IVVvsIHVV
Does hedging the AUD/USD currency risk improve your S&P 500 returns?
iShares S&P 500 ETF · iShares S&P 500 (AUD Hedged) ETF
IHVV hedges AUD/USD currency risk for an extra 6bp p.a. - useful when the AUD rises, but a drag when it falls. Unhedged (IVV) has typically won over long periods as the AUD trended lower, though hedging outcomes vary widely year-to-year.
Score Breakdown
Fund Profiles
As one of the world's most recognised index funds, IVV tracks the S&P 500 Index and is managed by BlackRock's iShares, giving ASX investors access to America's 500 largest companies. Listed on the ASX in Australian dollars, the fund provides unhedged exposure, meaning returns are influenced by movements in the AUD/USD exchange rate alongside underlying equity performance. IVV serves as a core international holding for Australian investors comfortable with US dollar currency exposure and seeking broad, low-cost access to the world's deepest equity market.
For investors wanting US large-cap exposure without currency risk, IHVV tracks the S&P 500 Index hedged to the Australian dollar. Managed by BlackRock's iShares, it is commonly paired with the unhedged IVV, allowing currency-aware investors to blend hedged and unhedged US equity allocations according to their AUD outlook. This ETF suits Australian investors who believe the Australian dollar may strengthen against the US dollar, or those seeking to isolate pure equity returns from America's 500 largest companies without foreign exchange noise.