SPYM's decade of market leadership highlights the impact of cap-weighting, as concentrated tech bets continue to outperform the broader diversification offered by equal-weighted alternatives like RSP.
SPYM's cap-weighted structure has driven decade-long outperformance but concentrates risk in mega-cap tech.
RSP's equal-weight construction provides broader diversification but has trailed cap-weighted SPYM over the past decade.
Apple is the largest holding in SPYM at 6.59% of net assets, illustrating the fund's concentration.
Amazon is a significant holding in SPYM at 3.62% of net assets.
Alphabet's Class A shares are part of the combined share classes that represent a notable concentration in SPYM.
Alphabet's Class C shares are part of the combined share classes that represent a notable concentration in SPYM.
Broadcom is a top holding in SPYM at 2.77% of net assets.
The SPDR Portfolio S&P 500 ETF (SPYM) has delivered a 323% return over the last decade, significantly outpacing the Invesco S&P 500 Equal Weight ETF (RSP) at 203%. This divergence stems from SPYM's market-cap-weighted structure, which concentrates capital in mega-cap tech leaders like Apple and Amazon, while RSP maintains equal exposure across all 500 constituents.
SPYM is market-capitalization-weighted, meaning larger companies represent a higher percentage of the fund, whereas RSP is equal-weighted, giving every company in the S&P 500 an identical allocation.
SPYM's performance has been driven by the rapid growth of mega-cap technology companies, which automatically receive higher weightings in the fund as their market value increases.