State Street, the third largest ETF provider, has cut fees on four ETFs.
The new expense ratios for the SPDR Bloomberg Barclays International Treasury Bond ETF (BWX) and SPDR Nuveen S&P High Yield Municipal Bond ETF (HYMB) are now 35 basis points, down from 50 and 45 basis points, respectively.
The new fees for the SPDR SSGA Income Allocation ETF (INKM) and SPDR SSGA Multi-Asset Real Return ETF (RLY) are 50 basis points, down almost 30% from 70 basis points previously. All four fee cuts were effective Sept. 4.
“In reducing the expense ratios of these four SPDRs we help lower the total cost of ownership for our clients and ensure the funds are well positioned for growth in the current market,” said Noel Archard, global head of SPDR product at State Street Global Advisors, in a statement.
(Related: Fidelity Unleashes No-Fee Index Funds)
The State Street fee cuts continue a growing trend among asset managers to cut expense ratios on ETFs and mutual funds and eliminate commissions on ETF trades. In July alone Fidelity introduced two no-fee index funds and Vanguard launched the industry’s largest platform of ETFs available commission-free.
Todd Rosenbluth, director of ETF & Mutual Fund Research at CFRA, says State Street’s move to reduce fees can help the firm stem outflows and attract inflows with more competitively priced funds as the ETF market expands. “It’s not too late. Investors are clearly gravitating toward cheaper alternatives,” says Rosenbluth.