Does SPY and Its 18% Rise Reflect U.S. Markets?

Does SPY and Its 18% Rise Reflect U.S. Markets?

The ETF has dramatically outperformed other U.S. stock ETFs, helped by Nvidia.

Senior ETF Analyst
Reviewed by: Staff
Edited by: Ron Day

Depending upon which ETF you look at, the U.S. stock market’s performance so far this year has been tepid, fantastic or more likely, somewhere in between.

The world’s largest exchange-traded fund, the SPDR S&P 500 ETF Trust (SPY) has broken record highs on its way to gaining 18% this year, just past the year's midway point.

Seen through a different lens, the market’s performance looks much less impressive. The narrower SPDR Dow Jones Industrial Average ETF Trust (DIA) is up just 5.1% year-to-date. DIA’s return is similar to 4.7% gain for the Invesco S&P 500 Equal Weight ETF (RSP), while it’s far superior to the mere 0.9% return for the iShares Russell 2000 ETF (IWM).

The wide-ranging returns for various U.S. stock market ETFs is a reflection of the current environment which has favored megacap tech companies above all else. 

One stock alone—Nvidia—has boosted SPY’s return by almost 500 basis points, while high interest rates have weighed on the profitability of many of the smaller companies that make up IWM.

Of course, IWM is hardly reflective of the overall U.S. stock market. The combined market cap of the Russell 2000 index is $2.8 trillion, less than Nvidia on its own.

But the Dow Jones, as imperfect as it is, has historically been a decent indicator of how the stock market is faring. And maybe it still is.

DIA’s return matches that of RSP, an ETF which tracks a version of the S&P 500 where every holding is equally weighted. It puts much less emphasis on the giant companies that dominate the traditional S&P 500.

The gap between SPY and RSP is currently around 1,300 basis points, which would be the second-largest performance differential for the ETFs since RSP’s inception in 2003 (in 2009, RSP soared almost 45%, trouncing the 26% gain for SPY).

Which ETF is more indicative of the performance of the U.S. stock market is open for debate. While the traditional S&P 500 tracked by SPY is the most widely-followed index of U.S. stocks, if the index continues to outperform its equal-weighted counterpart by leaps and bounds due to the incredible performance of a handful of stocks, an increasing number of investors may question whether it truly represents the stock market at large. 

Sumit Roy is the senior ETF analyst for, where he has worked for 13 years. He creates a variety of content for the platform, including news articles, analysis pieces, videos and podcasts.

Before joining, Sumit was the managing editor and commodities analyst for Hard Assets Investor. In those roles, he was responsible for most of the operations of HAI, a website dedicated to education about commodities investing.

Though he still closely follows the commodities beat, Sumit covers a much broader assortment of topics for, with a particular focus on stock and bond exchange-traded funds.

He is the host of’s Talk ETFs, a popular video series that features weekly interviews with thought leaders in the ETF industry. Sumit is also co-host of Exchange Traded Fridays,’s weekly podcast series.

He lives in the San Francisco Bay Area, where he enjoys climbing the city’s steep hills, playing chess and snowboarding in Lake Tahoe.