VFV vs. VOO: What’s the Difference Between the CAD-and USD-Listed S&P500 ETFs?

For Canadian investors, there may be a need to invest in the U.S. stock market. Against the backdrop of the U.S. stock market's continued positive performance. If investors do not have the time to choose which specific stock to invest in and are keen on index-tracking investment methods, then the two ETFs that track the S&P 500 index, VFV and VOO, may catch the interest of Canadian investors.

Let's get to know these two ETFs through this article to expand your investment decision-making options.

What are VFV and VOO?

Certainly! VFV and VOO are both exchange-traded funds (ETFs) that track the performance of the S&P 500 Index, which is one of the most widely recognized benchmarks for large-cap U.S. equities.

However, the difference is that VFV is a Canadian-listed ETF managed by Vanguard Investments Canada Inc. , priced in Canadian dollars (CAD). VOO is a U.S.-listed ETF managed by The Vanguard Group , priced in U.S. dollars (USD).

What is Vanguard?

Vanguard is a renowned American investment management company founded on May 1, 1975, by John C. Bogle. It is headquartered in Malvern, Pennsylvania, and is known for pioneering the concept of index funds for individual investors. Vanguard is unique in that it is owned by its funds, which are in turn owned by its shareholders, allowing it to maintain a focus on low-cost investing and avoid conflicts of interest typical of publicly traded firms.

Vanguard offers a wide range of financial products and services, including mutual funds, ETFs, brokerage services, financial planning, asset management, and trust services. It is the largest provider of mutual funds and the second-largest provider of ETFs globally, with over $10 trillion in assets under management as of late 2025.

VFV vs. VOO: What's the difference?

VFV vs. VOO: Fees

According to the official data, the MER（The management expense ratio，is an annualized measure of the cost charged to investors, to invest in a fund. It is calculated by dividing the total of the expenses charged to manage and operate the fund by the total assets of the fund.） for VFV is 0.09%, and the MER for VOO is 0.03%. Although the MER of VFV is higher than that of VOO, both have relatively low MERs compared to other ETFs. It's also important to note that the larger the fund size, the smaller the expense ratio tends to be, as the costs required to operate the fund do not increase proportionally with the scale of managed assets. Based on the data as of March 21, 2025, the AUM（assets Under Management） for VFV is CAD 21.06 billion, and the AUM for VOO is USD 619.52 billion. VOO's fund size is significantly larger than that of VFV, so the larger difference in their MERs is also reasonable.

VFV vs. VOO: Liquidity

Evaluating the liquidity of ETFs typically focuses on data such as their trading volume and asset size. Trading volume is a direct indicator of ETF liquidity, representing the level of trading activity of the ETF within a certain period. The higher the average daily trading volume, the better the liquidity, allowing investors to more easily buy and sell ETF shares. The total asset size of an ETF is also a factor in assessing its liquidity. Generally speaking, the larger the asset size of an ETF, the better its liquidity, as there are more assets available for trading.

We already know that the asset size of VOO is much larger than that of VFV. According to the official data released by the fund managers, the average daily trading volume of VOO is about 4.39 million US dollars, while the average daily trading volume of VFV is about 500,000 Canadian dollars. So from a data perspective, VOO's liquidity is better than VFV's. However, this conclusion needs to be viewed objectively because they target different markets, and the U.S. market that VOO faces, in terms of size, activity, and liquidity provided, is superior to the Canadian market that VFV faces.

VFV vs. VOO: Holdings

VOO and VFV both track the S&P 500 index and hold 503 stocks of the benchmark, but the difference is that VOO directly holds the stocks that track the index, while VFV indirectly holds these stocks by purchasing VOO. However, this does not mean they have the same holding data. The following is a comparison of the top 15 holdings of the two ETFs as of March 21, 2025.

This table compares the top 15 holdings of VOO and VFV as of March 21, 2025. Since both funds track the S&P 500 index, their allocations are identical.

VFV vs. VOO: Tax

Because both of these ETFs ultimately hold U.S. stocks, they may be subject to dividend withholding tax. When non-U.S. residents receive dividends from U.S. stocks they hold, a withholding tax is typically required. The standard withholding rate is 30%, but this rate can be reduced through a bilateral tax treaty. According to the U.S.-Canada tax treaty, the withholding rate is 15%, and holding through an RRSP account can exempt the withholding tax. Therefore, if you hold VOO through an RRSP, you don't have to consider the withholding tax. However, holding VFV through an RRSP does not exempt this withholding tax because VFV operates by purchasing VOO, and the tax liability arises before VFV pays the dividends to you (tax is applied when VOO distributes dividends). So, if you want to completely avoid withholding tax, holding VOO through an RRSP is the only option.

Additionally, it is important to note that you may also face the issue of double taxation. If encountered, you can apply for a foreign tax credit when filing your taxes to avoid double taxation.

VFV vs. VOO: Currency hedging

We already know that VFV operates by holding VOO, meaning that VFV is a Canadian ETF that holds a U.S. ETF, so the impact of exchange rates on it needs to be considered.

First and foremost, it should be clear that VFV is unhedged, so fluctuations in the exchange rate between the U.S. dollar and the Canadian dollar will directly affect the performance of VFV and also impact the return rate on your holding of VFV.

Based on this, we can specifically compare the differences that Canadian investors face when purchasing two ETFs:

Purchasing the CAD-denominated fund without currency hedging (VFV):

The investment return rate depends not only on the performance of the S&P 500 Index but is also directly affected by the exchange rate fluctuations between the US dollar and the Canadian dollar. If the U.S. dollar appreciates, the return rate will also increase accordingly.

Purchasing the USD-denominated fund after exchanging currency (VOO):

Investors first exchange Canadian dollars for US dollars and then purchase VOO. The investment return rate is not affected by exchange rate fluctuations on paper and depends solely on the performance of the S&P 500 Index. However, as Canadian investors holding US dollar-denominated assets, they will also face the impact of exchange rate changes on their returns. If the U.S. dollar appreciates, investors will benefit when ultimately converting the U.S. dollar returns back to Canadian dollars, and vice versa.

Key Points:

• Identical currency risk: Whether through a fund without currency hedging or by exchanging currency themselves, investors face the same currency fluctuation risk.

• Transparency and convenience: Holding a CAD-denominated fund without currency hedging (VFV) allows investors to manage their investments more conveniently since the fund already includes the currency factor. Currency exchange, on the other hand, requires additional operations and management.

VFV vs. VOO: Return

Based on the performance comparison chart of the two ETFs over the past three years, it can be seen that since they track the same index, the trends of the two ETFs are essentially the same, but there are still differences, which depend on exchange rates and a variety of other factors.

Let's take a look at the comparison of the two ETFs in terms of return rates.

It can be seen that while the return rates of the two ETFs are close, there are still differences, which aligns with the results presented in their performance comparison chart. This is primarily reflected in the differences in the three-year annualized average return rates.

Overall, in the past 10 years, due to several strengthening of the US dollar against the Canadian dollar, VFV has often outperformed VOO in terms of return data. For instance, there were two significant appreciations of the US dollar against the Canadian dollar in September 2014 and June 2021, which may respectively led to a substantial lead for VFV over VOO in the 10-year and 3-year average annual return data.

VFV vs VOO: How to choose?

If you are considering investing in an ETF that tracks the S&P 500 index, please choose between VFV and VOO based on your investment goals, tax situation, and the different characteristics of the two ETFs. Overall, VOO has a lower MER and higher liquidity, and there are ways to avoid withholding taxes. However, VFV trades in Canadian dollars, so there is no need to consider the exchange between the US dollar and the Canadian dollar. And VFV appears more impressive in terms of return data, but this should be viewed objectively, as the data may not accurately reflect the true situation. In summary, both ETFs have their own advantages, and investors still need to make choices based on their own needs.

Finally, please note that these two ETFs ultimately hold stocks as their underlying assets and are considered medium to high-risk products. Their past performance is not indicative of future results. Investors should carefully consider their own risk tolerance, investment objectives, and fully understand the characteristics of the relevant ETFs before making any investment decisions. It is recommended to consult with a professional financial advisor before investing. The information provided in this article is for reference only and does not constitute investment advice.