S&P 500 vs Equal-Weight S&P 500
SPY (cap-weighted S&P 500) and RSP (Invesco Equal Weight S&P 500) hold the same 500 stocks but with radically different weighting methodologies. SPY weights by free-float market cap, putting approximately 30 percent in the top 10 stocks and 50+ percent in the top 25.
Also known as: S&P 500 ETF (SPY) (ETF_SPY, S&P 500, SPX, SP500) · S&P 500 Equal Weight (RSP) (ETF_RSP, equal weight)
Why This Comparison Matters
SPY (cap-weighted S&P 500) and RSP (Invesco Equal Weight S&P 500) hold the same 500 stocks but with radically different weighting methodologies. SPY weights by free-float market cap, putting approximately 30 percent in the top 10 stocks and 50+ percent in the top 25. RSP weights every constituent equally at approximately 0.20 percent, rebalanced quarterly. Year-to-date 2026, RSP has outperformed SPY by approximately 5 percentage points (RSP +1 percent vs SPY -4 percent through late March 2026, recovered modestly since). The outperformance reflects mega-cap drag on cap-weighted SPY and the structural buy-low-sell-high discipline of equal-weight rebalancing. The pair captures the most fundamental market-breadth indicator in equity markets.
Cap-Weight vs Equal-Weight Mechanics
SPY weights by free-float market cap. April 2026 top weights: Apple ~7%, Microsoft ~7%, Nvidia ~7%, Amazon ~4%, Google (combined) ~4%, Meta ~2.5%, Tesla ~2%, Broadcom ~2%, Berkshire Hathaway ~2%, JPMorgan ~1.5%. The top 10 represent approximately 35 percent of SPY assets. Mega-cap concentration peaked near 38 percent in early 2024.
RSP holds the same 500 stocks but weights each at approximately 0.20 percent (1/500). Quarterly rebalancing forces selling of recent winners back to 0.20 percent weight and buying of recent losers. The mechanical buy-low-sell-high discipline produces structural alpha when sector breadth is healthy.
The practical implication: SPY is essentially a Magnificent 7 wrapper plus 493 other stocks. RSP is a true diversified equity exposure where each name contributes equally. When mega-caps lead, SPY outperforms; when breadth is healthy, RSP outperforms.
The 2024-2026 Rotation Story
From 2014 through 2024, SPY outperformed RSP cumulatively by approximately 70-80 percentage points, the longest sustained equal-weight underperformance in RSP's history. The driver was mega-cap dominance: AAPL, MSFT, NVDA, GOOGL, AMZN, META, TSLA combined market cap reached $20 trillion by early 2024, dominating SPY weighting and returns.
The 2025-2026 rotation has been material. RSP outpaced SPY by ~5 percentage points YTD 2026. The catalysts: AI capex translation questions weighing on mega-cap tech; Iran war-related sector rotation favoring industrials/financials/healthcare; Fed cut anticipation favoring rate-sensitive sectors that are equal-weighted in RSP but under-weighted in SPY.
The equal-weight outperformance is not just SPY-specific weakness; it reflects genuine breadth improvement. The number of S&P 500 stocks above their 200-day moving average has risen from approximately 50 percent in early 2024 to approximately 75 percent in April 2026.
Sector Differences
RSP and SPY have similar overall sector weights but with material differences in concentration. SPY: Tech ~30 percent, Financials 13 percent, Healthcare 12 percent, Consumer Discretionary 11 percent, Communications 9 percent, Industrials 8 percent, Consumer Staples 6 percent, Energy 4 percent. The Tech weight is dominated by 3-4 mega-caps.
Conditional Forward Response (Tail Events)
How S&P 500 Equal Weight (RSP) has historically behaved in the 5 sessions following a top-decile or bottom-decile daily move in S&P 500 ETF (SPY). Computed from 1,285 aligned daily observations ending .
Following these triggers, S&P 500 Equal Weight (RSP) falls 0.04% on average over the next 5 sessions, versus an unconditional baseline of +0.14%. 129 qualifying events; S&P 500 Equal Weight (RSP) closed positive in 51% of them.
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Frequently Asked Questions
What's the difference between SPY and RSP?+
SPY (cap-weighted S&P 500) and RSP (Invesco Equal Weight S&P 500) hold the same 500 stocks but with different weighting methodologies. SPY weights by free-float market cap (top 10 ~35% of assets, top 25 ~50+%). RSP weights every constituent equally at ~0.20 percent (1/500), rebalanced quarterly. The top 10 SPY weights April 2026: AAPL ~7%, MSFT ~7%, NVDA ~7%, AMZN ~4%, Google combined ~4%, META ~2.5%, TSLA ~2%, AVGO ~2%, BRK.B ~2%, JPM ~1.5%. RSP holds same names but at 0.20 percent each. Mega-cap concentration peaked at 38 percent in early 2024 (highest in S&P 500 history; previous record 33% in 1999 Tech Bubble).
Why is RSP outperforming SPY in 2026?+
YTD 2026 RSP has outpaced SPY by ~5 percentage points (RSP +1% vs SPY -4% through late March, recovered since). Catalysts: AI capex translation questions weighing on mega-cap tech (top 10 SPY holdings); Iran war-related sector rotation favoring industrials/financials/healthcare which are over-weighted in RSP; Fed cut anticipation favoring rate-sensitive sectors. The rotation reflects genuine breadth improvement: number of S&P 500 stocks above 200-day MA has risen from ~50% in early 2024 to ~75% in April 2026.
How do sector weights differ?+
SPY: Tech ~30%, Financials 13%, Healthcare 12%, Consumer Discretionary 11%, Communications 9%, Industrials 8%, Consumer Staples 6%, Energy 4%. The Tech weight is dominated by 3-4 mega-caps. RSP April 2026: Industrials ~16%, Financials ~15%, Tech ~14%, Healthcare ~13%, Consumer Discretionary ~10%, Consumer Staples ~6%. RSP's 14% Tech vs SPY's 30% is the central structural difference. Practical implication: RSP is more cyclical, more value-tilted, and less duration-sensitive than SPY.
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Data sourced from FRED, CoinGecko, CBOE, and other providers. This page is for informational purposes only and does not constitute financial advice. Past performance does not guarantee future results.