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RSP vs. VLUE: What’s The Difference?

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

The expense ratio of RSP is 0.05 percentage points higher than VLUE’s (0.2% vs. 0.15%). RSP also has a lower exposure to the technology sector and a higher standard deviation. Overall, RSP has provided higher returns than VLUE over the past ten years.

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

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Summary

RSPVLUE
NameInvesco S&P 500 Equal Weight ETFiShares MSCI USA Value Factor ETF
CategoryLarge BlendLarge Value
IssuerInvescoiShares
AUM28.62B15.95B
Avg. Return13.79%8.91%
Div. Yield1.31%1.89%
Expense Ratio0.2%0.15%

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 USA Value Factor ETF (VLUE) is a Large Value fund that is issued by iShares. It currently has 15.95B total assets under management and has yielded an average annual return of 8.91% over the past 10 years. The fund has a dividend yield of 1.89% with an expense ratio of 0.15%.

RSP’s dividend yield is 0.58% lower than that of VLUE (1.31% vs. 1.89%). Also, RSP yielded on average 4.88% more per year over the past decade (13.79% vs. 8.91%). The expense ratio of RSP is 0.05 percentage points higher than VLUE’s (0.2% vs. 0.15%).

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Fund Composition

Industry Exposure

RSP vs. VLUE - Industry Exposure

RSPVLUE
Technology14.73%26.89%
Industrials14.62%9.14%
Energy3.9%2.42%
Communication Services4.31%10.39%
Utilities5.58%2.68%
Healthcare13.69%14.31%
Consumer Defensive6.86%7.22%
Real Estate5.84%3.19%
Financial Services13.43%10.96%
Consumer Cyclical13.01%10.66%
Basic Materials4.04%2.14%

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 USA Value Factor ETF (VLUE) has the most exposure to the Technology sector at 26.89%. This is followed by Healthcare and Financial Services at 14.31% and 10.96% respectively. Energy (2.42%), Utilities (2.68%), and Real Estate (3.19%) only make up 8.29% of the fund’s total assets.

VLUE’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Communication Services, Consumer Cyclical, and Financial Services stocks at 7.22%, 9.14%, 10.39%, 10.66%, and 10.96%.

RSP is 12.16% less exposed to the Technology sector than VLUE (14.73% vs 26.89%). RSP’s exposure to Industrials and Healthcare stocks is 5.48% higher and 0.62% lower respectively (14.62% vs. 9.14% and 13.69% vs. 14.31%). In total, Basic Materials, Communication Services, and Utilities also make up 1.28% less of the fund’s holdings compared to VLUE (13.93% vs. 15.21%).

Holdings

RSP - Holdings

RSP HoldingsWeight
Chipotle Mexican Grill Inc0.27%
Nike Inc Class B0.25%
MSCI Inc0.25%
Monolithic Power Systems Inc0.25%
Enphase Energy Inc0.25%
Advanced Micro Devices Inc0.25%
ResMed Inc0.24%
PerkinElmer Inc0.24%
IDEXX Laboratories Inc0.24%
Danaher Corp0.24%

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%.

VLUE - Holdings

VLUE HoldingsWeight
AT&T Inc7.13%
Intel Corp6.14%
General Motors Co3.19%
Micron Technology Inc3.14%
Cisco Systems Inc3.05%
International Business Machines Corp2.76%
Target Corp2.38%
Citigroup Inc2.32%
Ford Motor Co2.23%
Pfizer Inc2.17%

VLUE’s Top Holdings are AT&T Inc, Intel Corp, General Motors Co, Micron Technology Inc, and Cisco Systems Inc at 7.13%, 6.14%, 3.19%, 3.14%, and 3.05%.

International Business Machines Corp (2.76%), Target Corp (2.38%), and Citigroup Inc (2.32%) have a slightly smaller but still significant weight. Ford Motor Co and Pfizer Inc are also represented in the VLUE’s holdings at 2.23% and 2.17%.

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Risk Analysis

RSPVLUE
Mean Return1.190
R-squared94.470
Std. Deviation15.360
Alpha-2.450
Beta1.10
Sharpe Ratio0.890
Treynor Ratio12.120

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

The iShares MSCI USA Value Factor ETF (VLUE) has a Standard Deviation of 0 with a Mean Return of 0 and a Sharpe Ratio of 0. Its R-squared is 0 while VLUE’s Alpha is 0. Furthermore, the fund has a Treynor Ratio of 0 and a Beta of 0.

RSP’s Mean Return is 1.19 points higher than that of VLUE and its R-squared is 94.47 points higher. With a Standard Deviation of 15.36, RSP is slightly more volatile than VLUE. The Alpha and Beta of RSP are 2.45 points lower and 1.10 points higher than VLUE’s Alpha and Beta.

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Performance

Annual Returns

RSP vs. VLUE - Annual Returns

YearRSPVLUE
202012.75%-0.32%
201928.94%27.47%
2018-7.77%-11.18%
201718.52%21.97%
201614.34%15.68%
2015-2.57%-3.54%
201414.02%12.29%
201335.6%0.0%
201217.04%0.0%
2011-0.5%0.0%
201021.3%0.0%

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 2019 was the strongest year for VLUE, returning 27.47% on an annual basis. The poorest year for VLUE in the last ten years was 2018, with a yield of -11.18%. Most years the iShares MSCI USA Value Factor ETF has given investors modest returns, such as in 2012, 2011, and 2010, when gains were 0.0%, 0.0%, and 0.0% respectively.

Portfolio Growth

RSP vs. VLUE - Portfolio Growth

FundInitial BalanceFinal BalanceCAGR
RSP$10,000$20,18513.79%
VLUE$10,000$17,2478.91%

A $10,000 investment in RSP would have resulted in a final balance of $20,185. This is a profit of $10,185 over 7 years and amounts to a compound annual growth rate (CAGR) of 13.79%.

With a $10,000 investment in VLUE, the end total would have been $17,247. This equates to a $7,247 profit over 7 years and a compound annual growth rate (CAGR) of 8.91%.

RSP’s CAGR is 4.88 percentage points higher than that of VLUE and as a result, would have yielded $2,938 more on a $10,000 investment. Thus, RSP outperformed VLUE by 4.88% annually.


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