The State Street SPDR Portfolio S&P 500 High Dividend ETF (SPYD) was launched on 10/21/2015, and is a smart beta exchange traded fund designed to offer broad exposure to the Style Box - Large Cap Value category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.
But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
The fund is sponsored by State Street Investment Management. It has amassed assets over $7.8 billion, making it one of the larger ETFs in the Style Box - Large Cap Value. This particular fund, before fees and expenses, seeks to match the performance of the S&P 500 High Dividend Index.
The S&P 500 High Dividend Index is designed to measure the performance of the top 80 dividend-paying securities listed on the S&P 500 Index, based on dividend yield.
Cost & Other Expenses
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
Operating expenses on an annual basis are 0.07% for SPYD, making it one of the least expensive products in the space.
The fund has a 12-month trailing dividend yield of 4.01%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
SPYD's heaviest allocation is in the Real Estate sector, which is about 24.8% of the portfolio. Its Consumer Staples and Financials round out the top three.
Taking into account individual holdings, Phillips 66 (PSX) accounts for about 1.63% of the fund's total assets, followed by Franklin Resources Inc (BEN) and Iron Mountain Inc (IRM).
SPYD's top 10 holdings account for about 15.3% of its total assets under management.
Performance and Risk
Year-to-date, the State Street SPDR Portfolio S&P 500 High Dividend ETF has added roughly 19.47% so far, and is up roughly 17.01% over the last 12 months (as of 08/25/2026). SPYD has traded between $41.96 $50.68 in this past 52-week period.
SPYD has a beta of 0.71 and standard deviation of 14.06% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 81 holdings, it effectively diversifies company-specific risk .
Alternatives
State Street SPDR Portfolio S&P 500 High Dividend ETF is an excellent option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. There are other ETFs in the space which investors could consider as well.
Schwab U.S. Dividend Equity ETF (SCHD) tracks Dow Jones U.S. Dividend 100 Index and the Vanguard Morningstar Value ETF (VTV) tracks CRSP U.S. Large Cap Value Index. Schwab U.S. Dividend Equity ETF has $112.02 billion in assets, Vanguard Morningstar Value ETF has $193.43 billion. SCHD has an expense ratio of 0.06% and VTV changes 0.03%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Value
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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State Street SPDR Portfolio S&P 500 High Dividend ETF (SPYD): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
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