Equal Weight vs Cap Weight — Why One Choice Changed the Outcome

Julius de Kempenaer breaks down a real-world portfolio experiment from 2025 that shows how weighting decisions—not sector picks—can dramatically change performance. See how equal-weight and cap-weight approaches produced very different results, and why this overlooked factor still matters for portfolio construction today. Julius de Kempenaer, creator of RRG Charts, reviews and analyzes his Best 5 Sectors articles from 2025 to highlight an often-overlooked factor in portfolio performance: weighting. While the sector signals themselves were largely effective, Julius shows how different weighting schemes significantly altered overall results. By comparing approaches and revisiting real outcomes, he explains why portfolio construction choices can matter just as much as the analysis behind them—and how small structural decisions can quietly change performance over time. 👀 See what better financial charting can do for you! https://stockcharts.com/?utm_source=YouTube&utm_medium=Organicvideo&utm_campaign=JuliusDK&utm_content=020226 👍🏻 If you enjoyed this video be sure to hit the THUMBS UP ✅ If you found value, consider SUBSCRIBING to our channel and ring the bell so you never miss a new video! Subscribe Here: https://tinyurl.com/wvet7qj 00:00 - Welcome 00:58 - Portfolio Equal Weighting Method ANALYZING PORTFOLIO PERFORMANCE 09:48 - Calculating Rankings and Prices 14:14 - Calculating Performance vs. SPY 16:34 - Sector Cap-Weighting Scheme 21:40 - Contribution Performance/Out-performance 23:33 - Results: Equal-Weight vs. Cap-Weight Graph 29:23 - Final Thoughts 👍🏻 FOLLOW US X - @StockCharts - https://x.com/stockcharts Facebook - https://www.facebook.com/stockchartsdotcom LinkedIn - https://www.linkedin.com/company/stockcharts.com-inc. #portfolioallocation #rrganalysis #portfoliodesign @StockChartsTV ❗️DISCLAIMER Past performance is not indicative of future results. Neither the Show Participants nor StockCharts.com guarantee any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment discussed on the show. Strategies or investments discussed may fluctuate in price or value. Investments or strategies mentioned in this show may not be suitable for you and you should make your own independent decision regarding them. This material does not take into account your particular investment objectives, financial situation or needs and is not intended as recommendations appropriate for you. You should strongly consider seeking advice from your own investment advisor ––––– ℹ️ ABOUT STOCKCHARTS StockCharts.com is the world's leading technical analysis and financial charting platform. Trusted by millions of online investors around the world, the company has been an industry leader in the financial technology space for more than two decades. With innovative, award-winning charting and analysis tools, our mission is to help you better analyze the markets, monitor and manage your portfolios, find promising new stocks and funds to buy, and ultimately make smarter investment decisions. ℹ️ ABOUT STOCKCHARTS TV StockCharts TV is devoted exclusively to financial charting and market analysis from the web's top technical experts. With a constant stream of technical charting-focused content, there's always something insightful, educational and entertaining to watch on the channel.