You might be sitting back and considering the iShares S&P 500 ETF (ASX: IVV) and thinking that June could be as good of a time as any to take closer look. Here’s how we would start our research.
Find out what the ETF does
The iShares IVV ETF provides investors with exposure to the largest 500 US stocks, by market capitalisation. This is a low-cost way to access leading US companies through a single fund.
The iShares IVV ETF could be used by investors to gain exposure to the leading 500 US equities, as determined by the S&P 500 Index. Investors can use ETFs to diversify their portfolios into international markets, as Australian investors are generally biased towards their own market.
IVV’s FUM meets our hurdle
The iShares IVV ETF had $5576.66 million of money invested when we last pulled the monthly numbers. Given IVV’s total funds under management (FUM) figure is over $100 million, the ETF has met our minimum criteria for the total amount of money invested, otherwise known as FUM. We draw the line at $100 million for ETFs in the International shares sector because we believe that relative to smaller ETFs, achieving this amount of FUM de-risks the ETF.
Pay attention to yearly costs & fees
iShares charges investors a yearly management fee of 0.04% for the IVV ETF. This means that if you invested $2,000 in IVV for a full year, you could expect to pay management fees of around $0.80.
For context, the average management fee (MER) of all ETFs covered by Best ETFs Australia on our complete list of ASX ETFs is 0.51% or around $10.20 per $2,000 invested. Keep in mind, small changes in fees can make a big difference after 10 or 20 years.
Our takeaway
If you’re thinking about investing in IVV, bear in mind that this is just an introductory glance at the ETF. To explore further, check out our free iShares IVV report. And for good measure, search our complete list of ASX ETFs for similar ETFs in the International shares sector to do a good comparison.
