EQL Ends June Near Flat as Mega-Cap Tech Falls

The ALPS Equal Sector Weight ETF (EQL) finished June down 0.10%, while the S&P 500 fell 1.0% for the month. Declines among a handful of large technology companies contributed to broader market weakness in June.

EQL holds stocks across 11 sectors and rebalances to give each sector roughly an equal share of the index, about 9% at each rebalance. Within each sector, individual stocks are weighted by size.

Within EQL’s equal-weighted sector index, healthcare rose 6.5% in June, industrials advanced 5.8%, financials gained 4.2% and utilities increased 2.6%. Consumer discretionary fell 4.6% for the sector overall. Amazon.com Inc. dropped 11.9% in June and reduced the consumer discretionary sector’s net contribution to the ETF by about 0.45 percentage points. Alphabet Inc. fell nearly 6%, and the media and communications sector declined roughly 7.5%. Smaller names in those sectors moved higher; Expedia Group rose 13.3% and Airbnb climbed 7.3%, but those gains had limited effect on sector-level returns relative to the larger companies’ moves.

The equal-sector structure limits exposure to any single large company compared with a market-cap-weighted index such as the S&P 500, where a few mega-cap stocks carry outsized weight. As a result, losses in the largest technology names had a bigger impact on cap-weighted benchmarks than on EQL’s evenly distributed lineup.

VettaFi LLC provides the underlying index for EQL and receives an index licensing fee. EQL is not issued, sponsored, endorsed or sold by VettaFi, and VettaFi is not responsible for the ETF’s issuance, administration, marketing or trading.