VUAG vs VUSA: Which S&P 500 ETF Is Right for You?
Choosing between VUAG and VUSA for your S&P 500 investment? While both ETFs track the same index, their key differences in dividend handling and tax implications can significantly impact your returns. Let's dive into a detailed comparison to help you make an informed decision.
VUAG vs VUSA: Key Features Comparison
| Feature | VUAG | VUSA |
|---|---|---|
| Index Tracked | S&P 500 | S&P 500 |
| Dividend Policy | Accumulating | Distributing |
| Expense Ratio | 0.07% | 0.07% |
| Fund Currency | USD | USD |
| Fund Domicile | Ireland | Ireland |
| Assets Under Management | €13B+ | €35B+ |
| Launch Date | May 2019 | May 2012 |
| Dividend Withholding Tax | 15% | 15% |
Key Differences Explained
1. Dividend Treatment
The primary distinction between these ETFs lies in how they handle dividends:
- VUAG (Accumulating): Automatically reinvests dividends back into the fund, potentially offering better compound growth and tax efficiency
- VUSA (Distributing): Pays out quarterly dividends to investors, ideal for those seeking regular income
2. Performance Characteristics
Both ETFs deliver nearly identical exposure to the S&P 500, but their total return patterns differ due to dividend handling:
- VUAG: Shows higher price appreciation due to dividend reinvestment
- VUSA: Lower price appreciation but provides regular income through distributions
3. Tax Implications
Both ETFs benefit from Ireland's tax treaty with the US, resulting in:
- 15% dividend withholding tax (versus 30% for US-domiciled ETFs)
- Different tax treatment for investors depending on their jurisdiction:
- VUAG: Potentially more tax-efficient for long-term investors
- VUSA: May require more active tax management due to regular distributions
Investment Accessibility
Trading Venues
Both ETFs are widely available across major European exchanges:
| Listing | Trade Currency | VUAG | VUSA |
|---|---|---|---|
| Euronext Paris | EUR | – | VUSA |
| gettex | EUR | VUAA | VUSA |
| Stuttgart Stock Exchange | EUR | – | VUSA |
| Borsa Italiana | EUR | VUAA | VUSA |
| Euronext Amsterdam | EUR | – | VUSA |
| London Stock Exchange | USD | VUAA | VUSD |
| London Stock Exchange | GBP | VUAG | VUSA |
| SIX Swiss Exchange | CHF | – | VUSA |
| XETRA | EUR | VUAA | VUSA |
Top Holdings
Top 10 Holdings
Which ETF Should You Choose?
Consider VUAG if you:
- Want a hands-off, long-term investment approach
- Prefer automatic dividend reinvestment
- Seek potential tax advantages through accumulation
Consider VUSA if you:
- Need regular income from your investments
- Prefer to manage dividend reinvestment yourself
- Want access to a more established fund with higher liquidity
How to Invest
Several reputable brokers offer access to both ETFs:
- Interactive Brokers
- Largest ETF selection
- Competitive fees (from 0.0035 USD per share)
- No minimum deposit
- Trading 212
- Commission-free trading. Other fees may apply. See terms and fees.
- User-friendly platform
- €/£0 minimum deposit
Find the best broker for your needs with our Broker Matching Tool
Final Thoughts
Both VUAG and VUSA offer efficient exposure to the S&P 500 index with minimal costs. Your choice should ultimately depend on your investment goals, tax situation, and income requirements. For long-term wealth building, VUAG's accumulating structure might be more advantageous, while VUSA could better suit investors seeking regular income.
