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Before switching to S&P futures I was an active SPY trader. I'm also very
familiar with the Vanguard Index funds. Keep in mind that SPY is a derivitive
and that the creators of the derivitive are taking a cut of the pie, as are
commissions. Also note that after factoring in accrued dividends SPY often
trades at a discount or premium to the S&P. All in all, as an investor, it's
probably a wash between SPY and Vanguard's extremely low .20% cut. As a trading
vehicle, SPY is superior to stocks because it is widely diversified and can be
shorted on a downtick, however it lacks the leverage of the futures.
Earl
-----Original Message-----
From: bruceb@xxxxxxxxxxxxx <bruceb@xxxxxxxxxxxxx>
To: Omega List <omega-list@xxxxxxxxxx>
Date: Wednesday, April 22, 1998 10:36 AM
Subject: Question for SPY traders
>Does anyone happen to have some good info about Spyders in regards to the
>costs? I'm trying to figure out if passive investors would be better off
>opening up an online account with a dirt cheap broker like Datek and just
>buying SPYs, rather than putting the money in an S&P Index fund, like
>Vangard's. Vangard's fees are low but not insignificant. Any ideas?
>
>Thanks,
>
>Bruce
>
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