Despite hits to consumer confidence and disappointing Chinese industrial data, the S&P 500 (SNPINDEX:^GSPC) kept calm and carried on, rising 0.6% on the week to bring its return to a remarkable 9.4% for the young year. Since the depths of the financial crisis, $10 trillion has returned to U.S. equities, and the S&P has been quite a willing beneficiary of that influx, as corporate profits surge. The benchmark flirted with all-time highs this week.
Most investors aren't fully invested in all 500 S&P companies at once; however, there are simple ways to gain that sort of exposure. Exchange-traded funds, or ETFs, are simple instruments the individual can use to invest in entire markets with the click of a button.
There are a lot of ETFs to choose from, but today we'll put an eye to four of them in particular, what they consist of, and how they've been performing recently:
SPDR S&P 500 Trust (NYSEMKT:SPY)
- Week: 0.4%
- YTD: 6.8%
Seeking to mimic the returns of the index it represents, the ETF tracking the S&P seems like a good place to start. While the performance won't be exactly in line with the index, it's generally pretty close. An expense ratio of just 0.11% per year is a small cost to pay to own 500 of the most esteemed companies in the United States. As it goes "ex-dividend" on Friday, part of the reason returns don't stack up to the actual index for the week and the year is that investors sold off after they knew they were going to receive the dividend payment.
iShares Russell 2000 Index Fund (NYSEMKT:IWM)
- Week: 1.3%
- YTD: 9.4%
Tracking small-cap U.S. equities, this ETF continues to be a stellar performer, registering a second straight week as the top fund examined. One of the sectors it's most exposed to is financials, which, after data from stress tests boosted some of the major players, rallied to 52-week highs, helping the Russell 2000 Index reach all-time highs of its own.
iShares MSCI Emerging Markets Index Fund (NYSEMKT:EEM)
- Week: (3.2%)
- YTD: (5.5%)
On the other side of the performance spectrum sits this emerging-markets fund, which continued its bleak performance this week on the heels of weak industrial numbers from China. Though the 9.9% advance in production through January and February would be remarkable by U.S. standards, the Chinese economy has a track record of even higher growth, and with Chinese investments comprising nearly one-fifth of the holdings, it's no surprise a lackluster showing in Asia hurt the fund.
SPDR Dow Jones Industrial Average ETF Trust (NYSEMKT:DIA)
- Week: 0.8%
- YTD: 8.3%
Lastly, let's look at an ETF tracking one of the most oft-cited indexes in the financial landscape. Nothing to go crazy about in the weekly performance, to be sure, but keep in mind that blue-chip stocks have been setting all-time records day after day, and only on Friday did the index break its legendary 10-day run, the best since 1996. Paying a mere 0.17% per year to gain exposure to 30 of the most esteemed and dominant companies in America is a small price to pay, especially when corporate profits are enjoying what some have labeled as a "golden age."
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