Looking for a Consumer Staples ETF? Here's How XLP and RSPS Compare on Cost, Risk, and Earnings

SPDR’s Consumer Staples Select Sector ETF (XLP) and Invesco’s equal‑weight RSPS both target U.S. consumer defensive stocks but differ materially: XLP charges a 0.08% expense ratio versus RSPS’s 0.40%, manages $15.5bn versus $236.2m AUM, and posted a 1‑yr return of -3.19% vs -5.05% (as of Dec. 14, 2025), with broadly similar dividend yields (~2.7%) and betas. XLP is market‑cap weighted across 36 names with a 27‑year track record and heavy concentration in mega‑caps (its top three holdings account for ~28.6% of assets), while RSPS’s 37 equal‑weighted holdings limit top‑three exposure (~9.5%) and provide broader mid‑tier exposure. The tradeoff for investors is clear: XLP offers lower fees, greater liquidity and concentrated upside (and downside) tied to sector leaders, whereas RSPS reduces single‑stock concentration and idiosyncratic risk at the cost of higher fees and much smaller scale.

Analysis

XLP and RSPS provide two distinct implementations of U.S. consumer defensive exposure: XLP charges a 0.08% expense ratio versus RSPS’s 0.40%, manages $15.5 billion of AUM versus $236.2 million, and delivered a 1‑year return of -3.19% compared with RSPS’s -5.05% as of Dec. 14, 2025; dividend yields are similar at ~2.7% and five‑year betas are nearly identical (0.50 vs 0.52). XLP is market‑cap weighted across 36 stocks with a 27‑year track record and heavy concentration in Walmart, Costco and Procter & Gamble, with the top three comprising 28.61% of assets. RSPS holds 37 names in an equal‑weight scheme where top positions (Dollar Tree, Dollar General, Estee Lauder) are each under ~4%, and the top three account for ~9.48% of the fund. Over five years XLP grew $1,000 to $1,180 versus RSPS’s $992 and shows a slightly smaller max drawdown (-16.32% vs -18.61%); the tradeoff is clear—XLP offers lower fees, larger liquidity and concentrated upside (and downside), while RSPS reduces single‑stock risk at the cost of higher fees and smaller scale.

Key Decisions for Investors

• Consider XLP for a core consumer‑staples allocation when priority is low ongoing fees, deep liquidity and exposure to mega‑cap leaders; appropriate for long‑term, cost‑sensitive positions
• Use RSPS as a satellite allocation to gain equal‑weight exposure to mid‑tier staples and to limit single‑stock concentration, acknowledging the higher 0.40% expense ratio and much smaller $236.2m AUM
• Monitor the performance and flows of XLP’s top holdings (WMT, COST, PG) and set alerts for widening underperformance or drawdowns beyond the historical ~16% level to consider trimming or hedging concentrated exposure
• Watch RSPS liquidity and fee drag for larger positions—if trading costs or bid/ask spreads rise materially given its smaller AUM, reassess sizing or use a staged entry to limit execution risk