S&P 500 ETF Australia: IVV, IHVV and VTS Compared (2026)

Last updated: Q2 2026. Figures are computed from ETFLens data as at Q2 2026, sourced from each issuer's published disclosure documents and reviewed quarterly. Always verify current figures with the issuer's PDS before investing.

Most Australians who search for an "S&P 500 ETF" assume there is one product to buy. On the ASX there are actually three meaningfully different ways to get United States large-cap exposure — and none of them requires a United States brokerage account or manual currency conversion. They differ in three ways that matter: currency treatment (hedged or unhedged), index scope (the 500 largest companies, or the whole US market), and fund domicile (Australian or United States), which changes the tax paperwork.

This guide sets out the data on IVV, IHVV and VTS so you can see how the three routes differ. It does not tell you which to hold — that depends on your own objectives, situation and needs. This article is general information only and not personal financial advice. ETFLens does not hold an Australian Financial Services Licence (AFSL).

What "S&P 500 exposure" means on the ASX

The S&P 500 is an index of 500 of the largest companies listed in the United States, spanning every sector from technology and healthcare to financials and energy. It is one of the most widely tracked equity benchmarks in the world. Owning an "S&P 500 ETF" means owning a fund that aims to replicate that index, so your money is spread across those 500 companies in proportion to their size.

On the ASX, three funds give Australians access to this part of the US market in a single trade, priced in Australian dollars:

• IVV — the iShares S&P 500 ETF. Tracks the S&P 500, unhedged. Australian-domiciled.
• IHVV — the iShares S&P 500 (AUD Hedged) ETF. The same index, hedged back to Australian dollars. Australian-domiciled.
• VTS — the Vanguard US Total Market Shares Index ETF. A broader index covering essentially the entire US market, unhedged. United States domiciled.

IVV and IHVV are pure S&P 500 funds. VTS is a close relative many investors weigh up at the same time, because the S&P 500 makes up the large majority of the US market by value — so VTS and IVV share most of their biggest holdings while VTS adds mid and small caps on top.

IVV, IHVV and VTS at a glance

The table below pulls live data from ETFLens as at Q2 2026. Yields are trailing distribution yields and are shown as approximate figures.

Fund	Index	MER	Fund size	Holdings	Hedged	Distributions	Yield
IVV	S&P 500	0.04% p.a.	$13.4B	503	No	Quarterly	approximately 1.1%
IHVV	S&P 500 (AUD hedged)	0.1% p.a.	$3.8B	503	Yes	Annually	approximately 0.76%
VTS	CRSP US Total Market	0.03% p.a.	$6.7B	3,458	No	Quarterly	approximately 1.3%

IVV is one of the largest ASX-listed US equity ETFs by assets, at $13.4B. Fund size and fee data are sourced from each issuer's published disclosure documents and reviewed quarterly. Holdings change over time.

Hedged (IHVV) vs unhedged (IVV): the currency question

IVV and IHVV hold the same 500 companies. The difference is what happens to your return when the Australian dollar moves against the US dollar.

When you own an unhedged fund like IVV, your Australian-dollar return is the US market return plus the effect of the AUD/USD exchange rate. If the Australian dollar falls against the US dollar, your US holdings are worth more in Australian-dollar terms, which adds to your return. If the Australian dollar rises, that detracts from it.

A hedged fund like IHVV uses currency contracts to strip most of that exchange-rate effect out, so your return tracks the US market more closely regardless of what the currency does. The trade-off is cost and complexity: IHVV charges 0.1% p.a. versus IVV's 0.04% p.a., and hedging has its own internal costs that are separate from the headline MER.

Neither approach is better in the abstract — it depends on whether an investor wants currency movements to be part of their return or not. ETFLens does not forecast the Australian dollar and nothing here should be read as a view on where it will go. Hedging is a trade-off, not a free reduction in risk: it removes the currency tailwind as well as the headwind.

A simple way to picture the mechanics: suppose the US market returns 10% in US-dollar terms over a year. An unhedged fund's Australian-dollar return would end up higher than 10% if the Australian dollar fell against the US dollar over that year, and lower than 10% if the Australian dollar rose — because the US holdings are translated back at a different exchange rate. A hedged fund aims to deliver close to the underlying 10% regardless of the currency move. These are illustrative mechanics, not a forecast: ETFLens does not predict currency movements, and the real figures depend entirely on the path the exchange rate actually takes.

It is worth noting the two funds distribute differently. IVV pays quarterly, while IHVV pays annually; hedged funds can also produce more variable distributions because currency-hedging gains and losses flow through to income. That can matter for an investor relying on regular, predictable income. You can see both funds side by side on the IVV vs IHVV comparison.

S&P 500 vs the total US market: IVV vs VTS

The S&P 500 holds around 500 large companies. VTS tracks the CRSP US Total Market Index, which covers approximately 3,458 companies — the same large caps as the S&P 500 plus thousands of mid-cap and small-cap businesses. In other words, IVV is the top of the US market by size, while VTS is the whole thing.

In practice the two behave similarly, because the largest companies dominate both indices by weight. Both funds count Nvidia (8.5%), Apple (6.88%), Microsoft (4.95%) among their biggest positions. VTS simply adds a long tail of smaller companies that make up a modest share of the fund. Whether that broader scope matters to an investor is a personal question about how much small and mid-cap exposure they want.

Fees are close but not identical. The table below shows the approximate annual cost of each fund's MER at three portfolio sizes, using the simple formula amount × MER ÷ 100.

Investment	IVV (0.04%)	IHVV (0.1%)	VTS (0.03%)
$10,000	$4/yr	$10/yr	$3/yr
$50,000	$20/yr	$50/yr	$15/yr
$100,000	$40/yr	$100/yr	$30/yr

These are headline management fees only and do not include brokerage, bid/ask spreads or the internal costs of currency hedging. The ETFLens Fee Analyser lets you model how a fee difference compounds over your own time horizon rather than relying on a single projected figure.

For a fuller breakdown of VTS specifically — including its US-domicile considerations — see the VTS ETF review, or the live IVV vs VTS comparison.

A note on past returns: over the period to Q2 2026, ETFLens shows reported returns of approximately 14.2% p.a. over five years for IVV and approximately 13.6% p.a. for VTS. Past performance is not a reliable indicator of future returns. These figures reflect a specific historical period — including the path of the AUD/USD exchange rate for the unhedged funds — and are not a prediction of what any fund will do next. ETFLens does not draw conclusions from past returns.

Distributions and US tax: where domicile matters

This is the area where the three funds genuinely differ, and it is often missed. The key distinction is fund domicile — the country where the fund is legally established.

IVV and IHVV are Australian-domiciled iShares funds. For an Australian investor that means they work like any other ASX-listed Australian ETF: you receive an AMIT (Attribution Managed Investment Trust) statement each year, US dividend withholding tax is handled at the fund level, and any foreign tax paid is generally passed through to you as a foreign income tax offset (FITO). You do not need to lodge a W-8BEN form yourself, and US estate tax is not a consideration. To understand the annual statement you will receive, see what is an AMIT statement.

VTS is United States domiciled. That brings two extra considerations for Australian investors: you generally need to complete a W-8BEN form (lodged through your broker) to access the reduced US dividend withholding rate, and US estate tax can apply to US-situated assets above USD $60,000 held by a non-US person. These are material differences that do not apply to the two Australian-domiciled funds.

None of these funds pays franked dividends, because franking applies only to Australian-company profits. For how ETF distributions are taxed more generally, see how ETF distributions are taxed in Australia. Tax treatment depends on your individual circumstances, and this is general information only — speak with a registered tax adviser about your situation.

What to check before buying any S&P 500 ETF

Beyond the choice between the three funds, a few practical points apply whichever you hold:

• Fund size and liquidity. All three are large and actively traded — IVV at $13.4B, IHVV at $3.8B and VTS at $6.7B as at Q2 2026. Larger, more liquid funds tend to have tighter bid/ask spreads, which is part of your real cost of trading on top of the headline MER.
• Brokerage and spreads. Your broker charges a fee each time you buy or sell, and the bid/ask spread is an additional implicit cost. For regular, smaller purchases these can matter more than a few hundredths of a percent of MER, so they are worth factoring in alongside the fee.
• Minimum trade size. The ASX minimum for a first trade in a security is generally $500, with no minimum for subsequent purchases of the same security.
• Distribution reinvestment (DRP). Each fund may offer a distribution reinvestment plan through its registry, which automatically reinvests distributions into new units instead of paying cash. Whether to use it is a personal preference with its own tax record-keeping implications.

None of these points favours one of the three funds over the others — they apply across the board, and they are part of the total cost and practicality of holding any ETF, not just the headline fee.

How to compare these ETFs on ETFLens

The decision between these three funds usually comes down to two questions: do you want currency hedging, and do you want the broad market or just the largest 500 companies? ETFLens has tools to put numbers behind both:

• Fund pages with live holdings, fees and distributions: IVV, IHVV and VTS.
• The IVV vs IHVV comparison for the hedged-versus-unhedged decision.
• The Fee Analyser to model long-run costs, and the overlap checker if you also hold a global fund like VGS and want to see how much US exposure you already have.

If you are weighing US-only exposure against a broader global fund, the IVV vs VGS guide covers that decision, and IVV vs NDQ covers the S&P 500 versus the Nasdaq-100.

This article is general information only and not personal financial advice. ETFLens does not hold an Australian Financial Services Licence (AFSL). Consider your own objectives, financial situation and needs, or speak with a licensed financial adviser before making investment decisions. Past performance is not a reliable indicator of future returns.