By Kestutis Balciunas·Published January 2026

Vanguard VUSA vs iShares CSPX: S&P 500 UCITS ETF Battle

To see what a few basis points really cost over 30 years, the ETF fee impact calculator projects the gap in euros.

For the wider context on how Vanguard and iShares S&P 500 UCITS ETFs slot into a European core portfolio, see our European ETF providers compared 2026 overview. Additionally, the VWCE vs FTSE All-World comparison hub covers global single-fund alternatives.

Choosing between Vanguard VUSA and iShares CSPX ranks among the most common dilemmas for European ETF investors. Both funds track the S&P 500 index. Furthermore, both charge identical 0.07% expense ratios. However, crucial differences exist in distribution policy, liquidity, replication methodology, and fund size. Consequently, these differences create meaningful implications for long-term returns. This comprehensive analysis dissects every dimension of the two market-leading ETFs. By the end, you can make an informed investment decision. For more detail, see our guide: Vanguard Investor Review.

The Fundamentals: What Sets Them Apart

At first glance, VUSA and CSPX appear nearly identical. Both deliver Irish-domiciled UCITS exposure to America’s 500 largest companies. Additionally, both charge the same 0.07% total expense ratio. Importantly, both benefit from Ireland’s favorable 15% withholding tax treaty with the United States. By contrast, Luxembourg funds face a 30% rate. Yet beneath this surface similarity lie critical distinctions. Moreover, these distinctions compound significantly over investment horizons measured in decades. For more detail, see our guide: Best Vanguard Funds and ETFs for UK Investors.

Selection criteria: the how we compare ETFs explains exactly how funds earn a place in this comparison.

CSPX (iShares Core S&P 500 UCITS ETF) launched in May 2010. Since then, it has grown into the largest S&P 500 ETF in Europe with over EUR 107 billion in assets under management. The fund automatically reinvests all dividends back into the portfolio. Therefore, it operates as an accumulating ETF. This structure appeals to investors who prioritize long-term capital growth. Notably, it eliminates the friction of dividend taxation events.

VUSA (Vanguard S&P 500 UCITS ETF) began trading in May 2012. Today, the fund manages approximately EUR 43 billion in assets. Unlike CSPX, VUSA operates as a distributing ETF. Therefore, it pays quarterly dividends directly to shareholders. These distributions totaled approximately $1.20 per share in 2024. Consequently, the distribution yield landed around 1.5%. Investors seeking regular income may prefer this structure. Similarly, those in tax-advantaged accounts often favor it.

The accumulating versus distributing distinction creates the most significant practical difference between these ETFs. In jurisdictions where dividend taxation applies immediately upon distribution, CSPX’s accumulating structure defers tax liability until you eventually sell shares. Consequently, this deferral allows more capital to compound over time. However, some countries tax phantom dividends in accumulating ETFs annually regardless. Therefore, this advantage disappears in those jurisdictions.

Fund Provider Credentials

BlackRock manages CSPX through its iShares brand. Notably, iShares ranks as the world’s largest ETF provider with over $3 trillion in global assets. Vanguard, founded by index investing pioneer John Bogle, operates VUSA. Additionally, the firm manages approximately $8 trillion globally across mutual funds and ETFs. Both institutions offer exceptional operational excellence, robust custody arrangements, and decades of indexing experience. Therefore, provider selection should not drive your decision between these particular funds.

Cost Analysis: Beyond the Expense Ratio

Both ETFs advertise identical 0.07% total expense ratios. As a result, they rank among Europe’s cheapest S&P 500 options. However, total cost of ownership extends far beyond the TER. Specifically, trading spreads, dividend withholding taxes, and potential tracking differences all impact net returns.

The bid-ask spread represents the difference between buy and sell prices for an ETF. CSPX typically maintains tighter spreads thanks to its substantially higher trading volume. Specifically, CSPX trades approximately 8 million shares daily compared to VUSA’s 2.5 million shares. During normal market conditions, CSPX spreads average 2-3 basis points. Meanwhile, VUSA spreads run slightly wider at 3-5 basis points. This difference matters primarily for large trades or frequent transactions.

Both ETFs face identical 15% US dividend withholding tax under Ireland’s double taxation treaty. Most European investors cannot recover this tax. Therefore, it represents a permanent drag on returns. On a portfolio yielding 1.5% annually, the withholding tax costs approximately 0.23% per year. When combined with the 0.07% TER and average trading spreads, the all-in annual cost runs approximately 0.35-0.40% for both funds.

Foreign exchange costs also warrant consideration. VUSA trades primarily in USD, GBP, and EUR across multiple exchanges. Similarly, CSPX offers identical currency listings. Your broker’s FX conversion spreads typically run 0.3-0.7% per transaction. Importantly, these costs impact both funds equally. Investors making regular contributions should prioritize brokers offering competitive FX rates. Doing so minimizes this friction.

Securities Lending Revenue

Both funds engage in securities lending to generate additional returns. This practice involves temporarily loaning portfolio holdings to short sellers in exchange for fees and collateral. VUSA and CSPX both participate in their respective providers’ lending programs. However, exact revenue figures remain opaque. Securities lending can add 0.02-0.05% annually. By contrast, it introduces modest counterparty risk despite collateralization requirements.

Liquidity and Trading Considerations

CSPX dominates VUSA on every liquidity metric. With more than double the assets under management and significantly higher daily trading volumes, CSPX offers superior price discovery and tighter spreads. This liquidity advantage matters most during market stress when spreads widen. For example, during March 2020’s volatility, CSPX maintained far tighter spreads than smaller S&P 500 ETFs.

The ETF creation-redemption mechanism theoretically keeps prices close to net asset value regardless of fund size. Specifically, authorized participants arbitrage away any significant premiums or discounts. They do this by creating or redeeming ETF shares directly with the fund. However, larger funds with deeper liquidity pools execute this mechanism more efficiently. As a result, they show less tracking error and tighter spreads.

VUSA’s smaller size doesn’t create meaningful disadvantages for most retail investors. The fund remains highly liquid by absolute standards. Moreover, spreads stay reasonable for typical investment amounts. Institutional investors or those deploying substantial capital should favor CSPX’s deeper liquidity. By contrast, retail investors accumulating positions through regular contributions will find VUSA’s liquidity perfectly adequate.

Exchange Listings and Currency Options

Both ETFs trade on multiple European exchanges in various currency denominations. CSPX lists on London Stock Exchange (USD, GBP), Euronext Amsterdam (EUR), Deutsche Boerse (EUR), and others. Similarly, VUSA offers comparable listings across LSE, Euronext, and Xetra. This flexibility lets investors trade in their local currency. However, the underlying holdings remain USD-denominated regardless of trading currency.

Currency denomination choices create a cosmetic rather than economic difference. Whether you buy GBP or EUR listings, you own the same underlying USD assets. Consequently, you face identical currency exposure either way. The trading currency simply determines your brokerage statement presentation. Choose the listing with the tightest spreads and highest volume. Typically, this means the primary London or Amsterdam exchanges.

Replication Methodology: Full vs Optimized

VUSA uses full physical replication. Specifically, the fund buys all 503 constituents of the S&P 500 in their exact index weights. This approach ensures maximum tracking accuracy to the benchmark. When Apple represents 7% of the index, VUSA holds exactly 7% in Apple shares. Full replication proves most advantageous for concentrated indices where holding every constituent remains practical.

CSPX uses optimized sampling replication. As a result, the fund holds a representative subset of index securities selected to mirror overall index characteristics. Rather than owning all 500+ stocks, the fund might hold 450-480 names. Meanwhile, it uses quantitative optimization to match sector exposures, market capitalizations, and risk factors. This approach reduces transaction costs. Particularly, it helps with rebalancing trades involving smaller index constituents.

The replication difference creates minimal practical impact. Both methods produce excellent tracking results. Specifically, annual tracking errors typically stay under 0.15% for both funds. VUSA’s full replication theoretically provides slightly tighter tracking. However, CSPX’s optimized approach reduces trading costs that can offset any tracking disadvantage. Historical data suggests comparable tracking performance between the two methodologies.

Transparency favors VUSA’s full replication. You know with certainty that your portfolio contains every index constituent. By contrast, CSPX’s sampling introduces small deviations from the benchmark. These deviations might concentrate holdings slightly differently. However, both funds publish complete holdings daily. As a result, you can verify portfolio composition easily. This transparency difference remains more philosophical than practical for most investors.

Index Tracking Quality

Tracking difference compares fund return versus benchmark return. Thus, it provides the ultimate performance measure. Both VUSA and CSPX demonstrate excellent tracking over long periods. Typically, they match the S&P 500 within 0.1-0.2% annually. The 0.07% TER represents the primary source of underperformance. Meanwhile, securities lending revenue partially offsets this drag.

Short-term tracking variations occur randomly due to dividend timing, cash drag, and rebalancing costs. Therefore, investors should evaluate tracking performance over complete market cycles rather than quarterly periods. Over five and ten-year horizons, both funds track their benchmark admirably. Notably, differences between them fall within measurement noise.

Tax Implications: Accumulating vs Distributing

The accumulating versus distributing structure creates profound tax implications. Moreover, these implications vary dramatically by investor jurisdiction. Understanding your local tax treatment of ETF income represents the single most important factor in choosing between VUSA and CSPX.

In accumulation-favorable jurisdictions like Belgium and Portugal, authorities tax only distributed income. Therefore, CSPX’s accumulating structure means you pay no annual tax on reinvested dividends. You only pay capital gains tax upon eventual sale. Consequently, this deferral allows maximum compounding efficiency. By contrast, VUSA’s distributions trigger immediate taxation. As a result, reinvestable capital shrinks.

In distribution-neutral jurisdictions like the UK and Germany, tax authorities impute phantom income from accumulating ETFs. Therefore, you owe the same annual tax whether dividends distribute or accumulate. This eliminates CSPX’s tax advantage. Consequently, the choice becomes purely preferential. If you want income, take VUSA. Alternatively, if you prefer automated reinvestment, choose CSPX.

Consider a concrete example. Assume a EUR 10,000 investment growing at 10% annually with 1.5% dividend yield. In an accumulation-favorable jurisdiction, CSPX reaches approximately EUR 25,937 after ten years. Specifically, it achieves this through uninterrupted compounding. By contrast, VUSA reaches only EUR 25,412 with dividends taxed at 15% before reinvestment. That difference equals EUR 525 from tax drag alone.

Plug your starting yield and growth rate into our dividend snowball calculator.

However, in distribution-neutral jurisdictions, this advantage disappears. Both structures produce identical after-tax outcomes since authorities tax accumulated income annually. Despite this, VUSA offers the advantage of providing actual cash distributions. You can redirect these toward other investments, living expenses, or strategic rebalancing across asset classes.

Capital Gains Tax Considerations

Eventual capital gains taxation affects both ETFs identically in most jurisdictions. When you sell shares, you owe tax on the difference between purchase and sale prices. However, accumulating ETFs like CSPX require careful cost basis tracking. Some countries let you increase your cost basis by accumulated dividends already taxed. Therefore, this prevents double taxation. Verify your jurisdiction’s treatment to avoid overpaying taxes.

VUSA’s distributing structure simplifies record-keeping. Your cost basis equals your purchase price plus any reinvested distributions (tracked separately). Capital gains represent the straightforward difference between sale proceeds and this basis. Consequently, this simplicity reduces accounting complexity and potential errors at tax time.

Performance Track Record

Examining historical returns reveals surprising variations between these supposedly identical funds. VUSA has delivered superior long-term performance in several measurement periods. By contrast, CSPX leads in others. These differences stem primarily from measurement methodology, currency fluctuations, and data source variations. They do not reflect fundamental performance divergence.

Over ten years ending late 2025, VUSA shows approximately 14.76% annualized returns. Meanwhile, CSPX delivers 12.81% in some analyses. However, these figures likely reflect different measurement currencies, time periods, or whether performance includes reinvested distributions. When normalized for currency and measurement methodology, performance converges to within 0.1-0.2% annually. Notably, this exactly matches the expected range given near-identical holdings and fees.

Short-term performance comparisons prove meaningless. Random variations in dividend timing, currency fluctuations, and cash management create noise. As a result, this noise dominates any real differences. CSPX might outperform one quarter. Then VUSA leads the next. These variations average out over time. Therefore, the expense ratio remains the primary determinant of relative performance.

Both funds have successfully delivered S&P 500 index returns to European investors after accounting for costs. Neither demonstrates systematic outperformance or underperformance relative to expectations. Investors should assume both funds will continue tracking their benchmark with similar accuracy. They will deviate only by their expense ratios and random tracking noise.

Volatility and Risk Metrics

Both ETFs exhibit essentially identical volatility and risk characteristics. The reason is simple: they hold the same underlying securities. Standard deviation, maximum drawdown, and downside capture all mirror the S&P 500’s risk profile. VUSA and CSPX experienced similar 33-35% drawdowns during March 2020’s COVID crash. Moreover, they participated equally in subsequent recoveries.

The only risk differentiation comes from counterparty exposure in securities lending programs. Both funds maintain strict collateralization and daily marking to market. Neither presents concerning counterparty risk. Although VUSA’s smaller lending program creates marginally less exposure, this distinction remains immaterial for practical purposes.

Dividend Treatment and Cash Flow

VUSA pays quarterly dividends totaling approximately 1.5% annually. Typically, distributions occur in March, June, September, and December. The fund captures S&P 500 constituent dividends and passes them through to shareholders. Importantly, this happens after withholding 15% for US taxes. Investors receive actual cash. They can spend, reinvest manually, or redirect it toward other opportunities.

CSPX automatically reinvests all dividends internally. Consequently, no cash distributions occur. Your share count remains static. Meanwhile, net asset value per share increases to reflect accumulated income. This structure provides perfect dollar-cost averaging. Specifically, dividends buy additional fractional exposure at prevailing market prices. Notably, this happens without generating taxable events in favorable jurisdictions.

For investors in accumulation phases prioritizing growth, CSPX’s automatic reinvestment eliminates a key behavioral risk. Specifically, it removes the temptation to spend dividends rather than reinvest them. Therefore, the fund enforces investment discipline mechanically. By contrast, retirees or income-focused investors benefit from VUSA. The fund provides reliable quarterly cash flows. Moreover, it supplements other income sources without requiring share sales.

Reinvestment Considerations

VUSA’s distributions require manual reinvestment if you want to compound returns. Many brokers offer automatic dividend reinvestment programs (DRIPs) that eliminate this friction. However, DRIPs may purchase shares at suboptimal prices. Additionally, they can complicate tax reporting with multiple purchase lots at different cost bases.

CSPX’s internal reinvestment occurs automatically at net asset value without trading costs or behavioral risks. Therefore, this provides maximum compounding efficiency. The trade-off comes in reduced flexibility. Specifically, you cannot redirect CSPX’s dividends elsewhere without selling shares. By contrast, VUSA’s distributions offer optionality. You can rebalance toward other asset classes or seize opportunities as they arise.

Suitable Investor Profiles

Choose CSPX if you prioritize maximum compounding efficiency during accumulation phases. Additionally, CSPX suits investors residing in jurisdictions taxing only distributed income. Moreover, it fits those who prefer automated reinvestment without manual intervention. Furthermore, CSPX serves investors who value superior liquidity for potentially large future transactions. Finally, you might simply want exposure to Europe’s largest and most liquid S&P 500 ETF.

Choose VUSA if you want quarterly dividend income without selling shares. Additionally, VUSA suits investors who prefer Vanguard’s ownership structure and company philosophy. Moreover, it appeals to those who value full physical replication for maximum transparency. Furthermore, VUSA fits investors residing in distribution-neutral jurisdictions where accumulating offers no tax advantage. Finally, you might need cash flows for rebalancing or spending purposes.

For most European investors in accumulation phases, CSPX edges ahead. Specifically, its accumulating structure and superior liquidity provide real advantages. Moreover, the tax deferral benefits compound significantly over decades. However, investors in retirement phases or those wanting income should favor VUSA. Although VUSA shows slightly wider spreads, the quarterly distributions provide reliable cash flow without forced liquidations.

Portfolio Integration

Both ETFs serve as excellent core equity holdings within diversified portfolios. Their 100% US large-cap exposure should typically comprise 30-70% of equity allocations. Additionally, you should complement them with international developed markets, emerging markets, and potentially small-cap funds. Neither fund provides geographic diversification beyond the United States. Despite this, US multinationals generate substantial international revenues.

Consider tax-loss harvesting opportunities between VUSA and CSPX. Their high correlation but separate ticker symbols allow selling one at a loss for tax purposes. Meanwhile, you can immediately purchase the other to maintain market exposure. This strategy works only in jurisdictions where wash-sale rules don’t apply. Alternatively, it works where rules distinguish between these substantially identical securities.

The Verdict: Which ETF Wins?

Neither VUSA nor CSPX emerges as the universal champion. Your optimal choice depends entirely on personal circumstances. Specifically, tax situation, investment phase, income needs, and preferences regarding dividend treatment all matter.

CSPX wins for most accumulation-phase investors. Specifically, its larger size, superior liquidity, and accumulating structure defer taxes in favorable jurisdictions. Moreover, the combination of automated reinvestment, tight trading spreads, and tax efficiency creates maximum long-term compound returns.

VUSA wins for income-focused investors. Specifically, it serves those who value regular cash distributions. Additionally, it appeals to investors who prefer Vanguard’s shareholder-owned structure. Moreover, VUSA fits investors residing in jurisdictions where accumulating provides no tax advantage. Notably, the quarterly dividends create flexibility and optionality absent from accumulating funds.

The performance difference between these ETFs remains negligible over time. Both deliver excellent S&P 500 exposure at identical costs. Therefore, your tax circumstances and dividend preferences should drive the decision. Minor performance variations or brand loyalty matter far less.

Fortunately, this choice carries low stakes. Both ETFs represent outstanding investment vehicles backed by premier asset managers. Whichever you select will serve your portfolio admirably. Focus more energy on asset allocation, contribution consistency, and cost minimization across your complete portfolio. Don’t agonize over this binary choice.

Final Recommendations

Start by understanding your jurisdiction’s treatment of accumulating versus distributing funds. Importantly, this single factor should heavily weight your decision. Accumulation-favorable jurisdictions strongly favor CSPX. By contrast, distribution-neutral jurisdictions make the choice preferential.

Consider your investment timeline and purpose. Long accumulation phases spanning decades favor CSPX’s compounding efficiency. By contrast, shorter horizons or retirement phases prioritize VUSA’s income generation. Match the fund structure to your life stage and financial objectives.

Don’t overthink this decision. Both funds deliver virtually identical exposure and returns. The “wrong” choice costs you perhaps 0.05% annually. Notably, that’s far less than the impact of staying invested through market volatility. Additionally, it’s smaller than the impact of maintaining regular contributions and avoiding behavioral mistakes. Execute your choice. Then redirect mental energy toward factors mattering more for long-term success.

How VUSA and CSPX Fit With Other S&P 500 UCITS Peers

VUSA and CSPX rank as the two most-traded S&P 500 UCITS ETFs in Europe. However, they are not the only Irish-domiciled options. The Vanguard accumulating sibling, VUAA, mirrors CSPX’s structure with the same Vanguard 0.07% TER. Additionally, Invesco’s SPDR S&P 500 UCITS ETF (SXR8 / SPY5) ranks as the third major contender. For the head-to-head we publish on the Vanguard accumulating versus iShares accumulating choice, see VUSA vs CSPX vs VUAA. Meanwhile, the fee-focused look at the Invesco/iShares pair lives in our SXR8 vs VUAA S&P 500 ETF fee analysis.

For context: spdr vs ishares.

If you are deciding more broadly between the two issuers behind these funds rather than just a single fund pair, our Vanguard vs iShares comparison walks through structural differences. Specifically, it covers mutual ownership versus listed asset manager structures that influence long-term cost trajectories. Additionally, if you are weighing US-only exposure against a globally diversified core, the CSPX vs VWCE: S&P 500 or global? piece is the natural next step.

Primary-Source Documents Every VUSA / CSPX Investor Should Read

Before committing capital, you should read the funds’ own Key Investor Information Documents (KIDs). Additionally, review the index methodology that both ETFs replicate. The Vanguard UK professional product page hosts the VUSA factsheet and KID. Meanwhile, iShares publishes the equivalent CSPX documents on its iShares UK individual investor site. Both documents include the official ongoing charge, replication method, securities-lending policy and 12-month performance figures audited against the benchmark.

The benchmark itself is the S&P 500. Importantly, S&P Dow Jones Indices’ published methodology governs it. The methodology sets the float-adjusted market-cap weighting and the eligibility screens. Specifically, screens require US domicile, positive most-recent-quarter earnings, and $14.5B+ minimum total market cap as of the latest review. Additionally, it sets the quarterly rebalancing cadence. For a third-party side-by-side, justETF’s VUSA profile and the justETF CSPX profile include rolling tracking-difference tables, distribution histories and listing-by-listing spread data updated daily. Cross-checking the KID figures against justETF and Morningstar UK represents the kind of diligence we apply before recommending any UCITS ETF on this site.

UCITS Wrapper and Regulatory Oversight

Both VUSA and CSPX are Irish-domiciled UCITS funds. Therefore, they fall under the EU’s Undertakings for Collective Investment in Transferable Securities directive. UCITS oversight at EU level is coordinated by ESMA. Meanwhile, national competent authorities such as BaFin (Germany) and CySEC (Cyprus) supervise distribution into their jurisdictions. The Irish Central Bank acts as the home regulator. This UCITS V/VI framework caps single-issuer concentration at 10% of fund assets. Additionally, it mandates daily liquidity. Moreover, the framework requires the depositary to segregate client assets. Notably, these protections do not apply to US-listed S&P 500 ETFs such as VOO or SPY when bought directly by an EU retail investor. For a deeper walkthrough of why the UCITS wrapper matters, see our UCITS ETF complete guide.

German Teilfreistellung on VUSA and CSPX

German tax residents holding either VUSA or CSPX benefit from the Teilfreistellung regime introduced by the 2018 Investmentsteuergesetz (InvStG). Specifically, 30% of capital gains and distributions from equity-heavy UCITS funds are tax-exempt at the investor level. Both VUSA and CSPX qualify. They hold well above the 51% listed-equity threshold required for Aktienfonds status. In practice this reduces the headline 25% Abgeltungsteuer (plus solidarity surcharge) on equity ETF gains to roughly 17.5% net. For CSPX, the accumulating Vorabpauschale advance levy is calculated annually using the Bundesbank base rate. By contrast, VUSA distributions are taxed on receipt. Speak to a Steuerberater for personal advice. We are not authorised to provide tax advice for specific situations.

Frequently Asked Questions

Is VUSA distributing and CSPX accumulating?

Yes. VUSA (ISIN IE00B3XXRP09) pays quarterly cash dividends sourced from the underlying S&P 500 constituents. Typically, it distributes in March, June, September and December. By contrast, CSPX (ISIN IE00B5BMR087) reinvests all dividends inside the fund and pays no cash. Both are Irish-domiciled UCITS ETFs with the same 0.07% headline ongoing charge. If you specifically want a Vanguard accumulating share class, the sibling ticker is VUAA (ISIN IE00BFMXXD54). Notably, our VUSA vs CSPX vs VUAA piece linked above covers it.

How does German Teilfreistellung apply to VUSA and CSPX?

Both qualify as Aktienfonds under InvStG 2018 because they hold more than 51% listed equities. Therefore, 30% of capital gains and distributions are exempt. The headline Abgeltungsteuer of 25% (plus 5.5% Soli on the tax) effectively becomes around 17.5% net on equity ETF profits. Additionally, CSPX incurs an annual Vorabpauschale advance levy on accumulating share classes. By contrast, VUSA is taxed on each quarterly distribution. Notably, the BZSt publishes both as recognised investment funds.

What are typical broker spreads on Xetra for VUSA and CSPX?

During Xetra core hours (09:00-17:30 CET), CSPX usually trades at 2-3 basis points bid-ask for retail-sized orders. The reason is its much higher daily volume and roughly 2.5x larger AUM. By contrast, VUSA typically runs 3-5 basis points on Xetra and the LSE EUR listing. On volatile sessions or outside core hours, both can widen materially. Therefore, we always recommend limit orders rather than market orders for any UCITS ETF.

Which is larger: VUSA or CSPX, and does fund size matter for retail investors?

CSPX is materially larger. Specifically, it holds over EUR 107 billion in AUM versus approximately EUR 43 billion for VUSA at the time of this review. For retail investors investing in monthly or quarterly tranches, both are deeply liquid. Consequently, the fund-size gap is irrelevant in practice. Fund size starts to matter for very large block trades, securities-lending revenue economics, and the marginal tightness of bid-ask spreads during stress periods.

How is the US dividend withholding tax handled inside VUSA and CSPX?

Both ETFs are Irish-domiciled. Therefore, they benefit from the Ireland-US double taxation treaty. Specifically, this reduces US withholding tax on S&P 500 dividends from the default 30% to 15%. That 15% is irrecoverable for the fund itself. Consequently, it represents a permanent drag of roughly 0.20-0.25% per year at the index’s current ~1.4-1.5% gross yield. The remaining 85% of US dividends either goes to VUSA holders as distributions (subject to your local dividend tax) or stays reinvested inside CSPX. The outcome depends on the share class.

How big is the tracking difference between VUSA and CSPX historically?

Both funds typically post annual tracking differences within +/- 0.1% to 0.2% of the S&P 500 net total return index after the 0.07% TER. Securities lending revenue and treatment of franked dividends can occasionally push CSPX or VUSA marginally ahead in a given year. However, over rolling 3- and 5-year periods, the difference between the two funds tends to fall within measurement noise. Moreover, it is dominated by the underlying index return. Notably, that’s exactly what you want from a vanilla physical replicator.

How much does domicile actually cost? Model the US dividend withholding drag of an Irish versus a Luxembourg fund with the free withholding tax and domicile calculator.

Kestutis Balciunas
European UCITS/ETF investor with 11+ years building a global dividend and index portfolio, and founder of Financial Expert Class. I write every guide here from first-hand experience investing across EU brokers and tax regimes — not theory. More about me →