Should ALPS Equal Sector Weight ETF (EQL) Be on Your Investing Radar?

Looking for broad exposure to the Large Cap Blend segment of the US equity market? You should consider the ALPS Equal Sector Weight ETF (EQL), a passively managed exchange traded fund launched on 07/07/2009.

The fund is sponsored by Alps. It has amassed assets over $531.47 million, making it one of the average sized ETFs attempting to match the Large Cap Blend segment of the US equity market.

Why Large Cap Blend

Companies that fall in the large cap category tend to have a market capitalization above $10 billion. Overall, they are usually a stable option, with less risk and more sure-fire cash flows than mid and small cap companies.

Blend ETFs usually hold a mix of growth and value stocks as well as stocks that exhibit both value and growth characteristics.

Costs

Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.

Annual operating expenses for this ETF are 0.25%, putting it on par with most peer products in the space.

It has a 12-month trailing dividend yield of 1.77%.

Sector Exposure and Top Holdings

It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.

Looking at individual holdings, Technology Select Sector Spdr Fund (XLK) accounts for about 9.89% of total assets, followed by Industrial Select Sector Spdr Fund (XLI) and Consumer Discretionary Select Sector Spdr Fund (XLY).

The top 10 holdings account for about 91.84% of total assets under management.

Performance and Risk

EQL seeks to match the performance of the NYSE Select Sector Equal Weight Index before fees and expenses. The NYSE Equal Sector Weight Index comprises of all active Select Sector SPDR ETFs in an equal weighted portfolio. These sector includes Consumer Discretionary, Consumer Staples, Materials, Energy, Technology, Utilities, Financial, Industrial, Health Care & Real Estate.

The ETF has gained about 6.50% so far this year and is up roughly 13.31% in the last one year (as of 07/08/2025). In the past 52-week period, it has traded between $37.36 and $44.43.

The ETF has a beta of 0.91 and standard deviation of 14.93% for the trailing three-year period, making it a medium risk choice in the space. With about 12 holdings, it has more concentrated exposure than peers.

Alternatives

ALPS Equal Sector Weight ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, EQL is an excellent option for investors seeking exposure to the Style Box - Large Cap Blend segment of the market. There are other additional ETFs in the space that investors could consider as well.

The SPDR S&P 500 ETF (SPY) and the Vanguard S&P 500 ETF (VOO) track a similar index. While SPDR S&P 500 ETF has $639.68 billion in assets, Vanguard S&P 500 ETF has $684.46 billion. SPY has an expense ratio of 0.09% and VOO charges 0.03%.

Bottom-Line

Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.

To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.

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This article originally published on Zacks Investment Research (zacks.com).

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