Equal-Weight S&P (RSP) vs Russell 2000 (IWM)
Live side-by-side comparison with current values, changes, and key statistics.
Why This Comparison Matters
RSP is effectively a mid-cap proxy because equal-weighting pulls the average market cap down from SPY's mega-cap skew. When RSP outperforms IWM, leadership is in quality mid-caps with stronger fundamentals. When IWM outperforms RSP, risk appetite is high enough to reach into low-quality small caps, which is typical of early-cycle recoveries.
Cross-Asset Analysis
To orient the reader: S&P 500 Equal Weight (RSP) represents equal-weight S&P 500, measures market breadth vs cap-weighted SPY and Russell 2000 ETF (IWM) represents iShares Russell 2000 ETF, small-cap equity benchmark, which is why this comparison sits in the peer pair category on Convex. Sector, style, and geographic dominance cycles each produce multi-year relative performance episodes between S&P 500 Equal Weight (RSP) and Russell 2000 ETF (IWM). Factor exposures embedded inside S&P 500 Equal Weight (RSP) and Russell 2000 ETF (IWM) drive their relative performance, with growth-value, large-small, and domestic-international all surfacing in the spread.
S&P 500 Equal Weight (RSP) and Russell 2000 ETF (IWM) look similar at a glance, but the embedded factor tilts between them matter meaningfully over time. Flows matter for the S&P 500 Equal Weight (RSP)-Russell 2000 ETF (IWM) relationship: when one peer attracts more capital, it outperforms on demand pressure that tends to mean-reverts. In bull markets the more aggressive peer between S&P 500 Equal Weight (RSP) and Russell 2000 ETF (IWM) generally leads, while bear markets shift leadership toward the more defensive peer.
Overlay strategies trade the S&P 500 Equal Weight (RSP)-Russell 2000 ETF (IWM) spread through options or swaps when the underlying pair is directly tradable, sizing against realized spread volatility. Corporate action events, including buybacks or spin-offs affecting constituents of S&P 500 Equal Weight (RSP) or Russell 2000 ETF (IWM), can distort the spread relative to its intended factor tilt.
90-Day Statistics
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Frequently Asked Questions
What is the relationship between S&P 500 Equal Weight (RSP) and Russell 2000 ETF (IWM)?+
S&P 500 Equal Weight (RSP) and Russell 2000 ETF (IWM) are connected through shared asset class exposure with different factor tilts. When the underlying asset class shifts, both respond, though with different sensitivities and at different speeds. The spread between S&P 500 Equal Weight (RSP) and Russell 2000 ETF (IWM) captures the specific macro signal that flows through this relationship.
When does S&P 500 Equal Weight (RSP) typically lead Russell 2000 ETF (IWM)?+
S&P 500 Equal Weight (RSP) tends to lead Russell 2000 ETF (IWM) during rotation episodes between the two factor exposures. In those periods, moves in S&P 500 Equal Weight (RSP) precede corresponding moves in Russell 2000 ETF (IWM) by days to weeks, depending on the transmission channel and the depth of each market.
How are S&P 500 Equal Weight (RSP) and Russell 2000 ETF (IWM) historically correlated?+
Long-run correlation between S&P 500 Equal Weight (RSP) and Russell 2000 ETF (IWM) varies by regime. Peers in the same asset class are highly correlated in direction, with the spread reflecting factor tilts and rotation dynamics. The correlation is not stable: it shifts with macro conditions, and the periods when it breaks down are often the most informative moments in the S&P 500 Equal Weight (RSP)-Russell 2000 ETF (IWM) relationship.
What macro conditions drive divergence between S&P 500 Equal Weight (RSP) and Russell 2000 ETF (IWM)?+
Divergence between S&P 500 Equal Weight (RSP) and Russell 2000 ETF (IWM) typically arises from index reconstitution, mega-cap earnings surprises, or liquidity differences between the peers. When one asset's idiosyncratic drivers dominate, the spread moves in ways that the common macro story does not predict, which is usually a signal to look more carefully at the specific drivers at work in S&P 500 Equal Weight (RSP) or Russell 2000 ETF (IWM).
Is S&P 500 Equal Weight (RSP) a hedge for Russell 2000 ETF (IWM)?+
Peers like S&P 500 Equal Weight (RSP) and Russell 2000 ETF (IWM) do not hedge each other; both rise or fall with the shared asset class, and using the pair as a spread trade is different from using it as a hedge. Effective hedging requires matching the hedge to the specific risk being protected, and the S&P 500 Equal Weight (RSP)-Russell 2000 ETF (IWM) pair is best stress-tested under scenarios the investor most worries about before being sized into a real portfolio.
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Data sourced from FRED, CoinGecko, CBOE, and other providers. This page is for informational purposes only and does not constitute financial advice. Past performance does not guarantee future results.