The S&P 500 is one of the world’s leading benchmarks, and one of the broadest indicators of the strength of the U.S. economy and corporate America. There are exchange traded funds (ETFs) and mutual funds that track the index. Who does it better?
Generally, the two primary ETFs tracking the S&P 500 have performed as promised, with a lower tracking error and better performance than almost all index mutual funds. The ETFs do have a lower expense ratio, which analysts believe is why the funds are more accurate trackers, according to Morningstar. [How to Play the S&P 500 with ETFs.]
The S&P 500 Index is known as the market’s barometer for the health of the U.S. economy. Investopedia explains that the S&P 500 is designed to be a leading indicator of U.S. equities and is meant to reflect the risk/return characteristics of the large cap universe. In order to be a part of this index, there are certain criteria that have to do with market size, liquidity and industry grouping. [What Large Cap ETFs Have Going For Them.]
Year-to-date, the index is down 6.1%.
- SPDR S&P 500 (NYSEArca: SPY)
- Rydex S&P Equal Weight ETF (NYSEArca: RSP)
- iShares S&P 500 (NYSEArca: IVV)
Tisha Guerrero contributed to this article.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Mr. Lydon serves as an independent trustee of certain mutual funds and ETFs that are managed by Guggenheim Investments; however, any opinions or forecasts expressed herein are solely those of Mr. Lydon and not those of Guggenheim Funds, Guggenheim Investments, Guggenheim Specialized Products, LLC or any of their affiliates. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.