QDEF vs SPY
FlexShares Quality Dividend Defensive Index 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 | QDEF | SPY | Winner |
|---|---|---|---|
| Expense Ratio | 0.39% | 0.09% | |
| AUM | $544M | $789.1B | |
| Dividend Yield | 1.61% | 1.01% | |
| Holdings | 136 | 505 | |
| YTD Return | +13.27% | +13.68% | |
| 1Y Return | +19.88% | +21.53% | |
| 3Y Return (annualized) | +19.37% | +21.44% | |
| 5Y Return (annualized) | +12.68% | +13.18% | |
| Volatility (annualized) | 13.4% | 15.3% | |
| Max Drawdown | -36.2% | -56.5% | |
| Fund Family | Flexshares Trust | State Street Investment Management | |
| Category | Equity | Equity | |
| Inception | Dec 14, 2012 | Jan 22, 1993 |
QDEF vs SPY Performance
FlexShares Quality Dividend Defensive Index Fund (QDEF) is a ETF from Flexshares Trust and State Street SPDR S&P 500 ETF Trust (SPY) is a ETF from State Street Investment Management. Over the past year QDEF returned +19.88% while SPY returned +21.53%. Year to date, QDEF is up 13.27% versus a gain of 13.68% for SPY.
Over three years, QDEF compounded at +19.37% per year against +21.44% for SPY; over five years the annualized figures are +12.68% and +13.18% respectively. Across the full 14-year window we track, QDEF has the edge at +10.71% annualized vs +8.85%. 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 13.4% for QDEF. 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 -36.2% for QDEF 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 0.95. They move almost in lockstep, so holding both mostly duplicates the same exposure.
Fees and Cost Over Time
QDEF charges 0.39% per year while SPY charges 0.09%. On a $10,000 position that is $39 vs $9 annually, a gap of $30 per year that compounds over a long holding period. On income, QDEF currently yields 1.61% against 1.01% for SPY.
Holdings Overlap
QDEF and SPY share 96 holdings out of 541 unique holdings combined, representing a 39.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, QDEF or SPY?
QDEF has an expense ratio of 0.39% while SPY charges 0.09%. SPY is the cheaper option. On a $10,000 investment, that is $30 per year of difference.
Which performed better, QDEF or SPY?
Over the past year QDEF returned +19.88% vs +21.53% for SPY, so SPY leads on 1-year performance. Over the longest common window we track (14 years), QDEF annualized +10.71% vs +8.85% for SPY. Past performance does not guarantee future results.
Which is riskier, QDEF or SPY?
SPY has been the more volatile fund at 15.3% annualized versus 13.4% for QDEF. Worst drawdown: QDEF -36.2% vs SPY -56.5%.
Should I hold both QDEF and SPY?
QDEF and SPY have a monthly-return correlation of 0.95, so they move almost identically. Holding both adds little diversification - most investors pick one, usually on fees or the specific index tracked.
What is the holdings overlap between QDEF and SPY?
QDEF and SPY share 96 common holdings with a 39.0% weight overlap. Combined, they hold 541 unique securities.
Which pays a higher dividend, QDEF or SPY?
QDEF yields 1.61% while SPY yields 1.01%, so QDEF currently pays the higher dividend yield.
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