Hello, from the charts, SPY seems to be outperforming its benchmark ^GSPC. That looks strange. From my understanding, SPY is designed to closely track the S&P 500.

Could there be an error in the charts?

Hey, the difference you're noticing comes from how the ^GSPC index is calculated. There's a distinction between a price index and a total return index.

Price Index: The ^GSPC is a price index, meaning it only reflects the price changes of the stocks within the index. It doesn't take dividends into account. So, when you're looking at a price index, you're only seeing a part of the story - the capital appreciation.

Total Return Index: On the other hand, the SPY ETF is designed to mirror the total return of the S&P 500. It accounts for both price changes and dividends, offering a better investment perspective. For SPY a better benchmark would be the ^SP500TR (S&P 500 Total Return Index): https://portfolioslab.com/symbol/^SP500TR.

Given this, it's totally fine for SPY to outperform the ^GSPC over longer periods. When assessing SPY's performance or similar investment tools that capture dividends, it's vital to compare them to the total return version of the benchmark for better accuracy. So comparing SPY and ^SP500TR, you'll find that SPY's performance matches closely the ^SP500TR: https://portfolioslab.com/tools/stock-comparison/SPY/^SP500TR. It's only slightly falling behind due to the fees fund managers charge for ETF management.

There's something wrong with the return time series at least: it shows SPY full history return as %2200 rather than ~%1200 as it should be. The return for ^GSPC, on the other hand, is about right.

This needs fixing.