Beyond SPY: Three ETF Alternatives Offering S&P 500 Exposure

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Includes: CSM, EPS, RSP, SPY
by: Tom Lydon

There’s more than one way to skin a cat, and there’s more than one way to get exposure to one of the most widely followed benchmarks in the world using ETFs. The S&P 500 is the market’s barometer for the top 500 U.S. listed stocks trading.

The S&P 500 index is a good way to measure the health of the U.S. economy, since it tracks the 500 largest corporations trading in the United States. ETFs that track this index are one of the most popular, the grandaddy of them all being SPDRs (NYSEARCA:SPY).

Kevin Grewal for Daily Marketss throws out a few other ways to get exposure to this popular index.

  • Rydex S&P Equal Weight ETF (NYSEARCA:RSP)

RSP has nearly identical holdings to the S&P 500, but gives an equal weighting to each individual stock, 0.20% to each of the 500 stocks. Utilizing this strategy makes it less likely to overweight overvalued stocks and underweight undervalued stocks. In periods where small-caps are outperforming – generally in recoveries – this strategy can be favored.

  • WisdomTree Earnings 500 Fund (NYSEARCA:EPS)

A benchmark that measures the performance of the earnings-generating companies within the large-cap segment of the U.S. stock market. One eligibility requirement to be included in the ETF is that a company must be incorporated in the United States and have posted positive earnings in each of its previous four fiscal quarters. EPS is market-cap weighted.

  • ProShares Credit Suisse 130/30 (NYSEARCA:CSM)

Tracks a benchmark that established either long or short positions in S&P 500 equities by applying rules-based rankings and weighting methodology. The fund establishes a 100% long position in the S&P 500, then sells 30% of the value of the portfolio in holdings that are expected to decline in value and then uses the proceeds from its sales to establish long positions in holdings that are expected to outperform.

Disclosure: None

Tisha Guerrero contributed to this article.