the Invesco S&P 500 Equal Weight ETF has given investors modest returns, such as in 2014, 2016, and 2012, when gains were 14.02%, 14.34%, and 17.04% respectively.

Portfolio Growth

IVW vs. RSP - Portfolio Growth

Fund Initial Balance Final Balance CAGR
IVW $10,000 $51,915 16.74%
RSP $10,000 $38,664 13.79%

A $10,000 investment in IVW would have resulted in a final balance of $51,915. This is a profit of $41,915 over 11 years and amounts to a compound annual growth rate (CAGR) of 16.74%.

With a $10,000 investment in RSP, the end total would have been $38,664. This equates to a $28,664 profit over 11 years and a compound annual growth rate (CAGR) of 13.79%.

IVW’s CAGR is 2.95 percentage points higher than that of RSP and as a result, would have yielded $13,251 more on a $10,000 investment. Thus, IVW outperformed RSP by 2.95% annually.


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