9 Best S&P 500 ETFs in Canada 2023

If you’re looking for a solid diversified investment option, you should definitely consider some S&P 500 ETFs.

They offer stability and performance, making them a great choice for Canadian investors that want to get access to the stock index in without having to purchase individual stocks.

In this blog post, we’ll discuss why S&P 500 ETFs are such a good investment choice irrespective of your financial goals and risk appetite, and we’ll also recommend some of the best S&P 500 ETFs in Canada.

So if you’re ready to learn more, keep reading!

Overview of the Best S&P 500 ETFs in Canada 

There are a few different S&P ETFs available in Canada, so it’s important to do your research and figure out which one is right for you.

Here is an overview of the best S&P 500 ETFs traded in both Canadian and US dollars that you can purchase from any of the brokerages in Canada.

The table shows the ETFs’ inception dates, their asset under management at the time of writing this post and their current MER.

Name & Ticker Symbol	Base Currency	Inception Date	MER
Vanguard S&P 500 Index ETF (VFV)	CAD	November 02, 2012	0.09%
Vanguard S&P 500 Index ETF CAD Hedged (VSP)	CAD	November 02, 2012	0.09%
iShares Core S&P 500 Index ETF (XSP)	CAD	May 24, 2001	0.10%
BMO S&P 500 Index ETF (ZSP)	CAD	November 14, 2012	0.09%
Horizons S&P 500 Index ETF (HXS)	CAD	November 30, 2010	0.1%
SPDR S&P 500 ETF (SPY)	USD	January 22, 1993	0.09%
Invesco S&P 500 Equal Weight ETF (RSP)	USD	April 24, 2003	0.20%
iShares Core S&P 500 ETF (IVV)	USD	May 15, 2000	0.03%
Vanguard S&P 500 ETF (VOO)	USD	September 07, 2010	0.03%

---

Bsst Canadian-Listed S&P 500 ETFs

Below are some of the best Canadian-listed S&P 500 ETFs that trade in Canadian dollars.

1. Vanguard S&P 500 Index ETF (VFV) 

• Management fee: 0.08%
• MER: 0.09%
• AUM: $7.037 billion
• Dividend yield: 1.52%
• Hedge status: Unhedged
• Distribution frequency: Quarterly

The Vanguard S&P 500 Index ETF (VFV) is an unhedged S&P 500 Index ETF that seeks to track the investment returns of large-capitalization US stocks that make up the US equity index.

VFV invests directly in the S&P 500 component companies and not through another ETF.  

The Vanguard S&P 500 Index ETF is one of the oldest S&P 500 ETFs in Canada and has provided returns of +15.74 since its inception on November 02, 2012 (as of February 28, 2023).

Learn more: VFV Review

2. Vanguard S&P 500 Index ETF CAD Hedged (VSP) 

• Management fee: 0.08%
• MER: 0.09%
• AUM: $2.550 billion
• Dividend yield: 1.52%
• Hedge status: CAD-hedged
• Distribution frequency: Quarterly

The Vanguard S&P 500 Index ETF (VSP) is hedged towards the Canadian dollar and seeks to track the investment returns of large-capitalization US stocks based on the performance of the broad US equity index.

Like the VFV, the VSP ETF also invests directly in the stocks of US companies that are included in the S&P 500 index.

As of February 28, 2023, the VSP ETF has provided investors with +11.53% returns since its inception on November 02, 2012 – a little lower than the performance of its unhedged counterpart, VFV.

3. iShares Core S&P 500 Index ETF (XSP)

• Management fee: 0.08%
• MER: 0.10%
• AUM: $7.905 billion
• Dividend yield: 1.52%
• Hedge status: Canada-hedged
• Distribution frequency: Semi-annual

The iShares Core S&P 500 Index ETF (XSP) is a Canada-hedged S&P 500 Index ETF that replicates the performance of the Canadian-hedged S&P 500 index towards achieving long-term capital growth.

Unlike most of the S&P 500 Index ETFs discussed above, the iShares Core S&P 500 Index ETF (XSP) distributes dividends semi-annually with the last dividend being 1.04%.

As of February 28, 2023, the iShares Core S&P 500 Index ETF (XSP) has returned 4.7% average annual return since inception.

4. BMO S&P 500 Index ETF (ZSP) 

• Management fee: 0.08%
• MER: 0.09%
• AUM: $12.15 billion
• Dividend yield: 1.49%
• Hedge status: Unhedged
• Distribution frequency: Quarterly

The BMO S&P 500 Index ETF (ZSP) is an unhedged S&P 500 Index ETF that tracks the returns of the S&P 500 Index.

This ETF provides greater exposure to diversified large-cap US equities with 100% allocations to stocks that make up the index.

With eligibility to multiple registered accounts, the ZSP ETF has returned 16.31% to investors since its inception on November 14, 2012 (as of February 28, 2023).

5. Horizons S&P 500 Index ETF (HXS) 

• Management fee: 0.10%
• MER: 0.10%
• AUM: $2.424 billion
• Dividend yield: N/A
• Hedge status: Unhedged
• Distribution frequency: Annually

The Horizons S&P Index ETF (HXS) is also an unhedged ETF that tracks the returns of the S&P 500 Index. It also trades in both CAD$ and US$. 

HXS is the smallest of the Canadian-listed S&P 500 ETFs by asset under management. That said, the ETF has returned 14.84% to investors since its inception on November 30, 2010 (as of February 28, 2023).

---

Best US-Listed S&P 500 ETFs

If you’ll rather invest directly in a US-listed S&P 500 ETF, there are a number of options available to you.

Below are some of the best US-listed ETFs that track the S&P 500 Index with US dollars.

6. SPDR S&P 500 ETF (SPY)

• Management fee: 0.09%
• MER: 0.09%
• AUM: $3645,544 million
• Dividend yield: 1.56%
• Distribution frequency: Quarterly

The SPDR S&P 500 ETF (SPY) tracks the performance of the S&P 500 Index through diversified large-cap US companies.

As the first US-listed exchange-traded fund, the SPY has provided -8.29% returns to investors since its inception on January 22, 1993 (as of January 31, 2023).

7. Invesco S&P 500 Equal Weight ETF (RSP)

• Management fee: 0.20%
• MER:0.20%
• AUM: $36.54 billion
• Dividend yield: 1.55%
• Distribution frequency: Quarterly

The Invesco S&P 500 Equal Weight ETF (RSP) seeks to invest a minimum of 90% in the S&P 500 Equal Weight Index which is rebalanced quarterly.

Currently, the ETF invests 29.19% of its funds in the Mid-Cap Blend market, 20.54% in the Large-Cap Blend market, and 17.90% in the Mid-Cap Value market.

As of February 28, 2023, Invesco S&P 500 Equal Weight ETF (RSP) has returned 11.38% since its inception (April 24, 2003).

8. iShares Core S&P 500 ETF (IVV)

• Management fee: 0.03%
• MER: 0.03%
• AUM: $302.52 billion
• Dividend yield: N/A
• Distribution frequency: Quarterly

Are you looking for a tax-efficient, low-cost and greater exposure to large-cap US companies? That’s what the iShares Core S&P 500 ETF (IVV) helps you achieve.

Like the above ETFs, the iShares Core S&P 500 ETF (IVV) also seeks to achieve long-term capital growth by tracking the performance of the S&P 500 Index.

As of February 28, 2023, the IVV ETF has provided 6.47% returns to investors since its inception (May 15, 2000).

9. Vanguard S&P 500 ETF (VOO)

• Management fee: N/A
• MER: 0.03%
• AUM: $279.61 billion
• Dividend yield: -1.64%
• Distribution frequency: Quarterly

The last but not the least best US-listed S&P 500 ETF on my list is the Vanguard S&P 500 ETF (VOO).

In trying to offer investors long-term capital growth, the VOO also tracks the returns of the S&P 500 Index which comprises large-cap US companies.

With a moderate-aggressive risk level, the VOO ETF has returned 13.07% to investors since its inception on September 07, 2010 (as of February 28, 2023).

Learn more: VFV vs VOO

---

What is S&P 500?

The S&P 500 index is a stock index that includes 500 of the largest publicly-traded companies in the United States. These companies are chosen based on their market capitalization, which is the value of all their outstanding shares.

The S&P 500 index represents more than 70% of the entire US market and is often used as a benchmark for the overall performance of the stock market in the US.

As a market-weighted stock index, S&P 500 is heavily weighted towards the largest companies – most of which are Technology companies. In fact, the top five companies (Apple, Microsoft, Amazon, Tesla, and Google) make up over 20% of the index.

But with 500+ individual companies, getting exposure to the index using individual companies can be difficult, time-consuming, and expensive.

This is where S&P 500 ETFs come in.

What are S&P 500 ETFs?

S&P 500 ETFs are exchange-traded funds that track the performance of the S&P 500 index.

There are many benefits to investing in an S&P 500 ETF instead of individual stocks. For instance, ETFs are much more diversified – meaning that your risk is spread out over many different companies instead of being concentrated in just a few.

Additionally, ETFs are generally more liquid than individual stocks, which makes it easier to buy and sell them. And finally, ETFs often have lower fees than purchasing individual stocks.

So if you’re looking for a way to get exposure to the US stock market, S&P 500 ETFs are a great option. And in this blog post, we’ll recommend some of the best S&P 500 ETFs for Canadian investors.

Why Invest in S&P 500 ETFs?

There are a few reasons why you might want to invest in an S&P 500 ETF. First of all, they offer great diversification. By investing in an S&P 500 ETF, you’re getting exposure to a large number of different companies. This diversification can help to reduce risk, because if one company performs poorly, the other companies in the ETF may offset those losses.

Another reason to invest in an S&P 500 ETF is that they offer stability and performance. These ETFs tend to be more stable than individual stocks, and they often provide better returns than traditional investments like bonds.

Finally, S&P 500 ETFs often have lower fees than other types of investments. This is because they’re generally more liquid than individual stocks, and they don’t require as much maintenance.

So if you’re looking for a solid investment option, an S&P 500 ETF might be a good choice for you. And any of the ones covered in the ranking of the best S&P 500 ETFs in Canada above will be a great addition to your portfolio.

How to Buy S&P 500 ETFs in Canada

Now that we’ve gone over some of the reasons why you should invest in an S&P 500 ETF, let’s talk about how to actually buy them.

There are generally 2 options available to Canadians that want exposure to S&P500:

1. Buy a US-listed ETF that tracks the S&P 500 Index
2. Buy a Canadian listed ETF that tracks the S&P 500 index by investing in individual companies
3. Buy a Canadian listed ETF that tracks the S&P 500 index by holding a US-listed S&P 500 ETF

We’ll cover the pros and cons of each option in the next section.

Here’s how to actually buy an S&P 500 ETF in Canada:

• Review the available ETFs
• Decide on the one that meets your objectives
• Open a brokerage account if you don’t already have one
• Fund your account with CAD or USD
• Place an order for the ETF purchase

If you’re a Canadian investor, there are several brokerages where you can buy S&P 500 ETFs. Some of the most popular brokerages that offer this service are Questrade, Wealthsimple Trade, Qtrade and National Bank Direct Brokerage.

• Questrade: ETFs purchases are free for all Canadian and US-listed ETFs. However, there’s a minimum charge of $4.95 and max of $9.95 when you sell the ETFs. New clients get a $50 trade rebate using this link and Questrade promo code “WALLETBLISS“.
• Wealthsimple Trade: The commission-free investing app supports free buying and selling of ETFs and stocks. It is a great choice if you’re looking to invest in any of the Canadian-listed S&P 500 ETFs. To trade the US-listed ETFs using your USD fund, you’ll have to upgrade to the Wealthsimple Trade Plus plan for $10/month. Alternatively, you can trade then using your CAD balance and pay a 1.5% currency conversion fee. Get $25 cash bonus using this link.
• Qtrade: The online brokerage supports commission-free trading on 100+ Canadian and US-listed ETFs. Unfortunately, not all the S&P 500 ETFs are covered. That means you may have to pay a $6.95-$8.95 commission depending on the ETF you choose.
• National Bank Direct Brokerage: Finally, this online brokerage from one of the big banks allows commission-free buys and sells on ETFs and Stocks. Both Canada and US-listed ETFs are supported.

Canadian vs US-listed S&P 500 ETFs

If you’re a Canadian investor, you can either buy an S&P 500 ETF that is listed on a Canadian stock exchange and trades in Canadian dollars or the ones that are listed on a US exchange.

The US-dollar denominated S&P 500 ETFs generally have lower management expense ratios. But they require you to source for USD to make the purchases. Unless you earn in US dollars, the fees for converting your CAD to USD can quickly add up and eat into your portfolio returns.

However, if you may be able to get USD cheaply using techniques like the Norbert’s Gambit. The only issue is that it takes a few days to complete and it is not allowed by all brokerages.

Canadian-listed S&P 500 ETFs operate similarly to their US-listed alternatives. These ETFs track the same indexes as their US-listed counterparts, but they’re listed on Canadian exchanges.

The two main benefits of this option are that it’s easier to set up, and you don’t have to pay any foreign exchange fees directly. The downside is that these ETFs often have higher fees than US-listed ETFs.

There may also be foreign withholding tax differences between holding Canadian vs US-listed S&P 500 ETFs depending on the type of account you choose. Learn more here.

To summarize, go with the US-listed S&P 500 ETFs if you:

• have a source of income in USD
• don’t mind the currency conversion fee when exchanging CAD to USD
• have the time and comfortable with Norbert’s Gambit

But if you’ll rather keep things simple and not worry about sourcing for US dollars to invest, then the Canadian-listed ETFs are your best bet.

---

Alternatives to S&P 500 ETFs in Canada

If you’re looking for alternatives to S&P 500 ETFs, there are a few options to consider.

Other Index ETFs

First of all, you could invest in other types of ETFs that track different indexes. For example, you could invest in an ETF that tracks the Dow Jones Industrial Average, or the Nasdaq 100.

Even better, you could go with an ETF that tracks the entire US market like the Vanguard Total Stock Market Index Fund ETF (VTI).

Asset Allocation ETFs

Asset Allocation ETFs are another alternative to S&P 500 ETFs. Asset Allocation ETFs are a type of ETF that invests in a basket of different asset classes, such as stocks, bonds, and commodities.

This option can be a good choice if you’re looking for diversification beyond the stock market and beyond the US market.

There are several options from some of the largest ETF issuers in Canada like Vanguard, Blackrock’s iShares, BMO and Fidelity. You can choose the one that meets your risk tolerance.

For example, there are all-equity options like VEQT, XEQT and ZEQT that invests 100% in globally diversified stocks. There are also balanced options like VBAL, XBAL and ZBAL with 60% equity and 40% fixed income.

No matter your risk tolerance, you’ll find a suitable all-in-one ETF that meets your needs.

Individual Stocks

Another option to buying S&P 500 ETFs is to invest in individual stocks. This option allows you to pick and choose the companies that you want to invest in, which can be a great way to build a portfolio that meets your specific goals.

However, it can be expensive to build and time-consuming to manage.

Mutual Funds

You could also invest in mutual funds as an alternative to buying S&P 500 stocks. Mutual funds are similar to ETFs, but they’re usually managed by a team of professionals. This option can be a good choice if you’re looking for active management.

Robo-advisors

Finally, robo-advisors are another alternative to buying individual ETFs like the S&P 500 ETFs. Robo-advisors are online investment platforms that provide automated portfolio management. This option can be a good choice if you’re looking for hands-off investing.

So those are some alternatives to S&P 500 ETFs. No matter which option you choose, make sure to do your research before investing. And as always, consult with a financial advisor to see if an investment is right for you.

---

S&P 500 ETFs in Canada FAQs