State Street ETFs Swap Indexes: Dow Jones Out, S&P In

by on December 23, 2010 | ETFs Mentioned:

State Street has made a few minor changes to its ETF lineup, ditching Dow Jones indexes in favor of benchmarks maintained by Standard & Poor’s for its broad-based domestic equity funds. Historically, the SPDR ETFs offering exposure to U.S. stock markets had been a bit of a hodgepodge, with the ultra-popular SPY and MDY linked to S&P indexes (the S&P 500 and S&P MidCap 400, respectively), and Dow Jones indexes filling out the rest of the cap/style matrix. Effective last week, the following changes went into effect:

The move puts State Street in more direct competition with iShares and Vanguard, both of whom offer ETFs linked to the aforementioned S&P indexes. State Street has had great success with its S&P 500 (SPY) and MidCap 400 (MDY) products, but has been beaten badly by iShares in the battle for assets in other size-specific and style-specific corners of the U.S. equity market.

State Street is at least the third issuer to tweak its ETF lineup this year by altering the indexes linked to its products. PowerShares changed its high yield bond fund this summer, dropping a Wells Fargo benchmark in favor of the RAFI High Yield Bond Index. More recently, iShares gave its semiconductor ETF a makeover, dropping the S&P North American Technology-Semiconductors Index Fund (IGW) and adding the PHLX Semiconductor Sector Index Fund (SOXX). In addition to the name and ticker change, iShares transitioned to a new index, the PHLX Semiconductor Sector Index.

[For updates on all new ETFs and tweaks to existing products, sign up for our free ETF newsletter]

Disclosure: No positions at time of writing.