Vanguard S&P 500 - VUSA ETF - Share Chat

New record high on Friday: 3,329.62 :boom:

That’s up +0.39% or +12.81 points.

Thursday was another record high, by the way: 3,316.81.

The S&P 500 returned 29% in 2019, which is incredible. Very different risk profile, but the best cash ISA returns a measly 2%, if fixed. Again, very different asset class, but to give a sense of scale. Of course, there are crashes and years when your portfolio shrinks.

Specific to Friday’s all-time high, Yahoo Finance wrote strong US housing data and signs of resilience in the Chinese economy raised hopes of a rebound in global growth. Data showed China ended 2019 on a somewhat firmer note, even as economic growth cooled to its weakest in nearly 30 years.

Market sentiment brightened further after the United States and China sealed a Phase 1 trade deal, pausing an 18-month tariff dispute that has weighed on financial markets globally.

My question is, how long will we see this index going strong? Is anyone expecting a crash this year?

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Since 2017 I’ve heard from stock analysts the S&P 500 is overpriced. It’s impossible to tell but some volatility and a dip would be nice. From a personal point of view I invest if I have the money as it’s for the long term :+1:t3:

At least until it breaks the bull run record:

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Something I want to examine is which stocks drive the S&P 500 index and which ones pull it down over time. Would people be interested reading that?

I like this particular ETF because A. I’m a Vanguard fan B. it’s physical as opposed to synthetic, so Vanguard actually do buy the stocks in the index (although that approach has disadvantages as well in any case).

What is relation between Spx index and VUSA
Why VUSA doesn’t change by same amount as Spx?

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ETFs are tracking the index, but the “amount change” is not identical between the index and an ETF, or even between two ETFs tracking the same index - as neither of them are the exact same things.

As a starting point, to demonstrate that all these things are not the same, ETFs often don’t have each and every stock of the index.

In an ideal world, all ETFs would invest in all the constituents of the underlying index.

VUSA is actually trying to do this, it’s called physical replication.

However, especially with particularly large indexes, think S&P 500 or FTSE All-Share, it’s not practical to buy all the stocks.

In the case of the FTSE All-Share, which has 650 constituents, investing in each and every one of the stocks is not practical.

The bottom 50 stocks in the FTSE All-Share make up less than 0.5% of the index, meaning the transaction costs involved in buying these stocks far outweigh the benefits of owning them.

So the ETF firm tries to build a portfolio with the same characteristics as the index with less securities to reduce transaction cost and/or the exposure to illiquid assets.

Another aspect is that often the ETFs tracking the same index are not even in the same time zone, e.g. VOO is traded on NYSE Arca, whereas VUSA is on the LSE (and a couple of other European exchanges). So they even have a different definition of trading day, different time windows to react to daily news.

ETFs tracking the same index also have different costs, which has an impact on how investors see them and invest in them, resulting in somewhat different supply and demand (and hence somewhat different growth).

So, again, the index-tracker ETFs are tracking, they are not identical to the index they’re tracking our even to each other.

This is an interesting article that details the replication issue, the cost issue, the issue of the cash drag that uninvested money coming from the daily operation of an ETF has, and other details that hopefully even help you pick the right ETF for your goals:

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VUSA is £, so fx movements also move the price.

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I’m aware of FX and tracking error.
But the difference seems rather large. It could be the illiquidity that shows up as difference in ETF price vs NAV.
But didn’t expect this much difference.

The ETF got morethan 500 securities and the FX rate changed less than 2%

I always find it fascinating to research for companies that overperform the S&P 500 index.

Even in times like this, some companies do well.

But while picking stocks is fascinating (to me), remember that eg an S&P 500 ETF give you better diversification.

I’ve just looked through some data (what else to do during this lockdown), and the rally between the 24th and 26th March was the best three-day rally for the S&P 500 since the 1930s. Well done to everyone that managed to ride that wave. The index ended the month 17.7 % above its lowest on the 23th March.

At month-end, the S&P is still quite down though, it was 20% below from the start of the year.

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Is there an eligible ETF that includes both US Large, US Medium and US Small-Cap equities?

Hi folks. Slightly off topic but any idea why I don’t seem to be getting any dividends from my various Vanguard stocks? I’m highly confused :joy:

You mean this specific ETF? It pays 4 times a year, not when the underlying stocks pay their respective dividend.

Ah, that makes a bit more sense. Yeah, I have VUKE, VUSA and VWRL. Trying to find specific dates for each and a dividend calculator online was very time consuming and I was still none the wiser.

Thank you for your reply

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Go on dividendmax and you should be able to get the ex dividend dates, the payout dates and input how many shares you own and it will tell you how much you should be expecting to have paid out.

So according to this Vanguard S&P 500 UCITS ETF (VUSA) Dividends
dividends were paid yesterday, how long until they get distributed via Freetrade?

The dividend on 18/6 was paid on 30/6 and I received notification on 2/7.
The dividend on 19/3 was paid on 31/3 and I received notification on 1/4.

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anyone received anything? I know somebody who holds vusa and they received their dividend, i didnt :frowning:

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2min ago

I did receive my dividends from VUSA. It was maybe 1 day after the expected date. I noticed the money in my wallet before receiving an email from FT, but later that day I did receive an email as well.