ETFs
Should the SPDR Portfolio S&P 500 ETF (SPLG) be on your investing radar?
Are you looking for broad exposure to the Large Cap Blend segment of the US equity market? You should consider the SPDR Portfolio S&P 500 ETF (SPLG), a passively managed exchange-traded fund launched on 08/11/2005.
The fund is sponsored by State Street Global Advisors. It has amassed assets of over $39.16 billion, making it one of the largest ETFs attempting to match the Large Cap Blend segment of the US stock market.
Why a large cap mix
Companies that fall into the large-cap category typically have a market capitalization greater than $10 billion. These are generally stable companies with predictable cash flows and generally less volatile than mid- and small-cap companies.
Typically holding a mix of growth and value stocks, blended ETFs also demonstrate the qualities of both value and growth investments.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
The annual operating expenses of this ETF are 0.02%, making it one of the cheapest products in the industry.
It has a 12-month current dividend yield of 1.28%.
Sector exposure and main holdings
ETFs provide diversified exposure and thus minimize the risk associated with an individual stock, but it is still important to look at a fund’s holdings before investing. Most ETFs are very transparent products and many disclose their holdings daily.
This ETF has the highest allocation to the information technology sector – approximately 28.50% of the portfolio. The finance and health sectors complete the top three.
Looking at individual stocks, Microsoft Corp (MSFT) accounts for around 7.15% of total assets, followed by Apple Inc (AAPL) and Nvidia Corp (NVDA).
The top 10 holdings represent approximately 32.56% of total assets under management.
Performance and risk
SPLG seeks to match the performance of the Russell 1000 Index before fees and expenses. The S&P 500 Index is designed to measure the performance of the large-cap segment of the U.S. stock market.
The ETF’s return is approximately 15.76% so far this year and has increased approximately 25.93% over the past year (as of 06/19/2024). Over the past 52 weeks, it has traded between $48.29 and $64.51.
The ETF has a beta of 1 and a standard deviation of 17.13% for the past three-year period. With approximately 506 securities, it effectively diversifies company-specific risks.
Alternatives
The SPDR Portfolio S&P 500 ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on the asset class’s expected return, expense ratio, and momentum, among other factors. For this reason, SPLG is an exceptional option for investors seeking exposure to the Style Box – Large Cap Blend market segment. There are other additional ETFs in the space that investors might also consider.
The story continues
The iShares Core S&P 500 ETF (IVV) and the SPDR S&P 500 ETF (SPY) track a similar index. While the iShares Core S&P 500 ETF has $478.46 billion in assets, the SPDR S&P 500 ETF has $540.58 billion. IVV has an expense ratio of 0.03% and SPY charges 0.09%.
Final result
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility and tax efficiency; they are also excellent vehicles for long-term investors.
To learn more about this and other ETFs, research products that match your investment objectives, and read articles on the latest developments in the ETF investment universe, please visit the Zacks ETF Center.
Want the latest recommendations from Zacks Investment Research? Today you can download the 7 best stocks for the next 30 days. Click to get this free report
SPDR Portfolio S&P 500 ETF (SPLG): ETF Research Reports
Apple Inc. (AAPL): Free Stock Analysis Report
Microsoft Corporation (MSFT): Free Stock Analysis Report
NVIDIA Corporation (NVDA): Free Stock Analysis Report
SPDR S&P 500 ETF (SPY): ETF Research Reports
iShares Core S&P 500 ETF (IVV): ETF Research Reports