The Invesco S&P 500 Equal Weight ETF (RSP) and the iShares Russell 2000 Value ETF (IWN) are both among the Top 100 ETFs. RSP is a Invesco Large Blend fund and IWN is a iShares Small Value fund. So, what’s the difference between RSP and IWN? And which fund is better?
The expense ratio of RSP is 0.04 percentage points lower than IWN’s (0.2% vs. 0.24%). RSP also has a higher exposure to the technology sector and a lower standard deviation. Overall, RSP has provided higher returns than IWN over the past ten years.
In this article, we’ll compare RSP vs. IWN. We’ll look at fund composition and annual returns, as well as at their risk metrics and portfolio growth. Moreover, I’ll also discuss RSP’s and IWN’s industry exposure, performance, and holdings and examine how these affect their overall returns.
Summary
| RSP | IWN | |
| Name | Invesco S&P 500 Equal Weight ETF | iShares Russell 2000 Value ETF |
| Category | Large Blend | Small Value |
| Issuer | Invesco | iShares |
| AUM | 28.62B | 15.48B |
| Avg. Return | 13.79% | 10.96% |
| Div. Yield | 1.31% | 1.26% |
| Expense Ratio | 0.2% | 0.24% |
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 Russell 2000 Value ETF (IWN) is a Small Value fund that is issued by iShares. It currently has 15.48B total assets under management and has yielded an average annual return of 10.96% over the past 10 years. The fund has a dividend yield of 1.26% with an expense ratio of 0.24%.
RSP’s dividend yield is 0.05% higher than that of IWN (1.31% vs. 1.26%). Also, RSP yielded on average 2.83% more per year over the past decade (13.79% vs. 10.96%). The expense ratio of RSP is 0.04 percentage points lower than IWN’s (0.2% vs. 0.24%).
Fund Composition
Industry Exposure
| RSP | IWN | |
| Technology | 14.73% | 6.02% |
| Industrials | 14.62% | 14.58% |
| Energy | 3.9% | 5.84% |
| Communication Services | 4.31% | 4.17% |
| Utilities | 5.58% | 4.69% |
| Healthcare | 13.69% | 10.94% |
| Consumer Defensive | 6.86% | 3.77% |
| Real Estate | 5.84% | 14.36% |
| Financial Services | 13.43% | 22.97% |
| Consumer Cyclical | 13.01% | 8.39% |
| Basic Materials | 4.04% | 4.29% |
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 Russell 2000 Value ETF (IWN) has the most exposure to the Financial Services sector at 22.97%. This is followed by Industrials and Real Estate at 14.58% and 14.36% respectively. Communication Services (4.17%), Basic Materials (4.29%), and Utilities (4.69%) only make up 13.15% of the fund’s total assets.
IWN’s mid-section with moderate exposure is comprised of Energy, Technology, Consumer Cyclical, Healthcare, and Real Estate stocks at 5.84%, 6.02%, 8.39%, 10.94%, and 14.36%.
RSP is 8.71% more exposed to the Technology sector than IWN (14.73% vs 6.02%). RSP’s exposure to Industrials and Healthcare stocks is 0.04% higher and 2.75% higher respectively (14.62% vs. 14.58% and 13.69% vs. 10.94%). In total, Basic Materials, Communication Services, and Utilities also make up 0.78% more of the fund’s holdings compared to IWN (13.93% vs. 13.15%).
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%.
| IWN Holdings | Weight |
| AMC Entertainment Holdings Inc Class A | 1.06% |
| Tenet Healthcare Corp | 0.47% |
| Stag Industrial Inc | 0.47% |
| Ovintiv Inc | 0.45% |
| EMCOR Group Inc | 0.42% |
| Valley National Bancorp | 0.37% |
| Chesapeake Energy Corp Ordinary Shares – New | 0.37% |
| Agree Realty Corp | 0.36% |
| Macy’s Inc | 0.35% |
| Essent Group Ltd | 0.35% |
IWN’s Top Holdings are AMC Entertainment Holdings Inc Class A, Tenet Healthcare Corp, Stag Industrial Inc, Ovintiv Inc, and EMCOR Group Inc at 1.06%, 0.47%, 0.47%, 0.45%, and 0.42%.
Valley National Bancorp (0.37%), Chesapeake Energy Corp Ordinary Shares – New (0.37%), and Agree Realty Corp (0.36%) have a slightly smaller but still significant weight. Macy’s Inc and Essent Group Ltd are also represented in the IWN’s holdings at 0.35% and 0.35%.
Risk Analysis
| RSP | IWN | |
| Mean Return | 1.19 | 1.01 |
| R-squared | 94.47 | 72.64 |
| Std. Deviation | 15.36 | 19.28 |
| Alpha | -2.45 | -6.32 |
| Beta | 1.1 | 1.21 |
| Sharpe Ratio | 0.89 | 0.59 |
| Treynor Ratio | 12.12 | 8.3 |
The Invesco S&P 500 Equal Weight ETF (RSP) has a Mean Return of 1.19 with a R-squared of 94.47 and a Sharpe Ratio of 0.89. Its Standard Deviation is 15.36 while RSP’s Beta is 1.1. Furthermore, the fund has a Treynor Ratio of 12.12 and a Alpha of -2.45.
The iShares Russell 2000 Value ETF (IWN) has a Sharpe Ratio of 0.59 with a Mean Return of 1.01 and a Standard Deviation of 19.28. Its Beta is 1.21 while IWN’s R-squared is 72.64. Furthermore, the fund has a Treynor Ratio of 8.3 and a Alpha of -6.32.
RSP’s Mean Return is 0.18 points higher than that of IWN and its R-squared is 21.83 points higher. With a Standard Deviation of 15.36, RSP is slightly less volatile than IWN. The Alpha and Beta of RSP are 3.87 points higher and 0.11 points lower than IWN’s Alpha and Beta.
Performance
Annual Returns
| Year | RSP | IWN |
| 2020 | 12.75% | 4.5% |
| 2019 | 28.94% | 22.17% |
| 2018 | -7.77% | -12.94% |
| 2017 | 18.52% | 7.73% |
| 2016 | 14.34% | 31.64% |
| 2015 | -2.57% | -7.53% |
| 2014 | 14.02% | 4.13% |
| 2013 | 35.6% | 34.3% |
| 2012 | 17.04% | 17.92% |
| 2011 | -0.5% | -5.64% |
| 2010 | 21.3% | 24.29% |
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 IWN, returning 34.3% on an annual basis. The poorest year for IWN in the last ten years was 2018, with a yield of -12.94%. Most years the iShares Russell 2000 Value ETF has given investors modest returns, such as in 2020, 2017, and 2012, when gains were 4.5%, 7.73%, and 17.92% respectively.
Portfolio Growth
| Fund | Initial Balance | Final Balance | CAGR |
| RSP | $10,000 | $38,664 | 13.79% |
| IWN | $10,000 | $28,189 | 10.96% |
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 IWN, the end total would have been $28,189. This equates to a $18,189 profit over 11 years and a compound annual growth rate (CAGR) of 10.96%.
RSP’s CAGR is 2.83 percentage points higher than that of IWN and as a result, would have yielded $10,475 more on a $10,000 investment. Thus, RSP outperformed IWN by 2.83% annually.
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