What are equal-weight index funds?

Equal-weight index funds are a way to combat this concentration risk. Equal-weight funds hold an equal proportion of each stock that makes up an index, which translates into a roughly 0.2 percent holding for each company in the S&P 500, for example. Here are some of the top equal-weight index funds to consider for your portfolio.

What is an equal-weight S&P 500 fund?

An equal-weight S&P 500 fund, for example, tracks the S&P 500 Equal Weight Index. There are also equal-weight versions of the Russell 1000 and the MSCI USA. An equal-weight S&P 500 portfolio holds the same percentages of all S&P 500 constituents.

What is an equal weight ETF?

With an equal-weight ETF, all the slices are the same size, regardless of the size of the company or sector. There are exchange-traded funds (ETFs) that track each of the two indexes, but even though they are basing their funds on the same companies, they can behave very differently. In Jan. 2003, the S&P 500 Equal Weight Index (EWI) was created.