The SPDR S&P 500 ETF Trust (SPY) and the SPDR Gold Shares (GLD) are both among the Top 100 ETFs. SPY is a SPDR State Street Global Advisors Large Blend fund and GLD is a SPDR State Street Global Advisors N/A fund. So, what’s the difference between SPY and GLD? And which fund is better?
The expense ratio of SPY is 0.31 percentage points lower than GLD’s (0.09% vs. 0.4%). SPY also has a higher exposure to the technology sector and a lower standard deviation. Overall, SPY has provided higher returns than GLD over the past ten years.
In this article, we’ll compare SPY vs. GLD. We’ll look at portfolio growth and performance, as well as at their fund composition and holdings. Moreover, I’ll also discuss SPY’s and GLD’s industry exposure, risk metrics, and annual returns and examine how these affect their overall returns.
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|Name||SPDR S&P 500 ETF Trust||SPDR Gold Shares|
|Issuer||SPDR State Street Global Advisors||SPDR State Street Global Advisors|
The SPDR S&P 500 ETF Trust (SPY) is a Large Blend fund that is issued by SPDR State Street Global Advisors. It currently has 374.03B total assets under management and has yielded an average annual return of 14.41% over the past 10 years. The fund has a dividend yield of 1.3% with an expense ratio of 0.09%.
The SPDR Gold Shares (GLD) is a N/A fund that is issued by SPDR State Street Global Advisors. It currently has 59.26B total assets under management and has yielded an average annual return of 5.81% over the past 10 years. The fund has a dividend yield of 0.0% with an expense ratio of 0.4%.
SPY’s dividend yield is 1.30% higher than that of GLD (1.3% vs. 0.0%). Also, SPY yielded on average 8.60% more per year over the past decade (14.41% vs. 5.81%). The expense ratio of SPY is 0.31 percentage points lower than GLD’s (0.09% vs. 0.4%).
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The SPDR S&P 500 ETF Trust (SPY) has the most exposure to the Technology sector at 24.22%. This is followed by Financial Services and Healthcare at 14.23% and 13.09% respectively. Utilities (2.45%), Real Estate (2.57%), and Energy (2.86%) only make up 7.88% of the fund’s total assets.
SPY’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Communication Services, Consumer Cyclical, and Healthcare stocks at 6.32%, 8.86%, 11.14%, 12.0%, and 13.09%.
The SPDR Gold Shares (GLD) has the most exposure to the Technology sector at 0.0%. This is followed by Industrials and Energy at 0.0% and 0.0% respectively. Consumer Cyclical (0.0%), Financial Services (0.0%), and Real Estate (0.0%) only make up 0.00% of the fund’s total assets.
GLD’s mid-section with moderate exposure is comprised of Consumer Defensive, Healthcare, Utilities, Communication Services, and Energy stocks at 0.0%, 0.0%, 0.0%, 0.0%, and 0.0%.
SPY is 24.22% more exposed to the Technology sector than GLD (24.22% vs 0.0%). SPY’s exposure to Financial Services and Healthcare stocks is 14.23% higher and 13.09% higher respectively (14.23% vs. 0.0% and 13.09% vs. 0.0%). In total, Utilities, Real Estate, and Energy also make up 7.88% more of the fund’s holdings compared to GLD (7.88% vs. 0.00%).
|Facebook Inc A||2.29%|
|Alphabet Inc A||2.02%|
|Alphabet Inc Class C||1.96%|
|Berkshire Hathaway Inc Class B||1.45%|
|JPMorgan Chase & Co||1.29%|
SPY’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc A, and Alphabet Inc A at 5.9%, 5.6%, 4.05%, 2.29%, and 2.02%.
Alphabet Inc Class C (1.96%), Berkshire Hathaway Inc Class B (1.45%), and Tesla Inc (1.44%) have a slightly smaller but still significant weight. NVIDIA Corp and JPMorgan Chase & Co are also represented in the SPY’s holdings at 1.37% and 1.29%.
GLD’s Top Holdings are Gold Trust, N/A, N/A, N/A, and N/A at 100.0%, 0%, 0%, 0%, and 0%.
N/A (0%), N/A (0%), and N/A (0%) have a slightly smaller but still significant weight. N/A and N/A are also represented in the GLD’s holdings at 0% and 0%.
The SPDR S&P 500 ETF Trust (SPY) has a Beta of 1 with a Mean Return of 1.23 and a Standard Deviation of 13.56. Its Alpha is -0.09 while SPY’s R-squared is 100. Furthermore, the fund has a Treynor Ratio of 14.12 and a Sharpe Ratio of 1.04.
The SPDR Gold Shares (GLD) has a Sharpe Ratio of 0.12 with a R-squared of 16.21 and a Alpha of 3.91. Its Treynor Ratio is 1.21 while GLD’s Mean Return is 0.21. Furthermore, the fund has a Beta of 0.48 and a Standard Deviation of 16.58.
SPY’s Mean Return is 1.02 points higher than that of GLD and its R-squared is 83.79 points higher. With a Standard Deviation of 13.56, SPY is slightly less volatile than GLD. The Alpha and Beta of SPY are 4.00 points lower and 0.52 points higher than GLD’s Alpha and Beta.
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SPY had its best year in 2013 with an annual return of 32.21%. SPY’s worst year over the past decade yielded -4.45% and occurred in 2018. In most years the SPDR S&P 500 ETF Trust provided moderate returns such as in 2014, 2010, and 2012 where annual returns amounted to 13.53%, 14.93%, and 15.84% respectively.
The year 2010 was the strongest year for GLD, returning 27.25% on an annual basis. The poorest year for GLD in the last ten years was 2013, with a yield of -28.09%. Most years the SPDR Gold Shares has given investors modest returns, such as in 2012, 2016, and 2011, when gains were 5.26%, 8.69%, and 11.2% respectively.
|Fund||Initial Balance||Final Balance||CAGR|
A $10,000 investment in SPY would have resulted in a final balance of $41,712. This is a profit of $31,712 over 11 years and amounts to a compound annual growth rate (CAGR) of 14.41%.
With a $10,000 investment in GLD, the end total would have been $16,395. This equates to a $6,395 profit over 11 years and a compound annual growth rate (CAGR) of 5.81%.
SPY’s CAGR is 8.60 percentage points higher than that of GLD and as a result, would have yielded $25,317 more on a $10,000 investment. Thus, SPY outperformed GLD by 8.60% annually.
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