The SPDR S&P 500 ETF Trust (SPY ) is turning 30 this weekend, and VettaFi head of research Todd Rosenbluth appeared on TD Ameritrade to discuss SPY’s impact on finance.
“There’s a lot to celebrate. We’ve got $7 trillion in U.S.-listed ETFs today. We’ve had back-to-back the strongest years ever in terms of overall inflows and the number of new products that have come to market,” Rosenbluth noted.
Both the iShares Core S&P 500 ETF (IVV ) and the Vanguard S&P 500 ETF (VOO ) have dug into SPY’s market share, but SPY remains an undeniable powerhouse. According to Rosenbluth, “it trades more than most of the underlining stocks combined.” SPY has grown to become the “default vehicle” for investors to get access to the S&P 500.
With over $370 billion AUM, SPY is still the largest ETF despite the incursions from IVV and VOO. Rosenbluth noted there are many versions and iterations of SPY, including the tech-focused Technology Select Sector SPDR Fund (XLK ) and the lower volatility take provided by the Invesco S&P 500® Low Volatility ETF (SPLV ).
The S&P 500 remains important as the benchmark for many actively managed funds. Rosenbluth said, “what’s been exciting to us is the growth of actively managed ETF universe.” He shared that though actively managed ETFs represent just 5% of the ETF funds out there, they have 13% of the assets under management in 2022. “These are products that are trying to outperform the S&P 500, or outperform SPY.”
ETFs continue to evolve and grow. Rosenbluth took a moment to summarize that since SPY’s inception, the ETF world has grown into over 3,000 funds and $7 trillion in AUM. “We continue to see new firms enter the marketplace,” Rosenbluth observed. After celebrating the innovation of the space, Rosenbluth urged investors to do their homework and know what they own.