S&P 500 Total Return ETF ?

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airelleofmusic
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S&P 500 Total Return ETF ?

Post by airelleofmusic » Mon Apr 16, 2018 3:16 pm

Hello,

First of all, many thanks everyone, I learnt so much on this forum :)

I am currently investing in three major asset classes, s&p 500, world ex-us and emerging markets.

Do you know if there is an ETF that tracks the S&P 500 dividends reinvested ?

Indeed I am currently investing from France (in USD through TD Ameritrade) and each time my s&p etf distributes dividends I am taxed 15% on it (instead of 30% because of tax treaty between the US and France). However to get back this money I need to fill a tax credit form in France which is very annoying for me.

That's why I would like to know if some etfs tracking the performance of the S&P 500 total return - that don't distribute any dividends - exist.

Same question for etfs tracking total returns World ex-US and Emerging markets.

Many thanks,
aom
LBYM and enjoy life ! Thanks BH !

lack_ey
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Re: S&P 500 Total Return ETF ?

Post by lack_ey » Mon Apr 16, 2018 3:33 pm

I don't know about the tax treatment, but there are accumulating ETFs available (outside the US) that reinvest dividends. If you're investing in US markets, no. The US-listed funds all distribute dividends.

I know some Ireland-domiciled ETFs are popular abroad but don't know how that fits. There's an iShares Core S&P 500 UCITS ETF (CSPX) for example that seems to be registered in France.

https://www.ishares.com/uk/institutiona ... titutional

EM:

https://www.ishares.com/uk/institutiona ... -ucits-etf

I'm not aware of an accumulating world ex-US ETF but it may exist (I have little reason generally to look at a US investor).


Chuck
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Re: S&P 500 Total Return ETF ?

Post by Chuck » Mon Apr 16, 2018 4:00 pm

I believe US-based funds are required by law to distribute dividends to investors.

airelleofmusic
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Re: S&P 500 Total Return ETF ?

Post by airelleofmusic » Mon Apr 16, 2018 4:11 pm

Ok, I did not know that US-based funds are required by law to distribute dividends to investors.

Maybe a solution is to sell my ETF just before the dividends are announced and then buyback ?
LBYM and enjoy life ! Thanks BH !

Chuck
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Re: S&P 500 Total Return ETF ?

Post by Chuck » Mon Apr 16, 2018 4:13 pm

What are you trying to accomplish?

ThriftyPhD
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Re: S&P 500 Total Return ETF ?

Post by ThriftyPhD » Mon Apr 16, 2018 4:18 pm

airelleofmusic wrote:
Mon Apr 16, 2018 4:11 pm
Ok, I did not know that US-based funds are required by law to distribute dividends to investors.

Maybe a solution is to sell my ETF just before the dividends are announced and then buyback ?
In general the dividend payout would be reflected in the ETF price. It would drop after the dividend is paid. Otherwise people would do the opposite, buy the day before and sell the day after to earn a quick sum of cash.

In your case, selling before and buying after, you would have a capital gain. If you do this every quarter, it would be a short term capital gain which would be taxed more so than the qualified dividend you're trying to avoid. Plus the complexity, opportunity cost of being out of the market, transaction fees, paperwork...

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triceratop
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Re: S&P 500 Total Return ETF ?

Post by triceratop » Mon Apr 16, 2018 4:21 pm

Chuck wrote:
Mon Apr 16, 2018 4:00 pm
I believe US-based funds are required by law to distribute dividends to investors.
Only to the extent the dividends exceed fund operating expenses, but yes.
"To play the stock market is to play musical chairs under the chord progression of a bid-ask spread."

selters
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Re: S&P 500 Total Return ETF ?

Post by selters » Mon Apr 16, 2018 4:31 pm

No. If you want the returns of the S&P500 Gross Return Index if you live outside the US, you need to take the dividends, pay taxes on them every year, and then fill out the French tax credit form. If you buy something like the iShares S&P 500 UCITS ETF, you will only get the returns of the S&P 500 Net Return Index, which are lower (0.20-0.50% lower) than the returns of the Gross Return Index.

This is what the fuzz about outlawing US listed ETFs in Europe is about. If you can't invest in the US listed ETFs, you're flushing 20-50 basis points of return down the toilet every tear due to the dividend tax leakage in the Europe listed UCITS funds.

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BeBH65
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Re: S&P 500 Total Return ETF ?

Post by BeBH65 » Mon Apr 16, 2018 4:51 pm

Assumung you are not an US person. Suggest you put something like [france] to attract the experts to your thread.

Please have a look at these wiki pages:
https://www.bogleheads.org/wiki/Nonresi ... Irish_ETFs
https://www.bogleheads.org/wiki/Outline ... Tax_issues
https://www.bogleheads.org/wiki/EU_inve ... re_classes
https://www.bogleheads.org/wiki/EU_inve ... d_taxation
BeBH65. (only an investment enthusiast, not a financial adviser, perform your due diligence).

airelleofmusic
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Re: S&P 500 Total Return ETF ?

Post by airelleofmusic » Tue Apr 17, 2018 2:13 am

Thanks for the links, I will have a look
LBYM and enjoy life ! Thanks BH !

aristotelian
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Re: S&P 500 Total Return ETF ?

Post by aristotelian » Tue Apr 17, 2018 6:14 am

Unfortunately there are no zero dividend ETFs. If you are determined to avoid dividends, you could put together your own portfolio around BRKB, GOOG, AMZN etc.

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