FCT vs SPY
First Trust Senior Floating Rate Income Fund II vs State Street SPDR S&P 500 ETF Trust
Quick Verdict
SPY has a lower expense ratio. SPY delivered stronger 1-year returns. SPY offers more diversification with 505 holdings.
Side-by-Side Comparison
| Metric | FCT | SPY | Winner |
|---|---|---|---|
| Expense Ratio | 1.67% | 0.09% | |
| AUM | $252M | $821.1B | |
| Dividend Yield | 11.84% | 1.01% | |
| Holdings | 221 | 505 | |
| YTD Return | +2.69% | +14.24% | |
| 1Y Return | +7.32% | +21.71% | |
| 3Y Return (annualized) | +10.56% | +22.10% | |
| 5Y Return (annualized) | +5.74% | +13.21% | |
| Volatility (annualized) | 14.8% | 15.3% | |
| Max Drawdown | -72.7% | -56.5% | |
| Fund Family | First Trust Portfolios (US) | State Street Investment Management | |
| Category | Fixed Income | Equity | |
| Inception | May 25, 2004 | Jan 22, 1993 |
FCT vs SPY Performance
First Trust Senior Floating Rate Income Fund II (FCT) is a ETF from First Trust Portfolios (US) and State Street SPDR S&P 500 ETF Trust (SPY) is a ETF from State Street Investment Management. Over the past year FCT returned +7.32% while SPY returned +21.71%. Year to date, FCT is up 2.69% versus a gain of 14.24% for SPY.
Over three years, FCT compounded at +10.56% per year against +22.10% for SPY; over five years the annualized figures are +5.74% and +13.21% respectively. Across the full 22-year window we track, SPY has the edge at +8.86% annualized vs -0.76%. 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 14.8% for FCT. 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 -72.7% for FCT 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 0.57. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
FCT charges 1.67% per year while SPY charges 0.09%. On a $10,000 position that is $167 vs $9 annually, a gap of $158 per year that compounds over a long holding period. On income, FCT currently yields 11.84% against 1.01% for SPY.
Holdings Overlap
FCT and SPY share 0 holdings out of 610 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, FCT or SPY?
FCT has an expense ratio of 1.67% while SPY charges 0.09%. SPY is the cheaper option. On a $10,000 investment, that is $158 per year of difference.
Which performed better, FCT or SPY?
Over the past year FCT returned +7.32% vs +21.71% for SPY, so SPY leads on 1-year performance. Over the longest common window we track (22 years), FCT annualized -0.76% vs +8.86% for SPY. Past performance does not guarantee future results.
Which is riskier, FCT or SPY?
SPY has been the more volatile fund at 15.3% annualized versus 14.8% for FCT. Worst drawdown: FCT -72.7% vs SPY -56.5%.
Should I hold both FCT and SPY?
FCT and SPY have a monthly-return correlation of 0.57, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between FCT and SPY?
FCT and SPY share 0 common holdings with a 0.0% weight overlap. Combined, they hold 610 unique securities.
Which pays a higher dividend, FCT or SPY?
FCT yields 11.84% while SPY yields 1.01%, so FCT currently pays the higher dividend yield.
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