SPDRs do not stick to walls nor do they scare people out of their curds and whey. In fact a SPDR is not scary at all, but instead a nice potential fit for your investing strategy.
A SPDR, officially known as a Standard & Poors Depository Receipts, is like a mini-portfolio of stocks and derivatives with the goal of emulating an investment vehicle like an index or commodity. In short, SPDRs are types of ETFs that trade in the United States. They track some of the most actively traded indexes and commodities on the U.S. exchanges.
For example, SPY is a SPDR ETF that tracks the S&P 500. So if you had an interest in the market, or specifically in the S&P 500, buying SPY shares may be the way to go. The reason using a SPDR may be easier than investing in an index is because the ETF is pre-packaged with shares of stocks in the S&P 500. It requires only one transaction to gain instant exposure to the index and market. In the case of buying shares in the index, you would have to make multiple trades or purchases. This could increase your transaction costs and make it difficult to get a desired price.
SPDRs also offer many advantages besides ease of use, one of the biggest being the tax benefit. Nothing scary about that. Not that a SPDR doesn’t have its disadvantages as well, but there is a reason SPDRs are popular investments.
If you think SPDRs may be a fit for your portfolio, you’ve come to the right place. Not only do we have a list of SPDR ETFs to help you with your research, but we also have information to help you get started with ETFs.
In the immortal words of a certain famous wall-crawler, with great power comes great responsibility. So it’s always important to thoroughly research any investment before you make any trades. However, once you are comfortable with SPDRs and ETFs, then it’s only matter of calling your friendly neighborhood Broker-Man.