FEDM vs SPY
FlexShares ESG & Climate Developed Markets ex-US Core Index Fund vs State Street SPDR S&P 500 ETF Trust
Quick Verdict
SPY has a lower expense ratio. FEDM delivered stronger 1-year returns. SPY offers more diversification with 503 holdings.
Side-by-Side Comparison
| Metric | FEDM | SPY | Winner |
|---|---|---|---|
| Expense Ratio | 0.12% | 0.09% | |
| AUM | $78M | $789.1B | |
| Dividend Yield | 2.98% | 1.01% | |
| Holdings | 261 | 505 | |
| YTD Return | +12.62% | +13.39% | |
| 1Y Return | +23.38% | +22.52% | |
| 3Y Return (annualized) | +16.61% | +21.36% | |
| 5Y Return (annualized) | +8.74% | +13.19% | |
| Volatility (annualized) | 15.7% | 15.3% | |
| Max Drawdown | -29.4% | -56.5% | |
| Fund Family | Flexshares Trust | State Street Investment Management | |
| Category | Equity | Equity | |
| Inception | Sep 20, 2021 | Jan 22, 1993 |
FEDM vs SPY Performance
FlexShares ESG & Climate Developed Markets ex-US Core Index Fund (FEDM) is a ETF from Flexshares Trust and State Street SPDR S&P 500 ETF Trust (SPY) is a ETF from State Street Investment Management. Over the past year FEDM returned +23.38% while SPY returned +22.52%. Year to date, FEDM is up 12.62% versus a gain of 13.39% for SPY.
Over three years, FEDM compounded at +16.61% per year against +21.36% for SPY; over five years the annualized figures are +8.74% and +13.19% respectively. Across the full 5-year window we track, SPY has the edge at +8.84% annualized vs +8.74%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
FEDM has been the more volatile fund, with annualized monthly volatility of 15.7% compared with 15.3% for SPY. 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 -29.4% for FEDM 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 0.79. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
FEDM charges 0.12% per year while SPY charges 0.09%. On a $10,000 position that is $12 vs $9 annually, a gap of $3 per year that compounds over a long holding period. On income, FEDM currently yields 2.98% against 1.01% for SPY.
Holdings Overlap
FEDM and SPY share 1 holdings out of 724 unique holdings combined, representing a 0.1% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Top Shared Holdings
| Stock | Weight in FEDM | Weight in SPY | Difference |
|---|---|---|---|
| ROP | 0.33% | 0.06% | 0.27% |
Frequently Asked Questions
Which is cheaper, FEDM or SPY?
FEDM has an expense ratio of 0.12% while SPY charges 0.09%. SPY is the cheaper option. On a $10,000 investment, that is $3 per year of difference.
Which performed better, FEDM or SPY?
Over the past year FEDM returned +23.38% vs +22.52% for SPY, so FEDM leads on 1-year performance. Over the longest common window we track (5 years), FEDM annualized +8.74% vs +8.84% for SPY. Past performance does not guarantee future results.
Which is riskier, FEDM or SPY?
FEDM has been the more volatile fund at 15.7% annualized versus 15.3% for SPY. Worst drawdown: FEDM -29.4% vs SPY -56.5%.
Should I hold both FEDM and SPY?
FEDM and SPY have a monthly-return correlation of 0.79, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between FEDM and SPY?
FEDM and SPY share 1 common holdings with a 0.1% weight overlap. Combined, they hold 724 unique securities.
Which pays a higher dividend, FEDM or SPY?
FEDM yields 2.98% while SPY yields 1.01%, so FEDM currently pays the higher dividend yield.
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