A sound investment process and strong management team underpin SPDR® S&P 500® ESG ETF's Morningstar Medalist Rating of Silver. The portfolio maintains a cost advantage over competitors, priced within the lowest fee quintile among peers.  

 The strategy merits a High Process Pillar rating. The strategy’s management team earns an Above Average People Pillar rating. The strategy's parent organization earns the firm an Above Average Parent Pillar rating. People, Process and Parent Pillar ratings for this strategy are indirectly assigned by a Morningstar analyst rather than algorithmically derived. Please see the notes following each pillar section for more details. The details of assigning methods can be found in each pillar section.

Analyst Rating

Microsoft

Apple

NVIDIA

Amazon

Alphabet

Eli Lilly

JPMorgan Chase & Co

UnitedHealth Group

Visa

Morningstar's evaluation of this security's process aims to determine the likelihood that it will outperform its Morningstar Category index on a risk-adjusted basis over the long term. SPDR® S&P 500® ESG ETF earns a High Process Pillar rating. 
The investment strategy as stated in the fund's prospectus is:  The investment seeks to provide investment results that, before fees and expenses, correspond generally to the total return performance of the S&P 500 ESG Index that provides exposure to securities that meet certain sustainability criteria (criteria related to environmental, social and governance ("ESG") factors) while maintaining similar overall industry group weights as the S&P 500 Index.  Under normal market conditions, the fund generally invests substantially all, but at least 80%, and of its total assets in the securities comprising the index. 

 The portfolio is overweight in technology by 5.2 percentage points in terms of assets compared with the category average, and its consumer cyclical allocation is similar to the category. The sectors with low exposure compared to category peers are industrials and financial services, with industrials underweighting the average portfolio by 3.4 percentage points of assets and financial services similar to the average. The portfolio is positioned across 318 holdings and its assets are more dispersed than peers in the category. In particular, 40.6% of the fund’s assets are concentrated in the top 10 fund holdings, as opposed to the typical peer's 48.8%. And in closing, in terms of portfolio turnover, on a year-over-year basis, 12% of the fund's holdings have turned over, whether through increasing, decreasing, or changing a position. 

 Note: The Process Pillar rating is indirectly assigned by an analyst. When an analyst covers a passively managed vehicle that tracks a particular index, Morningstar associates the Process Pillar rating assigned to that vehicle with the index concerned. Morningstar then maps the Process Pillar rating associated with a given index to any other uncovered passive strategies that track the same index. This ensures that the analyst’s view is leveraged whenever available and promotes consistency when assigning Process Pillar ratings to passive vehicles associated with a given index.

High

Process

State Street’s team is strong compared with others in the industry, resulting in an Above Average People Pillar rating. There are three managers listed on the fund: Karl Schneider, Emiliano Rabinovich, Olga Winner. The team is well equipped, with an average of 19 years of portfolio management experience. Together, they manage a total of two strategies, with a Silver asset-weighted average Morningstar Medalist Rating, indicating the potential to deliver positive alpha relative to the category median in aggregate.  

 Note: This People Pillar rating is indirectly assigned by an analyst. Morningstar analysts evaluate the People Pillar for passive products at the brand level and may also differentiate by asset class. There is at least one other passive strategy at the firm that is covered by a Morningstar analyst, so the People Pillar rating of the fund is inherited from the rating that the Morningstar analyst assigned to investment vehicles under the same brand name.

Above Average

People

State Street Global Advisors is under new leadership but continues to move along the positive trajectory established by former leaders. SSGA maintains its Above Average Parent Pillar rating.
Cyrus Taraporevala, who oversaw much of SSGA’s recent transformation, retired from the CEO position in December 2022 and passed the baton to his successor, Yie-Hsin Hung. She inherited a business that’s become more disciplined with its fund lineup. Fees have come down, while product development remains focused on fixed-income and sustainability funds, and many of SSGA’s launches have echoed that intention.
The seeds that SSGA planted over the past several years have been bearing fruit. It built out a low-cost series of portfolio building-block ETFs in the U.S. bearing the “SPDR Portfolio” branding. SSGA launched these later than its industry rivals, so they aren’t as large. But they’re competitive, with solid management and low fees, which helped them consistently take in new money over the past several years.
SSGA continued to overhaul its ETF business in Europe with most of its recent fixed-income and sustainability fund launches. Many of these funds track indexes and charge relatively low fees. With operations in the U.S. and Europe standing on a firm foundation, SSGA will put more focus on its Asia-Pacific business—the smallest regional segment of its business.

Parent

SPDR S&P 500 ESG ETF

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