The Best S&P 500 ETFs Compared

The S&P 500 changes over time, but the largest positions usually come from the same group of mega-cap names. Today, some of the most important holdings include Apple, Microsoft, Nvidia, Amazon, Alphabet, Meta Platforms, Berkshire Hathaway, Broadcom, Eli Lilly, and Tesla. These companies carry a lot of influence because the index is weighted by market capitalization, so the biggest firms shape performance more than smaller ones. Did you know that with El Fondo you can now run side-by-side comparisons for stocks and the same for ETFs?

We compared the largest funds tracking the S&P 500:

• State Street SPDR S&P 500 ETF Trust: SPY

• Vanguard S&P 500 ETF: VOO

• iShares Core S&P 500 ETF: IVV

• SPDR Portfolio S&P 500 ETF: SPLG

• Amundi S&P 500 Swap UCITS ETF USD Acc: 500U

Here you can access the comparison here. Among the five ETFs compared the Amundi fund 500U.L came out ahead on performance. That result is useful, but investors should read the structure carefully before choosing it. 500U.L uses swap replication, while the other major funds in the comparison follow physical replication, which means they hold the underlying stocks directly.

Swap replication can be efficient, but it adds an extra layer of counterparty risk and transparency risk. In plain terms, the fund depends on a financial contract with a bank or another institution to match the index, instead of owning the shares itself. That can be a disadvantage for investors who want the simplest possible structure, especially when a physical ETF offers direct ownership of the basket of stocks. Also the fund from Amundi is

There is another trade-off. The Amundi fund holds around 300 stocks, far fewer than the 500 names in the index. That lower number of holdings usually means less diversification and, in many cases, higher volatility. A fund can still track the S&P 500 closely with swaps, but beginners should understand that a strong past result does not remove structural differences. Also the 500U.L is an accumulating fund, which means that dividends are reinvested instead of payed out to the investor leading to higher returns due to the compounding effect. You can read our article about the power of compounding here.