IGI vs SPY
Western Asset Investment Grade Defined Opportunity Trust Inc. 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 | IGI | SPY | Winner |
|---|---|---|---|
| Expense Ratio | 0.85% | 0.09% | |
| AUM | $103M | $821.1B | |
| Dividend Yield | 5.01% | 1.01% | |
| Holdings | 415 | 505 | |
| YTD Return | -0.38% | +12.22% | |
| 1Y Return | +1.53% | +20.83% | |
| 3Y Return (annualized) | +4.98% | +21.70% | |
| 5Y Return (annualized) | -1.66% | +12.98% | |
| Volatility (annualized) | 11.2% | 15.3% | |
| Max Drawdown | -34.0% | -56.5% | |
| Fund Family | Franklin Templeton Investments (US) | State Street Investment Management | |
| Category | Fixed Income | Equity | |
| Inception | Jun 26, 2009 | Jan 22, 1993 |
IGI vs SPY Performance
Western Asset Investment Grade Defined Opportunity Trust Inc. (IGI) is a ETF from Franklin Templeton Investments (US) and State Street SPDR S&P 500 ETF Trust (SPY) is a ETF from State Street Investment Management. Over the past year IGI returned +1.53% while SPY returned +20.83%. Year to date, IGI is down 0.38% versus a gain of 12.22% for SPY.
Over three years, IGI compounded at +4.98% per year against +21.70% for SPY; over five years the annualized figures are -1.66% and +12.98% respectively. Across the full 17-year window we track, SPY has the edge at +8.79% annualized vs +0.19%. 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 11.2% for IGI. 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 -34.0% for IGI 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 0.40. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
IGI 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, IGI currently yields 5.01% against 1.01% for SPY.
Holdings Overlap
IGI and SPY share 1 holdings out of 788 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 IGI | Weight in SPY | Difference |
|---|---|---|---|
| C | 0.32% | 0.35% | 0.03% |
Frequently Asked Questions
Which is cheaper, IGI or SPY?
IGI 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, IGI or SPY?
Over the past year IGI returned +1.53% vs +20.83% for SPY, so SPY leads on 1-year performance. Over the longest common window we track (17 years), IGI annualized +0.19% vs +8.79% for SPY. Past performance does not guarantee future results.
Which is riskier, IGI or SPY?
SPY has been the more volatile fund at 15.3% annualized versus 11.2% for IGI. Worst drawdown: IGI -34.0% vs SPY -56.5%.
Should I hold both IGI and SPY?
IGI and SPY have a monthly-return correlation of 0.40, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between IGI and SPY?
IGI and SPY share 1 common holdings with a 0.3% weight overlap. Combined, they hold 788 unique securities.
Which pays a higher dividend, IGI or SPY?
IGI yields 5.01% while SPY yields 1.01%, so IGI currently pays the higher dividend yield.
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