Equal weight is a proportional measure that gives equal weight to each stock in a portfolio or index fund, regardless of company size.
Equal weighting is different from market capitalization weighting, which is more commonly used by indices and funds.
The concept of equally weighted portfolios has generated interest due to the historical performance of small cap stocks and the emergence of multiple exchange-traded funds (ETFs).
Equivalently weighted index funds tend to have higher stock turnover than market capitalization-weighted index funds, and as a result, they typically incur higher trading costs.