SPY vs TAGG
SPY vs TAGG
State Street SPDR S&P 500 ETF Trust vs T Rowe Price QM US Bond ETF
Quick Verdict
TAGG has a lower expense ratio. SPY delivered stronger 1-year returns. TAGG offers more diversification with 1212 holdings.
Side-by-Side Comparison
| Metric | SPY | TAGG | Winner |
|---|---|---|---|
| Expense Ratio | 0.09% | 0.08% | |
| AUM | $789.1B | $2.3B | |
| Dividend Yield | 1.01% | 4.57% | |
| Holdings | 505 | 1,595 | |
| YTD Return | +13.50% | +0.07% | |
| 1Y Return | +23.56% | +2.53% | |
| 3Y Return (annualized) | +21.17% | +4.41% | |
| 5Y Return (annualized) | +13.46% | - | |
| Volatility (annualized) | 15.3% | 6.6% | |
| Max Drawdown | -56.5% | -17.3% | |
| Fund Family | State Street Investment Management | T.Rowe Price | |
| Category | Equity | Fixed Income | |
| Inception | Jan 22, 1993 | Sep 28, 2021 |
SPY vs TAGG Performance
State Street SPDR S&P 500 ETF Trust (SPY) is a ETF from State Street Investment Management and T Rowe Price QM US Bond ETF (TAGG) is a ETF from T.Rowe Price. Over the past year SPY returned +23.56% while TAGG returned +2.53%. Year to date, SPY is up 13.50% versus a gain of 0.07% for TAGG.
Over three years, SPY compounded at +21.17% per year against +4.41% for TAGG. Across the full 5-year window we track, SPY has the edge at +8.85% annualized vs +0.14%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
SPY has been the more volatile fund, with annualized monthly volatility of 15.3% compared with 6.6% for TAGG. Lower volatility generally means a smoother ride, though it often comes with lower long-run returns.
The deepest peak-to-trough decline in our data was -56.5% for SPY and -17.3% for TAGG. Drawdown depth is worth weighing if you expect to sell during market stress rather than ride it out.
The two funds' monthly returns correlate at 0.59. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
SPY charges 0.09% per year while TAGG charges 0.08%. On a $10,000 position that is $9 vs $8 annually, a gap of $1 per year that compounds over a long holding period. On income, SPY currently yields 1.01% against 4.57% for TAGG.
Holdings Overlap
SPY and TAGG share 1 holdings out of 1714 unique holdings combined, representing a 0.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Top Shared Holdings
| Stock | Weight in SPY | Weight in TAGG | Difference |
|---|---|---|---|
| GE | 0.61% | 0.03% | 0.58% |
Frequently Asked Questions
Which is cheaper, SPY or TAGG?
SPY has an expense ratio of 0.09% while TAGG charges 0.08%. TAGG is the cheaper option. On a $10,000 investment, that is $1 per year of difference.
Which performed better, SPY or TAGG?
Over the past year SPY returned +23.56% vs +2.53% for TAGG, so SPY leads on 1-year performance. Over the longest common window we track (5 years), SPY annualized +8.85% vs +0.14% for TAGG. Past performance does not guarantee future results.
Which is riskier, SPY or TAGG?
SPY has been the more volatile fund at 15.3% annualized versus 6.6% for TAGG. Worst drawdown: SPY -56.5% vs TAGG -17.3%.
Should I hold both SPY and TAGG?
SPY and TAGG have a monthly-return correlation of 0.59, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between SPY and TAGG?
SPY and TAGG share 1 common holdings with a 0.0% weight overlap. Combined, they hold 1714 unique securities.
Which pays a higher dividend, SPY or TAGG?
SPY yields 1.01% while TAGG yields 4.57%, so TAGG currently pays the higher dividend yield.
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