The Trillion-Dollar Tickle

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Now, listen here. Most investors, bless their cotton socks, have taken to this rather lazy habit of letting machines do the stock-picking for them. These ‘ETFs’, or Exchange-Traded Funds, are like enormous buckets filled with bits of companies – dozens, hundreds, even thousands! It’s a bit like a magpie’s nest, really – a jumble of shiny things, hoping something good sticks.

We’ve been poking about in the history of the SPDR S&P 500 ETF Trust (SPY +0.79%) in this Voyager Portfolio series – a rather sensible chap, if you don’t mind saying so. It’s made a tidy profit for quite a few, you see. But there’s one thing this particular beast hasn’t managed yet: reaching a trillion dollars in assets. A truly enormous sum, wouldn’t you agree? This is the final chapter, and we’re going to have a good look at whether it’ll manage it, and if it will be first across the line.

A Colossal Contraption

The SPDR, you see, has hoovered up a great deal of money. It’s simple, and it generally goes up, which is always a good thing. The big boys – the institutions, the ones with pockets deeper than the Mariana Trench – rather like it. It’s a ‘unit investment trust’, which sounds frightfully complicated, but essentially means it’s predictable. And predictability, for those who move mountains of money, is rather comforting. They don’t want any nasty surprises, you see.

Lately, it’s become a bit of a habit for the SPDR to follow the fortunes of the biggest, most swaggering companies in the world. The S&P 500 index, which it mimics, has become rather top-heavy with a few enormous giants. You’ll find the usual suspects – Nvidia (NVDA +1.44%), Apple (AAPL +0.63%), Alphabet (GOOGL +0.17%) (GOOG +0.11%), and Microsoft (MSFT +0.35%). They’re so large, they rather dwarf the smaller companies, like mice next to elephants. It’s a bit unfair, really.

The Trillion-Dollar Hurdle

To reach this trillion-dollar mark, the SPDR needs to add another $300-odd billion to its current $693.3 billion (as of March 2nd, mind you). That’s a hefty sum, roughly equivalent to building a castle made entirely of sausages. Or, to put it another way, it needs to grow by about 44%.

Now, it’s tempting to say that a steady 10% return each year for four years would do the trick. And in a booming market, the S&P 500 might well shoot up even faster. But there’s a rather slippery variable at play here: people. Investors are fickle creatures, you see. If they get the jitters about the market, they’ll start selling. And if enough of them sell, the fund shrinks. It’s like a balloon losing air. But if everyone gets greedy and starts buying, the balloon inflates. It’s all rather unpredictable, isn’t it?

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Not Quite First Past the Post

Now, here’s a little secret. Despite having nearly $700 billion, the SPDR isn’t actually the biggest fund out there. And, because there are a couple of other funds that also track the S&P 500, it’s quite likely one of them will reach the trillion-dollar mark first. A bit embarrassing, really.

However, the SPDR is still a useful tool for investors. Here at the Voyager Portfolio, we prefer to hunt for overlooked individual stocks – a bit more exciting, you see. But if you’re looking to simplify things, or spread your bets, the SPDR is worth a look. Just don’t expect it to perform miracles. After all, even the most colossal contraption can have a bit of a wobble now and then.

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2026-03-04 20:02