FPEI vs SPY
First Trust Institutional Preferred Securities and 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. SPY offers more diversification with 505 holdings.
Side-by-Side Comparison
| Metric | FPEI | SPY | Winner |
|---|---|---|---|
| Expense Ratio | 0.85% | 0.09% | |
| AUM | $1.9B | $821.1B | |
| Dividend Yield | 5.82% | 1.01% | |
| Holdings | 176 | 505 | |
| YTD Return | +1.58% | +12.22% | |
| 1Y Return | +4.89% | +20.83% | |
| 3Y Return (annualized) | +9.71% | +21.70% | |
| 5Y Return (annualized) | +3.82% | +12.98% | |
| Volatility (annualized) | 8.1% | 15.3% | |
| Max Drawdown | -27.8% | -56.5% | |
| Fund Family | First Trust Portfolios (US) | State Street Investment Management | |
| Category | Allocation/Balanced | Equity | |
| Inception | Aug 22, 2017 | Jan 22, 1993 |
FPEI vs SPY Performance
First Trust Institutional Preferred Securities and Income ETF (FPEI) 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 FPEI returned +4.89% while SPY returned +20.83%. Year to date, FPEI is up 1.58% versus a gain of 12.22% for SPY.
Over three years, FPEI compounded at +9.71% per year against +21.70% for SPY; over five years the annualized figures are +3.82% and +12.98% respectively. Across the full 9-year window we track, SPY has the edge at +8.79% annualized vs +2.78%. 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 8.1% for FPEI. 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 -27.8% for FPEI 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 0.69. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
FPEI charges 0.85% per year while SPY charges 0.09%. On a $10,000 position that is $85 vs $9 annually, a gap of $76 per year that compounds over a long holding period. On income, FPEI currently yields 5.82% against 1.01% for SPY.
Holdings Overlap
FPEI and SPY share 1 holdings out of 623 unique holdings combined, representing a 0.3% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Top Shared Holdings
| Stock | Weight in FPEI | Weight in SPY | Difference |
|---|---|---|---|
| C | 0.46% | 0.35% | 0.11% |
Frequently Asked Questions
Which is cheaper, FPEI or SPY?
FPEI has an expense ratio of 0.85% while SPY charges 0.09%. SPY is the cheaper option. On a $10,000 investment, that is $76 per year of difference.
Which performed better, FPEI or SPY?
Over the past year FPEI returned +4.89% vs +20.83% for SPY, so SPY leads on 1-year performance. Over the longest common window we track (9 years), FPEI annualized +2.78% vs +8.79% for SPY. Past performance does not guarantee future results.
Which is riskier, FPEI or SPY?
SPY has been the more volatile fund at 15.3% annualized versus 8.1% for FPEI. Worst drawdown: FPEI -27.8% vs SPY -56.5%.
Should I hold both FPEI and SPY?
FPEI and SPY have a monthly-return correlation of 0.69, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between FPEI and SPY?
FPEI and SPY share 1 common holdings with a 0.3% weight overlap. Combined, they hold 623 unique securities.
Which pays a higher dividend, FPEI or SPY?
FPEI yields 5.82% while SPY yields 1.01%, so FPEI currently pays the higher dividend yield.
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