The ALPS Equal Sector Weight ETF (EQL) was launched on 07/07/2009, and is a passively managed exchange traded fund designed to offer broad exposure to the Large Cap Blend segment of the US equity market.

The fund is sponsored by Alps. It has amassed assets over $391.53 million, making it one of the average sized ETFs attempting to match the Large Cap Blend segment of the US equity market.

Why Large Cap Blend

Large cap companies typically have a market capitalization above $10 billion. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.

Typically holding a combination of both growth and value stocks, blend ETFs also demonstrate qualities seen in value and growth investments.

Costs

Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.

Annual operating expenses for this ETF are 0.25%, putting it on par with most peer products in the space.

It has a 12-month trailing dividend yield of 1.73%.

Sector Exposure and Top Holdings

While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.

Looking at individual holdings, Materials Select Sector Spdr Fund (XLB) accounts for about 9.37% of total assets, followed by Technology Select Sector Spdr Fund (XLK) and Consumer Discretionary Select Sector Spdr Fund (XLY).

The top 10 holdings account for about 91.21% of total assets under management.

Performance and Risk

EQL seeks to match the performance of the NYSE Select Sector Equal Weight Index before fees and expenses. The NYSE Equal Sector Weight Index comprises of all active Select Sector SPDR ETFs in an equal weighted portfolio. These sector includes Consumer Discretionary, Consumer Staples, Materials, Energy, Technology, Utilities, Financial, Industrial, Health Care & Real Estate.

The ETF has added roughly 16.32% so far this year and is up about 30.98% in the last one year (as of 11/01/2024). In the past 52-week period, it has traded between $99.98 and $129.32.

The ETF has a beta of 0.95 and standard deviation of 15.40% for the trailing three-year period, making it a medium risk choice in the space. With about 12 holdings, it has more concentrated exposure than peers.

Alternatives

ALPS Equal Sector Weight 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, EQL is a reasonable option for those seeking exposure to the Style Box - Large Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.