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State Street offers a cheaper S&P 500 ETF alternative to SPY with lower fees and dividend reinvestment.

Market News
10 Aug 2026
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The SPDR S&P 500 ETF Trust (SPY) is the largest and most liquid S&P 500 ETF but charges a 0.0945% fee and uses a structure that delays dividend reinvestment. State Street offers a cheaper alternative, the SPDR Portfolio S&P 500 ETF (SPYM), which tracks the same index with a much lower fee of 0.02% and reinvests dividends immediately, potentially improving long-term returns. SPY remains preferred for traders due to its deep options market and liquidity, while SPYM suits long-term investors focused on cost efficiency. Investors in taxable accounts should consider tax implications before switching, but those in tax-advantaged accounts might benefit from moving to SPYM for lower costs and better dividend handling.

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