SPDR S&P 500 ETF (NYSEArca: SPY) is just 2% away from joining SPDR Dow Jones Industrial Average ETF (NYSEArca: DIA) at new all-time highs, an event that is fueling both exuberance and caution among investors scarred by the 2008 credit meltdown.
The Dow ETF traded as high as $142.68 a share on Tuesday, eclipsing its record intraday high of $141.95 a share recorded in October 2007.
Meanwhile, the S&P 500 fund posted a session high of $154.70 a share on Tuesday, about 2% shy of its all-time high of $157.52 from Oct. 11, 2007.
It has taken these two major U.S. stock indices less than five and a half years to erase the steep losses from the financial crisis. The Dow and S&P 500 have both doubled in price since the 2009 low.
“Psychologically, it may give a sense that we have recovered a tremendous amount from the depths of the crisis,” Wasif Latif, vice president of equity investments at USAA Investments, told Bloomberg. “On the other hand, it could create a sense of nervousness that we reached an all-time high, so how much more is there to go?”
In terms of performance, the Dow ETF is outpacing the S&P 500 ETF so far in 2013 with an 8.4% total return versus 7.4%.