ETF Talk: Rea(W)L Patience: Invesco S&P 500 Revenue ETF (RWL)

“The two most powerful warriors are patience and time.”

–Leo Tolstoy

In the midst of the market chaos fueled by President Trump’s tariffs, investors must stay calm and collected. The trade war requires warriors like us to remain patient.

When it comes to timing, the markets are very volatile right now, with retaliatory tariffs and heightened tensions with countries in the European Union and China. Because of this, investing in exchange-traded funds (ETFs) might be more attractive to investors who still want exposure to large companies that they can be patient with, without taking the risk of trying to pick which ones will be winners.

The S&P 500 is an attractive index to tap into due to its history of positive returns and the variety of sectors it invests in. The Invesco S&P 500 Revenue ETF (RWL) may just be the right choice for investor-warriors who have the patience for long-term investing.

RWL is a revenue-weighted ETF, which weighs its holdings based on revenue generated by the companies, rather than market capitalization. Investors can have their hand in some of the largest companies on the market without having to place all their eggs in one basket.

The fund seeks to track the investment results of the S&P 500 Revenue-Weighted Index. No company in its holdings makes up more than 5%, with the top 10 holdings making up only 23.70% of total assets.

The top holdings include Walmart Inc. (NYSE: WMT), Amazon.com, Inc. (NASDAQ: AMZN), UnitedHealth Group Incorporated (NYSE: UNH), Apple Inc. (NASDAQ: AAPL), Berkshire Hathaway Inc. (NYSE: BRK-B), CVS Health Corporation (NYSE: CVS), Exxon Mobil Corporation (NYSE: XOM), McKesson Corporation (NYSE: MCK), Cencora, Inc. (NYSE: COR) and JPMorgan Chase & Co. (NYSE: JPM).

Exclusive ETF Talk: Finding Value in Your Brokerage

Chart Courtesy of www.stockcharts.com

Since it mimics the revenue-producing securities of the S&P 500, this ETF, like many other funds in the market right now, shows a clear dip in the chart above. However, RWL invests in several sectors and large companies, so when the market rebounds after this madness, it could yield long-term profits.

The ETF and Index are rebalanced quarterly, with net assets of $5.32 billion and a price-to-earnings (P/E) ratio of 17.

Anyone interested in a fund should consider its holdings and purpose to ensure it fits one’s goals and personal risk tolerance before buying any new investment. That process is part of the due diligence that should be performed before adding any stock, fund or ETF to one’s portfolio.

As always, I am happy to answer any of your questions about ETFs, so do not hesitate to send me an email. You just may see your question answered in a future ETF Talk.

Jim Woods

Jim Woods is a 20-plus-year veteran of the markets with varied experience as a broker, hedge fund trader, financial writer, author and newsletter editor. Jim is the editor of Forecasts & Strategies, Tactical Trader, TNT Trader, Five Star Trader, Bullseye Stock Trader, and The Deep Woods. His books include co-authoring, “Billion Dollar Green: Profit from the Eco Revolution,” and “The Wealth Shield: How to Invest and Protect Your Money from Another Stock Market Crash, Financial Crisis or Global Economic Collapse.” He’s also ghostwritten many books and articles, as well as edited content for some of the investment industry’s biggest luminaries. His articles have appeared on many leading financial websites, including StockInvestor.com, InvestorPlace.com, Main Street Investor, MarketWatch, Street Authority, Human Events and many others. Jim formerly worked with Investor’s Business Daily founder William J. O’Neil, helping to author training courses in the CANSLIM stock-picking methodology. The independent firm TipRanks rates Jim the No. 3 financial blogger in the world (out of more than 6,000). TipRanks calculates that, since 2012, he's made 361 successful recommendations out of 499 total, earning a success rate of 72% and a +15.3% average return per recommendation. He is known in professional and personal circles as “The Renaissance Man,” because his expertise includes such varied fields as composing and performing music; Western horsemanship, combat marksmanship, martial arts, auto racing and bodybuilding. Jim holds a BA in philosophy from the University of California, Los Angeles, and is a former U.S. Army paratrooper. A self-described “radical for capitalism,” he celebrates the virtue of making money from his Southern California horse ranch.