FSMB vs SPY
First Trust Short Duration Managed Municipal ETF vs State Street SPDR S&P 500 ETF Trust
Quick Verdict
SPY has a lower expense ratio. SPY delivered stronger 1-year returns. FSMB offers more diversification with 557 holdings.
Side-by-Side Comparison
| Metric | FSMB | SPY | Winner |
|---|---|---|---|
| Expense Ratio | 0.34% | 0.09% | |
| AUM | $632M | $821.1B | |
| Dividend Yield | 3.18% | 1.01% | |
| Holdings | 557 | 505 | |
| YTD Return | +1.41% | +14.24% | |
| 1Y Return | +2.68% | +21.71% | |
| 3Y Return (annualized) | +3.43% | +22.10% | |
| 5Y Return (annualized) | +1.41% | +13.21% | |
| Volatility (annualized) | 2.6% | 15.3% | |
| Max Drawdown | -6.3% | -56.5% | |
| Fund Family | First Trust Portfolios (US) | State Street Investment Management | |
| Category | Fixed Income | Equity | |
| Inception | Nov 1, 2018 | Jan 22, 1993 |
FSMB vs SPY Performance
First Trust Short Duration Managed Municipal ETF (FSMB) 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 FSMB returned +2.68% while SPY returned +21.71%. Year to date, FSMB is up 1.41% versus a gain of 14.24% for SPY.
Over three years, FSMB compounded at +3.43% per year against +22.10% for SPY; over five years the annualized figures are +1.41% and +13.21% respectively. Across the full 8-year window we track, SPY has the edge at +8.86% annualized vs +1.55%. 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 2.6% for FSMB. 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 -6.3% for FSMB 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 0.53. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
FSMB charges 0.34% per year while SPY charges 0.09%. On a $10,000 position that is $34 vs $9 annually, a gap of $25 per year that compounds over a long holding period. On income, FSMB currently yields 3.18% against 1.01% for SPY.
Holdings Overlap
FSMB and SPY share 0 holdings out of 834 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, FSMB or SPY?
FSMB has an expense ratio of 0.34% while SPY charges 0.09%. SPY is the cheaper option. On a $10,000 investment, that is $25 per year of difference.
Which performed better, FSMB or SPY?
Over the past year FSMB returned +2.68% vs +21.71% for SPY, so SPY leads on 1-year performance. Over the longest common window we track (8 years), FSMB annualized +1.55% vs +8.86% for SPY. Past performance does not guarantee future results.
Which is riskier, FSMB or SPY?
SPY has been the more volatile fund at 15.3% annualized versus 2.6% for FSMB. Worst drawdown: FSMB -6.3% vs SPY -56.5%.
Should I hold both FSMB and SPY?
FSMB and SPY have a monthly-return correlation of 0.53, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between FSMB and SPY?
FSMB and SPY share 0 common holdings with a 0.0% weight overlap. Combined, they hold 834 unique securities.
Which pays a higher dividend, FSMB or SPY?
FSMB yields 3.18% while SPY yields 1.01%, so FSMB currently pays the higher dividend yield.
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