The SPDR S&P 500 ETF Trust (SPY) and the iShares Core MSCI Total International Stock ETF (IXUS) are both among the Top 100 ETFs. SPY is a SPDR State Street Global Advisors Large Blend fund and IXUS is a iShares Foreign Large Blend fund. So, what’s the difference between SPY and IXUS? And which fund is better?
SPY and IXUS have the same expense ratio: 0.09%. SPY also has a higher exposure to the technology sector and a higher standard deviation. Overall, SPY has provided higher returns than IXUS over the past ten years.
In this article, we’ll compare SPY vs. IXUS. We’ll look at risk metrics and annual returns, as well as at their portfolio growth and industry exposure. Moreover, I’ll also discuss SPY’s and IXUS’s fund composition, performance, and holdings and examine how these affect their overall returns.
|Name||SPDR S&P 500 ETF Trust||iShares Core MSCI Total International Stock ETF|
|Category||Large Blend||Foreign Large Blend|
|Issuer||SPDR State Street Global Advisors||iShares|
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 iShares Core MSCI Total International Stock ETF (IXUS) is a Foreign Large Blend fund that is issued by iShares. It currently has 29.54B total assets under management and has yielded an average annual return of 6.09% over the past 10 years. The fund has a dividend yield of 2.13% with an expense ratio of 0.09%.
SPY’s dividend yield is 0.83% lower than that of IXUS (1.3% vs. 2.13%). Also, SPY yielded on average 8.32% more per year over the past decade (14.41% vs. 6.09%). SPY and IXUS have the same expense ratio: 0.09%.
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 iShares Core MSCI Total International Stock ETF (IXUS) has the most exposure to the Financial Services sector at 17.34%. This is followed by Technology and Industrials at 13.24% and 12.78% respectively. Real Estate (3.66%), Energy (4.39%), and Communication Services (7.09%) only make up 15.14% of the fund’s total assets.
IXUS’s mid-section with moderate exposure is comprised of Consumer Defensive, Basic Materials, Healthcare, Consumer Cyclical, and Industrials stocks at 8.19%, 8.5%, 9.29%, 12.57%, and 12.78%.
SPY is 10.98% more exposed to the Technology sector than IXUS (24.22% vs 13.24%). SPY’s exposure to Financial Services and Healthcare stocks is 3.11% lower and 3.80% higher respectively (14.23% vs. 17.34% and 13.09% vs. 9.29%). In total, Utilities, Real Estate, and Energy also make up 3.12% less of the fund’s holdings compared to IXUS (7.88% vs. 11.00%).
|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%.
|Taiwan Semiconductor Manufacturing Co Ltd||1.64%|
|Tencent Holdings Ltd||1.35%|
|Alibaba Group Holding Ltd Ordinary Shares||1.34%|
|Samsung Electronics Co Ltd||1.06%|
|ASML Holding NV||0.9%|
|Roche Holding AG||0.81%|
|LVMH Moet Hennessy Louis Vuitton SE||0.67%|
|Toyota Motor Corp||0.59%|
IXUS’s Top Holdings are Taiwan Semiconductor Manufacturing Co Ltd, Tencent Holdings Ltd, Alibaba Group Holding Ltd Ordinary Shares, Nestle SA, and Samsung Electronics Co Ltd at 1.64%, 1.35%, 1.34%, 1.1%, and 1.06%.
ASML Holding NV (0.9%), Roche Holding AG (0.81%), and LVMH Moet Hennessy Louis Vuitton SE (0.67%) have a slightly smaller but still significant weight. Novartis AG and Toyota Motor Corp are also represented in the IXUS’s holdings at 0.62% and 0.59%.
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 2017 was the strongest year for IXUS, returning 28.08% on an annual basis. The poorest year for IXUS in the last ten years was 2018, with a yield of -14.55%. Most years the iShares Core MSCI Total International Stock ETF has given investors modest returns, such as in 2011, 2010, and 2016, when gains were 0.0%, 0.0%, and 4.66% respectively.
|Fund||Initial Balance||Final Balance||CAGR|
A $10,000 investment in SPY would have resulted in a final balance of $23,219. This is a profit of $13,219 over 7 years and amounts to a compound annual growth rate (CAGR) of 14.41%.
With a $10,000 investment in IXUS, the end total would have been $14,209. This equates to a $4,209 profit over 7 years and a compound annual growth rate (CAGR) of 6.09%.
SPY’s CAGR is 8.32 percentage points higher than that of IXUS and as a result, would have yielded $9,010 more on a $10,000 investment. Thus, SPY outperformed IXUS by 8.32% annually.
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