The SPDR S&P 500 ETF Trust (SPY) and the iShares Core S&P Total U.S. Stock Market ETF (ITOT) are both interesting ETFs. SPY tracks S&P 500 Index and ITOT tracks S&P Composite 1500 Index. So, what’s the difference between SPY vs ITOT? And which fund is better?
SPY vs ITOT: The expense ratio of SPY is 0.09% and ITOT is 0.03%. SPY’s biggest holding is Apple Inc and ITOT’s biggest holding is Apple Inc. Overall, SPY has provided 0.31% Higher returns than ITOT over the past ten years.In this article, we’ll compare SPY vs ITOT. We’ll look at holdings and performance, as well as at their portfolio growth and annual returns. Moreover, I’ll also discuss SPY’s and ITOT’s industry exposure, risk metrics, fund composition and examine how these affect their overall returns.
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Summary SPY vs ITOT
ITOT vs SPY Table
|Name||SPDR S&P 500 ETF Trust||iShares Core S&P Total U.S. Stock Market ETF|
|Category||Large Blend||Large Blend|
|Issuer||SPDR State Street Global Advisors||iShares|
The SPDR S&P 500 ETF Trust (SPY) is a S&P 500 Index fund that is issued by SPDR State Street Global Advisors. It currently has $393.46B total assets under management and has yielded an average annual return of 12.85% over the past 10 years. The fund has a dividend yield of 1.55% with an expense ratio of 0.09%.
The iShares Core S&P Total U.S. Stock Market ETF (ITOT) is a S&P Composite 1500 Index that is issued by iShares. It currently has $41.96B total assets under management and has yielded an average annual return of 12.54% over the past 10 years. The fund has a dividend yield of 1.56% with an expense ratio of 0.03%.
SPY’s dividend yield is Lower than that of ITOT (1.55% vs 1.56%). Also, SPY yielded on average 0.31% Higher per year over the past decade (12.85% vs 12.54%). The expense ratio of SPY is 0.06% percentage points Higher than ITOT’s (0.09% vs 0.03%).
Fund Composition SPY vs ITOT
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Industry Exposure Table vs SPY
The SPDR S&P 500 ETF Trust (SPY) has the most exposure to the Technology sector at 28.64%. This is followed by Healthcare and Financial Services at 13.77% and 12.01% respectively. Basic Materials (2.18%), Real Estate (2.50%), and Utilities (2.68%) only make up 7.36% of the fund’s total assets.
SPY’s middle weighted sectors is made up with moderate exposure to Energy, Consumer Defensive, Industrials, Communication Services, and Consumer Cyclical stocks at 4.17%, 6.83%, 8.01%, 8.75%, and 10.31%.
The iShares Core S&P Total U.S. Stock Market ETF (ITOT) has the most exposure to the Technology sector at 0.2789. This is followed by Healthcare and Financial Services at 0.1368 and 0.1221 respectively. Basic Materials (0.0237), Utilities (0.0257), and Real Estate (0.0312) only make up 0.0806 of the fund’s total assets.
ITOT’s middle weighted sectors is made up with moderate exposure to Energy, Consumer Defensive, Communication Services, Industrials, and Consumer Cyclical stocks at 0.0417, 0.0628, 0.0804, 8.75%, and 10.31%.
SPY is 0.75% More exposed to the Technology sector than ITOT (28.64% vs 27.89%). SPY’s exposure to Healthcare and Financial Services stocks is 0.09% More and -0.20% Less respectively (13.77% vs. 13.68%) and (12.01% vs. 12.21%).
In total, SPY’s bottom three industries, Utilities, Real Estate, and Basic Materials also make up -0.70% Lower of the fund’s holdings compared to ITOT’s bottom three industries. (7.36% vs. 0.0806).
Holdings SPDR S&P 500 ETF Trust (SPY)
|Alphabet Inc Class A||2.09%|
|Alphabet Inc Class C||1.83%|
|Meta Platforms Inc Class A||1.68%|
|Berkshire Hathaway Inc Class B||1.65%|
|UnitedHealth Group Inc||1.30%|
SPY’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, NVIDIA Corp, and Alphabet Inc Class A at 7.53%, 6.98%, 3.07%, 2.66%, and 2.09%.
Alphabet Inc Class C (1.83%), Meta Platforms Inc Class A (1.68%), and Berkshire Hathaway Inc Class B (1.65%) have a slightly smaller but still significant weight. Tesla Inc and UnitedHealth Group Inc are also represented in the SPY’s holdings at 1.57% and 1.30%.
Holdings iShares Core S&P Total U.S. Stock Market ETF (ITOT)
|Alphabet Inc Class A||0.0179|
|Alphabet Inc Class C||0.0156|
|Meta Platforms Inc Class A||0.0144|
|Berkshire Hathaway Inc Class B||0.0141|
|UnitedHealth Group Inc||0.0111|
SPY’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, NVIDIA Corp, and Alphabet Inc Class A at 0.0644, 0.0597, 0.0262, 0.0227, and 0.0179.
Alphabet Inc Class C (0.0156), Meta Platforms Inc Class A (0.0144), and Berkshire Hathaway Inc Class B (0.0141) have a slightly smaller but still significant weight. Tesla Inc and UnitedHealth Group Inc are also represented in the ’s holdings at 0.0134 and 0.0111.
Risk Analysis SPY vs ITOT
The SPDR S&P 500 ETF Trust has a Standard Deviation of 17.89 with a Alpha of -0.06 and a Treynor Ratio of 11.41. Its Sharpe Ratio is 0.68 while SPY’s Beta is 1. Furthermore, the fund has a Mean Return of 1.14 and a R-squared of 100.
The ITOT has a R-squared of 99.09 with a Mean Return of 1.09 and a Standard Deviation of 18.22. Its Sharpe Ratio is 0.64 while ITOT’s Alpha is -0.841. Furthermore, the fund has a Beta of 1.01 and a Treynor Ratio of 10.52.
Performance SPY vs ITOT
Annual Returns SPY vs ITOT
SPY had its best year in 2013 with an annual return of 32.31%. SPY’s worst year over the past decade yielded -18.17% and occurred in 2022. In most years the SPDR S&P 500 ETF Trust provided moderate returns such as in 2019, 2021, and 2017 where annual returns amounted to 31.35%, 28.78%, and 21.77% respectively.
The year 2013 was the strongest year for ITOT, returning 0.3273 on an annual basis. The poorest year for ITOT in the last ten years was 2022, with a yield of -0.1947. Most years the iShares Core S&P Total U.S. Stock Market ETF has given investors modest returns, such as in 2019, 2021, and 2017, when gains were 27.32%, 17.56%, and 16.26% respectively.
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Performance Comparison SPY vs ITOT
|Fund||Initial Balance||Final Balance||CAGR|
A $10,000 investment in SPY would have resulted in a final balance of $30,587.17. This is a profit of $20,587.17 over 10 years and amounts to a compound annual growth rate (CAGR) of 13.23%.
With a $10,000 investment in ITOT, the end total would have been $29,646.61. This equates to a $19,646.61 profit over 10 years and a compound annual growth rate (CAGR) of 12.83%.
ITOT’s CAGR is -0.39% Lower than that of SPY and as a result, would have yielded -$940.55 Less on a $10,000 investment. Thus, ITOT Underperformed SPY by -$94.06 annually.