Should You Invest in the Invesco S&P 500 Equal Weight Materials ETF (RSPM)?
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jul 10 2024
0mins
Source: NASDAQ.COM
Invesco S&P 500 Equal Weight Materials ETF (RSPM):
- Launched on 11/01/2006, this passively managed ETF provides exposure to the Materials - Broad segment of the equity market.
- Offers low costs, transparency, flexibility, and tax efficiency for both retail and institutional investors.
- Sponsored by Invesco, the fund has assets over $267.38 million and seeks to match the performance of the S&P 500 EQUAL WEIGHT MATERIALS INDEX.
- The ETF has a 12-month trailing dividend yield of 2% and a 0.40% annual operating expense ratio.
- It is heavily allocated in the Materials sector, with top holdings including International Paper Co (IP), Newmont Corp (NEM), and International Flavors & Fragrances Inc (IFF).
Performance and Risk:
- The ETF has gained about 1.32% year-to-date and 6.95% in the last year, with a beta of 1.10 and standard deviation of 20.01%.
- With around 29 holdings, it has more concentrated exposure compared to peers.
Alternatives:
- Investors can consider other ETF options like Materials Select Sector SPDR ETF (XLB) and FlexShares Morningstar Global Upstream Natural Resources ETF (GUNR).
- XLB tracks the Materials Select Sector Index, while GUNR tracks the Morningstar Global Upstream Natural Resources Index.
- XLB has $5.39 billion in assets with an expense ratio of 0.09%, and GUNR has $5.82 billion with a 0.46% expense ratio.
Bottom Line:
- Invesco S&P 500 Equal Weight Materials ETF (RSPM) is ranked 3 (Hold) by Zacks and offers exposure to the Materials ETFs area of the market.
- Investors are encouraged to explore products that align with their investment objectives and stay updated on ETF investing developments through resources like Zacks ETF Center.
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Analyst Views on IP
Wall Street analysts forecast IP stock price to rise
12 Analyst Rating
9 Buy
2 Hold
1 Sell
Moderate Buy
Current: 33.520
Low
36.00
Averages
48.35
High
57.80
Current: 33.520
Low
36.00
Averages
48.35
High
57.80
About IP
International Paper Company is a sustainable packaging solutions company. The Company's segments include Packaging Solutions North America and Packaging Solutions EMEA. The Company's products and services include Packaging, Packaging Services, and Recycling. It provides corrugated packaging, solid fiber, corrugated sheets, retail displays, bulk packaging, and more. It also offers related services such as design and fulfillment to support these solutions. It provides a range of packaging and display services, from design and testing to fulfillment, including structural design, graphic design services, printing, testing, fulfillment and assembly and mechanical packaging. Its recycling solutions and services manage fiber recovery programs for retailers, grocers, e-commerce, distribution centers, manufacturers, and our own box plants. It designs closed-loop recycling programs that move old corrugated containers (OCC) and other fiber-based recycling materials.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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See More
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- Earnings Beat Expectations: International Paper reported earnings of 15 cents per share for Q1, surpassing market expectations, indicating improvements in cost control and operational efficiency despite a challenging overall market environment.
- Sales Missed Targets: The company's sales totaled $5.970 billion, falling short of analyst expectations, reflecting weak demand and intensified market competition, which could pose pressure on future revenue growth.
- Cautious Market Reaction: Although earnings exceeded expectations, the shortfall in sales may lead to diminished investor confidence in the company's future performance, potentially impacting stock price movements, necessitating close monitoring of subsequent market dynamics.
- Need for Strategic Adjustments: In light of declining sales, International Paper may need to reassess its market strategies and product offerings to adapt to changing market demands, ensuring long-term sustainable growth.
See More
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See More
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- Chipmakers Surge: Qualcomm's Q2 adjusted revenue of $10.60 billion surpassed expectations of $10.56 billion, resulting in a stock surge of over 15%, which not only enhanced its market position but also lifted the entire semiconductor sector.
- Positive Economic Data: U.S. initial jobless claims fell to 189,000, a 57-year low, reflecting a robust labor market that further bolstered investor confidence in economic recovery, contributing to the stock market's rise.
- Oil Price Decline Supports Stocks: WTI crude oil prices fell by more than 1%, lowering inflation expectations and bond yields, which provided support for the stock market, with the 10-year T-note yield dropping to 4.38%, creating a favorable financing environment for equities.
See More
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- Oversold Signal: International Paper Co (IP) has an RSI of 29.5, indicating that after significant selling pressure, the stock may be nearing a bottom, prompting investors to consider buying opportunities.
- Price Fluctuation: IP shares hit a low of $29.45, with the current trading price at $30.42, still significantly below the 52-week high of $56.13, reflecting market caution towards the stock.
- Market Comparison: Compared to the S&P 500 ETF (SPY) with an RSI of 69.1, IP's oversold condition may attract investors looking for a rebound, highlighting a divergence in market sentiment.
- Investor Strategy: With the RSI nearing 30, investors might perceive that the selling pressure is waning, providing a basis for future buying decisions, which could influence short-term price movements.
See More
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- Strong Labor Market: U.S. initial jobless claims fell to 189,000, a 57-year low, indicating a robust labor market that exceeded expectations of 212,000, further bolstering market confidence in economic recovery.
- Declining Inflation Expectations: WTI crude oil prices dropped over 1%, leading to lower inflation expectations and bond yields, with the 10-year T-note yield down 4 basis points to 4.39%, providing support for the stock market.
- Global Economic Impact: The blockade of the Strait of Hormuz due to escalating tensions with Iran could exacerbate the global energy crisis, with Goldman Sachs estimating a reduction of nearly 500 million barrels from global crude stockpiles, potentially reaching a billion barrels by June, affecting market supply-demand dynamics.
See More
