When tracking the S&P 500, most exchange traded fund investors automatically fall back on the SPDR S&P 500 (NYSEArca: SPY), the largest and oldest ETF. Still, investors may choose to invest in other funds that track the S&P 500 as well.

The SPDR’s SPY tries to reflect the performance of the S&P 500, an index of market capitalization weighted large- and mid-cap U.S.-listed stocks, which combined make up about 80% of the U.S market’s total value. The ETF has $104.3 billion in assets. SPY comes with a 0.09% expense ratio and a 2.02% yield.

The major difference between SPY and most other index ETF is that the SPDR offering is organized as a unit investment trust, which prevents reinvesting dividends and excludes securities not in the underlying index, such as futures or lending securities.

“Those structural differences lead to a slightly higher estimated holding cost,” according to Michael Rawson for Morningstar.

Nevertheless, “SPY has greater trading volume and assets under management, which result in the lowest market impact costs of any S&P 500 tracker,” Rawson added. “Large institutions moving tens of millions of dollars will likely prefer to use SPY.”

Recently, iShares restructured its S&P 500 ETF into the iShares Core S&P 500 ETF (NYSEArca: IVV), which now comes with a lower expense ratio of 0.07%. The lower fees helped the ETF attract $2 billion in new inflows over October while SPY saw $7.2 billion in outflows. The fund now has $31.6 billion in assets. [iShares S&P 500 ETF Attracts Cash After Fee Cut]

IVV is a 1940 Act Fund. As such, the iShares ETF may reinvest dividends, utilize securities lending and trade index futures if required, which help the fund better reflect the performance of the S&P 500 or lower tracking volatility.

Lastly, the Vanguard S&P 500 ETF (NYSEArca: VOO) with $5.6 billion in assets is the smallest of the three but it is also the cheapest at a 0.05% expense ratio.

“But while the estimated holding cost for VOO is less than SPY, the market impact is slightly higher,” Rawson said. “For buy-and-hold investors, holding costs have a bigger impact on returns than trading costs, which are incurred only when trading. What these means is that large dollar and rapid traders will continue to prefer to use SPY, but long-term investors who trade less frequently will prefer to use VOO.”

For more information on ETFs, visit our ETF 101 category.

Max Chen contributed to this article.