The ongoing tech selloff, spurred by concerns over capital spending in AI, has led investors to rotate into value stocks, benefiting indices like the equal-weighted S&P 500. This shift has been driven by the index's diversified sector exposure, particularly in industrials, utilities, and financials, which has allowed it to outperform its market-cap-weighted counterpart. As a result, strategists are recommending the equal-weighted S&P 500 as a strategic investment, citing its alignment with long-term policies and its relatively low valuation. This rotation comes amid the S&P 500's decline, as it trades lower due to the tech sector's current challenges.
The ProShares Ultra S&P500 (SSO) ETF experienced a decline, dropping 3.28% to $95.80 at 11:00 AM on Monday, January 27.