RHS: A Smart Beta Defensive Play

Vasily Zyryanov profile picture
Vasily Zyryanov


  • RHS is essentially an equally-weighted portfolio of the bellwether U.S. consumer staples stocks.
  • This article provides a look at the value, growth, and quality characteristics of the RHS portfolio, with the assessment of XLP and IYK added for better context.
  • The analysis presented revealed that the equal weight schema is not necessarily supportive of cheaper valuations, with performance (including volatility, risk-adjusted returns, and drawdowns) also being mixed.

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Investors who are searching for a portfolio of better-priced defensive equities have reasons to turn to smart beta funds like the Invesco S&P 500 Equal Weight Consumer Staples ETF (NYSEARCA:RHS), an ETF providing exposure

ETFs comparison

Calculated by the author using data from Seeking Alpha, IYK, RHS, and XLP

Stocks' profitability analysis

Created by the author using data from Seeking Alpha and the fund

Data by YCharts

This article was written by

Vasily Zyryanov profile picture
Vasily Zyryanov is an individual investor and writer.He uses various techniques to find both relatively underpriced equities with strong upside potential and relatively overappreciated companies that have inflated valuation for a reason.In his research, he pays much attention to the energy sector (oil & gas supermajors, mid-cap, and small-cap exploration & production companies, the oilfield services firms), while he also covers a plethora of other industries from mining and chemicals to luxury bellwethers.He firmly believes that apart from simple profit and sales analysis, a meticulous investor must assess Free Cash Flow and Return on Capital to gain deeper insights and avoid sophomoric conclusions.While he favors underappreciated and misunderstood equities, he also acknowledges that some growth stocks do deserve their premium valuation, and its an investor's primary goal to delve deeper and uncover if the market's current opinion is correct or not.

Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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