A sound investment process and strong management team underpin Invesco S&P 500® Equal Wt Hlth Care ETF's Morningstar Medalist Rating of Silver. The portfolio maintains a sizable cost advantage over competitors, priced within the least expensive fee quintile among peers.  

 The strategy's investment process inspires confidence and earns an Above Average Process Pillar rating. Independent of the rating, analysis of the strategy's portfolio shows it has maintained a significant overweight position in quality exposure and an underweight in volatility exposure compared with category peers. High quality exposure is attributed to stocks with low financial leverage and strong returns on equity. And low volatility exposure is rooted in stocks that have a lower standard deviation of returns. The strategy’s management team earns an Above Average People Pillar rating. The strategy's parent organization earns the firm an Average Parent Pillar rating. People Pillar and Parent Pillar ratings for this strategy are indirectly assigned by a Morningstar analyst rather than algorithmically derived. Please see the notes following each pillar section for more details. The details of assigning methods can be found in each pillar section.

Analyst Rating

Moderna

ResMed

Amgen

Mettler-Toledo

Quest Diagnostics

Boston Scientific

UnitedHealth Group

Elevance Health Inc

Bio-Techne

McKesson

Morningstar's evaluation of this security's process aims to determine the likelihood that it will outperform its Morningstar Category index on a risk-adjusted basis over the long term. Invesco S&P 500® Equal Wt Hlth Care ETF earns an Above Average Process Pillar rating. 

The most meaningful contributor to the rating is that this fund tracks an index. Historical data, like Morningstar's Active/Passive Barometer, finds that passively managed funds have generally outperformed their active counterparts, especially over longer time horizons. Respectable risk-adjusted performance also supports the process. This can be seen in the fund's five-year alpha calculated relative to the category average, which suggests that the managers have shown skill in their allocation of risk. Lastly, the process is limited by its parent firm's disappointing risk-adjusted performance, as shown by the firm's average 10-year Morningstar Rating of 2.8 stars. A lower star rating suggests that the firm has struggled to outperform on a risk-adjusted basis.

 This strategy tends to hold smaller, more value-oriented companies than its average peer in the Health Morningstar Category. Analyzing additional factors, this strategy has consistently had a defensive tilt owing to its exposure to high-quality stocks over the past few years. This means the fund holds consistently profitable, growing companies with solid balance sheets that may help it weather downturns better than Morningstar Category peers. In recent months, the strategy was more exposed to the Quality factor compared with its Morningstar Category peers as well. The managers have also shown an underweight risk tilt, demonstrated by lower volatility exposure over peers in recent years. These companies have historically been a valuable ballast to steady portfolio returns during market downturns. Similarly, in recent months, the strategy also had less exposure to the Volatility factor than peers. Additionally, the managers have tended to overweight yield, shown by the portfolio's high exposure to stocks paying dividends or buying back shares. High-yield stocks tend to be associated with more mature, profitable businesses that can grow as well as provide a stream of income. Such stocks could suffer, however, if setbacks force them to cut their dividends. In this month, the strategy also had more exposure to the Yield factor over its peers. More information on a fund and its respective category's factor exposure can be found in the Factor Profile module within the Portfolio section. 

 The portfolio has allocations in its top two sectors, healthcare and energy, that are similar to the category. The sectors with low exposure compared to category peers are basic materials and technology; however, the allocations are similar to the category. The strategy owns 66 securities and its assets are more dispersed than peers in the category. In particular, 16.4% of the portfolio's assets are concentrated in the top 10 fund holdings, as opposed to the category’s 41.0% average. And in closing, in terms of portfolio turnover, looking at year-over-year movements, 26% of the fund's holdings have changed, whether through increasing, decreasing, or changing a position.

Above Average

Process

Invesco S&P 500® Equal Wt Hlth Care ETF's strong equity team drives the strategy's Above Average People Pillar rating. There are four managers listed on the fund: Peter Hubbard, Tony Seisser, Michael Jeanette, Pratik Doshi. The team is well equipped, with an average of 12 years of portfolio management experience. Together, they manage a total of 145 strategies, with solid long-term prospects. The strategies average a Bronze asset-weighted Morningstar Medalist Rating, indicating a position to deliver positive alpha relative to the category median in aggregate. This group has had relatively low management turnover, providing a stable environment and continuity for the strategies. 

 Note: This People Pillar rating is indirectly assigned by an analyst. Morningstar analysts evaluate the People Pillar for passive products at the brand level and may also differentiate by asset class. There is at least one other passive strategy at the firm that is covered by a Morningstar analyst, so the People Pillar rating of the fund is inherited from the rating that the Morningstar analyst assigned to investment vehicles under the same brand name.

People

Invesco succeeds in a number of areas but also has its share of subpar offerings, along with many others that land somewhere in the middle. A mid-2023 change of CEO, from longtime chief Marty Flanagan to veteran Invesco executive Andrew Schlossberg, is noteworthy, and several other executives retired or departed in 2023. Portfolio-manager shuffles aimed at bolstering poor performers, which began under Flanagan, have continued under Schlossberg, who told Morningstar his most important aim is bolstering “investment quality.” However, major changes of direction or approach are unlikely. The firm retains a Morningstar Parent rating of Average. 
Invesco’s international-equity teams in Texas and New York remain solid. However, the extensive U.S.-equity lineup needs improvement. Fixed-income offerings run the gamut: The multisector and short-term-bond areas are good, but corporate high-yield is less impressive. The firm’s exchange-traded fund lineup includes the popular Nasdaq-focused QQQ; passive strategies make up around 37% of Invesco’s assets under management. Invesco has not been averse to trying new types of strategies, and it was among the firms that immediately launched a spot bitcoin ETF after SEC approval in early 2024.
The picture outside the United States is mixed. Fund performance has been subpar in Asia, and while the picture has brightened in the United Kingdom and Europe, that region still can’t be considered a strength.

Average

Parent

Invesco S&P 500 Equal Weight Health Care ETF

RSPH tracks an equal-weighted index of US health care companies taken from the S&P 500 Index.

This monthly article series shows aggregate industry metrics in the healthcare sector. All healthcare subsectors are overvalued based on my metrics. Pharmaceuticals/biotechnology has the lowest scores in both value and quality.

RSPH: Healthcare Dashboard For May 2024

Launched on 11/01/2006, the Invesco S&P 500 Equal Weight Health Care ETF (RSPH) is a passively managed exchange traded fund designed to provide a broad exposure to the Healthcare - Broad segment of the equity market.

Should You Invest in the Invesco S&P 500 Equal Weight Health Care ETF (RSPH)?

Making its debut on 11/01/2006, smart beta exchange traded fund Invesco S&P 500 Equal Weight Health Care ETF (RSPH) provides investors broad exposure to the Health Care ETFs category of the market.

Is Invesco S&P 500 Equal Weight Health Care ETF (RSPH) a Strong ETF Right Now?

Healthcare may benefit from a reallocation away from large-cap Technology as investors seek better value. Invesco S&P 500® Equal Weight Health Care ETF provides diversified exposure to the healthcare sector. The RSPH ETF's equal-weight strategy and diverse holdings make it an attractive choice for investors interested in the healthcare sector.

RSPH: The Time For Healthcare And Equal Weight Will Come

The healthcare sector trailed the broader market last year. The group was stymied by its status as a defensive group.

Healthcare Bargains Abound in Equal-Weight ETF

Various stages of the market + business cycle call for rotational strategies in tactical allocation. Healthcare emerges as one standout in defensive markets and is worth a thoughtful analysis. Q3 earnings in the healthcare sector were weaker than expected, but long-term earnings growth projections are strong.

RSPH: Balanced Outlook, Look For Selective Opportunities Over Broad Holdings

As measured by the S&P 500 Growth and Value indexes, growth stocks are trouncing their value counterparts this year. On a year-to-date basis as of August 28, the gap between those two benchmarks is 1,000 basis points in favor of the growth index.

Healthcare Sector Could Propel Value Resurgence

With the hoopla surrounding mega-cap growth stocks this year, some slower-moving sectors may not be getting the attention they deserve. Arguably, healthcare is part of that group.

Healthcare Prime Destination for Bargains, Quality

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Reports made much of a small number of stocks accounting for massive portions of broader market returns early this year. In other words, concentration risk is again on market participants' radars.

News for Invesco S&P 500 Equal Weight Health Care ETF ETF (RSPH)