SPY vs VOO: Comparing S&P 500 ETFs

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State Street Global Advisors vs Vanguard. This article compares SPY vs VOO, State Street Global Advisor's S&P 500 ETF vs Vanguard's S&P 500 ETF.

This article compares SPY vs VOO — State Street’s SPDR® S&P 500 ETF Trust and Vanguard’s S&P 500 ETF. 

Both are passively managed index ETFs popular with passive investors looking to match market returns with yields below risk-free high-yield savings rates

Index ETFs track market indexes, such as the Dow Jones Industrial Average or the Russell 2000. 

SPY and VOO track the most widely-watched U.S. stock market index: Standard & Poor’s 500.

Both funds own shares of the 500 largest U.S. companies and pay quarterly dividends. 

Passive index ETF managers do not pick stocks. They allocate funds to all stocks in the benchmark index to track its performance. Managers receive a small fee to achieve this outcome.

Since most actively managed mutual funds do not beat their target benchmarks, many fiduciary financial planners recommend index funds and ETFs instead of actively managed funds or individual stocks.

Bottom Line Upfront (BLUF)

Before I get into the details of SPY vs VOO, it’s essential to keep the following in mind:

  • The funds are virtually identical. Don’t overthink your selection. VOO edges SPY slightly in a lower expense ratio.
  • Both funds are excellent, low-fee stock index fund options for your portfolio.
  • SPY is a State Street ETF. VOO is a Vanguard ETF. 
  • Both ETFs are available to purchase from any online broker. I recommend M1 Finance, which is best for dividend investing and dividend reinvestment. 
  • If you have an account with Vanguard or Fidelity, you can own similar mutual funds (see the mutual funds section). 

Please note that both ETFs update their prospectuses regularly. The information referenced in this article will change over time.

The best resource for both funds is the respective company’s websites.

Here are links to the most updated information at Schwab and Vanguard. Consider the information on those pages to be the authoritative data source.

SPY vs VOO — Side-by-Side Comparison

Here’s a side-by-side comparison of both ETFs. Scroll right on mobile.

A few noticeable differences comparing SPY vs VOO:

  • SPY is an older fund tracing back to the year 1993. SPY was the first U.S. ETF.  
  • SPY is larger, and the price point is higher (though both are insignificant attributes in an investment decision). 
  • VOO has a lower expense ratio. SPY has a relatively high expense ratio for an established index ETF of this size. 
  • The funds are virtually identical; however, VOO slightly outperforms over all periods due to the lower expense ratio. 

SPY vs VOO — Benchmark Indexes

SPY and VOO track the S&P 500 Index, one of the most widely-watched stock indexes worldwide.

Visit this page for the latest information about the index.

The S&P 500 Index is a float-adjusted market cap-weighted index, meaning the largest stocks make up a proportionately high percentage of the index. Lower market cap stocks comprise a proportionately lower percentage of the index. 

A selection committee of financial market professionals chooses which stocks go into the index. The focus is primarily on large-cap stocks that are representative of the U.S. economy.

The committee does not try to “pick stocks” for market outperformance. Instead, they look at company size, stock liquidity, share float, and profitability, and it fits the index’s goal to reflect the broad, large-cap marketplace accurately.

SPY vs VOO Chart — Performance

Here is a daily updated chart of the performance of a $10,000 investment in both SPY vs VOO over ten years. Scroll right on mobile.

Note that this chart shows the net asset value (NAV) price performance of each ETF after dividend payments. 

Past performance is not indicative of future results. 

The funds have performed in tandem as expected because they track the same index and carry similar expense ratios. The higher SPY expense ratio is mostly insignificant. 

Either fund is suitable as a foundational stock ETF in your portfolio. 

See the table above for up-to-date three-, five-, and ten-year average annual performance records.

SPY vs VOO — Dividend Payout Schedules

Both SPY and VOO pay quarterly dividends. 

Investors receive quarterly dividend payments in March, June, September, and December.

SPY vs VOO — Top Ten Holdings

Here are the top ten holdings for each index fund. Visit the links at the beginning of the article for the most updated lists. 

SPY

As of 04/02/2024
# Symbol Company Weight
1 MSFT Microsoft Corp. 0.0719
2 AAPL Apple Inc. 0.0618
3 NVDA NVIDIA Corp. 0.0457
4 AMZN Amazon.com Inc. 0.03759
5 META Facebook Inc. Class A 0.02544
6 GOOGL Alphabet Inc. Class A 0.01916
7 BRK-B Berkshire Hathaway Inc. Class B 0.01742
8 GOOG Alphabet Inc. Class C 0.01628
9 LLY Eli Lilly & Co. 0.01405
10 AVGO Broadcom Inc. 0.01335
WordPress Table

VOO

As of 04/02/2024
# Symbol Company Weight
1 MSFT Microsoft Corp. 0.0719
2 AAPL Apple Inc. 0.0618
3 NVDA NVIDIA Corp. 0.0457
4 AMZN Amazon.com Inc. 0.03759
5 META Facebook Inc. Class A 0.02544
6 GOOGL Alphabet Inc. Class A 0.01916
7 BRK-B Berkshire Hathaway Inc. Class B 0.01742
8 GOOG Alphabet Inc. Class C 0.01628
9 LLY Eli Lilly & Co. 0.01405
10 AVGO Broadcom Inc. 0.01335
WordPress Table

Learn more about the S&P top 50 holdings.

Though the funds are nearly identical, the timing of reporting and transactions may vary, causing slight imbalances between funds. 


Mutual Fund Equivalents

Here are the closest mutual fund equivalents for both ETFs.

  • SPY = FXAIX (Fidelity)
  • VOO = VFIAX (Vanguard)

The SPY mutual fund equivalent at Fidelity is the 500 Index Fund (FXAIX). Investors with an account at Fidelity who prefer mutual funds can consider this fund an a SPY alternative.

The VOO mutual fund equivalent at Vanguard is the S&P 500 Index Fund Admiral Shares (VFIAX). Investors with an account at Vanguard who prefer mutual funds can consider this fund a VOO alternative.

Customers of online brokers that charge fees for mutual funds should use the VOO or SPY ETFs.

Mutual funds trade differently than ETFs, which trade like stocks. 

ETFs are easier to own, and the price changes throughout the day. Mutual funds only trade at the market close. 

Active investors typically use ETFs for trading purposes or to buy and hold indexes when they can’t access index mutual funds.

For example, if you have an investing account with M1 Finance, you’d invest via ETFs instead of mutual funds. If your account is with Vanguard, you may benefit from using the index fund VFIAX because it’s slightly easier to reinvest capital gains and dividends. 

Use the above resources to find the most up-to-date information regarding FXAIX vs VFIAX.

SPY vs VOO vs IVV

SPY is the largest ETF of the three. 

However, the three ETFs are virtually identical, aside from the higher SPY expense ratio, which is three times that of SPY and VOO at 0.09.

Own either IVV or VOO to save 0.06 in fees.

Read more: VOO vs IVV 

What is the Best Broker to Buy SPY or VOO?

Here are my favorite online brokers for investing in ETFs and automatically reinvesting dividends. 

Fidelity and Vanguard are excellent choices for long-term retirement investors. You’re in good hands if your IRA or employer-sponsored plan is with either broker.

I recommend another broker for a more modern user experience that can also serve your banking, borrowing, and spending needs. 

Long-term investors may prefer an online broker better for dollar cost averaging and dividend reinvestment. 

I’m a big fan of the online brokerage M1 Finance. M1 Finance is a reliable, robust, no-fee online broker for beginner and intermediate investors. It’s easy to get started.

As your investing skills and portfolio mature, M1 is one of the best platforms to scale.

They also offer an integrated checking account and low borrowing rates. Read my complete M1 Finance review here

M1 Finance does not offer mutual funds. However, ETFs are plentiful. It’s my favorite online broker for everyday investing. 

The platform is more intuitive than old-school brokers because it’s built on a modern technology platform.

You create portfolio “pies” that contain all the stocks and ETFs you want to own and in what percentages. Simply add an ETF to a pie and add funds to your account. 

Learn More about M1 Finance

Conclusion

Deciding between SPY vs VOO depends on your preference for State Street or Vanguard.

Aside from the fund administrator, the expense ratio is the only other significant distinguisher between SPY and VOO. 

However, even a 0.06 higher expense ratio is insignificant. SPY is a widely-owned ETF with high liquidity. It’s the oldest and most well-known ETF in the U.S. Investors should be comfortable owning either fund. 

If you need a distinguisher, choose VOO over SPY because of the expense ratio. 

Otherwise, don’t overthink your selection. Returns, liquidity, and dividends will be nearly identical. 

Purchase either ETF at any commission-free online broker. 

Please reply with your questions regarding SPY vs VOO in the comments section below. Include any requests you have about adding more detail to this article. 

Read more:

Disclosure: The author does not own either fund but may own a position in the top ten holdings of each fund. The opinions expressed are solely those of the authors and do not reflect the views of M1. They are for informational purposes only and are not a recommendation of an investment strategy or to buy or sell any security in any account. They are also not research reports and are not intended to serve as the basis for any investment decision. Prior to making any investment decision, you are encouraged to consult your personal investment, legal, and tax advisors.


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