FXD vs RSPD

Key Takeaways

• FXD is a smart-beta fund tracking the StrataQuant Consumer Discretionary AlphaDEX Index, using multi-factor selection and tiered equal weighting across roughly 119 holdings.
• RSPD is a pure equal-weight fund tracking the S&P 500 Equal Weight Consumer Discretionary Index, holding about 48 to 50 large-cap names with quarterly rebalancing.
• FXD leans into mid-cap and cross-sector exposure (communication services and industrials), while RSPD provides a nearly pure-play large-cap consumer discretionary basket.
• RSPD is the lower-cost option at a 0.40% expense ratio versus 0.60% for FXD, a meaningful structural advantage over time.
• Tickeron AI Verdict: RSPD is the preferred ticker of the two based on cost efficiency, disciplined equal weighting, and pure sector exposure.

Introduction

Consumer discretionary is one of the most economically sensitive corners of the equity market, making the choice of exposure vehicle particularly important in a shifting rate and spending environment. FXD and RSPD both target U.S. consumer discretionary equities, but they take fundamentally different paths to that goal. This ETF comparison highlights how a smart-beta, multi-factor approach differs from a straightforward equal-weight, large-cap strategy. Understanding their sector exposure, fund performance drivers, and relative positioning can help investors decide which structure better matches their objectives in the current market cycle.

First Trust Consumer Discretionary AlphaDEX Fund (FXD) Overview

FXD seeks to track the StrataQuant Consumer Discretionary AlphaDEX Index, which applies First Trust's AlphaDEX stock-selection methodology to consumer discretionary names drawn from the Russell 1000 Index. The strategy ranks stocks on a blend of fundamental growth and value factors, then applies tiered equal weighting. This produces a diversified portfolio of roughly 119 holdings with a heavier tilt toward mid-cap companies than a typical large-cap sector fund.

Top holdings have historically included names such as Dillard's (DDS), Gap (GAP), SharkNinja (SN), Mattel (MAT), and Macy's (M). While consumer discretionary dominates at roughly 75% of the portfolio, FXD also carries meaningful communication services and industrials exposure. The fund carries a 0.60% expense ratio and rebalances to reflect the index's factor-driven rankings, distinguishing it from simple market-cap-weighted sector products.

Invesco S&P 500 Equal Weight Consumer Discretionary ETF (RSPD) Overview

RSPD tracks the S&P 500 Equal Weight Consumer Discretionary Index, which takes the consumer discretionary constituents of the S&P 500 Index and assigns each an equal weight, rebalancing quarterly. This results in a concentrated yet balanced portfolio of roughly 48 to 50 large-cap names, all weighted near 2% to 2.5% each.

Representative holdings include Carnival (CCL), TJX Companies (TJX), Royal Caribbean (RCL), Marriott International (MAR), Ralph Lauren (RL), Amazon (AMZN), and Tesla (TSLA). The portfolio is essentially a pure consumer discretionary play, with hotels, restaurants, and leisure representing the largest industry group. The fund charges a 0.40% expense ratio, and its equal-weight design dilutes the mega-cap concentration found in cap-weighted rivals.

Industry and Thematic Backdrop

Both funds are heavily influenced by the health of the U.S. consumer, which in turn depends on employment, wage growth, inflation, and interest rates. In recent cycles, resilient labor markets have supported spending on travel, dining, and discretionary retail, while higher financing costs have pressured big-ticket purchases such as autos and housing-related goods. Travel and leisure names feature prominently in RSPD, while FXD's multi-factor tilt has exposed it more to value-oriented retailers and select media and industrial names. Regulatory and tariff developments affecting imported consumer goods, along with shifting inventory and promotional dynamics in retail, remain key swing factors for both funds.

Performance and Positioning Comparison

Across recent market cycles, the two funds have shown meaningfully different risk and return profiles despite their shared sector theme. RSPD's large-cap, equal-weight structure tends to track the broader consumer discretionary complex with moderate volatility, while FXD's mid-cap and factor tilts can amplify both upside and downside during style rotations. When value and smaller-cap names have led, FXD's multi-factor screen has provided a differentiated return stream; when large-cap, high-quality franchises have outperformed, RSPD's simpler structure has generally held up better. Cost also matters: RSPD's 0.40% expense ratio versus FXD's 0.60% provides a recurring head start, while FXD's broader diversification across roughly 119 names offsets some single-stock risk relative to RSPD's more concentrated 48-to-50-name portfolio.

AI Screener

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Tickeron AI Verdict

Between the two funds, Tickeron's AI would likely favor RSPD for its structural simplicity, disciplined quarterly equal weighting, pure large-cap consumer discretionary exposure, and lower 0.40% expense ratio. While FXD offers broader diversification and a differentiated multi-factor tilt, its higher cost and mid-cap bias introduce additional style risk that may not consistently translate into outperformance. In an environment where large-cap, liquid franchises across travel, leisure, and specialty retail have demonstrated steadier relative positioning, RSPD's cleaner and more cost-efficient structure gives it the edge in this head-to-head ETF comparison.

Disclaimer

The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer.

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