What is the Best S&P 500 ETF to Buy?
Вставка
- Опубліковано 31 лип 2024
- One of the most popular and more accessible ways to gain exposure to the U.S. market is through the S&P 500. Historically, the S&P 500 has returned an impressive average annualized return of over 10% over the last 20 years.
Among the various ways to invest in the S&P 500, the SPDR S&P 500 ETF (SPY) stands out as a popular choice for many investors. It is the largest ETF in the world with assets under management of over US$520 billion. It also has a solid, long track record of delivering returns that closely match the S&P 500 index’s performance, making it a reliable investment option for those looking to invest in the U.S. market.
However, we don't like the SPY due to a few major drawbacks. Instead, we like these few other S&P 500 ETFs instead...
00:00 Introduction
02:39 Why we won't buy SPY
05:35 CSPX/VUAA
10:27 SPY5
12:51 SPLG
📖 FREE EBOOK - A Quick-start Guide to Winning the Game of Stocks
fifthperson.com/ebook/
💻 FREE TRAINING WEBINAR - How to build a profitable income portfolio
TheIncomeStrategy.com
📈 OPEN $0 COMMISSION TRADING ACCOUNT
fifthperson.com/moomoo
Here are a few more investing tips and tutorials to help you out:
💵 HOW TO INVEST IN DIVIDEND STOCKS
• How To Invest And Make...
🏢 HOW TO INVEST IN REITS
• How To Invest In REITs...
🏖️ HOW TO GROW YOUR CPF FOR RETIREMENT
• How To Grow Your CPF F...
📄 HOW TO READ A FINANCIAL REPORT
• How To Read A Financia...
_________________
📊 Get more investment insights, tips, and company analysis from our blog (100% free).
FifthPerson.com
🎙️Also on Spotify: podcasters.spotify.com/pod/sh...
📢 Say 'Hi!' on Social
Facebook: / fifthperson
Instagram: / thefifthperson
TikTok: / thefifthperson
Telegram: t.me/thefifthperson
![ULTIMATE S&P 500 ETF Review [You'll never guess what's the best S&P 500 ETF]](http://i.ytimg.com/vi/r2-sRp42g5Y/mqdefault.jpg)
Thank you Adam, Rusmin and Victor. This was great as always, looking forward to your next informational recording!
You're most welcome, Alex!
Great information, thank you guys
Our pleasure!
Great sharing as usual! I learned a lot. Thanks! 😁
You're most welcome!
Great content. thank you! this solves one of my worries. I am now thinking that I should (over time, as I am not young!) sell individual US stocks and buy ETFs which won't attract estate duties. can you do a feature on such ETFs?
thank you for sharing and will be looking at the some alternate investment
Thanks for watching!
Thanks, guys. It’s really so nice of you to educate people like myself on this. I always learn so much from your videos. Keep it up. Just to double check regarding SPLG, are you referring to the etf currently trading at around 62.50 ?
Yes, SPLG is currently trading around US$62
I invest only in Irish domiciled ETFs for my US allocation to avoid the risk of US estate duty and withholding tax. Not just for stock based ETFs but also for bonds ETF.
Mayb it will be good to do another video for best broker to buy Irish dom etf every month for DCA
V helpful & all-rounded discussion. Thanks! Hopefully there will a video on whether is it better to invest via stock mkt or fund mgr like Endowus..
depends on urself. lazy + have cash use fund managers. no money + interested + willing to learn = invest in stock market urself
Does have similar for tech etf ?
Would SPLG be the best option if you want to do covered calls on your positions over the long run?
Thank you
Welcome!
Great video as usual. Question - I have been wanting to switch my SPY to CSPX - since both SPY and CSPX mirror SPX, does it make sense to just sell the SPY and immediately use the proceeds to buy the CSPX on the same day ? Similarly, the Ireland Domicile for QQQ would be CSNDX?
Depending on your fund size, you can also stagger your transfer from SPY to CSPX. It's really your personal preference.
Yes, an Irish-domiciled equivalent for the QQQ would be CNDX. However, the dividend yield for the QQQ is much lower, so you might not save much in terms of withholding tax.
@@TheFifthPersonChannel Thanks! I am more concerned with the estate tax re QQQ as well..
Great sharing as usual. Do you guys have recommendation for irish domiciled version of Total World Stock ETF like vanguard's VT?
Thanks! Yes, VWRA
Thanks, this video is so helpful.
Glad it was helpful!
Nice sharing as always! Thanks! Can you please share your view about S27 ( SGX listed S&P 500)
Thanks! S27 is listed in Singapore, but it is U.S.-domiciled so you still have the 30% withholding tax and U.S. estate tax.
@@TheFifthPersonChannel thank you for reply and information 🙏
Should I take out my endowus money and put it into cspx
BTW, do you guys think that Amazon is a good buy now?
Other than expense ratio what is the pros of buying splg
What about those options offered by Endowus, its more expensive ? I presume its also subjected to dividend withholding and estate taxes like US domiciled.
It's best to email Endowus directly to ask about the dividend withholding and estate taxes for their funds.
VUAA (smaller price to purchase too) is a gd replica of ......... CSPX
Funny how i literally just explained almost word for word what this video covers! Now i can just send my friends this video HAHAHAHA
Synchronicity!
Thank you for your information and sharing. If US ETFs and stocks are purchased and held from a joint trading account, if one of them dies, will the other inherit directly without having to pay estate tax?
Technically, the proportion of assets owned by the deceased in the joint account is still subject to estate tax in the event of passing.
money.stackexchange.com/questions/149317/taxes-on-joint-tenants-with-rights-of-survivorship-stock-brokerage-account-upo
www.bogleheads.org/forum/viewtopic.php?p=4375485#p4375485
What is the fees that we need to look into for IBKR? I look at their pricing examples and need to pay market data fee, round trip trade fee, etc...
It could be quite a substantial amount to maintain to hold the ETF.
IBKR charges US$1.70 minimum for USD-denominated trades on the London Stock Exchange. Live market data fees are optional. Round trip fees are simply a buy and sell trade, so a round trip trade is simply twice that for a single trade. Hope this helps!
www.interactivebrokers.com/en/pricing/commissions-stocks-europe.php
How about for sg investors. We DCA spy500 till a targetted amount. Iiquidate it and buy local dividend stocks?
Some investors 'de-risk' their portfolio nearer to retirement, and shift from U.S. equities to Singapore dividend stocks, bonds, etc.
Regarding estate taxes. What are your thoughts about setting up joint brokerage accounts with spouse and/ or children?
You could do that so someone else maintains access to your brokerage account. Technically, the proportion of assets owned by the deceased in the joint account is still subject to estate tax in the event of passing.
money.stackexchange.com/questions/149317/taxes-on-joint-tenants-with-rights-of-survivorship-stock-brokerage-account-upo
www.bogleheads.org/forum/viewtopic.php?p=4375485#p4375485
is it similar for QQQ too? in terms of withholding & inheritance/estate tax?
The QQQ tracks the Nasdaq-100 which is a different index. QQQ is U.S.-domiciled, so it has a 30% dividend withholding tax and U.S. estate tax.
The accumulating version of SPY5 is SPYL.
If I’m investing in long term, is there any real meaningful differences between all these and CSPX?
Thank you! The main difference would be fees with SPY5/SPYL at 0.03% and CSPX at 0.07%.
Hi Adam, Rusmin and Victor, if the US shares are held in a joint account and if one accound holder passes on, would the other account holder be subjected to estate duties?
Yes, from what we know, the proportion of assets owned by the deceased in the joint account is still subject to estate tax in the event of passing.
money.stackexchange.com/questions/149317/taxes-on-joint-tenants-with-rights-of-survivorship-stock-brokerage-account-upo
www.bogleheads.org/forum/viewtopic.php?p=4375485#p4375485
1. I use the Superhero app to invest. Can you do a video on this app? E.g. pros and cons. Also, this app only has the Australian and American stocks available.
2. I live in Australia. Can you do a video on the best ETF if I live in Australia?
I lump sum into cspx in year 2022 if i not wrong just because of seeing finance youtubers talking about it. After purchasing, the cspx price drop and i was in a negative for about a year, but i didnt bother, just left it there as they were my extra funds.
Come 2024, cspx has now increase almost 30 percent of its price and now i am ahead at 30 percent haha..
Now just thinking whether should do another lump sum.
Good to know!
Hi, why wasn't the spread and transaction fees, amount invested each time, brokers (e.g. IBKR) factored in? I figured that would have been more holistic, i think this might potentially skew the decision depending on the different variables?
Commissions on IBKR are US$0.35 minimum for NYSE and US$1.70 for LSE. I guess this will matter if you're investing very small amounts each time.
Good to remind ppl about the US estate duty. For your mentioned non-US domiciled ETF, any consideration which exchange it's on?
Thanks! Most Irish-domiciled ETFs are listed on the London Stock Exchange.
Will ticker symbol "IVV" under Australian Securities Exchange Ltd (ASX) comparable too?
Australia-Singapore Tax Treaty dividend income come at 15%, with ETF Management Fee at 0.04% and under Dividend reinvestment Plan (DRIP) too.
Yes, if you don't mind holding Australian dollars.
Hi, great content, i still have no idea after repeat the video and still don understand, as a Singaporean, if spy is to avoid, can you please advise me which etf is able to avoid any fees so that able to pass on to my spouse or child where i am gone.
Waiting for your kind reply. Also which broker to use
Hi! Great content! If I reside in Singapore and buy any US listed ETF, shall I pay estate taxes too?
Yes, US-domiciled ETFs are subject to US estate tax
I will still keep it as it still give mw good returns
👍👍
How about other CSPX alternatives? UDVD ? GGRW?
expense ratio is too high for udvd at 0.35% and is dividends are distributing and not accumulating like cspx. Either way both UDVD and GGRW doesn't track S&P 500 so is not a CSPX alternative
Which brokerage can we buy CNDX? I tried IBKR but it doesn’t have. Appreciate if anyone can share their experience.. thanks
CNDX is listed on the London Stock Exchange which IBKR has access to. You may want to check again.
www.interactivebrokers.com/en/pricing/commissions-stocks-europe.php?re=europe
Are there any irish counterparts ETF for FTEC, QQQM, VTV? The holdings Not necessarily have to be the same, at least 80-90% similar will do
I have found some,
IUIT for FTEC,
R1VL for VTV.
What do u guys think?.
Thx and cheers from Malaysia
CNDX for QQQ. Cheers!
Which brokerage can we buy CNDX? I tried IBKR but it doesn’t have. Appreciate if anyone can share their experience.. thanks
Vanguard S&P 500 ETF (Ireland Domiciled) that I know:
Distributing: VUSD (USD), VUSA (GBP)
Accumulating: VUAA (USD), VUAG (GBP)
Would you mind sharing what brokerage the three of you use for your stocks?
We have a few accounts: Interactive Brokers, Saxo Markets, FSMOne, Moomoo, Tiger Brokers, etc.
Which is the best broker?
Hi, could you give your view about isac?
We'll have a look!
Hello, Thanks for the video. I started investing in VUAA, but now just thinking about it as it is in LSE(UK). I read that there is a 10% capital gains tax in UK, In that case how should we manage the filing of tax. Just worried that it may affect my withdrawal. Thanks
VUAA is Irish-domiciled; Ireland is not part of the UK. In any case, there is no capital gains tax on UK stocks for non-UK residents: www.gov.uk/capital-gains-tax/what-you-pay-it-on
Thanks for the prompt reply
Hi, is lump sum or DCA better for CSPX?
It depends on what you prefer. Lump sum investing offers potentially higher returns, but carries the risk of market timing. DCA reduces this risk by spreading investments over time, providing more stability during volatile periods.
Hey Team, but if I were to DCA small amounts (100 SGD) every month into S&P500 ETF, would it be advisable to buy US domiciled ETF using brokerage that have free US trade?
Hi Grace, at smaller amounts it'd be better to invest quarterly or semi-annually to save on brokerage fees. We'd still go with an Irish-domiciled ETF over a U.S. one.
Any withholding tax and inheritance tax for foreigners who invest in VOO?
Yes, VOO is U.S.-domiciled.
Hi there. Do you guys know about a new S&P500 Irish Domiciled ETF? It’s called SPYL, with a much lower expense ratio of 0.03%. But this ETF is traded on EBS and AEB only. I need an expert like you guys to analyze through this ETF whether it’s valuable for the long run since it is quite new as well. I would be thankful if you are willing to make a video regarding this. Much appreciated thanksss😊
How does this trading stuff work? I'm really interested but I just don't know how it go about it. I heard people really make it huge trading
it's not an ETF but how does Lion Global Infinity U.S 500 Stock Index Fund SGD compare to those you have mentioned?
There's an initial charge of up to 2% according to their webpage. It's best to email Lion Global Investors directly to ask about dividend withholding tax and U.S. estate taxes for their funds.
www.lionglobalinvestors.com/en/fund.html?officialNav=IUSS#information
Which is better for long term hold, CSPX or VUAA ?
They're essentially the same.
Understand the rationale to choose Irish-domiciled over ETF domiciled in US. Curious though - Does the same advantage applies for ETF domiciled in other countries such as China/ Thailand?
It depends on the country's tax laws and its tax treaty with your resident country. For example, China has a 10% dividend withholding tax, but it could fall to 5% if your resident country has a tax treaty.
taxsummaries.pwc.com/peoples-republic-of-china/corporate/withholding-taxes
Have you factored in the brokerage/transaction fees?
Yes, commissions on IBKR are US$0.35 minimum for NYSE and US$1.70 for LSE. This difference will only matter if you're investing very small amounts each time.
I am new to ETF. Would you share about S27, also S&P 500? Thanks
S27 is listed in Singapore, but it is U.S.-domiciled so you still have the 30% withholding tax and U.S. estate tax.
@@TheFifthPersonChannel thank you for reply. I am new to US market, if I buy US stock, will US stock also subject to estate tax? Thanks
Yes, U.S. stocks are subject to estate tax as well
What is the best to buy and which platform to purchase? This is for non US citizen and plan to do a long term accumulative for 10-15 years. What is best way? Inject monthly a fix amount or now is good to pump in sum like 100k and let it sit
Which platform is best to buy CSPX?
You can consider Interactive Brokers, Saxo Markets.
Does this matter if you're trading stock options instead of investing?
Doesn't matter. It's just a different strategy altogether
How about setting up a Singapore company to hold US equities since it’s legally a separate and perpetual entity? Put wife and kids as directors in case you up the lorry.
Of course, there are maintenance costs but negligible compared to US estate tax esp when portfolio is $1 million and above.
Will the above work?
not as directors but as trustees
That could work if your fund size justifies the running costs. You will need to justify that your gains are not of an income nature to avoid the 17% corporate tax.
If I want to invest into S&P500 using SRS, is SPY the only option ?
For SRS, the only S&P 500 options are S27 (which is domiciled in the U.S.) or the iShares US Index Fund (which is a synthetic ETF) through Endowus.
www.sgx.com/campaign/etf-investing-srs
endowus.com/insights/how-invest-s-p-500-index-singapore
Can foreigners invest in JEPI etf and JEPQ. ??
Yes
@@TheFifthPersonChannel I am biased toward JEPQ. 8.80% dividend yield vs SPY 1.34% SPY ETF has larger basket of holdings. These newer ETFs like JEPQ and many others now concentrate more into 80-100 companies vs 500 companies
Cspx vuaa since they are accumulating, i dont even pay 15% dividend tax..zero dividend tax, correct ?
0.07% commision is only based on initial invested amount or each year can be different depending on the total amount of etf ? Tks
Dividends are taxed 15% first before reinvested. The 0.07% annual fee is deducted from the net asset value of the ETF.
XUS
Guys this is good information. A 40% estate tax on US stocks is quite frankly mindboggling. However, I check with my stock broker (a local company), and they that the US stocks held in their brokerage should not be subject to the estate tax. Is that the case?
No, all U.S.-based assets including U.S. stocks are subject to estate tax.
www2.deloitte.com/content/dam/Deloitte/us/Documents/Tax/us-tax-us-estate-and-gift-tax-rules-for-resident-and-nonresident-aliens.pdf
@@TheFifthPersonChannel Thanks. Guess I need to go down and clarify with them.
why not mini-futures? Lower funding
You could if you're comfortable using derivatives
SPY5 how do we buy?
The SPY5 is listed on the London Stock Exchange, so you will need a broker with access to that exchange.
What is the most cost effective way to invest in the VOO?
Through a Vanguard brokerage account.
investor.vanguard.com/investment-products/etfs/etf-fees
please share all your free documents thanks
For a second I thought u guys don’t encourage us (non US citizen) to buy S&P 500
😂
If the objective is long term investing (aka like a savings account) and liquidity is not that crucial, the synthetic replicating UCITS I500 Swap ETF (S&P500) and UCITS EQQS Swap ETF (Nasdaq) are great candidates because they do not incur dividend withholding tax due to the non-dividend distributing nature of the underlying assets.
If you're comfortable with synthetic ETFs!
no kids no issues
For irish domicilled etf. Only IKBR have. But they have the annoying currency exchange cost. Its expensive. So not that worth for people investing sub 1k a month.
IBKR's foreign exchange rates are one of the lowest in the brokerage industry. You can also invest quarterly/semi-annually to reduce transactions costs.
@@TheFifthPersonChannel dont they have an exchange fee of at least $3?
Yes, there's a US$2 minimum fee when exchanging currencies on IBKR, but its forex spreads are among the lowest. So you're right that it doesn't make sense at small amounts; it's better to accumulate and exchange/invest larger amounts at wider frequencies.
In any case, the U.S.-domiciled SPY and the Irish-domiciled CSPX both trade in U.S. dollars, so you need to make the exchange anyway.
@@TheFifthPersonChannel thanks for the quick reply.
Not too sure but why are mega investors such as adam khoo in Voo instead og CSPX?
Really am confused about that.
Haha! We'll ask Adam Khoo next time we see him
SPYL….
Yes, another option but just launched on 31 Oct 2023.
6:27 rich people laugh
How will Uncle Sam know when you pass on?
It's tricky...
www.nbcnews.com/business/taxes/why-billions-dollars-estate-taxes-go-uncollected-n457236
Just don’t pay the estate tax. Go look at the amount of people that the usa can’t retrieve it
Yes, but that would technically be tax evasion.
How about the SPY.L
SPYL is another low-cost option. It only just launched in Oct 2023, so some investors may prefer an ETF with a longer track record
@@TheFifthPersonChannel thanks for the reply. Was wondering if I should go for that instead the expense ratio is only 0.03 compared to cspx 0.07