DFSD vs SPY
Dimensional Short-Duration Fixed Income ETF vs State Street SPDR S&P 500 ETF Trust
Quick Verdict
SPY has a lower expense ratio. SPY delivered stronger 1-year returns. DFSD offers more diversification with 1125 holdings.
Side-by-Side Comparison
| Metric | DFSD | SPY | Winner |
|---|---|---|---|
| Expense Ratio | 0.16% | 0.09% | |
| AUM | $7.1B | $789.1B | |
| Dividend Yield | 4.18% | 1.01% | |
| Holdings | 1,500 | 505 | |
| YTD Return | +1.02% | +13.79% | |
| 1Y Return | +3.07% | +23.66% | |
| 3Y Return (annualized) | +5.19% | +21.40% | |
| 5Y Return (annualized) | - | +13.37% | |
| Volatility (annualized) | 2.7% | 15.3% | |
| Max Drawdown | -8.4% | -56.5% | |
| Fund Family | Dimensional | State Street Investment Management | |
| Category | Fixed Income | Equity | |
| Inception | Nov 15, 2021 | Jan 22, 1993 |
DFSD vs SPY Performance
Dimensional Short-Duration Fixed Income ETF (DFSD) is a ETF from Dimensional and State Street SPDR S&P 500 ETF Trust (SPY) is a ETF from State Street Investment Management. Over the past year DFSD returned +3.07% while SPY returned +23.66%. Year to date, DFSD is up 1.02% versus a gain of 13.79% for SPY.
Over three years, DFSD compounded at +5.19% per year against +21.40% for SPY. Across the full 5-year window we track, SPY has the edge at +8.85% annualized vs +2.53%. 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 2.7% for DFSD. 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 -8.4% for DFSD and -56.5% for SPY. 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 0.59. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
DFSD charges 0.16% per year while SPY charges 0.09%. On a $10,000 position that is $16 vs $9 annually, a gap of $7 per year that compounds over a long holding period. On income, DFSD currently yields 4.18% against 1.01% for SPY.
Holdings Overlap
DFSD and SPY share 0 holdings out of 1628 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, DFSD or SPY?
DFSD has an expense ratio of 0.16% while SPY charges 0.09%. SPY is the cheaper option. On a $10,000 investment, that is $7 per year of difference.
Which performed better, DFSD or SPY?
Over the past year DFSD returned +3.07% vs +23.66% for SPY, so SPY leads on 1-year performance. Over the longest common window we track (5 years), DFSD annualized +2.53% vs +8.85% for SPY. Past performance does not guarantee future results.
Which is riskier, DFSD or SPY?
SPY has been the more volatile fund at 15.3% annualized versus 2.7% for DFSD. Worst drawdown: DFSD -8.4% vs SPY -56.5%.
Should I hold both DFSD and SPY?
DFSD and SPY have a monthly-return correlation of 0.59, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between DFSD and SPY?
DFSD and SPY share 0 common holdings with a 0.0% weight overlap. Combined, they hold 1628 unique securities.
Which pays a higher dividend, DFSD or SPY?
DFSD yields 4.18% while SPY yields 1.01%, so DFSD currently pays the higher dividend yield.
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