State Street Corp.’s SPDR unit, the number three U.S. ETF issuer, pulled in less cash in the fourth quarter of 2024 than in the same period in 2023, as investors cut the amount of money that went into the company’s flagship SPDR S&P 500 ETF Trust (SPY) by more than half.
Boston-based State Street’s ETF unit pulled in $65 billion in Q4 2024, marking a noticeable dip from the $68 billion in the same quarter in 2023, according to the company’s latest earnings report. Still, that total is a 75% jump from Q3 2024, when the SPDR unit pulled in $37 billion.
The first and currently the world’s largest U.S. ETF with $621.4 billion in assets, SPY’s asset growth has slowed as Vanguard’s $603.9 trillion Vanguard S&P 500 ETF (VOO) seizes more market share. The latter fund has become the world’s second-largest, replacing the iShares Core S&P 500 ETF (IVV) in just the past few days, and is widely expected to take over as the world’s largest exchange-traded fund, possibly within a matter of weeks.
SPY’s inflows slumped to $20.8 billion in the fourth quarter from $46.3 billion in 2023’s final period. Meanwhile, VOO’s inflows more than tripled to $45.3 billion in the fourth quarter from $11.9 billion in 2023’s last quarter.
SPY costs three times more to own than VOO, charging an expense ratio of 0.09% compared with VOO’s 0.03%.
VOO’s momentum, at the expense of SPY, is continuing this year, Bloomberg Senior ETF Analyst Eric Balchunas posted on X.
“Somehow $VOO is outdoing itself this year w/ +$13b in 11 days to start 2025,” he wrote. “It’s also 25% of all net flows and a mere $20b away from dethroning $SPY.”
The entire North American ETF industry’s assets surged 61% year over year to $427 billion, State Street noted in its press release.
State Street, which manages $1.29 trillion in 137 ETFs, ranks behind BlackRock Inc. and its iShares unit and Vanguard Group in terms of largest issuers.
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