Archive · 17 Dec 2025
ETF Fee Wars: Cheap Investing's Future
Two big companies, Vanguard and State Street, are competing to have the largest and cheapest investment funds called ETFs.
ETFs are like baskets of stocks that let people invest in many companies at once without paying high fees.
VOO, managed by Vanguard, and SPY, managed by State Street, are the two biggest ETFs, each with over $620 billion in investments.
VOO charges a lower fee (0.03% per year) than SPY (0.09% per year).
While these big ETFs keep getting cheaper, newer ETFs are charging higher fees because they invest in more complicated or specific things, like environmentally friendly companies or single stocks.
Vanguard recently cut fees on many of its funds, showing that big, simple ETFs can still offer very low fees.
This means that if investors stick to these simple, low-fee ETFs, they can save a lot of money in the long run.
VOO and SPY, the two largest ETFs, each have over $620bn in assets and compete on fees.
VOO charges 0.03% per year, while SPY charges 0.09% per year.
Newer ETFs have higher fees (0.5% or more) due to more complex or specific investment strategies.
Vanguard reduced fees on 87 of its funds, showcasing the potential for further fee reductions in simple ETFs.
Investors can save money by focusing on low-fee, broad-market ETFs rather than more expensive, specialized ones.
- Who
- Vanguard and State Street Global Advisors
- What
- Competition between VOO and SPY ETFs
- When
- February 2024
- Where
- United States
- Why
- To offer the lowest fees and attract more investors
- VOO Assets
- Over $620bn
- SPY Assets
- Over $620bn
- VOO Fee
- 0.03% per year
- SPY Fee
- 0.09% per year
- New ETF Fees
- 0.5% or higher
- Vanguard's Average Fee
- 0.07% (reduced from 0.08%)
- Vanguard's Assets Under Management
- $10trn
- Largest 15 Equity ETFs Assets
- $3.9trn