State Street Debuts Low Cost ETFs [mostly rebranding old ones and cutting ERs]

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State Street Debuts Low Cost ETFs [mostly rebranding old ones and cutting ERs]

Post by lack_ey » Mon Oct 16, 2017 3:03 pm

The fee wars continue.

Product page (click the "low cost core" category):

News article: ... nopaging=1
This morning, State Street launched a dramatic new salvo in the fee war with its SPDR Portfolio ETFs, a suite of 15 existing ETFs repackaged with rock-bottom expense ratios, some the lowest in their class.

Effective today [October 16, 2017], the issuer has slashed fees for the 15 ETFs, which together comprise an existing $11.7 billion in assets under management. The funds were also given new names and tickers, listed below. Three funds were given new indexes as well.
Notably this does not include SPY. But the S&P 500 Value and S&P 500 Growth ETFs now have 0.04% ERs, and there are now a lot of very competitive products. For reference, the emerging markets fund has Taiwan but not South Korea, like the FTSE-based products that Vanguard and some others use. Also, the World ex-US product is developed markets, not including emerging markets—it includes South Korea and Canada, so it's not just EAFE.

For total bond index, they're now undercutting BND and AGG by 1 bp, though the latter two are more liquid and are probably still better to use. There were actually a couple of popular corporate bond ETFs that are included in the price cuts. Used to be that SCPB (1-3 yr) offered a shorter-duration take compared to Vanguard's short-term corporate bond index ETF VCSH (1-5 yr), and ITR (1-10 yr) was a popular intermediate-term-ish fund that represented a large portion of the space in one fund while omitting the long-term (over 10 years) bonds that some don't like. Now these are cheaper and have new ticker symbols. The Treasury products are also very cheap now, though in most brokerages you could just use the actual bonds.


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Re: State Street Debuts Low Cost ETFs [mostly rebranding old ones and cutting ERs]

Post by asif408 » Mon Oct 16, 2017 3:13 pm

The core funds looks good to me. As long as they track their indexes reasonably well I'll consider them for my TDAmeritrade account to replace the Vanguard funds I previously used. The EM & Developed Ex-US core funds are about 3 bps cheaper than Vanguard's, which is pretty impressive. Foreign investing is getting cheaper and cheaper.

It's odd that their intermediate term Treasury fund costs several basis points more than the short and long term Treasury funds.

Thanks for sharing.

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Re: State Street Debuts Low Cost ETFs [mostly rebranding old ones and cutting ERs]

Post by Dale_G » Mon Oct 16, 2017 3:50 pm

Robust competition is good. Now even more investors can benefit from the Vanguard effect. Thank you John Bogle. I don't really need Vanguard to grow a lot more, so the competition is welcome. I haven't looked at the underlying indices, but maybe we have some new low cost tax loss harvesting partners.

Volatility is my friend

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