RSP holds the stocks in the S&P 500 at approximately equal weight, roughly 0.2 percent each, rather than weighting by market capitalization. In the standard S&P 500 the ten largest companies make up more than a third of the index, while in RSP each carries about the same weight as the smallest member. This gives much greater exposure to mid-sized S&P 500 companies and a tilt toward cheaper, smaller stocks. The fund is rebalanced quarterly, which means selling stocks that have risen and buying those that have fallen. RSP has tended to do better when market gains are broad and to lag when a few mega-cap stocks drive the index, as in 2023 and 2024. Turnover and trading costs are higher than in cap-weighted funds.
