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Featuring Another Giant S&P 500 Fund


Last week, I tackled the biggest exchange-traded fund (ETF) on the market, SPY. Today’s ETF Talk will examine another ETF that tracks the S&P 500. Unlike SPY, this week’s fund is run by BlackRock’s iShares. This fund has a much smaller amount of assets under management than SPY does, but it is nonetheless the second-largest ETF in existence. The world’s second-biggest ETF is iShares Core S&P 500 ETF (IVV).

IVV’s 2014 gain of 11.43% closely matched the returns of the S&P, the U.S. domestic large-cap index that IVV seeks to match. Holding nearly $70 billion in assets is no small feat, much as it pales in comparison to SPY’s gargantuan market share. Just like SPY, IVV’s holdings match those of the S&P 500 index, though IVV differentiates itself from similar ETFs with its low expense ratio of 0.07%.

The S&P 500 has had a bumpy start this year. But if markets return to form, IVV will reap the benefits. This ETF provides a dividend yield of 1.83%.

IVV invests 17.38% of its assets in its largest 10 positions, all of which are big, recognizable names. These giant public companies include Apple Inc. (AAPL), 3.60%; Exxon Mobil Corporation (XOM), 2.13%; Microsoft Corp. (MSFT), 2.12%; Johnson & Johnson (JNJ), 1.63%; and Berkshire Hathaway Class B shares (BRK-B), 1.51%.

If you are looking for a way to get exposure to the broad U.S. domestic large-cap market without breaking the bank, iShares Core S&P 500 ETF (IVV)’s low expense ratio could provide a tempting offer.

If you want my advice about buying and selling specific ETFs, including appropriate stop losses, please consider subscribing to my Successful ETF Investing newsletter. As always, I am happy to answer any of your questions about ETFs, so do not hesitate to send me an e-mail. You just may see your question answered in a future ETF Talk.

In case you missed it, I encourage you to read my e-letter column from last week on Eagle Daily Investor about the largest ETF in the world. I also invite you to comment in the space provided below my Eagle Daily Investor commentary.

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