State Street Global Advisors Unveils SPDR S&P 500 Buyback ETF
SPYB Provides Investors Precise Exposure To Stocks With The Highest Buyback Ratios In The S&P 500
BOSTON, February 5, 2015 –(BUSINESS WIRE)–State Street Global Advisors (SSGA), the asset management business of State Street Corporation (NYSE:STT), today announced that the SPDR S&P 500 Buyback ETF (Symbol SPYB) began trading on the NYSE Arca on February 5, 2015. Providing access to a portfolio of S&P 500 stocks with the highest buyback ratio, SPYB offers investors an opportunity to complement their dividend strategies and potentially improve the risk-return profile of their portfolio.
“Companies that buy back their own shares have established a long-term track record of outperforming their peers in both up and down markets,” said James Ross, executive vice president and global head of SPDR Exchange Traded Funds at State Street Global Advisors. “SPYB helps investors access a diversified buyback portfolio to capture this return stream and complement any existing dividend strategies.”
The SPDR S&P 500 Buyback ETF seeks to track the performance of the S&P 500 Buyback Index. The index provides exposure to the 100 constituent companies in the S&P 500 with the highest buyback ratio in the last 12 months. The buyback ratio is defined as the ratio of the total cash put towards buybacks in the trailing year and the market capitalization of the company as of a reference date. A “buyback” occurs when a company buys back its own shares from the marketplace, reducing the number of shares outstanding. Index constituents are equally weighted and the index is rebalanced quarterly. The SPDR S&P 500 Buyback ETF’s expense ratio is 0.35 percent.
Over the past three decades, share repurchases have surpassed cash dividends to become the dominant form of corporate payout in the United States. From 1980 to 2013, the proportion of dividend-paying companies has decreased from 78 percent to 40 percent.1 During this same period of time, the proportion of companies with share buybacks increased from 28 percent to 43 percent.1 This increased use of share buybacks is driven by legal, tax, and structural changes in the US markets.
1 S&P Dow Jones, as of December 31, 2014
About SPDR Exchange Traded Funds
SPDR ETFs are a comprehensive family spanning an array of international and domestic asset classes. SPDR ETFs are managed by SSGA Funds Management, Inc., a registered investment adviser and wholly owned subsidiary of State Street Bank and Trust Company. The funds provide investors with the flexibility to select investments that are precisely aligned to their investment strategy. Recognized as an industry pioneer, State Street created the first US listed ETF in 1993 (SPDR S&P 500® – Ticker SPY) and has remained on the forefront of responsible innovation, as evidenced by the introduction of many ground-breaking products, including first-to-market launches with gold, international real estate, international fixed income, and sector ETFs. For more information, visit www.spdrs.com.
About State Street Global Advisors
For nearly four decades, State Street Global Advisors has been committed to helping our clients, and the millions who rely on them, achieve financial security. We partner with many of the world’s largest, most sophisticated investors and financial intermediaries to help them reach their goals through a rigorous, research-driven investment process spanning both indexing and active disciplines. With trillions* in assets, our scale and global reach offer clients unrivaled access to markets, geographies and asset classes, and allow us to deliver thoughtful insights and innovative solutions.
State Street Global Advisors is the investment management arm of State Street Corporation.
*Assets under management were $2.45 trillion as of December 31, 2014. This AUM total includes the assets of the SPDR Gold Trust (approx. $27.3 billion as of December 31, 2014), for which State Street Global Markets, LLC, an affiliate of State Street Global Advisors, serves as the marketing agent. Please note that AUM totals are unaudited.
ETFs trade like stocks, are subject to investment risk, fluctuate in market value and may trade at prices above or below the ETFs net asset value. Brokerage commissions and ETF expenses will reduce returns.
The gross expense ratio is the fund’s total annual operating expenses ratio. It is gross of any fee waivers or expense reimbursements. It can be found in the fund’s most recent prospectus.
“SPDR” is a registered trademark of Standard & Poor’s Financial Services LLC (“S&P”) and has been licensed for use by State Street Corporation. STANDARD & POOR’S, S&P, S&P 500 and S&P MIDCAP 400 are registered trademarks of Standard & Poor’s Financial Services LLC. No financial product offered by State Street Corporation or its affiliates is sponsored, endorsed, sold or promoted by S&P or its affiliates, and S&P and its affiliates make no representation, warranty or condition regarding the advisability of buying, selling or holding units/shares in such products. Further limitations and important information that could affect investors’ rights are described in the prospectus for the applicable product.
Distributor: State Street Global Markets, LLC, member FINRA, SIPC, a wholly owned subsidiary of State Street Corporation. References to State Street may include State Street Corporation and its affiliates. Certain State Street affiliates provide services and receive fees from the SPDR ETFs.
Before investing, consider the funds’ investment objectives, risks, charges and expenses. To obtain a prospectus or summary prospectus which contains this and other information, call 1-866-787-2257, download a prospectus or summary prospectus now, or talk to your financial advisor. Read it carefully before investing.
Not FDIC Insured * No Bank Guarantee * May Lose Value
SOURCE: State Street Corporation