2 S&P 500 ETFs Which One?

adamni2006

Hi, so I'm thinking of investing in one of two American ETFs, one has a greater dividend, but the other may have better growth. Any opinions?

Vanguard Funds Plc S&P 500 UCITS ETF USD(GBP) (VUSA)

or

Invesco Markets Plc S&P 500 High Dividend Low Volatility UCITS ETF (HDLG)

Thank you

Bostonerimus1

Well what do you want, growth or dividends? 

dunstonh

Which one fits best with your overall portfolio? 

Neither fund is there to be held in isolation, but to form part of the jigsaw that makes your portfolio.   That portfolio will have an investing style.  Is it total return or yield biased?

Linton

What is your investment time frame?  Do you want to access some or all of the wealth in 20 years time or do you need some now?

adamni2006

Mostly I have income funds at the moment and reinvest the dividends when they build up. I have a mixture of ETFs and Investment. I have an equal balance of Asian, Global, UK, Europe (ex UK), and the SPDR Russell 2000 (R2SC). It's in my SIPP, hoping to retire in about a couple of years time - maybe longer. So I guess I'm asking which maybe the better of the two.

Thank You

masonic

What does "better" mean to you? If you want to take an income, avoid volatility, and not draw down capital, perhaps the income fund is better. If you want your investment to grow as much as possible and are content to sell shares when needed, perhaps the Vanguard ETF is better.

What is your reasoning for adding a second US fund? Why not add to the one you have?

DRS1

HDLG only has 50 shares in it so it excludes a large part of the S&P500.  Not what most people would want from an S&P 500 fund.  On the plus side it looks like it doesn't have any of the Mag7 (or not in the top 10 holdings anyway).  So it looks like one of those contrarian things which might do well (some time) or at least not do as badly.

If you put the two investments on a comparison chart then VUSA is streets ahead.  But past performance is no guide to the future.

And you have a very short time horizon and you prefer income generating funds so HDLG is probably more your thing.

Or if you can't decide then go for both 50/50.  You'll be half right.

adamni2006

Thank you - I'll probably go for VUSA (or maybe VUAG accumulation) - I suppose I can always move it later if I feel the need. After all it's all about spread

adamni2006

masonic said:

What does "better" mean to you? If you want to take an income, avoid volatility, and not draw down capital, perhaps the income fund is better. If you want your investment to grow as much as possible and are content to sell shares when needed, perhaps the Vanguard ETF is better.

What is your reasoning for adding a second US fund? Why not add to the one you have?

I was thinking the SPDR Russell 2000 includes smaller businesses and with an S&P500, this would increase the spread over the American market.

masonic

adamni2006 said:

masonic said:

What does "better" mean to you? If you want to take an income, avoid volatility, and not draw down capital, perhaps the income fund is better. If you want your investment to grow as much as possible and are content to sell shares when needed, perhaps the Vanguard ETF is better.

What is your reasoning for adding a second US fund? Why not add to the one you have?

I was thinking the SPDR Russell 2000 includes smaller businesses and with an S&P500, this would increase the spread over the American market.

Oh yes, for some reason I'd misunderstood that to be the total market Russell 3000. It probably doesn't make sense to hold only US small caps, especially via a whole market tracker. Many prefer the S&P600 for this due to the profitability filter, though past performance isn't all that different and one index hasn't consistently outperformed the other.

george4064

Neither. Go for the SPDR S&P 500 UCITS ETF (SPXL). It physically replicates all constituents of the index, automatically reinvests dividends and only costs 0.03% TER (Total Expense Ratio).