Here's the Smartest Way to Invest in the S&P 500 in May

1 hour ago 1

David Dierking, The Motley Fool

Mon, May 4, 2026 astatine 9:35 AM CDT 4 min read

April had investors feeling bully again. With the Iran warfare tensions dilatory subsiding, stocks rapidly began recovering what they had mislaid successful March. After a 9% diminution earlier this year, the S&P 500 (SNPINDEX: ^GSPC) was backmost astatine all-time highs successful mid-April and has been pushing higher ever since.

There are 4 superior exchange-traded funds (ETFs) you tin usage for investing successful the S&P 500:

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Vanguard S&P 500 ETF (NYSEMKT: VOO)
iShares Core S&P 500 ETF (NYSEMKT: IVV)
State Street SPDR S&P 500 ETF (NYSEMKT: SPY)
State Street SPDR Portfolio S&P 500 ETF (NYSEMKT: SPYM)

Each ETF is immense successful presumption of assets nether absorption (AUM), precise liquid, and ultra-cheap. Choosing betwixt them tin beryllium similar splitting hairs, but there's 1 I similar somewhat supra the others.

Coins, barroom chart, upward arrow, and the words "S&P 500."

Key takeaways

The differences betwixt the large S&P 500 ETFs are mostly trivial. The biggest 1 is the higher 0.0945% disbursal ratio of SPY compared to the others.
Performance, yield, and trading spreads are virtually identical among each of them.
For me, the tiebreaker is Vanguard's size advantage.
All of these volition springiness you fundamentally the aforesaid S&P 500 exposure. SPYM and its 0.02% disbursal ratio would beryllium the victor if you privation the implicit lowest outgo possible.

Why the Vanguard S&P 500 ETF beats the others

If you look astatine the champion S&P 500 ETFs from a high-level view, there's truly nary difference. Their show is virtually the same. Their output is virtually the same. They're each investing successful the aforesaid index, truthful the lone existent differentiator is cost.

On that front, the State Street SPDR S&P 500 ETF gets dropped from consideration. In a conception wherever each ground constituent counts, charging astir 6.5 ground points much than its competitors doesn't marque consciousness for a retail investor.

If you privation to look purely astatine disbursal ratio, the State Street SPDR Portfolio S&P 500 ETF wins with its 0.02% disbursal ratio. But that's not the lone outgo to consider. Trading spreads, which are a relation of liquidity and tradability, tin adhd to a fund's full cost.

This is wherever Vanguard gets the edge. Its modestly higher trading measurement and AUM basal compared to some the iShares Core S&P 500 ETF and the State Street SPDR Portfolio S&P 500 ETF apt little trading fees. That tin springiness the Vanguard S&P 500 ETF the slightest of edges connected a full outgo basis.

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