Ms. Subramanian’s recommendation: Own the equal-weighted version of the index for the second half of the year.
Another benefit: long-term returns. The 20-year average annual return of the equal-weighted index is 11.5 per cent, as of April 30, 2023, according to S&P. That beats the 10.3-per-cent return for the market-weighted version of the S&P 500 over the same period. ETFs tied to equal weighting also tend to cost more in fees, given the frequent rebalancing required to maintain the proper weightings. The Invesco fund charges a management expense ratio of 0.2 per cent – not a lot, but more than five times what a typical S&P 500 ETF will cost.
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