![8 Massive ETFs With Billions In Assets Are Beating The S&P 500 8 Massive ETFs With Billions In Assets Are Beating The S&P 500](https://www.investors.com/wp-content/uploads/2017/02/wETF01_gold_022317_adobe.jpg)
You don’t do it you have to play on tiny ETFs with few assets to beat the S&P 500. Turns out you can do it pretty well with massive ETFs if you know where to look.
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Eight ETFs with at least $33 billion in assets under management, including SPDR Gold shares (GLD), iShares S&P 500 Growth ETF (IVW) and Vanguard Growth ETF (VUG), are outperforming the S&P 500 this year, according to an Investor’s Business Daily analysis of Morningstar Direct data and Market increase. All of these ETFs rank among the 50 largest ETFs by assets, indicating that they are not just investing in quirky niches that are currently working.
Additionally, all are passive funds whose performance is not affected by the inflow of assets. Unlike large, active mutual funds, where managers have to find more places to put the money if it floods in.
“Unlike active mutual funds where investors have to worry that a strategy is too big to continue to be successful, passive ETFs are different,” says Todd Rosenbluth of Vetta Fi. “These ETFs simply replicate the exposure of a broader investment style without making active selections. So there are no such legitimate concerns.”
Sparkling like gold
SPDR Gold Shares is the best performing large ETF this year. The $65 billion asset fund has returned more than 17% this year. This is particularly impressive given that the ETF, which tracks the price of gold, does not pay dividend.
Soaring gold prices boost ETF gains. The price of a troy ounce of gold on the Comex is up more than 29% from its lowest level in the last 52 weeks, according to S&P Global Market Intelligence. Surprisingly, persistently rising prices are pushing investors to protect their purchasing power with hard assets.
“(The) SPDR Gold Shares (ETFs) benefit from rising gold prices in an increasingly tenacious inflationary environment,” Rosenbluth said.
Go big or go home
Bigger is better, that’s definitely a theme this year.
The Vanguard Growth ETF isn’t just a massive fund in its own right with $125.4 billion in assets. He also has significant stakes in the largest stocks in the S&P 500 that perform so well. Among its main titles are giants like Microsoft (MSFT), Metaplatforms (META) And Nvidia (NVDA). All of these positions significantly outperform the S&P 500.
In fact, AI king Nvidia rallied again after reporting better-than-expected first-quarter results in late May 22. And Vanguard Growth itself is up about 14% this year. And it’s not alone. Significant holdings in the largest S&P 500 companies also bring in $45.7 billion in iShares S&P 500 Growth assets and $92 billion in iShares Russell 1000 Growth ETF assets (IWF). These ETFs are up 16% and 14% respectively this year.
“ETFs focused on megacap growth benefit from continued demand for artificial intelligence and other technologies,” Rosenbluth said.
Quality matters too
But investors aren’t just interested in the size of ETFs and their holdings. Quality matters too.
Stable cash flow drives up shares of companies in the $44 billion-asset iShares MSCI USA Quality Factor ETF (WHICH). Some of the quality stocks in the portfolio include mega-cap techs like Microsoft and Nvidia. But also companies like ConocoPhillips (COP) And Elie Lilly (THERE IS).
For example, thanks to its successful weight loss and neurological treatments, analysts believe Eli Lilly’s adjusted earnings per share will grow more than 117% this year and another 38% in 2025.
“Given market uncertainty, investors have shifted to high-quality companies,” Rosenbluth said.
Top Big ETFs This Year
All have assets of $33 billion or more
Name | Teleprinter | Cumulative return for the year | Net assets ($ billions) |
---|---|---|---|
SPDR Gold Stocks | (GLD) | 17.29% | $65.4 |
iShares S&P 500 Growth | (IVW) | 4:17 p.m. | 45.7 |
iShares Russell 1000 Growth | (IWF) | 14.11 | 92.3 |
Avant-garde growth | (VUG) | 13.97 | 125.4 |
iShares MSCI USA Quality Factor | (WHICH) | 13.24 | 44.4 |
Energy Sector Select SPDR | (XLE) | 12.88 | 39.4 |
SPDR of the selected financial sector | (45) | 12:60 p.m. | 39.9 |
SPDR S&P 500 Portfolio | (SPLG) | 12:20 p.m. | 36.7 |
Vanguard S&P 500 | (FLIGHT) | 12.19 | 455.9 |