Should You Invest in the Invesco S&P 500 Equal Weight Industrials ETF (RGI)? – Yahoo Finance

Posted: February 17, 2020 at 6:45 pm


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The Invesco S&P 500 Equal Weight Industrials ETF (RGI) was launched on 11/01/2006, and is a passively managed exchange traded fund designed to offer broad exposure to the Industrials - Broad segment of the equity market.

Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.

Investor-friendly, sector ETFs provide many options to gain low risk and diversified exposure to a broad group of companies in particular sectors. Industrials - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 13, placing it in bottom 19%.

Index Details

The fund is sponsored by Invesco. It has amassed assets over $238.29 M, making it one of the average sized ETFs attempting to match the performance of the Industrials - Broad segment of the equity market. RGI seeks to match the performance of the S&P 500 Equal Weight Industrials Index before fees and expenses.

This index is an unmanaged equal weighted version of the S&P 500 Industrials Index that consists of the common stocks of the following industries: aerospace & defense, building products, construction & engineering, electrical equipment, conglomerates, machinery; commercial services & supplies, air freight & logistics, airlines, marine, road & rail transportation infrastructure.

Costs

Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.

Annual operating expenses for this ETF are 0.40%, making it one of the cheaper products in the space.

It has a 12-month trailing dividend yield of 1.29%.

Sector Exposure and Top Holdings

ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.

This ETF has heaviest allocation in the Industrials sector--about 100% of the portfolio.

Looking at individual holdings, Northrop Grumman Corp (NOC) accounts for about 1.53% of total assets, followed by Lockheed Martin Corp (LMT) and Huntington Ingalls Industries Inc (HII).

The top 10 holdings account for about 14.94% of total assets under management.

Performance and Risk

Year-to-date, the Invesco S&P 500 Equal Weight Industrials ETF return is roughly 3.50% so far, and was up about 19.21% over the last 12 months (as of 02/17/2020). RGI has traded between $116.14 and $141.39 in this past 52-week period.

The ETF has a beta of 1.20 and standard deviation of 15.38% for the trailing three-year period, making it a medium risk choice in the space. With about 70 holdings, it effectively diversifies company-specific risk.

Alternatives

Invesco S&P 500 Equal Weight Industrials ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, RGI is a sufficient option for those seeking exposure to the Industrials ETFs area of the market. Investors might also want to consider some other ETF options in the space.

Vanguard Industrials ETF (VIS) tracks MSCI US Investable Market Industrials 25/50 Index and the Industrial Select Sector SPDR ETF (XLI) tracks Industrial Select Sector Index. Vanguard Industrials ETF has $3.74 B in assets, Industrial Select Sector SPDR ETF has $11.97 B. VIS has an expense ratio of 0.10% and XLI charges 0.13%.

Bottom Line

To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Invesco S&P 500 Equal Weight Industrials ETF (RGI): ETF Research Reports Northrop Grumman Corporation (NOC) : Free Stock Analysis Report Lockheed Martin Corporation (LMT) : Free Stock Analysis Report Vanguard Industrials ETF (VIS): ETF Research Reports Industrial Select Sector SPDR ETF (XLI): ETF Research Reports Huntington Ingalls Industries, Inc. (HII) : Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research

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Should You Invest in the Invesco S&P 500 Equal Weight Industrials ETF (RGI)? - Yahoo Finance

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February 17th, 2020 at 6:45 pm

Posted in Investment