I was looking at 5 year returns (14.11.2013 - 14.11.2018) on both indexes:
^SP500TR (Total return S&P500 index): 67.18% in USD
^SPX (Price return S&P500 index): 50.87% in USD
And comparing to two iShares ETF's for european investors - both are total return (dividends accumulated):
IUSE (iShares S&P 500 UCITS hedged EUR): 51.09% in EUR
CSPX (iShares S&P 500 UCITS unhedged EUR): 64.06% in USD, 97% in EUR (with FX return)
Why is there a 13% difference between returns of IUSE (EUR) and CSPX (USD)? Is currency hedging so expensive? In Key Investor Information document they said, they use one month FX forward contracts and Total Expense Ratio is 0.2% p.a. It looks like all income from dividends is used for hedging costs.
^SP500TR (Total return S&P500 index): 67.18% in USD
^SPX (Price return S&P500 index): 50.87% in USD
And comparing to two iShares ETF's for european investors - both are total return (dividends accumulated):
IUSE (iShares S&P 500 UCITS hedged EUR): 51.09% in EUR
CSPX (iShares S&P 500 UCITS unhedged EUR): 64.06% in USD, 97% in EUR (with FX return)
Why is there a 13% difference between returns of IUSE (EUR) and CSPX (USD)? Is currency hedging so expensive? In Key Investor Information document they said, they use one month FX forward contracts and Total Expense Ratio is 0.2% p.a. It looks like all income from dividends is used for hedging costs.