Best BlackRock S&P 500 ETFs in Canada For 2023

Canadians have fair access to the US S&P 500 ETFs in both local and foreign currencies. This was made possible by industry giants like Blackrock, Vanguard, BMO and Horizons.

In this article, we’re going to look at the S&P 500 ETFs offered by BlackRock, the world’s largest asset manager with over $10 trillion in assets under management and a $101 billion market capitalization.

There’s a lot to admire about the BlackRock S&P 500 ETFs in Canada which explains why they are among the best S&P 500 ETFs in Canada.

But when it comes to narrowing your selection on BlackRock S&P 500 ETFs, you must compare and contrast to make the best decision.

This article compiles the best BlackRock S&P 500 ETFs in Canada with tips on how to narrow your selection.

About S&P 500 ETFs

S&P 500 ETFs are passively managed indexes that track the returns of 500+ US companies. With a single S&P 500 ETF, you will gain exposure to 500+ companies, saving risk and costs.

The ETFs track the performance of the top companies in the US under the S&P 500 index. The S&P 500 index is made up of over 70% of the US stock market.

That said, the S&P 500 ETFs invest more funds in large-cap US companies such as Apple, Microsoft, Amazon, Tesla and Alphabet.

With wide exposure to large-cap top-performing US companies, the S&P 500 ETFs have proven records of providing competitive returns to investors. 

As the world’s largest asset manager, BlackRock is one of the top providers of the S&P 500 ETFs in the world. However, this doesn’t guarantee that BlackRock S&P 500 ETFs are the best for you.

To determine the best of them, it’s essential to compare and contrast as we shall be doing shortly. 

Best BlackRock S&P 500 ETFs in Canada (Canadian-Listed)

BlackRock offers Canadian-listed and US-listed S&P 500 ETFs. That way, you can choose to trade the ETFs with Canadian dollars or US dollars.

If you’re looking to trade the S&P 500 ETFs with CAD, the following are the best BlackRock offerings: 

1. iShares Core S&P 500 Index ETF (XSP)

• Date of inception: May 24, 2001
• Exchange: Toronto Stock Exchange
• Price: $43.08 (as of January 27, 2023)
• Management fee: 0.09%
• MER: 0.10%
• Number of underlying holdings: 503
• Average return since inception: 4.28%
• 12-month trailing yield: 1.30%
• Dividend yield: 1.16%
• Distribution frequency: Semi-annual

The iShares Core S&P 500 Index ETF (XSP) is a CAD-hedged S&P 500 ETF that was launched in 2001 to provide long-term capital appreciation by investing in the top 500 companies in the US.

This S&P 500 ETF is traded on the Toronto Stock Exchange and it has 503 underlying holdings. 

Compared to other BlackRock S&P 500 ETFs, XSP has relatively low pricing with the last closing price being $40.60.

That being said, the following are the top 10 underlying holdings of XSP as of November 4, 2022: 

As of September 30, 2022, XSP provided the following average annual returns to investors: 

• 1-year: -16.84%
• 3-year: 6.37%
• 5-year: 7.43%
• 10-year: 10.53%
• Since inception: 4.28%

2. iShares Core S&P 500 Index ETF (XUS)

• Date of inception: April 10, 2013 
• Exchange: Toronto Stock Exchange
•  Price: $67.09 (as of January 27, 2023)
• Management fee: 0.09%
• MER: 0.10%
• Number of underlying holdings: 503
• Average return since inception: 14.27%
• 12-month trailing yield: 1.22%
• Dividend yield: 1.08%
• Distribution frequency: Semi-annual

iShares Core S&P 500 Index ETF is also traded on the Toronto Stock Exchange with the ticker “XUS”. 

This ETF also seeks to provide long-term capital growth by investing in the S&P 500 Index which tracks the performance of top US companies.

XUS also has 503 underlying holdings, meaning it invests funds across more than 500 companies. The ETF has had low pricing with competitive returns since its inception.

Below are the top 10 holdings of XUS as of November 4, 2022:

As of September 30, 2022, XUS provided the following average annual returns to investors: 

• 1-year: -8.58%
• 3-year: 9.12%
• 5-year: 10.90%
• Since inception: 14.27%

3. iShares Core S&P 500 Index ETF  – USD Units (XUS.U)

• Date of inception: Apr 10, 2013
• Exchange: Toronto Stock Exchange
• Price: $51.10 (as of January 27, 2023)
• Management fee: 0.09%
• MER: 0.10%
• Number of holdings: 504
• Average return since inception: 8.54%
• 12-month trailing yield: 1.14%
• Dividend yield: 1.12%
• Distribution frequency: Semi-annual

The iShares Core S&P 500 Index ETF – USD Units is traded on the TSX with the ticker symbol “XUS.U” 

Like XUS, XUS.U was also launched to offer capital growth by tracking the returns of the S&P 500 Index.

In addition, both XUS and XUS.U use CAD as their funds’ base currency. However, XUS.U uses USD as its class base currency. 

XUS.U has 504 holdings with the following being the top 10 as of November 4, 2022:

That being said, XUS.U provided a 15.71% 1-year return and 8.54% return since inception as of September 30, 2022.

Best BlackRock S&P 500 ETF in Canada (US-Listed)

If you want to trade the S&P 500 ETFs with USD, BlackRock also got you covered. The following is the best BlackRock S&P 500 ETF that’s traded with USD in Canada.

4. iShares Core S&P 500 ETF (IVV)

• Date of inception: May 15, 2000
• Exchange: NYSE Arca
• Price: $407.67 (as of January 27, 2023)
• Management fee: 0.03%
• MER: 0.03%
• Number of holdings: 503
• Average return since inception: 6.07%
• 12-month trailing yield: 1.72%
• Dividend yield: –
• Distribution frequency: Quarterly

The iShares Core S&P 500 ETF (IVV) is one of the best US-listed S&P 500 ETFs in Canada that’s publicly traded on the NYSE Arca.

Compared to the above Canadian-listed BlackRock S&P 500 ETFs, IVV has an extremely low management fee of 0.03% and 0.03% MER.

In addition, IVV distributes dividends quarterly not semi-annually as is the case with the above Canadian-listed S&P 500 ETFs.

That being said, IVV also invests in 503 companies in the US with the following being the top 10 as of November 4, 2022:

As of September 30, 2022, IVV had the following returns:

• 1-year: -15.50%
• 3-year: 8.13%
• 5-year: 9.20%
• 10-year: 11.66%
• Since inception: 6.07%

Which BlackRock S&P 500 ETF to Choose?

So far we have discussed the best BlackRock S&P 500 ETFs in Canada. To make the selection easier, the following table highlights the key features of all the ETFs:

As you can see, the US-listed BlackRock S&P ETF has low fees compared to the Canadian-listed ETFs. In addition, the US-listed ETF has a competitive 12-month trailing yield of 1.72% in the last distribution.

Beyond that, the Canadian-listed S&P ETFs of BlackRock have competitive returns, dividend yields and low pricing compared to the US-listed ETF.

In addition, you need to consider tax implications when comparing Canadian vs US-listed S&P 500 ETFs of BlackRock.

With a Canadian-listed S&P 500 ETF, you don’t have to worry about withholding taxes which is the case with a US-listed ETF.

And if you don’t have USD, the cost of converting CAD to USD could easily add up to your investment cost. 

All things being equal, you wouldn’t go wrong with the above BlackRock S&P 500 ETFs so long you factor in your investment needs and situation.

Is It Worth Investing in BlackRock S&P 500 ETFs?

It’s up to you to decide. As noted earlier, the BlackRock S&P 500 ETFs are among the best S&P 500 ETFs in Canada. And the above review reveals why they are among the best. 

As per the Canadian-listed ETFs, they are ideal for their competitive returns, dividend yields and low pricing. The US-listed S&P 500 ETF of BlackRock also competes with its peers in terms of returns, yields and fees.

It goes without saying that you can’t go wrong with any of the above BlackRock S&P 500 ETFs that suit your needs.

Notwithstanding, you must understand that these are index ETFs that are passively managed. As such, you should not expect them to deliver the same returns as actively managed ETFs.

So if you have an above-average risk appetite and are trying to reduce your investment costs, one of the best BlackRock S&P 500 ETFs might be ideal for you.

But if you’re looking for actively managed funds, you should consider one of the best all-in-one ETFs in Canada.

How to Invest in BlackRock S&P 500 ETFs in Canada

The method you choose to invest in the BlackRock S&P 500 ETFs will depend heavily on your investment skill.

If you have sufficient investment knowledge and are confident in handling the entire process, you should consider signing up with an online discount broker directly.

With an online discount broker, you will have easy access to trading the securities of your choice including the BlackRock S&P 500 ETFs. 

However, online discount brokers vary per the securities they support, account types, minimum investment requirements, fees, commissions on trading and so on.

That being said, you can also invest in BlackRock S&P 500 ETFs through your financial advisor if you have one. This option is suitable if you don’t have sufficient knowledge to handle the investment process yourself.

Of course, investing through your financial advisor will be more costly but it will likely save you from the risk of handling everything yourself with limited knowledge.

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Verdict 

Passively managed index funds often beat their benchmark more than actively managed funds. This is in addition to their low fees and low-risk levels compared to actively managed funds.

With this, the importance of diversifying your portfolio with index ETF funds can’t be overemphasized. 

However, the index ETF you invest in matters a lot in achieving the desired result. From the above review, you can see how even BlackRock’s best S&P 500 ETFs compete against themselves.

This underscores the significance of weighing the pros and cons of an index ETF before investing in it.

Hopefully, now you know the best BlackRock S&P 500 ETFs in Canada and can easily determine the perfect one for you. 

To make a better decision, I encourage you to compare the BlackRock ETFs with the other best S&P 500 ETFs in Canada before deciding.

That brings us to the end of this review. If you have any questions or concerns, kindly drop them in the comment section or email them to our expert team at [email protected].

Before leaving, kindly check out our Stock Archive to learn more about other best investment deals in Canada.