FXO vs SPY
First Trust Financials AlphaDEX Fund 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 503 holdings.
Side-by-Side Comparison
| Metric | FXO | SPY | Winner |
|---|---|---|---|
| Expense Ratio | 0.60% | 0.09% | |
| AUM | $1.1B | $789.1B | |
| Dividend Yield | 2.21% | 1.01% | |
| Holdings | 106 | 505 | |
| YTD Return | +10.33% | +13.68% | |
| 1Y Return | +16.94% | +21.53% | |
| 3Y Return (annualized) | +20.88% | +21.44% | |
| 5Y Return (annualized) | +10.43% | +13.18% | |
| Volatility (annualized) | 21.4% | 15.3% | |
| Max Drawdown | -72.2% | -56.5% | |
| Fund Family | First Trust Portfolios (US) | State Street Investment Management | |
| Category | Equity | Equity | |
| Inception | May 8, 2007 | Jan 22, 1993 |
FXO vs SPY Performance
First Trust Financials AlphaDEX Fund (FXO) 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 FXO returned +16.94% while SPY returned +21.53%. Year to date, FXO is up 10.33% versus a gain of 13.68% for SPY.
Over three years, FXO compounded at +20.88% per year against +21.44% for SPY; over five years the annualized figures are +10.43% and +13.18% respectively. Across the full 19-year window we track, SPY has the edge at +8.85% annualized vs +7.12%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
FXO has been the more volatile fund, with annualized monthly volatility of 21.4% 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 -72.2% for FXO 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 0.84. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
FXO charges 0.60% per year while SPY charges 0.09%. On a $10,000 position that is $60 vs $9 annually, a gap of $51 per year that compounds over a long holding period. On income, FXO currently yields 2.21% against 1.01% for SPY.
Holdings Overlap
FXO and SPY share 40 holdings out of 567 unique holdings combined, representing a 5.5% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, FXO or SPY?
FXO has an expense ratio of 0.60% while SPY charges 0.09%. SPY is the cheaper option. On a $10,000 investment, that is $51 per year of difference.
Which performed better, FXO or SPY?
Over the past year FXO returned +16.94% vs +21.53% for SPY, so SPY leads on 1-year performance. Over the longest common window we track (19 years), FXO annualized +7.12% vs +8.85% for SPY. Past performance does not guarantee future results.
Which is riskier, FXO or SPY?
FXO has been the more volatile fund at 21.4% annualized versus 15.3% for SPY. Worst drawdown: FXO -72.2% vs SPY -56.5%.
Should I hold both FXO and SPY?
FXO and SPY have a monthly-return correlation of 0.84, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between FXO and SPY?
FXO and SPY share 40 common holdings with a 5.5% weight overlap. Combined, they hold 567 unique securities.
Which pays a higher dividend, FXO or SPY?
FXO yields 2.21% while SPY yields 1.01%, so FXO currently pays the higher dividend yield.
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