The S&P 500 has become shorthand for “the market,” but not every S&P 500 fund plays by the same rulebook. Invesco has built an exchange-traded fund that rewires how the index is weighted, and over long stretches that structural tweak has translated into periods of stronger returns than a traditional tracker like Vanguard’s VOO. I want to unpack how that works, what trade-offs it creates, and why the same firm is also experimenting with even more aggressive ways to juice index performance.
How Invesco rewrites the S&P 500 rulebook
The starting point is simple: most investors know the S&P 500 as a market-cap index, where giants like Apple and Microsoft dominate the performance. The Invesco S&P 500 Equal Weight ETF, known by its ticker RSP, keeps the same 500 constituents but gives each stock roughly the same influence on returns instead of letting the largest companies call the shots. That means a mid-cap industrial and a mega-cap tech stock sit side by side with similar portfolio weight, which is a very different bet than owning a cap-weighted fund such as VOO.
By design, that equal approach spreads exposure across more corners of the market and forces a regular rebalance out of recent winners and into laggards. The Invesco team describes the Equal Weight ETF RSP as offering a “unique twist on traditional index investing,” with a structure that aims for more balanced exposure across sectors rather than a tech-heavy tilt. I see that as a rules-based way to lean into mean reversion, systematically trimming what has run and topping up what has been left behind, which is a very different engine than the momentum that drives a cap-weighted benchmark.
RSP versus VOO: fees, income, and sector tilts
When I compare RSP with VOO, the first obvious difference is cost. RSP charges a higher expense ratio than its Vanguard rival, while VOO is built to be one of the cheapest ways to own the S&P 500. That fee gap is not trivial over decades, but it is only one part of the equation. Reporting on RSP notes that the fund offsets some of that disadvantage with a modestly higher dividend yield than VOO, which can matter for investors who care about cash flow as much as price appreciation.
The second big difference is what sits under the hood. Because RSP equal-weights its holdings, it ends up with very different sector weights than a cap-weighted S&P 500 tracker. Analysis of those sector weights shows that RSP typically has less concentration in mega-cap technology and more exposure to areas like industrials and equal-sized slices of financials and consumer names. That can help when leadership broadens out beyond a handful of tech titans, but it can also cause RSP to lag in periods when the largest growth stocks are doing all the heavy lifting.
Performance patterns without the hype
Performance is where the marketing language around “crushing” VOO needs to be handled carefully. Over some long windows, equal-weight strategies have outpaced cap-weighted S&P 500 funds, particularly in cycles when smaller and value-oriented stocks have the upper hand. Coverage of RSP versus VOO notes that VOO has delivered strong returns in its own right, and that investors who prioritize the lowest possible fees and straightforward market exposure may still prefer the Vanguard fund. The same reporting on VOO makes clear that there is no one-size-fits-all winner, only different trade-offs.
Crucially, none of the available sources quantify RSP’s edge over VOO as a specific cumulative figure such as 276 percent, and I cannot verify that number. What I can say, based on the comparison of RSP and VOO, is that RSP has historically tended to outperform during stretches when the market’s gains are broad-based and when smaller S&P 500 constituents are in favor, while VOO has shined in eras dominated by a narrow group of mega-cap leaders. Any claim that RSP has categorically “crushed” VOO with a specific percentage edge over a full cycle is unverified based on available sources, and investors should treat such precise figures with skepticism unless they can trace them back to transparent performance data.
Why equal weight feels different in real portfolios
Beyond headline returns, equal weight changes the day-to-day experience of owning the S&P 500. The Invesco materials on the Equal Weight ETF RSP emphasize that, unlike standard ETFs that weight holdings by market capitalization, this structure can reduce concentration risk and give more room for underappreciated sectors to contribute. The description of The Invesco approach highlights that more balanced exposure across sectors can appeal to investors who worry about being overexposed to a single industry or style factor.
In practice, that means living with a different pattern of tracking error versus the headline S&P 500 index. When mega-cap technology stocks surge, an equal-weight portfolio will usually lag, because it has systematically underweighted those names. When leadership rotates into cyclicals, financials, or smaller companies, RSP can suddenly look like the smarter bet. The blog analysis of the Equal Weight ETF underscores that this is a deliberate design choice, not a bug, and that investors need to be comfortable with periods of underperformance in exchange for the potential long-term benefits of diversification and rebalancing.
Invesco’s “rocket fuel” twist on indexing
RSP is not the only way Invesco is trying to rethink index investing. The firm also runs the Invesco RAFI US 1000 ETF, ticker PRF, which takes a more aggressive stance on what should drive portfolio weights. Instead of relying on market capitalization, PRF uses fundamental metrics such as cash flow to decide how much of each company to own. A recent Quick Read describes how this approach aims to put “rocket fuel” on the S&P 500 concept by tilting toward companies with stronger underlying business metrics rather than simply the highest stock market valuations.
That fundamental tilt can create a very different mix of holdings than either RSP or VOO, and it pushes the idea of rules-based investing further away from pure index replication. The same coverage of Invesco RAFI US notes that PRF holds over one thousand stocks and weights them by fundamentals, which can lead to heavier exposure to companies that look cheap on measures like cash flow and sales. For investors, that means accepting a strategy that behaves more like a systematic value tilt than a plain-vanilla index fund, with the potential for both bigger upside and deeper drawdowns relative to a traditional S&P 500 tracker.
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*This article was researched with the help of AI, with human editors creating the final content.
Grant Mercer covers market dynamics, business trends, and the economic forces driving growth across industries. His analysis connects macro movements with real-world implications for investors, entrepreneurs, and professionals. Through his work at The Daily Overview, Grant helps readers understand how markets function and where opportunities may emerge.
