US Domiciled ETFs vs Irish Domiciled ETFs. Irish ETF price chart not following S&P 500, unlike US ETF

Hi all,

Ive heard about the 30% withholding tax the US has and that it’s best for SGeans to invest in Irish domiciled S&P 500 ETFS.

I was comparing VUSA, VOO & the S&P 500. Was surprised to see that VOO & SP500 followed each other to the dot but VUSA generally followed the movements but not to the dot.

Rather new to investing, so would appreciate if someone could explain why this is so? And if this makes a big difference?

Thanks!

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Tan Choong Hwee

02 Jun 2021

Solutions Specialist at Providend

You are right, didn't realize a noticeable deviation in their past 5 years movements:

Could be due to tracking error and forex rates.

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Chris

02 Jun 2021

Owner and Writer at Tortoisemoney.com

VUSA's performance only differs from VOO and S&P500 by about 0.1% (last night) at least during the hours when both markets are open. VOO tracks much closer because it is trading at the same time as the US market. This means that investors and bots can accurately determine the right price of VOO. On the other hand, for the large part of VUSAs trading time, its price is mainly determined by speculation, futures and premarket in the US. Hence it should be expected that some discrepancy would occur. But over the long run, this discrepancy should even out anyways to be quite insignificant in the long run.

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thefrugalstudent

02 Jun 2021

Founder at thefrugalstudent.com

Hi Risheek,

I'm not 100% sure of the reasons, but here are some possible explanations:

currency....

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