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The Fund employs an indexing investment approach designed to track the performance of the S&P 500 Value Index, which represents the value companies, as determined by the index provider, of the S&P 500 Index. The Index measures the performance of large-capitalization value companies in the United States. The Fund attempts to replicate the target index by investing all, or substantially all, of its assets in the stocks that make up the Index, holding each stock in approximately the same proportion as its weighting in the Index.

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Bank of America analysts are optimistic about stocks in 2025, expecting a 10% increase in S&amp;P 500 index to 6,666, driven by earnings growth and sector rotation.

S&amp;P 500 At 6,666 In 2025? Bank Of America Predicts &#39;Another Good Year For Equities&#39;

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&#34;Value&#34; Funds See Big Inflow, Oil Continues To Bleed - ETF Winners And Losers: Mid-Cap Flows

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A Cheap Value ETF For April

Bank of America analysts shared a positive outlook for stocks in 2025 during Monday&#8217;s conference call on the <a href="https://www.benzinga.com/topic/expert-ideas">economic and market forecast.</a>



According to the bank, the S&amp;P 500 Index—as tracked by the SPDR S&amp;P 500 ETF Trust (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SPY#NYSE">SPY</a>)—will climb to 6,666 by the end of 2025, marking a 10% increase from current levels. The forecast underscores confidence in productivity gains, resilient corporate earnings, and strategic sector rotation.



<h3 class="wp-block-heading">16 Years Of S&amp;P 500: From 666 To 6,666</h3>



"We are expecting another good year for equities," said Savita Subramanian, head of U.S. equity strategy at Bank of America. "Our forecast is basically a move from 666 in 2009 to 6,666 in 2025." 



This translates to an annualized return of approximately 10%, driven by robust earnings growth and broader participation across sectors.



The equity outlook for 2025 leans heavily on a projected 13% corporate earnings growth. 



"Although we do believe that 2025 will be a year of rotation rather than just buy the index," Subramanian indicated, hinting at a focus on cyclical stocks as investors seek opportunities beyond mega-cap tech.



Read Also: <a href="https://www.benzinga.com/24/11/42246831/morgan-stanley-sounds-alarm-for-markets-in-2025-sp-500-is-extremely-expensive">Morgan Stanley Sounds Alarm For Markets In 2025: &#8216;S&amp;P 500 Is Extremely Expensive&#8217;</a>



<h3 class="wp-block-heading">Sector Rotation and Valuation Themes</h3>



Bank of America's analysis points to cyclicals, particularly financials, energy, and consumer sectors, as key outperformers in 2025. 



Subramanian said that &#8220;the average stock is more attractive than the overall index,&#8221; citing the sharp gap between equal-weighted and cap-weighted S&amp;P 500 valuations.



Analysts at Bank of America highlighted opportunities in large-cap value stocks – as broadly tracked by the Vanguard S&amp;P 500 Value ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VOOV#NYSE">VOOV</a>) – which they view as well-positioned to weather inflation and interest rate uncertainties. 



&#8220;The key risk under Trump 2.0 is the potential for higher inflation and higher long term interest rates. Our favorite cohort of the S&amp;P 500 is large cap value,&#8221; Subramanian said.



Small caps are expected to outperform large-cap counterparts during the first year of Donald Trump&#8216;s second term.



&#8220;We think the narrative on small caps as the biggest potential outperform,&#8221; analyst Jill Carey Hall said.



However, she indicated that if tariffs and immigration policies are enacted as proposed, especially with a front-loaded approach, they could pose a significantly greater risk to small-cap stocks.



&#8220;Recently proposed tariffs on Canada and Mexico could be a 7% hit to Russell earnings,&#8221; the analyst added. 



<h3 class="wp-block-heading">Productivity and Economic Growth</h3>



Economist Aditya Bhave continues to predict a strong U.S. economy, with productivity gains driving GDP growth to around 2% in 2025. 



"Productivity has accelerated," Bhave said. "We're now on a faster trend growth rate since the start of the pandemic than we were in the previous cycle."



While inflation is moderating, Bank of America warned of persistent risks. "We expect a few tenths extra inflation from tariffs and underlying inflation even setting aside policy changes as being a little bit sticky," Bhave stated.



<h3 class="wp-block-heading">Fed Policy And Risks</h3>



The Federal Reserve is expected to cut rates three times in 2025, bringing the terminal rate to 3.75-4%, according to Bank of America. 



However, Bhave cautioned about uncertainties tied to inflation and trade policy, particularly the potential impact of tariffs.



"Tariffs could add a few tenths to inflation, particularly against China, though FX could offset some of the impact," Bhave said.



Read Next:



<ul>
<li><a href="https://www.benzinga.com/analyst-ratings/analyst-color/24/12/42273230/stellantis-market-value-halves-in-2024-why-ceo-tavares-exit-could-take-things-from-bad-to-worse">Stellantis Market Value Halves In 2024: Why CEO Tavares&#8217; Exit Could Take Things From Bad To Worse</a></li>
</ul>



Photo: Shutterstock

S&P 500 At 6,666 In 2025? Bank Of America Predicts 'Another Good Year For Equities'

We performed a screening of mid-cap ETFs, defined as having Assets Under Management (AUM) between $2 billion and $10 billion &#8211; to determine what funds had the largest positive and negative returns on the week, according to data from <a href="http://etfdb.com">etfdb.com</a>. Only non-leveraged funds were considered.



<h2 class="wp-block-heading">Winners</h2>



iShares S&amp;P Mid-Cap 400 Value ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IJJ#NYSE">IJJ</a>)



IJJ lost $1.60 billion in net assets over the trailing week.



The iShares S&amp;P Mid-Cap 400 Value ETF offers exposure to mid-cap stocks that exhibit "value" characteristics.



IJJ has $8.99 billion in AUM and an expense ratio of 0.18%. The fund has holdings in 295 companies, with the 10 largest comprising 9.30% of the fund.



The fund's largest holdings are Jabil Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/JBL#NYSE">JBL</a>) and Equity LifeStyle Properties, Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ELS#NYSE">ELS</a>) making up 1.46% and 1.13% of the fund, respectively.



IJJ has added $634.84 million in net assets YTD.



Vanguard S&amp;P 500 Value ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VOOV#NYSE">VOOV</a>)



VOOV added $1.15 billion in AUM over the trailing week.



The Vanguard S&amp;P 500 Value ETF is linked to the S&amp;P 500/Citigroup Value Index, which offers exposure to large-cap companies that exhibit "value" characteristics.



The fund has $5.16 billion in AUM and an expense ratio of 0.10%. VOOV has holdings in 402 companies, with the 10 largest comprising 27.64% of the fund.



The fund's largest holdings are Microsoft Corporation (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MSFT#NASDAQ">MSFT</a>) and Meta Platforms Inc. Class A (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/META#NASDAQ">META</a>) making up 6.62% and 4.20% of the fund, respectively.



VOOV added $1.47 billion in AUM, YTD.



<h2 class="wp-block-heading">Losers</h2>



Materials Select Sector SPDR Fund (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XLB#NYSE">XLB</a>)



XLB lost $442.92 million in net assets over the trailing week.



The Materials Select Sector SPDR Fund offers exposure to the US materials sector. This is often a small portion of larger broad-based US market ETFs, but a sector with large potential upside and an attractive option for those looking to indirectly access commodity markets.



XLB has $3.12 billion in AUM and an expense ratio of 0.10%. The fund has holdings in 31 companies, with the 10 largest comprising 65.98% of the fund.



The fund's largest holdings are Linde plc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/LIN#NASDAQ">LIN</a>) and Sherwin-Williams Company (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SHW#NYSE">SHW</a>) making up 20.62% and 7.49% of the fund, respectively.



XLB lost $583.65 million in net assets YTD.



SPDR S&amp;P Oil &amp; Gas Exploration &amp; Production ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XOP#NYSE">XOP</a>)



XOP lost $275.11 million in AUM over the trailing week.



The SPDR S&amp;P Oil &amp; Gas Exploration &amp; Production ETF offers exposure to the exploration and production sub-sector of the domestic oil market. Like many of State Street's products, it is equally weighted, making it a balanced option.



The fund has $3.27 billion in AUM and an expense ratio of 0.35%. XOP has holdings in 58 companies, with the 10 largest comprising 26.92% of the fund.



The fund's largest holdings are Phillips 66 (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/PSX#NYSE">PSX</a>) and Chord Energy Corporation (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/CHRD#NASDAQ">CHRD</a>) making up 2.96% and 2.84% of the fund, respectively.



XOP lost $1.43 billion in AUM YTD.

"Value" Funds See Big Inflow, Oil Continues To Bleed - ETF Winners And Losers: Mid-Cap Flows

Investors looking to circle their wagons around the still-lagging value factor in hopes value stocks will rebound later this year have plenty of exchange traded funds to consider. That group includes the SPDR Portfolio S&amp;P 500 Value ETF (NYSE:<a class="ticker" href="/stock/SPYV#NYSE">SPYV</a>).
The $1.33-billion SPYV is <a href="https://newpublic.cfraresearch.com/">CFRA Research&#39;s</a> focus ETF for the month of April. With an annual expense ratio of 0.04 percent, the equivalent of $4 on a $10,000 investment, SPYV is one of the least expensive value ETFs on the market. In fact, SPYV is the cheapest ETF tracking the S&amp;P 500 Value Index. The SPDR fund is significantly less expensive than the Vanguard S&amp;P 500 Value ETF (NASDAQ:<a class="ticker" href="/stock/VOOV#NASDAQ">VOOV</a>) and the iShares S&amp;P 500 Value ETF (NYSE:<a class="ticker" href="/stock/IVE#NYSE">IVE</a>).
&ldquo;SPYV is one of the three ETFs tracking this index, but at just 4 basis points, the SPDR ETF is at 11 basis points cheaper than VOOV and 14 basis points less than IVE,&rdquo; CFRA Director of ETF &amp; Mutual Fund Research Todd Rosenbluth in a note out last week.
<h3>
	Spying On SPYV</h3>
SPYV holds 389 stocks with a weighted average market value of $125.23 billion. The ETF&#39;s underlying index &ldquo;contains stocks that exhibit the strongest value characteristics based on: book value to price ratio; earnings to price ratio; and sales to price ratio,&rdquo; <a href="https://us.spdrs.com/en/etf/spdr-portfolio-sp-500-value-etf-SPYV">according to State Street.</a>
As is the case with many traditional value funds, SPYV is heavily allocated to the financial services and energy sectors. Those sectors combine for 36.72 percent of the fund&#39;s weight. Seven of the ETF&#39;s top 10 holdings, including Berkshire Hathaway Inc. (NYSE: <a class="ticker" href="/stock/brk-b#NYSE">BRK-B</a>) and JPMorgan Chase &amp; Co.(NYSE:<a class="ticker" href="/stock/JPM#NYSE">JPM</a>), hail from those sectors.
With passively managed ETFs, we think investors focus too much on how well a fund tracks a benchmark and the fund&rsquo;s past performance record,&rdquo; said Rosenbluth. &ldquo;Meanwhile, we think SPYV&rsquo;s performance record relative to active funds is the result of investment decisions made by those active funds, not the ETF manager SSGA. CFRA thinks what&rsquo;s going to drive SPYV in 2018 and beyond are its holdings.&rdquo;
The research firm has a Buy rating on Dow component JPMorgan Chase.
<h3>
	Fees Matter</h3>
Fees matter when it comes to investors&#39; long-term returns. Those fees also matter when it comes to luring investors in the first place. SPYV is proof positive of that notion.
Since its expense ratio reduction in mid-October and the addition of SPYV onto a commission free platform, SPYV has pulled in more than $1 billion of new money. Meanwhile, its average daily trading volume has doubled to approximately 700,000 shares,&rdquo; Rosenbluth said.&nbsp;
CFRA has an Overweight rating on SPYV.
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