Rydex Unveils Equal Weighted S&P 500 ETF

April 22, 2003 (PLANSPONSOR.com) - Exchange-traded fund investors now have a new way in which to invest in the S&P 500.

Rydex Global Advisors and S&P announced that Rydex is set to launch the S&P Equal Weight ETF, based on the S&P Equal Weight Index (EWI) that was launched in January 2003. The companies said that the EWI was designed to offer investors access to the 500 US companies in the S&P 500, only equally weighted instead of being market weighted.

The 500 stocks are given equal weight through quarterly rebalancing, which eliminates the bias toward larger companies and provides the opportunity for lower sector volatility, the companies said.

Exchange-traded funds combine the diversification benefits of mutual funds with the flexibility of stocks.  Like mutual funds, ETFs are baskets of stocks that can be purchased in a single transaction. Because ETFs are listed on a stock exchange, investors can purchase shares through a brokerage account, trade throughout the day, purchase on margin and use limit and stop orders.

The Rydex S&P Equal Weight ETF will be listed on the American Stock Exchange (Amex) and is expected to begin trading at 9:30 a.m. April 30, 2003 under the symbol RSP. With the addition of the Rydex S&P Equal Weight ETF, the Amex now lists 125 ETFs.