The Invesco S&P 500 Equal Weight ETF (RSP) and the Schwab U.S. Large-Cap Growth ETF (SCHG) are both among the Top 100 ETFs. RSP is a Invesco Large Blend fund and SCHG is a Schwab ETFs Large Growth fund. So, what’s the difference between RSP and SCHG? And which fund is better?
The expense ratio of RSP is 0.16 percentage points higher than SCHG’s (0.2% vs. 0.04%). RSP also has a lower exposure to the technology sector and a higher standard deviation. Overall, RSP has provided lower returns than SCHG over the past ten years.
In this article, we’ll compare RSP vs. SCHG. We’ll look at annual returns and fund composition, as well as at their portfolio growth and risk metrics. Moreover, I’ll also discuss RSP’s and SCHG’s industry exposure, performance, and holdings and examine how these affect their overall returns.
Summary
| RSP | SCHG | |
| Name | Invesco S&P 500 Equal Weight ETF | Schwab U.S. Large-Cap Growth ETF |
| Category | Large Blend | Large Growth |
| Issuer | Invesco | Schwab ETFs |
| AUM | 28.62B | 15.16B |
| Avg. Return | 13.79% | 17.81% |
| Div. Yield | 1.31% | 0.43% |
| Expense Ratio | 0.2% | 0.04% |
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 Schwab U.S. Large-Cap Growth ETF (SCHG) is a Large Growth fund that is issued by Schwab ETFs. It currently has 15.16B total assets under management and has yielded an average annual return of 17.81% over the past 10 years. The fund has a dividend yield of 0.43% with an expense ratio of 0.04%.
RSP’s dividend yield is 0.88% higher than that of SCHG (1.31% vs. 0.43%). Also, RSP yielded on average 4.02% less per year over the past decade (13.79% vs. 17.81%). The expense ratio of RSP is 0.16 percentage points higher than SCHG’s (0.2% vs. 0.04%).
Fund Composition
Industry Exposure
| RSP | SCHG | |
| Technology | 14.73% | 39.21% |
| Industrials | 14.62% | 3.01% |
| Energy | 3.9% | 0.2% |
| Communication Services | 4.31% | 17.07% |
| Utilities | 5.58% | 0.0% |
| Healthcare | 13.69% | 12.05% |
| Consumer Defensive | 6.86% | 2.15% |
| Real Estate | 5.84% | 1.64% |
| Financial Services | 13.43% | 7.98% |
| Consumer Cyclical | 13.01% | 15.01% |
| Basic Materials | 4.04% | 1.68% |
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 Schwab U.S. Large-Cap Growth ETF (SCHG) has the most exposure to the Technology sector at 39.21%. This is followed by Communication Services and Consumer Cyclical at 17.07% and 15.01% respectively. Energy (0.2%), Real Estate (1.64%), and Basic Materials (1.68%) only make up 3.52% of the fund’s total assets.
SCHG’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Financial Services, Healthcare, and Consumer Cyclical stocks at 2.15%, 3.01%, 7.98%, 12.05%, and 15.01%.
RSP is 24.48% less exposed to the Technology sector than SCHG (14.73% vs 39.21%). RSP’s exposure to Industrials and Healthcare stocks is 11.61% higher and 1.64% higher respectively (14.62% vs. 3.01% and 13.69% vs. 12.05%). In total, Basic Materials, Communication Services, and Utilities also make up 4.82% less of the fund’s holdings compared to SCHG (13.93% vs. 18.75%).
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%.
| SCHG Holdings | Weight |
| Apple Inc | 11.49% |
| Microsoft Corp | 10.91% |
| Amazon.com Inc | 7.89% |
| Facebook Inc A | 4.45% |
| Alphabet Inc A | 3.93% |
| Alphabet Inc Class C | 3.82% |
| Tesla Inc | 2.8% |
| NVIDIA Corp | 2.67% |
| Visa Inc Class A | 2.12% |
| UnitedHealth Group Inc | 2.02% |
SCHG’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc A, and Alphabet Inc A at 11.49%, 10.91%, 7.89%, 4.45%, and 3.93%.
Alphabet Inc Class C (3.82%), Tesla Inc (2.8%), and NVIDIA Corp (2.67%) have a slightly smaller but still significant weight. Visa Inc Class A and UnitedHealth Group Inc are also represented in the SCHG’s holdings at 2.12% and 2.02%.
Risk Analysis
| RSP | SCHG | |
| Mean Return | 1.19 | 1.46 |
| R-squared | 94.47 | 92.92 |
| Std. Deviation | 15.36 | 14.78 |
| Alpha | -2.45 | 1.97 |
| Beta | 1.1 | 1.05 |
| Sharpe Ratio | 0.89 | 1.14 |
| Treynor Ratio | 12.12 | 16.3 |
The Invesco S&P 500 Equal Weight ETF (RSP) has a Treynor Ratio of 12.12 with a Alpha of -2.45 and a Beta of 1.1. Its Mean Return is 1.19 while RSP’s Standard Deviation is 15.36. Furthermore, the fund has a R-squared of 94.47 and a Sharpe Ratio of 0.89.
The Schwab U.S. Large-Cap Growth ETF (SCHG) has a Sharpe Ratio of 1.14 with a Mean Return of 1.46 and a R-squared of 92.92. Its Treynor Ratio is 16.3 while SCHG’s Beta is 1.05. Furthermore, the fund has a Standard Deviation of 14.78 and a Alpha of 1.97.
RSP’s Mean Return is 0.27 points lower than that of SCHG and its R-squared is 1.55 points higher. With a Standard Deviation of 15.36, RSP is slightly more volatile than SCHG. The Alpha and Beta of RSP are 4.42 points lower and 0.05 points higher than SCHG’s Alpha and Beta.
Performance
Annual Returns
| Year | RSP | SCHG |
| 2020 | 12.75% | 39.13% |
| 2019 | 28.94% | 36.21% |
| 2018 | -7.77% | -1.35% |
| 2017 | 18.52% | 28.04% |
| 2016 | 14.34% | 6.76% |
| 2015 | -2.57% | 3.26% |
| 2014 | 14.02% | 15.74% |
| 2013 | 35.6% | 33.96% |
| 2012 | 17.04% | 17.02% |
| 2011 | -0.5% | -0.67% |
| 2010 | 21.3% | 16.83% |
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 2020 was the strongest year for SCHG, returning 39.13% on an annual basis. The poorest year for SCHG in the last ten years was 2018, with a yield of -1.35%. Most years the Schwab U.S. Large-Cap Growth ETF has given investors modest returns, such as in 2014, 2010, and 2012, when gains were 15.74%, 16.83%, and 17.02% respectively.
Portfolio Growth
| Fund | Initial Balance | Final Balance | CAGR |
| RSP | $10,000 | $31,875 | 13.79% |
| SCHG | $10,000 | $47,556 | 17.81% |
A $10,000 investment in RSP would have resulted in a final balance of $31,875. This is a profit of $21,875 over 10 years and amounts to a compound annual growth rate (CAGR) of 13.79%.
With a $10,000 investment in SCHG, the end total would have been $47,556. This equates to a $37,556 profit over 10 years and a compound annual growth rate (CAGR) of 17.81%.
RSP’s CAGR is 4.02 percentage points lower than that of SCHG and as a result, would have yielded $15,681 less on a $10,000 investment. Thus, RSP performed worse than SCHG by 4.02% annually.
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