iShares S&P 500 ETF (IVV) inks all-time ASX high! Too late to buy?

Here's my take on this ETF's new record.

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It's been a disastrous start to the trading week for ASX shares so far this Tuesday. At the time of writing, the S&P/ASX 200 Index (ASX: XJO) has tanked by a horrid 1.56%, leaving the index at just under 7,740 points. But it's been a very different story for the iShares S&P 500 ETF (ASX: IVV) today.

Whilst the ASX 200 has been nosediving this Tuesday, the iShares S&P 500 ETF is exploding higher. At present, IVV units have risen by a robust 1.08% up to $54.19 each.

Just after midday, things were even better for this ASX exchange-traded fund (ETF), with IVV units climbing to a high of $54.21 each.

Not only is that a new 52-week high for the iShares S&P 500 ETF, but an all-time record high. Yep, since its ASX listing back in 2007, this index fund has never been more expensive than it is today.

So how can we be seeing a new record high for this ASX ETF on a day that has seen the ASX 200 take such a bath from Australian investors?

How has the IVV ETF just hit a new ASX record?

Well, the first thing to note is that the iShares S&P 500 ETF has absolutely no correlation to the ASX or any ASX shares. Rather, it represents an investment in the largest 500 companies listed on the American stock market.

As such, it's not really surprising to see this ETF move in the opposite direction to most ASX shares this Tuesday.

Last night, we saw the US markets rocket higher. The S&P 500 Index (SP: .INX) gained 0.26% to finish up at 5,360.799 points, which is just a tad below its current all-time high of 5,375.08 points.

So it's no wonder an S&P 500-tracking ETF is following suit on the ASX today.

The S&P 500 Index (and thus the iShare S&P 500 ETF) counts the major US tech stocks as its largest holdings. So it was no surprise to see these tech giants grow in value during last night's trade.

To illustrate, Microsoft stock rose by 0.95% last night. Amazon shares grew 1.5%, while Alphabet's Class A stock was up 0.43%. NVIDIA shares bounced 0.75% higher, and Meta Platforms soared 1.96%.

These companies are all top ten stocks within the IVV portfolio. So it's easy to see why this ASX ETF is having such a stunning day on the ASX boards right now.

Should investors buy?

Many investors will be taking note of today's fresh highs and no doubt wonder if it's too late to buy in. So is it?

Well, I like to take a long-term view with all investments, but particularly for index funds like IVV. Index funds, both those that cover ASX shares and those that track US shares, have a long history of delivering solid returns over decades. The iShares S&P 500 ETF is no different. As of 31 May, this ASX ETF has returned an average of 16.32% per annum over the past ten years.

Now one should never assume that an investment's past returns will dictate future gains. However, with that objectively high rate of return, this ETF would have seen plenty of record highs in years gone by. If an investor had put off deploying more cash into IVV units at any of its last all-time highs, they would probably be rueing that decision today.

Will today's new all-time high be different? I don't know, and neither does anyone else. But if I were personally contemplating whether an investment at today's all-time highs was prudent, I would remember this simple fact and go ahead. The stock market goes up far more often than it goes down. By that logic, it makes sense to invest as often as we can, as soon as we can.

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Motley Fool contributor Sebastian Bowen has positions in Alphabet, Amazon, Meta Platforms, and Microsoft. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet, Amazon, Meta Platforms, Microsoft, Nvidia, and iShares S&P 500 ETF. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has recommended the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool Australia has recommended Alphabet, Amazon, Meta Platforms, Microsoft, Nvidia, and iShares S&P 500 ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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