# Equal-Weight ETF vs Cap-Weighted: Why the Difference Matters

The Vanguard S&P 500 ETF is indeed cheap and easy to use, outperforming 88% of actively managed funds over the past 15 years. But there is a detail worth noting here:

**Concentration Risk**. Although the S&P 500 consists of 500 stocks, it is market-cap weighted, meaning the giants have the final say. Nvidia, Microsoft, Apple, Amazon, and Meta account for nearly 28% of the index, despite only representing 1% of the total components. If these giants falter, the entire index will decline.

**Another option**: Invesco's Equal Weight S&P 500 ETF (RSP). Each stock has almost the same weight, with large-cap stocks only accounting for 1-2%. When small-cap stocks outperform, this ETF performs even better.

In simple terms: Want a more balanced allocation and lower dependence on big tech? Equal weighting is worth considering. Long-term growth is stable, and risks can be controlled to some extent.