The SPDR S&P Dividend ETF (SDY) and the JPMorgan Ultra-Short Income ETF (JPST) are both among the Top 100 ETFs. SDY is a SPDR State Street Global Advisors Large Value fund and JPST is a JPMorgan Ultrashort Bond fund. So, what’s the difference between SDY and JPST? And which fund is better?
The expense ratio of SDY is 0.17 percentage points higher than JPST’s (0.35% vs. 0.18%). SDY also has a high exposure to the financial services sector while JPST is mostly comprised of A bonds. Overall, SDY has provided higher returns than JPST over the past 3 years.
In this article, we’ll compare SDY vs. JPST. We’ll look at annual returns and performance, as well as at their industry exposure and holdings. Moreover, I’ll also discuss SDY’s and JPST’s fund composition, portfolio growth, and risk metrics and examine how these affect their overall returns.
Summary
| SDY | JPST | |
| Name | SPDR S&P Dividend ETF | JPMorgan Ultra-Short Income ETF |
| Category | Large Value | Ultrashort Bond |
| Issuer | SPDR State Street Global Advisors | JPMorgan |
| AUM | 19.67B | 17.32B |
| Avg. Return | 12.44% | 2.57% |
| Div. Yield | 2.65% | 0.94% |
| Expense Ratio | 0.35% | 0.18% |
The SPDR S&P Dividend ETF (SDY) is a Large Value fund that is issued by SPDR State Street Global Advisors. It currently has 19.67B total assets under management and has yielded an average annual return of 12.44% over the past 10 years. The fund has a dividend yield of 2.65% with an expense ratio of 0.35%.
The JPMorgan Ultra-Short Income ETF (JPST) is a Ultrashort Bond fund that is issued by JPMorgan. It currently has 17.32B total assets under management and has yielded an average annual return of 2.57% over the past 10 years. The fund has a dividend yield of 0.94% with an expense ratio of 0.18%.
SDY’s dividend yield is 1.71% higher than that of JPST (2.65% vs. 0.94%). Also, SDY yielded on average 9.86% more per year over the past decade (12.44% vs. 2.57%). The expense ratio of SDY is 0.17 percentage points higher than JPST’s (0.35% vs. 0.18%).
Fund Composition
Holdings
| SDY Holdings | Weight |
| Exxon Mobil Corp | 2.81% |
| AT&T Inc | 2.5% |
| South Jersey Industries Inc | 2.22% |
| Chevron Corp | 2.02% |
| International Business Machines Corp | 2.0% |
| AbbVie Inc | 1.93% |
| National Retail Properties Inc | 1.86% |
| Federal Realty Investment Trust | 1.77% |
| Realty Income Corp | 1.7% |
| Old Republic International Corp | 1.65% |
SDY’s Top Holdings are Exxon Mobil Corp, AT&T Inc, South Jersey Industries Inc, Chevron Corp, and International Business Machines Corp at 2.81%, 2.5%, 2.22%, 2.02%, and 2.0%.
AbbVie Inc (1.93%), National Retail Properties Inc (1.86%), and Federal Realty Investment Trust (1.77%) have a slightly smaller but still significant weight. Realty Income Corp and Old Republic International Corp are also represented in the SDY’s holdings at 1.7% and 1.65%.
| JPST Bond Sectors | Weight |
| A | 39.21% |
| BBB | 36.75% |
| AAA | 14.9% |
| AA | 9.14% |
| Others | 0.0% |
| Below B | 0.0% |
| B | 0.0% |
| BB | 0.0% |
| US Government | 0.0% |
JPST’s Top Bond Sectors are ratings of A, BBB, AAA, AA, and Others at 39.21%, 36.75%, 14.9%, 9.14%, and 0.0%. The fund is less weighted towards Below B (0.0%), B (0.0%), and BB (0.0%) rated bonds.
Risk Analysis
| SDY | JPST | |
| Mean Return | 1.07 | 0 |
| R-squared | 83.62 | 0 |
| Std. Deviation | 12.9 | 0 |
| Alpha | -0.1 | 0 |
| Beta | 0.87 | 0 |
| Sharpe Ratio | 0.95 | 0 |
| Treynor Ratio | 13.94 | 0 |
The SPDR S&P Dividend ETF (SDY) has a Mean Return of 1.07 with a Alpha of -0.1 and a Standard Deviation of 12.9. Its Beta is 0.87 while SDY’s R-squared is 83.62. Furthermore, the fund has a Sharpe Ratio of 0.95 and a Treynor Ratio of 13.94.
The JPMorgan Ultra-Short Income ETF (JPST) has a Standard Deviation of 0 with a Mean Return of 0 and a Sharpe Ratio of 0. Its Beta is 0 while JPST’s Alpha is 0. Furthermore, the fund has a R-squared of 0 and a Treynor Ratio of 0.
SDY’s Mean Return is 1.07 points higher than that of JPST and its R-squared is 83.62 points higher. With a Standard Deviation of 12.9, SDY is slightly more volatile than JPST. The Alpha and Beta of SDY are 0.10 points lower and 0.87 points higher than JPST’s Alpha and Beta.
Performance
Annual Returns
| Year | SDY | JPST |
| 2020 | 1.78% | 2.17% |
| 2019 | 23.37% | 3.36% |
| 2018 | -2.73% | 2.19% |
| 2017 | 15.84% | 0.0% |
| 2016 | 20.17% | 0.0% |
| 2015 | -0.7% | 0.0% |
| 2014 | 13.8% | 0.0% |
| 2013 | 30.09% | 0.0% |
| 2012 | 11.51% | 0.0% |
| 2011 | 7.28% | 0.0% |
| 2010 | 16.41% | 0.0% |
SDY had its best year in 2013 with an annual return of 30.09%. SDY’s worst year over the past decade yielded -2.73% and occurred in 2018. In most years the SPDR S&P Dividend ETF provided moderate returns such as in 2012, 2014, and 2017 where annual returns amounted to 11.51%, 13.8%, and 15.84% respectively.
The year 2019 was the strongest year for JPST, returning 3.36% on an annual basis. The poorest year for JPST in the last ten years was 2017, with a yield of 0.0%. Most years the JPMorgan Ultra-Short Income ETF has given investors modest returns, such as in 2013, 2012, and 2011, when gains were 0.0%, 0.0%, and 0.0% respectively.
Portfolio Growth
| Fund | Initial Balance | Final Balance | CAGR |
| SDY | $10,000 | $12,213 | 12.44% |
| JPST | $10,000 | $10,791 | 2.57% |
A $10,000 investment in SDY would have resulted in a final balance of $12,213. This is a profit of $2,213 over 3 years and amounts to a compound annual growth rate (CAGR) of 12.44%.
With a $10,000 investment in JPST, the end total would have been $10,791. This equates to a $791 profit over 3 years and a compound annual growth rate (CAGR) of 2.57%.
SDY’s CAGR is 9.86 percentage points higher than that of JPST and as a result, would have yielded $1,422 more on a $10,000 investment. Thus, SDY outperformed JPST by 9.86% annually.
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