SPY vs WDI
SPY vs WDI
State Street SPDR S&P 500 ETF Trust vs Western Asset Diversified Income Fund
Quick Verdict
SPY has a lower expense ratio. SPY delivered stronger 1-year returns. SPY offers more diversification with 503 holdings.
Side-by-Side Comparison
| Metric | SPY | WDI | Winner |
|---|---|---|---|
| Expense Ratio | 0.09% | 1.82% | |
| AUM | $789.1B | $723M | |
| Dividend Yield | 1.01% | 12.55% | |
| Holdings | 505 | 410 | |
| YTD Return | +11.49% | +1.66% | |
| 1Y Return | +21.37% | -1.21% | |
| 3Y Return (annualized) | +20.76% | +10.93% | |
| 5Y Return (annualized) | +12.94% | +2.64% | |
| Volatility (annualized) | 15.3% | 13.9% | |
| Max Drawdown | -56.5% | -32.5% | |
| Fund Family | State Street Investment Management | Franklin Templeton Investments (US) | |
| Category | Equity | Fixed Income | |
| Inception | Jan 22, 1993 | Jun 24, 2021 |
SPY vs WDI Performance
State Street SPDR S&P 500 ETF Trust (SPY) is a ETF from State Street Investment Management and Western Asset Diversified Income Fund (WDI) is a ETF from Franklin Templeton Investments (US). Over the past year SPY returned +21.37% while WDI returned -1.21%. Year to date, SPY is up 11.49% versus a gain of 1.66% for WDI.
Over three years, SPY compounded at +20.76% per year against +10.93% for WDI; over five years the annualized figures are +12.94% and +2.64% respectively. Across the full 5-year window we track, SPY has the edge at +8.78% annualized vs +2.78%. 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 13.9% for WDI. 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 -32.5% for WDI. 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 0.69. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
SPY charges 0.09% per year while WDI charges 1.82%. On a $10,000 position that is $9 vs $182 annually, a gap of $173 per year that compounds over a long holding period. On income, SPY currently yields 1.01% against 12.55% for WDI.
Holdings Overlap
SPY and WDI share 0 holdings out of 695 unique holdings combined, representing a 0.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, SPY or WDI?
SPY has an expense ratio of 0.09% while WDI charges 1.82%. SPY is the cheaper option. On a $10,000 investment, that is $173 per year of difference.
Which performed better, SPY or WDI?
Over the past year SPY returned +21.37% vs -1.21% for WDI, so SPY leads on 1-year performance. Over the longest common window we track (5 years), SPY annualized +8.78% vs +2.78% for WDI. Past performance does not guarantee future results.
Which is riskier, SPY or WDI?
SPY has been the more volatile fund at 15.3% annualized versus 13.9% for WDI. Worst drawdown: SPY -56.5% vs WDI -32.5%.
Should I hold both SPY and WDI?
SPY and WDI have a monthly-return correlation of 0.69, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between SPY and WDI?
SPY and WDI share 0 common holdings with a 0.0% weight overlap. Combined, they hold 695 unique securities.
Which pays a higher dividend, SPY or WDI?
SPY yields 1.01% while WDI yields 12.55%, so WDI currently pays the higher dividend yield.
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