The SPDR S&P 500 ETF Trust (SPY) and the Vanguard Total International Stock Index Fund ETF Shares (VXUS) are both among the Top 100 ETFs. SPY is a SPDR State Street Global Advisors Large Blend fund and VXUS is a Vanguard Foreign Large Blend fund. So, what’s the difference between SPY and VXUS? And which fund is better?
The expense ratio of SPY is 0.01 percentage points higher than VXUS’s (0.09% vs. 0.08%). SPY also has a higher exposure to the technology sector and a lower standard deviation. Overall, SPY has provided higher returns than VXUS over the past ten years.
In this article, we’ll compare SPY vs. VXUS. We’ll look at holdings and annual returns, as well as at their risk metrics and fund composition. Moreover, I’ll also discuss SPY’s and VXUS’s performance, portfolio growth, and industry exposure and examine how these affect their overall returns.
FYI: Another great way to get exposure to the real estate sector is by investing in real estate debt. Groundfloor offers fantastic short-term, high-yield bonds that can add diversification to your portfolio!
Summary
| SPY | VXUS | |
| Name | SPDR S&P 500 ETF Trust | Vanguard Total International Stock Index Fund ETF Shares |
| Category | Large Blend | Foreign Large Blend |
| Issuer | SPDR State Street Global Advisors | Vanguard |
| AUM | 374.03B | 404.73B |
| Avg. Return | 14.41% | 8.41% |
| Div. Yield | 1.3% | 2.44% |
| Expense Ratio | 0.09% | 0.08% |
If you are also looking for SPY vs. IWR, You can check out all those details.
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 Vanguard Total International Stock Index Fund ETF Shares (VXUS) is a Foreign Large Blend fund that is issued by Vanguard. It currently has 404.73B total assets under management and has yielded an average annual return of 8.41% over the past 10 years. The fund has a dividend yield of 2.44% with an expense ratio of 0.08%.
SPY’s dividend yield is 1.14% lower than that of VXUS (1.3% vs. 2.44%). Also, SPY yielded on average 6.00% more per year over the past decade (14.41% vs. 8.41%). The expense ratio of SPY is 0.01 percentage points higher than VXUS’s (0.09% vs. 0.08%).
FYI: The best way I've found to invest is through M1 Finance. It's free and you even get an instant line of credit and 100$! Have a look here (link to M1 Finance).
Fund Composition
Industry Exposure
I have a comparison for SPY vs. EFA, You can check out all those details.
| SPY | VXUS | |
| Technology | 24.22% | 13.07% |
| Industrials | 8.86% | 12.94% |
| Energy | 2.86% | 4.55% |
| Communication Services | 11.14% | 7.06% |
| Utilities | 2.45% | 2.94% |
| Healthcare | 13.09% | 9.19% |
| Consumer Defensive | 6.32% | 7.83% |
| Real Estate | 2.57% | 3.79% |
| Financial Services | 14.23% | 17.64% |
| Consumer Cyclical | 12.0% | 12.64% |
| Basic Materials | 2.27% | 8.37% |
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 Vanguard Total International Stock Index Fund ETF Shares (VXUS) has the most exposure to the Financial Services sector at 17.64%. This is followed by Technology and Industrials at 13.07% and 12.94% respectively. Real Estate (3.79%), Energy (4.55%), and Communication Services (7.06%) only make up 15.40% of the fund’s total assets.
VXUS’s mid-section with moderate exposure is comprised of Consumer Defensive, Basic Materials, Healthcare, Consumer Cyclical, and Industrials stocks at 7.83%, 8.37%, 9.19%, 12.64%, and 12.94%.
SPY is 11.15% more exposed to the Technology sector than VXUS (24.22% vs 13.07%). SPY’s exposure to Financial Services and Healthcare stocks is 3.41% lower and 3.90% higher respectively (14.23% vs. 17.64% and 13.09% vs. 9.19%). In total, Utilities, Real Estate, and Energy also make up 3.40% less of the fund’s holdings compared to VXUS (7.88% vs. 11.28%).
If you need another SPY comparison I have one SPY vs. DIA right here.
Holdings
| SPY Holdings | Weight |
| Apple Inc | 5.9% |
| Microsoft Corp | 5.6% |
| Amazon.com Inc | 4.05% |
| Facebook Inc A | 2.29% |
| Alphabet Inc A | 2.02% |
| Alphabet Inc Class C | 1.96% |
| Berkshire Hathaway Inc Class B | 1.45% |
| Tesla Inc | 1.44% |
| NVIDIA Corp | 1.37% |
| 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%.
| VXUS Holdings | Weight |
| Taiwan Semiconductor Manufacturing Co Ltd | 1.62% |
| Tencent Holdings Ltd | 1.41% |
| Alibaba Group Holding Ltd Ordinary Shares | 1.26% |
| Nestle SA | 1.1% |
| Samsung Electronics Co Ltd | 1.05% |
| ASML Holding NV | 0.86% |
| Roche Holding AG | 0.81% |
| Toyota Motor Corp | 0.67% |
| LVMH Moet Hennessy Louis Vuitton SE | 0.61% |
| Novartis AG | 0.6% |
VXUS’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 1.62%, 1.41%, 1.26%, 1.1%, and 1.05%.
ASML Holding NV (0.86%), Roche Holding AG (0.81%), and Toyota Motor Corp (0.67%) have a slightly smaller but still significant weight. LVMH Moet Hennessy Louis Vuitton SE and Novartis AG are also represented in the VXUS’s holdings at 0.61% and 0.6%.
Risk Analysis
| SPY | VXUS | |
| Mean Return | 1.23 | 0.56 |
| R-squared | 100 | 98.39 |
| Std. Deviation | 13.56 | 15.12 |
| Alpha | -0.09 | 0.31 |
| Beta | 1 | 0.99 |
| Sharpe Ratio | 1.04 | 0.4 |
| Treynor Ratio | 14.12 | 5.14 |
The SPDR S&P 500 ETF Trust (SPY) has a Treynor Ratio of 14.12 with a Sharpe Ratio of 1.04 and a Alpha of -0.09. Its Beta is 1 while SPY’s Standard Deviation is 13.56. Furthermore, the fund has a R-squared of 100 and a Mean Return of 1.23.
The SPY vs. IUSB is another great set of index’s and ETF to look at.
The Vanguard Total International Stock Index Fund ETF Shares (VXUS) has a Mean Return of 0.56 with a Treynor Ratio of 5.14 and a R-squared of 98.39. Its Alpha is 0.31 while VXUS’s Standard Deviation is 15.12. Furthermore, the fund has a Sharpe Ratio of 0.4 and a Beta of 0.99.
SPY’s Mean Return is 0.67 points higher than that of VXUS and its R-squared is 1.61 points higher. With a Standard Deviation of 13.56, SPY is slightly less volatile than VXUS. The Alpha and Beta of SPY are 0.40 points lower and 0.01 points higher than VXUS’s Alpha and Beta.
NOTE: The easiest way to add diversification to your portfolio is to invest in real estate through Fundrise. You can become private real estate investor without the burden of property management! Check it out here (link to Fundrise).
Performance
Annual Returns
| Year | SPY | VXUS |
| 2020 | 18.25% | 11.32% |
| 2019 | 31.29% | 21.58% |
| 2018 | -4.45% | -14.42% |
| 2017 | 21.69% | 27.52% |
| 2016 | 11.8% | 4.72% |
| 2015 | 1.34% | -4.28% |
| 2014 | 13.53% | -4.17% |
| 2013 | 32.21% | 15.16% |
| 2012 | 15.84% | 18.22% |
| 2011 | 2.06% | 0.0% |
| 2010 | 14.93% | 0.0% |
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 VXUS, returning 27.52% on an annual basis. The poorest year for VXUS in the last ten years was 2018, with a yield of -14.42%. Most years the Vanguard Total International Stock Index Fund ETF Shares has given investors modest returns, such as in 2010, 2016, and 2020, when gains were 0.0%, 4.72%, and 11.32% respectively.
Portfolio Growth
| Fund | Initial Balance | Final Balance | CAGR |
| SPY | $10,000 | $35,561 | 14.41% |
| VXUS | $10,000 | $19,315 | 8.41% |
A $10,000 investment in SPY would have resulted in a final balance of $35,561. This is a profit of $25,561 over 9 years and amounts to a compound annual growth rate (CAGR) of 14.41%.
If you need more comparisons to read try SPY vs. MBB.
With a $10,000 investment in VXUS, the end total would have been $19,315. This equates to a $9,315 profit over 9 years and a compound annual growth rate (CAGR) of 8.41%.
SPY’s CAGR is 6.00 percentage points higher than that of VXUS and as a result, would have yielded $16,246 more on a $10,000 investment. Thus, SPY outperformed VXUS by 6.00% annually.
Current recommendations:
Over the past years, I have discovered several tools and products that have helped me tremendously on my path to financial freedom:
P.S.: The links below are affiliate links, which means I receive a small commission at no extra cost to you when you sign up for one of the services. Thank you for your support!
1)Personal Capital is simply the best tool out there to track your net worth and plan for financial freedom. Just their retirement planner alone has become an invaluable tool to keep myself on track financially. Try it out, it's free!
2) Take a look at M1 Finance, my favorite broker. I love how easy it is to invest and maintain my portfolio with them. I can set up automatic transfers, rebalance my portfolio with one click and even borrow up to 35% of my assets at super low interest rates!
3) Fundrise is by far the best way I've found to invest in Real Estate. You can diversify your portfolio by investing in their eREITs or even allocate capital to individual properties (without the hassle of managing tenants!).
4) Groundfloor is another great way to get exposure to the real estate sector by investing in short-term, high-yield real estate debt. Current returns are >10% and you can get started with just $10.
5) If you are interested in startup investing, check out Mainvest. I've started allocating a small amount of assets to invest in and support small businesses. Return targets are between 10-25% and you can start with just $100!
To see all of my most up-to-date recommendations, check out the Recommended Tools section.
I believe that money is just a means to an end: to be free to spend your time as you wish, to maximize your positive impact on the world.
