SPY Is Washed Up

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Quote

"If all the economists were laid end to end, they’d never reach a conclusion." - George Bernard Shaw

He's not wrong.

SPY Is Getting Old

It's January 1993 on Wall Street. Ding ding ding, the market opens and the ticker "SPY" pulses on the screen for the first time. Brokers on the floor take a quick look, and then it's back to their computers (which are the size of a modern-day mini fridge). The action is about to unfold before them. The world's first ETF had just been released, and no one was prepared for what it would turn into.

Since SPY just turned 30 years old (boomer age) it only seemed right to go over some fun facts you can throw around at the office to flex your investing knowledge.

If you are new here and want more ETF action, I'll leave a link below to a recent post where I covered my 5 favorite ETFs for 2023.

Let's get into the facts quickly, then I'll break down why there are actually better options if you want to invest in the S&P 500.

Fun Facts

1) SPY went live in 1993.

What else was happening this year? I wasn't around, but Bill Clinton was president, the space shuttle Endeavour completed its fifth mission, and the Dallas Cowboys won the Super Bowl (next year is our year).

2) SPY accounts for approximately 20% of the US trading volume.

If you wanted to put a number on this it comes out to around 80 million shares each day. In velocity terms, that is 3,418 shares per second.

3) Lifetime return of 9.5%.

Over its 30 years of existence, SPY has returned an average of 9.5% each year. Basically, if you put $10,000 into SPY on day one it would be worth $152,000 today.

4) SPY was the first ETF to trade more than $100 billion in a single day.

With pandemic worries becoming all the talk, SPY saw its single highest trading day on Feb 28th, 2020. Just how much is $100 billion? In 2020 that was more than the market cap of Greece and Egypt combined.

5) The Black Monday crash of 1987 led to SPY's creation.

Known for being one of the worst days in market history, which saw the Dow drop 22.6%, Black Monday made regulators realize the need for a single security that represented the broad market. Six years later, SPY hit the exchange for the first time.

It Gets Better

Yes, SPY is a great ETF, but if you are looking to invest in the S&P 500 there are better options. I'd recommend checking out VOO and IVV. Why?

VOO and IVV both have an expense ratio of 0.03% compared to SPY's expense ratio of 0.09%. I dived into the details of why this small difference is important in a recent post, if interested you can read it here.

Conclusion

I hope you enjoyed the shorter email. Work was a *insert bad word* this week so it was a last-second scramble to get this piece ready to send out.

Use some of these facts to flex on your neighbor, impress your co-workers, or show just how "financially in tune" you are on your next date.

Tilll next time, Cade.

Cade's Finds

Inverse Cramer - Cool email by Market Sentiment showing the data behind Cramers 21,653 picks over the last 7 years.

Why You Should Not Pay Cash For A Car - Short video by The Money Guy Podcast where they discuss their 20/3/8 rule for buying a car.

5 ETFs For 2023 - One of my recent posts on 5 ETFs I like long term.

Best Memes

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Nothing in this email is intended to serve as financial advice. Do your own research. Thanks for reading, if you have any questions, comments, suggestions, etc. about the email send me a DM on twitter. See you soon!