ALPS launched the first Equal Sector ETF (EQL). The new fund is an ETF of ETFs that tracks the Banc of America Securities – Merrill Lynch Equal Sector Weight Index by owning each of the nine Select Sector SPDR ETFs in equal weights.
The nine Select Sector SPDR ETFs will be rebalanced back to equal weight on a quarterly basis.
The logic of the equal sector weighting strategy is that it minimizes the negative impact of any one sector by diversifying over multiple sectors.
At the same time by offering meaningful exposure to each sector of the market, it allows investors the ability to participate in market rallies regardless of where they occur.