The iShares S&P 500 ETF (ASX: IVV) is one of the most popular index funds on the ASX. Being the only index fund that tracks the S&P 500 Index was always going to make IVV a go-to choice for ASX investors looking for exposure to the best of the American markets.
After all, S&P 500 index funds enjoy the endorsement of legendary investor Warren Buffett. So, this was always an avenue that at least some investors would find appealing.
We would all be aware that US stocks, and the American markets in general, have had a very lucrative year indeed so far in 2024. But what about an ASX investor who bought IVV units five years ago? Let's dig into the returns those investors have enjoyed today.
How much has the ASX IVV returned to investors over five years?
So, in mid-November 2019, IVV units closed at $30.66. Of course, that's adjusted for this exchange-traded fund (ETF)'s stock split in late 2022.
If one had spent $5,000 on an ASX IVV investment back then, they would have received 163 units with a little change left over.
Today, those same units are priced at $61.50 each. That means that IVV's ASX investors have enjoyed a capital gain return worth 100.59% over the past five years alone. That's worth an annual compounded growth rate of 14.94% per annum.
As such, our investor's 163 IVV units would be worth approximately $10,024.50 today.
We can already tell how rewarding investing in the iShares S&P 500 ETF five years ago has been for ASX investors. But we haven't even included the returns from dividend distributions yet.
The IVV ETF pays its ASX investors a dividend distribution every quarter. While the S&P 500 isn't exactly known for its heavy-hitting dividends, these returns are still worth tabulating.
Since November 2019, the iShares S&P 500 ETF has paid out a total of $2.775 per unit in dividend distributions. Our investor, who has 163 of those units, would have, therefore, received a total of $452.33 in dividend income over the past five years.
Adding that to our unit price return, we get a final figure of $10,476.83. We can thus conclude that a $5,000 investment five years ago would today be worth $10,476.83. That's with both share price gains and dividend income accounted for. Therefore, we get an absolute return of 109.64%, or 15.96% per annum.
Let's see what the next five years deliver to iShares S&P 500 ETF investors.
