The Invesco S&P 500 Equal Weight ETF (RSP) and the iShares MSCI EAFE Value ETF (EFV) are both among the Top 100 ETFs. RSP is a Invesco Large Blend fund and EFV is a iShares Foreign Large Value fund. So, what’s the difference between RSP and EFV? And which fund is better?
The expense ratio of RSP is 0.19 percentage points lower than EFV’s (0.2% vs. 0.39%). RSP also has a higher exposure to the technology sector and a lower standard deviation. Overall, RSP has provided higher returns than EFV over the past ten years.
In this article, we’ll compare RSP vs. EFV. We’ll look at industry exposure and risk metrics, as well as at their annual returns and holdings. Moreover, I’ll also discuss RSP’s and EFV’s fund composition, portfolio growth, and performance and examine how these affect their overall returns.
Summary
| RSP | EFV | |
| Name | Invesco S&P 500 Equal Weight ETF | iShares MSCI EAFE Value ETF |
| Category | Large Blend | Foreign Large Value |
| Issuer | Invesco | iShares |
| AUM | 28.62B | 14.37B |
| Avg. Return | 13.79% | 3.99% |
| Div. Yield | 1.31% | 2.94% |
| Expense Ratio | 0.2% | 0.39% |
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%.
The iShares MSCI EAFE Value ETF (EFV) is a Foreign Large Value fund that is issued by iShares. It currently has 14.37B total assets under management and has yielded an average annual return of 3.99% over the past 10 years. The fund has a dividend yield of 2.94% with an expense ratio of 0.39%.
RSP’s dividend yield is 1.63% lower than that of EFV (1.31% vs. 2.94%). Also, RSP yielded on average 9.79% more per year over the past decade (13.79% vs. 3.99%). The expense ratio of RSP is 0.19 percentage points lower than EFV’s (0.2% vs. 0.39%).
Fund Composition
Industry Exposure
| RSP | EFV | |
| Technology | 14.73% | 2.98% |
| Industrials | 14.62% | 11.6% |
| Energy | 3.9% | 6.6% |
| Communication Services | 4.31% | 6.46% |
| Utilities | 5.58% | 6.14% |
| Healthcare | 13.69% | 9.19% |
| Consumer Defensive | 6.86% | 6.82% |
| Real Estate | 5.84% | 5.06% |
| Financial Services | 13.43% | 26.55% |
| Consumer Cyclical | 13.01% | 9.0% |
| Basic Materials | 4.04% | 9.59% |
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%.
The iShares MSCI EAFE Value ETF (EFV) has the most exposure to the Financial Services sector at 26.55%. This is followed by Industrials and Basic Materials at 11.6% and 9.59% respectively. Real Estate (5.06%), Utilities (6.14%), and Communication Services (6.46%) only make up 17.66% of the fund’s total assets.
EFV’s mid-section with moderate exposure is comprised of Energy, Consumer Defensive, Consumer Cyclical, Healthcare, and Basic Materials stocks at 6.6%, 6.82%, 9.0%, 9.19%, and 9.59%.
RSP is 11.75% more exposed to the Technology sector than EFV (14.73% vs 2.98%). RSP’s exposure to Industrials and Healthcare stocks is 3.02% higher and 4.50% higher respectively (14.62% vs. 11.6% and 13.69% vs. 9.19%). In total, Basic Materials, Communication Services, and Utilities also make up 8.26% less of the fund’s holdings compared to EFV (13.93% vs. 22.19%).
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%.
| EFV Holdings | Weight |
| Novartis AG | 2.41% |
| Toyota Motor Corp | 2.21% |
| Commonwealth Bank of Australia | 1.59% |
| Siemens AG | 1.45% |
| Sanofi SA | 1.42% |
| HSBC Holdings PLC | 1.4% |
| TotalEnergies SE | 1.35% |
| Allianz SE | 1.23% |
| GlaxoSmithKline PLC | 1.18% |
| Rio Tinto PLC | 1.1% |
EFV’s Top Holdings are Novartis AG, Toyota Motor Corp, Commonwealth Bank of Australia, Siemens AG, and Sanofi SA at 2.41%, 2.21%, 1.59%, 1.45%, and 1.42%.
HSBC Holdings PLC (1.4%), TotalEnergies SE (1.35%), and Allianz SE (1.23%) have a slightly smaller but still significant weight. GlaxoSmithKline PLC and Rio Tinto PLC are also represented in the EFV’s holdings at 1.18% and 1.1%.
Risk Analysis
| RSP | EFV | |
| Mean Return | 1.19 | 0.42 |
| R-squared | 94.47 | 92.15 |
| Std. Deviation | 15.36 | 16.53 |
| Alpha | -2.45 | -1.77 |
| Beta | 1.1 | 1.05 |
| Sharpe Ratio | 0.89 | 0.26 |
| Treynor Ratio | 12.12 | 2.92 |
The Invesco S&P 500 Equal Weight ETF (RSP) has a Mean Return of 1.19 with a Alpha of -2.45 and a R-squared of 94.47. Its Beta is 1.1 while RSP’s Treynor Ratio is 12.12. Furthermore, the fund has a Sharpe Ratio of 0.89 and a Standard Deviation of 15.36.
The iShares MSCI EAFE Value ETF (EFV) has a Mean Return of 0.42 with a Alpha of -1.77 and a Standard Deviation of 16.53. Its Sharpe Ratio is 0.26 while EFV’s Treynor Ratio is 2.92. Furthermore, the fund has a Beta of 1.05 and a R-squared of 92.15.
RSP’s Mean Return is 0.77 points higher than that of EFV and its R-squared is 2.32 points higher. With a Standard Deviation of 15.36, RSP is slightly less volatile than EFV. The Alpha and Beta of RSP are 0.68 points lower and 0.05 points higher than EFV’s Alpha and Beta.
Performance
Annual Returns
| Year | RSP | EFV |
| 2020 | 12.75% | -2.78% |
| 2019 | 28.94% | 15.97% |
| 2018 | -7.77% | -14.88% |
| 2017 | 18.52% | 21.22% |
| 2016 | 14.34% | 4.87% |
| 2015 | -2.57% | -5.89% |
| 2014 | 14.02% | -5.65% |
| 2013 | 35.6% | 22.61% |
| 2012 | 17.04% | 17.52% |
| 2011 | -0.5% | -12.24% |
| 2010 | 21.3% | 3.18% |
RSP had its best year in 2013 with an annual return of 35.6%. RSP’s worst year over the past decade yielded -7.77% and occurred in 2018. In most years the Invesco S&P 500 Equal Weight ETF provided moderate returns such as in 2014, 2016, and 2012 where annual returns amounted to 14.02%, 14.34%, and 17.04% respectively.
The year 2013 was the strongest year for EFV, returning 22.61% on an annual basis. The poorest year for EFV in the last ten years was 2018, with a yield of -14.88%. Most years the iShares MSCI EAFE Value ETF has given investors modest returns, such as in 2020, 2010, and 2016, when gains were -2.78%, 3.18%, and 4.87% respectively.
Portfolio Growth
| Fund | Initial Balance | Final Balance | CAGR |
| RSP | $10,000 | $38,664 | 13.79% |
| EFV | $10,000 | $14,134 | 3.99% |
A $10,000 investment in RSP would have resulted in a final balance of $38,664. This is a profit of $28,664 over 11 years and amounts to a compound annual growth rate (CAGR) of 13.79%.
With a $10,000 investment in EFV, the end total would have been $14,134. This equates to a $4,134 profit over 11 years and a compound annual growth rate (CAGR) of 3.99%.
RSP’s CAGR is 9.79 percentage points higher than that of EFV and as a result, would have yielded $24,530 more on a $10,000 investment. Thus, RSP outperformed EFV by 9.79% annually.
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