HYG vs SPY
iShares iBoxx $ High Yield Corporate Bond ETF vs State Street SPDR S&P 500 ETF Trust
Quick Verdict
SPY has a lower expense ratio. SPY delivered stronger 1-year returns. HYG offers more diversification with 1,331 holdings.
Side-by-Side Comparison
| Metric | HYG | SPY | Winner |
|---|---|---|---|
| Expense Ratio | 0.49% | 0.09% | |
| AUM | $17.8B | $821.1B | |
| Dividend Yield | 5.93% | 1.01% | |
| Holdings | 1,331 | 505 | |
| YTD Return | +2.08% | +12.22% | |
| 1Y Return | +4.97% | +20.83% | |
| 3Y Return (annualized) | +8.65% | +21.70% | |
| 5Y Return (annualized) | +3.79% | +12.98% | |
| Volatility (annualized) | 10.0% | 15.3% | |
| Max Drawdown | -41.9% | -56.5% | |
| Fund Family | iShares by BlackRock (US) | State Street Investment Management | |
| Category | Fixed Income | Equity | |
| Inception | Apr 4, 2007 | Jan 22, 1993 |
HYG vs SPY Performance
iShares iBoxx $ High Yield Corporate Bond ETF (HYG) is a ETF from iShares by BlackRock (US) and State Street SPDR S&P 500 ETF Trust (SPY) is a ETF from State Street Investment Management. Over the past year HYG returned +4.97% while SPY returned +20.83%. Year to date, HYG is up 2.08% versus a gain of 12.22% for SPY.
Over three years, HYG compounded at +8.65% per year against +21.70% for SPY; over five years the annualized figures are +3.79% and +12.98% respectively. Across the full 19-year window we track, SPY has the edge at +8.79% annualized vs +0.14%. 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 10.0% for HYG. 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 -41.9% for HYG 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 0.74. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
HYG charges 0.49% per year while SPY charges 0.09%. On a $10,000 position that is $49 vs $9 annually, a gap of $40 per year that compounds over a long holding period. On income, HYG currently yields 5.93% against 1.01% for SPY.
Holdings Overlap
HYG and SPY share 0 holdings out of 1515 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, HYG or SPY?
HYG has an expense ratio of 0.49% while SPY charges 0.09%. SPY is the cheaper option. On a $10,000 investment, that is $40 per year of difference.
Which performed better, HYG or SPY?
Over the past year HYG returned +4.97% vs +20.83% for SPY, so SPY leads on 1-year performance. Over the longest common window we track (19 years), HYG annualized +0.14% vs +8.79% for SPY. Past performance does not guarantee future results.
Which is riskier, HYG or SPY?
SPY has been the more volatile fund at 15.3% annualized versus 10.0% for HYG. Worst drawdown: HYG -41.9% vs SPY -56.5%.
Should I hold both HYG and SPY?
HYG and SPY have a monthly-return correlation of 0.74, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between HYG and SPY?
HYG and SPY share 0 common holdings with a 0.0% weight overlap. Combined, they hold 1515 unique securities.
Which pays a higher dividend, HYG or SPY?
HYG yields 5.93% while SPY yields 1.01%, so HYG currently pays the higher dividend yield.
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