Investors aiming to capture the performance of America's largest publicly traded companies frequently turn to ETFs that track the S&P 500 index. Comprising 500 of the biggest U.S. corporations by market capitalization, the S&P 500 reflects the overall health of the U.S. economy and stock market. In December 2025, several ETFs stand out by offering comprehensive, cost-efficient, and liquid means to access this index. This article examines seven prominent ETFs that investors might consider adding to their portfolios.
Understanding S&P 500 ETFs
The S&P 500 index, established in its current form in 1957, ranks companies by their free-float market capitalization, meaning it accounts only for shares available for public trading. To be eligible for inclusion, companies must have market capitalizations exceeding $6.1 billion, maintain a monthly dollar trading value above $1, and trade at least 250,000 shares monthly. ETFs that track the index provide investors exposure to its constituent stocks, enabling broad, diversified investment.
The first ETF to track the S&P 500 debuted in 1993 under the ticker symbol SPY, paving the way for a multitude of similar funds. These ETFs trade on stock exchanges in real-time and combine mutual fund diversification with stock-like liquidity.
Top Seven ETFs for S&P 500 Exposure
1. iShares Core S&P 500 ETF (IVV)
The iShares Core S&P 500 ETF, launched by BlackRock in 2000, is widely regarded for its tight tracking of the S&P 500, boasting a median tracking difference of just -0.04% over twelve months. It offers investors low cost with an expense ratio of only 0.03%, coupled with daily disclosures of holdings, an advantage over some rivals. The fund’s structure enhances tax efficiency, with advisors noting no capital gains distributions over the past decade. IVV’s liquidity, though less than the largest peers, remains sufficient for most investors, making it an excellent core component for long-term portfolios.
2. Vanguard S&P 500 ETF (VOO)
Vanguard’s entry into the S&P 500 ETF space provides shareholders with one of the cheapest options available, carrying the same 0.03% expense ratio as IVV. Although it does not match the daily share volume of SPY, VOO maintains high liquidity with over three million shares traded per day. Since its inception in 2010, VOO has delivered performance nearly identical to the underlying index, with returns closely tracking the S&P 500’s 13.52% annualized gain.
3. SPDR S&P 500 ETF Trust (SPY)
SPY has the distinction of being the very first ETF launched in 1993, making it a long-established option for investors seeking expansive market exposure. While its 0.0945% expense ratio surpasses that of IVV and VOO, SPY compensates through exceptional daily trading volume and liquidity. Structured as a unit investment trust, SPY does not reinvest dividends, which may appeal to investors preferring distributions. This fund is scheduled to terminate in 2114, underscoring its long-term availability.
4. SPDR Portfolio S&P 500 ETF (SPLG)
SPLG seeks to mirror the total return of the S&P 500 and forms part of SPDR’s lineup of low-cost portfolio ETFs. With a remarkably low expense ratio of 0.02%, it offers cost-conscious investors access to broad U.S. large-cap equity exposure. Rebalanced quarterly, SPLG carefully manages sector allocations and liquidity, and due to its generally lower share price compared to SPY, it is well-suited for retail investors.
5. Schwab U.S. Large-Cap ETF (SCHX)
Differing from pure S&P 500 trackers, SCHX follows an index composed of the 780 largest U.S. companies, thus broadening exposure beyond the core 500 stocks. Despite this, its top 10 holdings mirror those of S&P 500 ETFs like SPY, IVV, and VOO; however, they constitute a smaller portion of the fund’s total holdings at 19%, compared to 22% in more narrowly focused ETFs. With an expense ratio of 0.03%, SCHX provides attractive value while maintaining close alignment with S&P 500 performance, offering a balance between strict index tracking and wider market coverage.
6. iShares S&P 500 Growth ETF (IVW)
This ETF seeks to deliver returns exceeding the market average by emphasizing stocks with strong growth fundamentals. Using metrics such as earnings growth, sales growth, and momentum, IVW disproportionately weights technology sector companies, with the top 10 holdings making up over 34% of assets. Although more costly than broad S&P 500 ETFs, with a 0.18% expense ratio, IVW offers an avenue for investors wanting to tilt exposure toward growth-oriented equities within the S&P 500.
7. Invesco S&P 500 Equal Weight ETF (RSP)
RSP tracks an equal-weighted version of the S&P 500, giving roughly the same exposure to each constituent stock rather than weighting by market cap. The fund’s portfolio often leans toward mid-cap stocks and is rebalanced quarterly to maintain equal weighting. This approach results in sector diversification with allocations spanning IT, Industrials, Healthcare, Financials, and more. By providing an equal footing to all holdings, RSP can reduce concentration risk inherent in traditional cap-weighted indexes.
Key Considerations for Choosing an S&P 500 ETF
While many ETFs strive to replicate the S&P 500, subtle differences in index construction, weighting, and rebalancing can lead to performance variations. Investors should evaluate primary factors including:
- Availability: Select ETFs available through most brokerage platforms with sufficient average trading volumes to avoid liquidity issues during market fluctuations.
- Costs: Expense ratios directly impact net returns; lower fees generally benefit long-term investors.
- Tracking Accuracy: The ETF’s ability to closely replicate the underlying index ensures predictable performance aligned with market movements.
Benefits and Limitations
Investing in S&P 500 ETFs affords broad diversification across sectors and companies, typically featuring low expense ratios relative to actively managed funds. Their tax-efficient structures often generate qualified dividends with fewer capital gains distributions, enhancing after-tax returns for taxable accounts. Compared to indexes like the Dow Jones Industrial Average or the technology-heavy NASDAQ Composite, S&P 500 ETFs represent a balanced exposure to large-cap U.S. stocks.
On the other hand, these ETFs offer market-average returns, potentially limiting opportunities for outperformance without additional strategies such as growth tilts or equal weighting. While broad index funds reduce individual company risk through diversification, investors remain exposed to overall market downturns. Furthermore, smaller companies with limited free-float may be underrepresented due to the index’s weighting methodology.
Conclusion
S&P 500 ETFs remain foundational tools for investors seeking large-cap U.S. equity exposure with cost efficiency and diversification. The choice among different ETFs hinges on personal preferences regarding expense ratio, liquidity requirements, portfolio construction philosophy, and growth versus value orientation. For long-term investors, well-established ETFs like IVV, VOO, and SPY provide dependable options, while others like IVW and RSP cater to specialized strategies aiming to enhance returns or balance portfolio exposure.
Investors are advised to carefully assess these funds against their investment goals and trading preferences, acknowledging the inherent risks and costs associated with equity market investing.