SPY vs TEI
State Street SPDR S&P 500 ETF Trust vs Templeton Emerging Markets Income Fund Inc.
Quick Verdict
SPY has a lower expense ratio. TEI delivered stronger 1-year returns. SPY offers more diversification with 503 holdings.
Side-by-Side Comparison
| Metric | SPY | TEI | Winner |
|---|---|---|---|
| Expense Ratio | 0.09% | 1.14% | |
| AUM | $789.1B | $2,711.9 | |
| Dividend Yield | 1.01% | 12.41% | |
| Holdings | 505 | 151 | |
| YTD Return | +13.39% | +10.35% | |
| 1Y Return | +22.52% | +28.99% | |
| 3Y Return (annualized) | +21.36% | +23.68% | |
| 5Y Return (annualized) | +13.19% | +8.67% | |
| Volatility (annualized) | 15.3% | 17.9% | |
| Max Drawdown | -56.5% | -71.1% | |
| Fund Family | State Street Investment Management | Franklin Templeton Investments (US) | |
| Category | Equity | Fixed Income | |
| Inception | Jan 22, 1993 | Sep 23, 1993 |
SPY vs TEI Performance
State Street SPDR S&P 500 ETF Trust (SPY) is a ETF from State Street Investment Management and Templeton Emerging Markets Income Fund Inc. (TEI) is a ETF from Franklin Templeton Investments (US). Over the past year SPY returned +22.52% while TEI returned +28.99%. Year to date, SPY is up 13.39% versus a gain of 10.35% for TEI.
Over three years, SPY compounded at +21.36% per year against +23.68% for TEI; over five years the annualized figures are +13.19% and +8.67% respectively. Across the full 31-year window we track, SPY has the edge at +8.84% annualized vs +0.40%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
TEI has been the more volatile fund, with annualized monthly volatility of 17.9% 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 -56.5% for SPY and -71.1% for TEI. 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 0.55. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
SPY charges 0.09% per year while TEI charges 1.14%. On a $10,000 position that is $9 vs $114 annually, a gap of $105 per year that compounds over a long holding period. On income, SPY currently yields 1.01% against 12.41% for TEI.
Holdings Overlap
SPY and TEI share 0 holdings out of 523 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 TEI?
SPY has an expense ratio of 0.09% while TEI charges 1.14%. SPY is the cheaper option. On a $10,000 investment, that is $105 per year of difference.
Which performed better, SPY or TEI?
Over the past year SPY returned +22.52% vs +28.99% for TEI, so TEI leads on 1-year performance. Over the longest common window we track (31 years), SPY annualized +8.84% vs +0.40% for TEI. Past performance does not guarantee future results.
Which is riskier, SPY or TEI?
TEI has been the more volatile fund at 17.9% annualized versus 15.3% for SPY. Worst drawdown: SPY -56.5% vs TEI -71.1%.
Should I hold both SPY and TEI?
SPY and TEI have a monthly-return correlation of 0.55, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between SPY and TEI?
SPY and TEI share 0 common holdings with a 0.0% weight overlap. Combined, they hold 523 unique securities.
Which pays a higher dividend, SPY or TEI?
SPY yields 1.01% while TEI yields 12.41%, so TEI currently pays the higher dividend yield.
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