iShares has lowered the total expense ratio on the accumulation share class on its S&P 500 exchange traded fund (ETF) to 0.07 per cent.
The total expense ratio on the ETF was lowered to 0.15 per cent in September 2013 but it has now been lowered again to 0.07 per cent.
However, the firm is keeping the total expense ratio on income distributing version of the iShares S&P 500 ETF at 0.4 per cent.
Adam Laird, passive investment manager at Hargreaves Lansdown, said the price drop meant that the 0.07 per cent S&P 500 tracker is the lowest priced physical ETF available to UK investors.
He said the other version of the ETF had a higher price because it had a lower bid-offer spread meaning it costs less to buy.
The ETF with the lower spread but higher total expenses may be cheaper for short-term traders, while the ETF with lower total expenses but higher spread would be suited for a buy-and-hold investor.
Ben Seager-Scott, senior research analyst at Bestinvest, had last year downgraded the iShares S&P 500 ETF due to its insistence on keeping the distributing share class TER up at 0.4 per cent.
