Spiders - SPDR

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DEFINITION of 'Spiders - SPDR'

A short form of Standard & Poor's depositary receipt, an exchange-traded fund (ETF) managed by State Street Global Advisors that tracks the Standard & Poor's 500 Index (S&P 500). Each share of spider contains one-tenth of the S&P index and trades at roughly one-tenth of the dollar-value level of the S&P 500. Spiders can also refer to the general group of ETFs to which the Standard & Poor's depositary receipt belongs.

BREAKING DOWN 'Spiders - SPDR'

Spiders are listed on the New York Stock Exchange (NYSE) after the acquisition of the American Stock Exchange (AMEX) under the ticker symbol SPY. By trading like stocks, spiders have continuous liquidity, can be short sold, bought on margin, provide regular dividend payments and incur regular brokerage commissions when traded.

Spiders are used by large institutions and traders as bets on the overall direction of the market. They are also used by individual investors who believe in passive management (index investing). In this respect, spiders compete directly with S&P 500 index funds.

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RELATED FAQS
  1. What is a spider and why should I buy one?

    The term spider is the commonly-used expression to describe the the Standard & Poor's Depository Receipt (SPDR). This ... Read Full Answer >>
  2. What is the difference between iShares, VIPERs and Spiders?

    iShares, VIPERs and spiders each represent different exchange-traded fund (ETF) families. In other words, an individual company ... Read Full Answer >>
  3. Can mutual funds outperform savings accounts?

    A mutual fund can – and should – outperform a savings account. In most cases, it should not even be a close race. Savings ... Read Full Answer >>
  4. Can mutual funds invest in private companies?

    Mutual funds can invest in private companies, which may come as a surprise to many investors. It is rare for a fund to have ... Read Full Answer >>
  5. Where do penny stocks trade?

    Generally, penny stocks are traded through the use of the Over the Counter Bulletin Board (OTCBB) and through pink sheets. ... Read Full Answer >>
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    Some penny stocks, those using the definition of trading for less than $5 per share, are traded on regular exchanges such ... Read Full Answer >>

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