Industry Updates

S&P 500 ETFs bounce back into positive territory this year

The S&P 500 has climbed 46% in four months

George Geddes

a close up of a person's eye

The S&P 500’s year-to-date performance has turned positive for the first time since the coronavirus turmoil shocked markets.

When the US market opened on Tuesday morning, the S&P 500 was trading at $3,268.52, up 11 points since the beginning of the year.

As coronavirus wreaked havoc across the world economies, markets tumbled with the S&P 500 hitting its lowest level on 23 March, down 31.3% since 1 January. It has since bounced 46%, as of 21 July, as economies started to recover.

The SPDR S&P 500 ETF Trust (SPY), the world’s largest ETF, has seen its net asset value (NAV) and total assets under management (AUM) grow since the turn of the year.

According to data from Ultumus, SPY had $289.2bn AUM and a price of $314.2 which have grown to $289.4bn and $324.3, respectively, as at Monday’s close.

Europe's largest ETF, the iShares Core S&P 500 UCITS ETF (CSPX) has also recovered since the turmoil. CSPX’s AUM has grown from $35.7bn to $38bn and its NAV has increased from $319.36 to $324.33 over the same period.

The same recovery cannot be said for other regions however, as the FTSE 100 and EURO Stoxx 50 remain significantly down this year. The FTSE 100 has plummeted 17.6% while the EURO Stoxx 50 is down 10.3%.

The iShares Core FTSE 100 UCITS ETF (ISF), the largest ETF tracking the FTSE 100, has seen its AUM fall from $10.6bn at the beginning of the year to $7.9bn.

With a fee of 0.07%, this difference of $2.7bn will be costing BlackRock $1.9m in annual revenue if the AUM remains unchanged.

Investing in US equity: Lyxor’s low fee vs iShares’ liquidity

These performances are taking their toll on European-domiciled ETF flows as US equity ETFs attracted significantly more assets compared to their European counterparts, according to data from Lyxor.

In June, Europe equity ETFs gathered €300m in new assets whereas US equity ETFs gathered €2.3bn.

Elsewhere, world equity ETFs saw €2.8bn inflows for the month whereas emerging market exposures saw outflows worth €600m.

Featured in this article

Logo for BlackRock