The Invesco S&P 500 Equal Weight ETF (RSP) and the iShares National Muni Bond ETF (MUB) are both among the Top 100 ETFs. RSP is a Invesco Large Blend fund and MUB is a iShares Muni National Interm fund. So, what’s the difference between RSP and MUB? And which fund is better?
The expense ratio of RSP is 0.13 percentage points higher than MUB’s (0.2% vs. 0.07%). RSP also has a high exposure to the technology sector while MUB is mostly comprised of AA bonds. Overall, RSP has provided higher returns than MUB over the past ten years.
In this article, we’ll compare RSP vs. MUB. We’ll look at industry exposure and portfolio growth, as well as at their risk metrics and fund composition. Moreover, I’ll also discuss RSP’s and MUB’s annual returns, performance, and holdings and examine how these affect their overall returns.
Summary
| RSP | MUB | |
| Name | Invesco S&P 500 Equal Weight ETF | iShares National Muni Bond ETF |
| Category | Large Blend | Muni National Interm |
| Issuer | Invesco | iShares |
| AUM | 28.62B | 22.71B |
| Avg. Return | 13.79% | 4.04% |
| Div. Yield | 1.31% | 1.96% |
| Expense Ratio | 0.2% | 0.07% |
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 National Muni Bond ETF (MUB) is a Muni National Interm fund that is issued by iShares. It currently has 22.71B total assets under management and has yielded an average annual return of 4.04% over the past 10 years. The fund has a dividend yield of 1.96% with an expense ratio of 0.07%.
RSP’s dividend yield is 0.65% lower than that of MUB (1.31% vs. 1.96%). Also, RSP yielded on average 9.75% more per year over the past decade (13.79% vs. 4.04%). The expense ratio of RSP is 0.13 percentage points higher than MUB’s (0.2% vs. 0.07%).
Fund Composition
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%.
| MUB Bond Sectors | Weight |
| AA | 60.38% |
| AAA | 18.39% |
| A | 15.04% |
| BBB | 6.0% |
| Others | 0.17% |
| BB | 0.02% |
| Below B | 0.0% |
| B | 0.0% |
| US Government | 0.0% |
MUB’s Top Bond Sectors are ratings of AA, AAA, A, BBB, and Others at 60.38%, 18.39%, 15.04%, 6.0%, and 0.17%. The fund is less weighted towards BB (0.02%), Below B (0.0%), and B (0.0%) rated bonds.
Risk Analysis
| RSP | MUB | |
| Mean Return | 1.19 | 0.32 |
| R-squared | 94.47 | 99 |
| Std. Deviation | 15.36 | 3.68 |
| Alpha | -2.45 | -0.46 |
| Beta | 1.1 | 1.01 |
| Sharpe Ratio | 0.89 | 0.88 |
| Treynor Ratio | 12.12 | 3.2 |
The Invesco S&P 500 Equal Weight ETF (RSP) has a Mean Return of 1.19 with a Standard Deviation of 15.36 and a Sharpe Ratio of 0.89. Its R-squared is 94.47 while RSP’s Alpha is -2.45. Furthermore, the fund has a Beta of 1.1 and a Treynor Ratio of 12.12.
The iShares National Muni Bond ETF (MUB) has a Alpha of -0.46 with a Beta of 1.01 and a R-squared of 99. Its Sharpe Ratio is 0.88 while MUB’s Treynor Ratio is 3.2. Furthermore, the fund has a Mean Return of 0.32 and a Standard Deviation of 3.68.
RSP’s Mean Return is 0.87 points higher than that of MUB and its R-squared is 4.53 points lower. With a Standard Deviation of 15.36, RSP is slightly more volatile than MUB. The Alpha and Beta of RSP are 1.99 points lower and 0.09 points higher than MUB’s Alpha and Beta.
Performance
Annual Returns
| Year | RSP | MUB |
| 2020 | 12.75% | 4.87% |
| 2019 | 28.94% | 7.28% |
| 2018 | -7.77% | 0.86% |
| 2017 | 18.52% | 4.61% |
| 2016 | 14.34% | 0.06% |
| 2015 | -2.57% | 2.99% |
| 2014 | 14.02% | 8.61% |
| 2013 | 35.6% | -3.26% |
| 2012 | 17.04% | 6.14% |
| 2011 | -0.5% | 10.85% |
| 2010 | 21.3% | 1.4% |
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 2011 was the strongest year for MUB, returning 10.85% on an annual basis. The poorest year for MUB in the last ten years was 2013, with a yield of -3.26%. Most years the iShares National Muni Bond ETF has given investors modest returns, such as in 2015, 2017, and 2020, when gains were 2.99%, 4.61%, and 4.87% respectively.
Portfolio Growth
| Fund | Initial Balance | Final Balance | CAGR |
| RSP | $10,000 | $38,664 | 13.79% |
| MUB | $10,000 | $15,333 | 4.04% |
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 MUB, the end total would have been $15,333. This equates to a $5,333 profit over 11 years and a compound annual growth rate (CAGR) of 4.04%.
RSP’s CAGR is 9.75 percentage points higher than that of MUB and as a result, would have yielded $23,331 more on a $10,000 investment. Thus, RSP outperformed MUB by 9.75% annually.
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