The Vanguard S&P 500 ETF (VOO 1.15%) and the SPDR S&P 500 ETF Trust (SPY 1.20%) are both designed to mirror the performance of the S&P 500 Index, giving investors access to a diversified basket of large U.S. companies.
This comparison examines their costs, returns, risk, and portfolio details to help clarify any differences that may be significant for long-term investors.
Snapshot (cost & size)
| Metric | SPY | VOO |
|---|---|---|
| Issuer | SPDR | Vanguard |
| Expense ratio | 0.09% | 0.03% |
| 1-yr return (as of Jan. 1, 2026) | 16.3% | 16.3% |
| Dividend yield | 1.06% | 1.12% |
| Beta (5Y monthly) | 1.00 | 1.00 |
| AUM | $701 billion | $1.5 trillion |
Beta measures price volatility relative to the S&P 500. The 1-yr return represents total return over the trailing 12 months.
VOO offers a lower expense ratio than SPY, making it more affordable for fee-conscious investors. VOO also delivers a slightly higher dividend yield, though the difference is marginal.
Performance & risk comparison
| Metric | SPY | VOO |
|---|---|---|
| Max drawdown (5 y) | -24.5% | -24.5% |
| Growth of $1,000 over 5 years | $1,824 | $1,825 |
What's inside
VOO tracks the S&P 500 Index and holds 505 stocks, with a portfolio currently weighted toward technology (making up 37% of total assets), financial services (13%), and consumer cyclical (11%).
Its largest positions are Nvidia, Apple, and Microsoft. The fund has been operating for over 15 years, and it does not employ leverage or special strategies.
SPY offers nearly identical exposure with the same top holdings, closely mirroring VOO’s allocations. Both funds avoid quirks or non-standard index tracking.
For more guidance on ETF investing, check out the full guide at this link.
What this means for investors
SPY and VOO are both S&P 500 ETFs tracking the same index, so they'll be close to identical in terms of holdings, sector allocation, risk, and performance.
The main differences between them, then, will come down to fees, yield, and liquidity -- and VOO has a slight advantage in all of these areas.
VOO offers a lower expense ratio than SPY: 0.03% compared to 0.09%. This means investors can expect to pay $3 per year in fees for every $10,000 invested with VOO, compared to $9 per year with SPY. While it may seem like a small difference at first, it adds up for long-term investors who have accumulated hundreds of thousands of dollars.
VOO also delivers a slightly higher dividend yield of 1.12% compared to SPY's 1.06%. Again, it's a marginal difference. But for those who own many shares, even a slightly higher dividend payment can amount to hundreds or even thousands of dollars more in dividend income.
Finally, VOO's higher assets under management could be an advantage for some investors, as it provides more liquidity and makes it easier to buy and sell without affecting the ETF's price. For long-term investors who don't plan on selling anytime soon, though, this factor may not be a deciding factor.
This isn't to say that SPY isn't also a strong investment. If you already own other SPDR ETFs, sticking with a familiar name can be enough of an advantage in itself. But if you're looking to minimize fees and earn slightly more dividend income from your investment, VOO has an edge in these areas.
Glossary
ETF: Exchange-traded fund that holds a basket of assets and trades on stock exchanges like a stock.
Index fund: Fund designed to replicate the performance of a specific market index, such as the S&P 500.
S&P 500 Index: Benchmark index of 500 large U.S. companies, widely used to represent the overall U.S. stock market.
Expense ratio: Annual fund operating costs expressed as a percentage of assets, deducted from investor returns.
Dividend yield: Annual dividends paid by a fund or stock divided by its current price, shown as a percentage.
Assets under management (AUM): Total market value of all assets a fund or investment manager oversees.
Beta: Measure of an investment’s volatility relative to the overall market; 1.00 moves roughly in line with the market.
Max drawdown: Largest peak-to-trough decline in value over a period, showing worst-case loss during that time.
Total return: Investment performance including price changes plus all dividends and distributions, assuming they are reinvested.
Sector weighting: Percentage of a fund’s assets invested in specific industries, such as technology or financial services.
Leverage: Use of borrowed money or derivatives to amplify investment exposure, which can increase both gains and losses.
Tracking: How closely an index fund or ETF matches the performance of its target index over time.
