In my article on the definition of a spider, I mentioned that I wanted to know whether SPY was the most traded ETF or not.

Well, I did my investigation and here’s the list of top 5 most traded ETFs:

– SPY (SPDR S&P 500): Average volume of 296.83 million shares/day.
– XLF (Financial Select Sector SPDR): Average volume of 116.77 million shares/day.
– IWM (iShares Russell 2000 Index): Average volume of 85.20 million shares/day.
– QQQ (PowerShares QQQ Trust, Series 1): Average volume of 81.53 million shares/day.
– EEM (iShares MSCI Emerging Markets Index): Average volume of 77.77 million shares/day.

With an average volume of nearly 300 million shares/day, SPY is by far the most traded ETF in the US stock market, and most likely the most traded stock in all the US market. SPY’s average volume is 60 million shares short of the combined volume of the remaining top 5 ETFs (their total average volume is around 360 million shares/day).

I think that having SPY as the most active ETF means that there’s a lot of investors who like to play the S&P index, and prefer it over playing the NASDAQ 100 index or the Russel 2000 index.