Q: I'm curious as to why you recommend VFV as it is my understanding that it is a Canadian ETF invested in a US S&P 500 ETF which has double taxation in a RRSP and doesn't seemed to be taxed favorably in a TFSA or non registered account either. Wouldn't be better to buy ZSP which invests directly in the S&P stocks or HXS which has a higher fee but no dividend to trigger withholding tax?
5i Research Answer:
The withholding tax issue has validity for some accounts, and ZSP can be better for some accounts. With an indicated dividend yield of 1.3%, the withholding tax on ZSP can be 0.195%. The additional tax hit is relatively minor. But, ZSP should be preferred overall. VFV has been a 'go to' fund for us for awhile, and we note that five year returns on the two are identical. But taxes can play a part here. HXS we like but many investors do not understand the swap/derivatives so we often mention it after other ETFs.
Authors of this answer, directors, partners and/or officers of 5i Research and/or affiliated companies have a financial or other interest in VFV.