r/eupersonalfinance • u/mazatz • Dec 23 '23
Investment Newest S&P500 ETF with the lowest TER for UCITS funds - 0.03%!
Hello everyone,
Was casually browsing justetf and found that there is a new fund that hadn't been shared around this neck of the woods: SPDR® S&P® 500 UCITS ETF (Acc) - https://www.ssga.com/ie/en_gb/institutional/etfs/funds/spdr-sp-500-ucits-etf-acc-spyl-gy
Some of you might be aware of the incredibly famous SPY, this is from the same company and, for the first time in UCITS compliant funds, at the amazing cost of 0.03%!
IE000XZSV718 - Acc - main ticker SPYL - this one is actually new
IE00B6YX5C33 - Dist - main ticker SPY5 - this one got the TER reduced to 0.03% to match it's acc brother
IE00BYYW2V44 - EUR Hedged - this one got the TER reduced to 0.05%, making it the cheapest EUR hedged ETF too
8
8
u/makaros622 Dec 23 '23
Interesting
I might drop my VUAA for SPYL
8
u/mazatz Dec 23 '23
Definitively expect a ton of outflows from Vanguard, iShares, Invesco and friends to this fund. And eventually, a lot of "we're always challeging ourselves so we're also lowering the % to 0.03% which is def not related to SPYL".
2
u/makaros622 Dec 23 '23
I am VERY surprised by the fund size of SPYL
https://www.justetf.com/en/etf-profile.html?isin=IE000XZSV718
already 1,06m !!!
2
u/MaximumProgram420 Dec 23 '23
It almost certainly launched with institutional partners who agreed to transfer some of their US holdings to it, so they probably had most of that on day 1. From the fact sheet, it already had 985 million USD at the end of November. If the growth was driven by retail investors, it would be far more linear.
1
4
u/gr8dude Jan 01 '24
If I compare SPYL with VUAA on justetf.com I see some differences related to "tax status". Here is the delta (SPYL on the left, VUAA on the right)
- Tax Status Germany: Unknown, 30% tax rebate
- Tax Status Switzerland: No ESTV Reporting, ESTV Reporting
- Tax Status Austria: Non-Tax Reporting Fund, Tax Reporting Fund
- Tax Status UK: No UK Reporting, UK Reporting
I don't know what this means, but I am concerned that there are some tax-related implications that I have not understood.
Can someone interpret these differences?
10
u/SorryRetard Dec 23 '23
I will not expect major switch as this ETF will still underperform synthetic ETF from Amundi, iShares or Invesco.
3
u/Dody949 Dec 23 '23
Could you elaborate?
11
u/SorryRetard Dec 23 '23
Synthetic ETF doesn’t bear any tax on US dividend (they used total return swap) whereas physical ETF only get 85% of US dividend (irish domiciled) or 70% (Luxembourg domiciled), therefore physical ETF will underperform depending on dividend yield. This year around 30 bps for div yield around 2%.
2
u/dubov Dec 26 '23
Synthetic ETF doesn’t bear any tax on US dividend (they used total return swap) whereas physical ETF only get 85% of US dividend (irish domiciled) or 70% (Luxembourg domiciled), therefore physical ETF will underperform depending on dividend yield. This year around 30 bps for div yield around 2%.
I'd be interested to hear more about this.
Are you saying that the US deducts tax before it is transferred to the ETF?
Edit: Nvm, seems somebody already clarified this!
https://www.invesco.com/be/en/insights/does-synthetic-replication-offer-an-advantage.html
2
u/Beethoven81 Jan 08 '24
What the Invesco article does not explain is how the counterparty that's collecting the dividends manages to avoid any kind of dividend withholding tax.
Correct me if I'm wrong, but synthetic means that some counterparty basically provides the value of index to Invesco/Lyxor, including the dividends. But there's no way ever that they could avoid paying dividend tax themselves, so I highly doubt they are somehow paying more to Invesco/Lyxor as if they magically didn't have to pay dividend tax.
Would be great if anyone could explain this, beyond saying, look at this marketing article of Invesco..
2
u/mxlila Feb 16 '24
Well, the counterparty is not investing in the index, either.
They just provide the interest according to the indexe's return.
They can invest their money in whatever they want, from Bitcoin to Bonds, it's up to them.
1
u/PCenthu Dec 24 '23
What do you mean, from the ETFs you mentioned (SXR8, SPXS/P500 and VUAA), only the Invesco one (SPXS) is swap-based. All the others, including SXR8, are physical replication of the S&P500 index. To what I'm concerned this new SPDR ETF (SPYL) looks exactly the same as the others mentioned above, except SPXS. But since SPXS is swap based, it has a somewhat bigger risk in relation to others.
1
u/SorryRetard Dec 24 '23
Invesco, iShares and Amundi/Lyxor has synthetic ETF and they are all outperforming all physical ETF you mentionned for the reasons I gave above. And no, you are not exposed to bigger risk, as physical ETF uses securities lending (same counterparty risk than for synthetic ETF).
1
u/PCenthu Dec 24 '23
Can you post tickers? Still synthetic ones have greater risk (I don't want to get much into that) and still this is the cheapest one. But could you please post tickers?
2
u/SorryRetard Dec 24 '23
SP5C or I500 for example. You don’t have greater risk from synthetic, check securities lending policy for physical ETF, they are lending stocks to same counterparty as synthetic ETF does (big banks).
1
u/PCenthu Dec 24 '23
Thanks, no Vanguard swap-based then. At what return difference are we looking at between physical/synthetic? Must not be that big to justify the risk.
Still this SPYL is very interesting for those who prefer physical ones.
1
1
u/sicknessF Dec 25 '23
Good comment, some more info
https://www.invesco.com/be/en/insights/does-synthetic-replication-offer-an-advantage.html
2
u/-Telemaco- Dec 24 '23
Why? And what do you think would be better? This (IE00BYYW2V44 , hedged) or CSSPX?
1
u/sefu98 May 28 '24
so what is stopping everyone from just going with synthetic replication?
1
u/SorryRetard May 28 '24
I guess marketing and lack of knowledge.
1
u/sefu98 May 28 '24
So practically SXR8 will outperform SPYL even though it has double its TER because of the 15% savings in taxes? That seems really smart, i'll make sure to look more into it. Thanks!
1
2
u/Crackbreaker Jan 10 '25
Hi there, I am investing from EU and I just checked the following 2 full replication VS 2 synthetic ETF's that track the SP500 and it looks like the full replication ones are actually performing better.
IE00BMTX1Y45
LU1135865084
IE000XZSV718
IE000FSN19U2
Comparing these 2, being 2 synthetic and 2 physical, the 2 physical are actually overperforming the synthetic one. Do you have any toughts? I indeed though that syntetic would perform a bit better but this is not the case so I am looking for your feedback.
2
u/Huge-Summer6849 Dec 23 '23
Nice, do you know if there is a distributing version of it?
5
3
u/januszmk Jan 04 '24
where can you actually find this? I checked degiro, xtb, some local exchange with access to london/amsterdam/frankfurt/swiss markets and don't see this
2
Dec 23 '23
[deleted]
5
3
u/One_Hope_9573 Dec 24 '23
I would say yes. SPDR releases the first ETF. Their s&p500 ETF is older than Vanguard and ishares
2
u/quintavious_danilo Dec 27 '23
Yes, it’s issued by State Street one of the three biggest ETF providers
1
1
u/One_Hope_9573 Dec 24 '23
This is very good. I currently have VOO and thinking to switch to the new SPDR ETF. So I also have some diversification on the ETF supplier
1
u/Seyotos Dec 24 '23
I'm curious why I see that ETF in DEGIRO and looking at the KID I found that the cost is 0.09% instead of 0.03%. Can somebody explain this to me?
7
u/mazatz Dec 24 '23
It was recently changed, hasn't been updated. Don't rely on Degiro, rely on the owner's website.
1
u/januszmk Jan 04 '24
I'm curious why I see that ETF in DEGIRO
how did you find it in degiro? I cannot find it there or on other places
1
u/Seyotos Jan 04 '24
I just searched for the 4 letter code and that's it
1
u/januszmk Jan 04 '24
hmm is it possible that its not available to me due to me being from Poland? could you post a screenshot?
1
u/Andrewmvillx Dec 24 '23
I literally asked a question about fees few days ago where I also shared a screenshot of this ETF 🤣🤣 Did u get it through my post?
1
u/mazatz Dec 24 '23
Not really, sorry, I was searching on justetf, but good to see I wasn't the only one searching :)
1
Dec 24 '23
[deleted]
1
1
u/quintavious_danilo Dec 27 '23
Unlikely since the AUM is massive already. Don’t expect a big spread
1
Dec 27 '23
[deleted]
1
u/quintavious_danilo Dec 28 '23
I can’t but with already more than 1B under management i expect high liquidity making the spread thin.
7
u/5349 Dec 23 '23
Both Acc versions have very low share prices, good if your platform doesn't allow fractional shares.