Equal-weight ETF GSEW nears $2B, returns 12.3% YTD

Goldman Sachs’ Equal Weight U.S. Large Cap Equity ETF (GSEW) returned 12.3% year-to-date, had an expense ratio of 9 basis points and held about $1.8 billion in assets as of mid-July, bringing it close to $2 billion in assets under management.

The fund assigns the same weight to each U.S. large-cap stock in its basket and rebalances monthly to restore equal weights. Its 9-basis-point fee is lower than several rival equal-weight funds, including the Invesco S&P 500 Equal Weight ETF (RSP).

GSEW gained 16.9% over the past 12 months and 16.2% over the past three years. Those returns exceeded the category average for large-cap equity ETFs for the same periods.

As of July 14, the fund’s price traded above both its 50-day and 200-day simple moving averages, a technical setup some market participants view as a positive entry signal.

The equal-weight method reduces single-stock concentration by trimming positions that have risen and adding to names that have lagged at each rebalance. That produces a different sector and security profile than cap-weighted large-cap indexes, which allocate a larger share to the biggest companies.

Market participants have cited concentration in major AI-focused technology companies as a risk for diversified portfolios; a sharp reversal in sentiment toward those firms could lead to declines in portfolios heavily weighted to the largest caps. Other factors that could affect tech and AI sector performance include changes in interest rates, inflation trends and operational costs such as energy.

Assets for GSEW rose to about $1.8 billion at the latest update. Future flows and performance will depend on broader market and sector developments through the remainder of the year.