The Invesco S&P 500 Equal Weight Technology ETF (RYT – Free Report) was launched on 11/01/2006, and is a passively managed exchange traded fund designed to offer broad exposure to the Technology – Broad segment of the equity market.
Passively managed ETFs are becoming increasingly popular among institutional as well as retail investors due to their low costs, transparency, flexibility and tax efficiency. These are excellent vehicles for long-term investors.
Investor-friendly, sector ETFs provide multiple options to gain low-risk and diversified exposure to a broad group of companies in specific sectors. Technology – Broad is one of 16 Zacks broad sectors within the Zacks Industry classification. It is currently ranked 9th, placing it under 44%.
Index Details
The fund is sponsored by Invesco. It has accumulated assets of more than $1.96 billion, making it one of the larger ETFs that attempts to match the performance of the Technology – Broad segment of the equity market. RYT seeks to match the performance of the S&P 500 Equal Weight Information Technology Index before fees and expenses.
The S&P 500 Equal Weight Information Technology Index equally weights stocks in the information technology sector of the S&P 500 Index.
Expenses
Cost is an important factor in choosing the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are equal.
Annual operating expenses for this ETF are 0.40%, making it one of the cheapest products in the space.
It has a 12-month trailing dividend yield of 0.69%.
Sector Exposure and Top Holdings
Although ETFs offer diversified exposure that minimizes single stock risk, it’s still important to look at a fund’s holdings before investing. Fortunately, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has the heaviest allocation to the Information Technology sector–about 100% of the portfolio.
Looking at individual holdings, Intuit Inc (INTO – Free Report) accounts for approximately 1.44% of total assets, followed by Epam Systems Inc (EPAM – Free Report) and Servicenow Inc (NOW – Free Report) .
The top 10 holdings account for approximately 13.97% of total assets under management.
Performance and Risk
The ETF has lost about -25.73% so far this year and is down about -16.86% over the past one year (since 09/22/2022). Over the past 52-week period, it has traded between $229.64 and $327.55.
The ETF has a beta of 1.16 and a standard deviation of 29.46% for the trailing three years, making it a medium risk option in the space. With approximately 77 holdings, it effectively diversifies company-specific risk.
Alternatives
Invesco S&P 500 Equal Weight Technology ETF has a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class returns, expense ratio, and momentum, among other factors. This makes RYT an excellent option for investors seeking exposure to the Technology ETFs segment of the market. There are other additional ETFs in the space that investors may also consider.
Select Technology Sector SPDR ETF (XLK – Free Report) tracks the Technology Select Sector Index and the Vanguard Information Technology ETF (VGT – Free Report) tracks the MSCI US Investable Market Information Technology 25/50 Index. The Technology Select Sector SPDR ETF has $38.76 billion in assets, the Vanguard Information Technology ETF has $42.05 billion. XLK has an expense ratio of 0.10% and VGT charges 0.10%.
Bottom Line
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