SPY vs TAXT
State Street SPDR S&P 500 ETF Trust vs Northern Trust Tax-Exempt Bond ETF
Quick Verdict
TAXT has a lower expense ratio. SPY delivered stronger 1-year returns. SPY offers more diversification with 503 holdings.
Side-by-Side Comparison
| Metric | SPY | TAXT | Winner |
|---|---|---|---|
| Expense Ratio | 0.09% | 0.05% | |
| AUM | $789.1B | $60M | |
| Dividend Yield | 1.01% | 2.54% | |
| Holdings | 505 | 441 | |
| YTD Return | +13.75% | +0.40% | |
| 1Y Return | +22.91% | +4.56% | |
| 3Y Return (annualized) | +21.67% | - | |
| 5Y Return (annualized) | +13.32% | - | |
| Volatility (annualized) | 15.3% | 3.8% | |
| Max Drawdown | -56.5% | -2.5% | |
| Fund Family | State Street Investment Management | Northern Trust Asset Management | |
| Category | Equity | Fixed Income | |
| Inception | Jan 22, 1993 | Feb 28, 2025 |
SPY vs TAXT Performance
State Street SPDR S&P 500 ETF Trust (SPY) is a ETF from State Street Investment Management and Northern Trust Tax-Exempt Bond ETF (TAXT) is a ETF from Northern Trust Asset Management. Over the past year SPY returned +22.91% while TAXT returned +4.56%. Year to date, SPY is up 13.75% versus a gain of 0.40% for TAXT.
Risk: Volatility and Drawdowns
SPY has been the more volatile fund, with annualized monthly volatility of 15.3% compared with 3.8% for TAXT. 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 -56.5% for SPY and -2.5% for TAXT. 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 0.50. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
SPY charges 0.09% per year while TAXT charges 0.05%. On a $10,000 position that is $9 vs $5 annually, a gap of $4 per year that compounds over a long holding period. On income, SPY currently yields 1.01% against 2.54% for TAXT.
Holdings Overlap
SPY and TAXT share 0 holdings out of 685 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, SPY or TAXT?
SPY has an expense ratio of 0.09% while TAXT charges 0.05%. TAXT is the cheaper option. On a $10,000 investment, that is $4 per year of difference.
Which performed better, SPY or TAXT?
Over the past year SPY returned +22.91% vs +4.56% for TAXT, so SPY leads on 1-year performance. Past performance does not guarantee future results.
Which is riskier, SPY or TAXT?
SPY has been the more volatile fund at 15.3% annualized versus 3.8% for TAXT. Worst drawdown: SPY -56.5% vs TAXT -2.5%.
Should I hold both SPY and TAXT?
SPY and TAXT have a monthly-return correlation of 0.50, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between SPY and TAXT?
SPY and TAXT share 0 common holdings with a 0.0% weight overlap. Combined, they hold 685 unique securities.
Which pays a higher dividend, SPY or TAXT?
SPY yields 1.01% while TAXT yields 2.54%, so TAXT currently pays the higher dividend yield.
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