Best S&P 500 ETFs in Canada

WOWA® Simply Know Your Options

Choosing an S&P 500 ETF can feel like choosing between nearly identical jars of peanut butter. The labels differ and the contents barely do. VFV, ZSP and XUS hold the same 500 large U.S. companies, and over the past 10 years their returns finished within a few hundredths of a percentage point of each other.

For a simple, long-term holding, VFV, ZSP and XUS will serve you about equally well. Pick whichever is easiest and cheapest to buy at your brokerage. If you’d rather take the U.S. dollar out of the equation, the hedged trio of XSP, VSP and ZUE does that. HXS is a specialist tool: it saves tax in a non-registered account, but at today’s costs the saving barely covers its extra fees, even in the top tax bracket.

The useful question is which version fits your portfolio. Owning two or three of them mostly gives you the same stocks with slightly different packaging. If you’re still deciding between ETFs and other funds, WOWA’s guide to ETFs vs. mutual funds covers the basics, and our list of the best Canadian ETFs covers other kinds of funds.

Comparing 7 Canadian-listed S&P 500 ETFs by size, cost and historical returns.

Data as of October 23, 2026. Total returns include price changes and reinvested distributions, in Canadian dollars, before personal taxes and brokerage costs. Multi-year figures are annualized. Past returns do not guarantee future results. HXS’s trading expense ratio is as of June 30, 2026 and is mostly the cost of its swap.

The S&P 500 isn’t simply the 500 biggest U.S. companies. A committee at S&P Dow Jones Indices picks the members, and a company has to pass a few tests to be considered:

• It must be based in the U.S. for index purposes.
• It must be large. The current minimum is a market value of about US$22.7 billion.
• It must be profitable, with positive earnings in its most recent quarter and over its last four quarters combined.
• Enough of its shares must be available to buy and trade actively.

The profit test has kept some famous names waiting. Tesla was already one of the most valuable companies in America before it finally joined in December 2020, after a run of profitable quarters. You’ll see about 503 holdings rather than 500 because a few companies, such as Alphabet, have more than one class of shares in the index.

Each company counts in proportion to its market value. That makes the index far less evenly spread than “500 companies” suggests. As of October 2026, the 10 largest holdings make up close to 40% of the index. Nvidia, Apple and Microsoft each make up roughly 6% to 8% on their own, and technology companies account for more than a third of the total. Put $1,000 into an S&P 500 ETF and about $80 goes to Nvidia, while the smallest members get less than a dollar each.

So the S&P 500 is well diversified across companies but tilted heavily toward big U.S. technology firms. It also leaves out smaller U.S. companies and everything outside the U.S. Together, its members cover about 80% of the value of the U.S. stock market.

These three are the plain-vanilla options. Your return moves with U.S. stocks and with the U.S. dollar. They differ mainly in how they hold the stocks and how often they pay you:

• VFV (Vanguard) is the largest Canadian S&P 500 ETF and ties for the lowest MER at 0.08%. It holds Vanguard’s U.S.-listed ETF, VOO, and pays distributions quarterly.
• ZSP (BMO) buys the stocks directly and pays quarterly. It also has a U.S.-dollar version, ZSP.U, which is handy if you already hold U.S. cash.
• XUS (iShares) holds iShares’ U.S.-listed IVV, much as VFV holds VOO, and pays twice a year.

Think of a direct flight and a flight with one quick connection: you land in the same city. You might expect the funds with the connection to cost more, as if you paid two management fees. You don’t. The MER shown for each Canadian fund already covers the U.S. fund underneath, and all three MERs are within 0.01 percentage points of each other. On $10,000, that’s $1 a year.

In a TFSA or RRSP, the 15% U.S. withholding tax on dividends is lost either way, whether the Canadian fund holds the stocks directly or through a U.S. ETF.

If you already own one of these three, a slightly better historical return in another isn’t much of a reason to switch. In a taxable account, selling to switch can create a tax bill.

These funds hold the same index but use currency contracts to neutralize most moves in the U.S. dollar:

• XSP (iShares) has been hedging the S&P 500 since 2001, which makes it the oldest fund on this page. It pays twice a year.
• VSP (Vanguard) has the lowest MER of the three at 0.08% and pays quarterly.
• ZUE (BMO) pays quarterly and has been around since 2009.

Their returns have tracked each other closely. The currency decision matters far more than the choice between them. Decide that first (the section on hedging explains it), then pick whichever hedged fund your brokerage makes easiest to buy.

Global X’s HXS doesn’t own the S&P 500’s stocks. It gets the index’s total return through a swap agreement with a bank. Dividends never reach you as income. They stay inside the fund and show up in the unit price. Global X was called Horizons ETFs until 2024, so you may know the fund by that name.

That design has two side effects. Because the swap pays the index’s total return, HXS avoids the U.S. withholding tax that conventional funds lose on dividends. But it also brings swap costs on top of the 0.11% MER. Global X raised the swap fee to as much as 0.50% a year in 2025, and the fund’s trading expense ratio was 0.49% as of June 30, 2026. All in, HXS costs several times as much as the other funds on this page. The swap also adds counterparty risk: you rely on the bank to keep paying.

HXS earns its place only when the tax deferral is worth more than those costs. The account section below explains that.

With an unhedged ETF, your return in Canadian dollars depends on two things: how U.S. stocks perform and what the U.S. dollar does against ours.

Imagine U.S. stocks rise 10%. If the U.S. dollar also gains 5% against the loonie, your combined return is about 15.5% before expenses. If the U.S. dollar falls 5%, it’s about 4.5%. Same stock market, very different result in your account.

A hedged fund uses currency contracts to cancel most of that effect. You give up the boost when the loonie weakens and avoid the hit when it strengthens. Hedging isn’t free, either. Its cost depends on the gap between U.S. and Canadian interest rates, and it has been a real drag in recent years, when U.S. rates sat above Canada’s.

The table above shows both forces at work. Five years ago a U.S. dollar cost about $1.24 Canadian; by October 2026 it cost over $1.40. Hedging also cost money for most of that stretch. Together, those left the hedged funds trailing their unhedged twins by more than four percentage points a year. Over 10 years the picture changes: the U.S. dollar only rose from about $1.32 to $1.40, so most of the 10-year gap came from the cost of hedging itself. The currency can turn the other way, and when it does, the hedged funds come out ahead.

Unhedged exposure is a sensible default for long-term investors comfortable owning U.S. dollar assets. Hedging can suit investors who want less currency exposure. Neither choice wins every year, and neither protects you from falling stock prices.

Any of the unhedged or hedged funds above works for long-term U.S. exposure in a TFSA. The U.S. keeps 15% of the dividends, and you can’t recover it in a TFSA. Buying a U.S.-listed fund such as VOO or IVV directly doesn’t help here.

That’s 15% of the dividends, not 15% of your investment. With the S&P 500 yielding around 1%, the cost is roughly 0.15% of your balance a year. Vanguard’s withholding-tax guide breaks down the treatment by account and fund type, and it applies to every fund company’s ETFs, not just Vanguard’s.

HXS avoids that withholding tax, but its extra costs are larger than the savings, so it doesn’t belong in a TFSA.

The Canada–U.S. tax treaty generally exempts U.S.-listed funds such as VOO, IVV or SPY from withholding tax when they’re held directly in an RRSP, and the exemption carries on when the RRSP becomes a RRIF. Canadian-listed funds don’t get it, even inside an RRSP. That saves roughly 0.15% to 0.2% of your balance a year, and the big U.S. funds also charge lower fees, about 0.03% for VOO and IVV.

The catch is the currency conversion. Most brokerages build their fee into the exchange rate, often 1% to 2% of the amount converted. Because that cost grows with the amount, a big purchase doesn’t dilute it. Paying 1.5% to convert, and again when you convert back to withdraw, can take more than a decade of withholding-tax savings to recoup.

Norbert’s Gambit changes the math. Its cost is mostly two trading commissions plus a small price spread, which barely grows with the amount, so it pays off best on larger conversions. It’s worth the effort for a sizeable RRSP, or if you already hold U.S. dollars. For smaller or frequent contributions, a Canadian-listed fund is usually simpler and close to as cheap. WOWA’s RRSP calculator shows how your savings could grow, and the RRIF calculator shows what the withdrawals look like later.

Conventional S&P 500 ETFs pass U.S. dividends to you as foreign income. It’s taxed at your full marginal rate every year and gets no Canadian dividend tax credit, though you can usually claim the U.S. withholding tax as a foreign tax credit. WOWA’s income tax calculator shows your marginal rate.

HXS turns that yearly income into growth inside the fund. You generally pay tax only when you sell, and then as a capital gain, with half the gain taxable. The capital gains tax calculator can estimate the bill. Global X can still pay a distribution in some years, so treat this as tax deferral, not tax-free investing. See HXS’s disclosures.

Whether that’s worth the extra cost depends on your tax rate, and the answer surprised us a little. We followed $100,000 invested once in a conventional S&P 500 ETF and in HXS, held in a non-registered account and sold at the end, for three Ontario investors:

Amounts are what you’d keep after selling and paying tax. For scale, the conventional fund grows to about $166,000 to $180,000 after tax over 10 years, depending on your bracket, and to $518,000 to $628,000 over 30.

In our example, HXS comes out behind at every income. Its tax advantage is real, and it grows with your tax rate. In the top bracket it almost cancels out the extra cost, but it never quite overtakes it. Below that, the extra 0.5% or so a year simply costs more than the tax it saves, and the gap widens the longer you hold.

It wasn’t always this way. Before Global X raised its swap fee cap from 0.30% to 0.50% in 2025, HXS was likely cheap enough to come out ahead for top-bracket investors. By our numbers, the break-even all-in cost is about 0.5% a year at the top bracket, about 0.4% around $120,000 of income and under 0.3% around $60,000. HXS sits at about 0.6%. If its costs fall, or if U.S. dividend yields rise well above today’s 1% or so, the top bracket could tip back in its favour. Check the current trading expense ratio before you buy.

The S&P 500 covers large U.S. companies. Total-market ETFs add mid-sized and small companies to the basket.

Performance as of October 23, 2026. VFV stands in for the S&P 500 here; ZSP and XUS show nearly identical figures. Total returns include reinvested distributions and are annualized, in Canadian dollars. Holdings counts use each fund’s latest published holdings date (VFV Jul 31, 2026; VUN Jul 31, 2026; XUU Sep 4, 2026). Volatility measures how much returns have swung around; a higher figure means a bumpier ride.

Owning thousands more companies broadens your exposure less than you’d think. These funds weight each company by its size, so the giants still drive most of the result. Over the past five years, the extra small companies held the total-market funds back slightly.

Pick an S&P 500 ETF if you want large U.S. companies specifically. Pick a total-market fund if you’d rather own businesses of every size. Owning both mostly adds overlap.

Neither gives you a complete global portfolio. For the Canadian side, WOWA’s S&P/TSX Composite Index guide explains the main domestic benchmark.

You can buy these funds through any self-directed brokerage that offers TSX trading, such as Wealthsimple, CIBC Investor’s Edge or moomoo. If you don’t have an account yet, WOWA’s guide to opening a brokerage account walks you through it.

1. Choose and fund your TFSA, RRSP or non-registered account. Check your TFSA contribution room first if you’re using one.
2. Search for the ticker and check the fund name and trading currency. ZSP trades in Canadian dollars; ZSP.U trades in U.S. dollars.
3. Enter the number of units and the order type. A limit order sets the most you’ll pay per unit. Check the bid–ask spread and any commission before you submit.
4. Confirm that the order filled. Placing an order and owning the units are two different steps.

Use WOWA’s trading platform comparison to compare brokerages, or follow the full walkthrough on how to buy stocks in Canada.