How to Hedge USD Exposure When Investing in VOO

Investing in VOO (Vanguard S&P 500 ETF) gives exposure to top U.S. companies — but if your base currency is CHF, EUR, SGD or others, you’re also taking on USD currency risk. Over time, the U.S. dollar has depreciated relative to several stronger currencies, which can reduce your returns when converted back.

Here are 3 effective ways to hedge that risk:

1. Buy a Currency-Hedged S&P 500 ETF

These use derivatives to neutralize USD movements, so your exposure stays focused on U.S. stocks.

🔹 CHF-Hedged ETFs

• iShares S&P 500 CHF Hedged UCITS ETF (IUSC) — TER: 0.25%
• Xtrackers S&P 500 CHF Hedged UCITS ETF (XDPC) — TER: 0.35%
• UBS S&P 500 CHF Hedged ETF (A-acc) — TER: 0.27%
• Xtrackers Equal-Weight ESG CHF Hedged ETF (XEWC) — TER: 0.25%

🔹 EUR-Hedged ETFs

• iShares S&P 500 EUR Hedged UCITS ETF (IUSE) — TER: 0.25%
• Amundi S&P 500 EUR Hedged UCITS ETF (S500H) — TER: 0.18%

🔹 SGD-Hedged ETFs

• UBS S&P 500 SGD Hedged UCITS ETF (A-acc) — TER: 0.27%
• LionGlobal US 500 Hedged Fund (SGD) — TER: ~0.50%

🔹 GBP-Hedged ETFs

• iShares S&P 500 GBP Hedged UCITS ETF (IGUS) — TER: 0.20%

🔹 JPY-Hedged ETFs

• Nikko AM S&P 500 JPY Hedged ETF — TER: ~0.22%

🔹 CAD-Hedged ETFs

• iShares S&P 500 Index ETF (CAD-Hedged) (XSP) — TER: 0.22%

🔹 AUD-Hedged ETFs

• ISHARES S&P 500 ETF (AUD Hedged) (SPYH) — TER: 0.1%

2. Use Currency Derivatives (Advanced)

Advanced investors can hedge using FX forwards or futures. This gives flexibility but requires more expertise and may include rollover and margin costs.

3. Diversify with Natural Hedging

Hold other local-currency assets (like bonds or REITs) to offset USD exposure. This indirect hedge can balance risk across your portfolio.

Why Hedge in CHF — Even If You’re Not Swiss

Final Thoughts

If you want simplicity: go with a currency-hedged ETF. For more flexibility: explore derivatives. But at minimum, understand your currency exposure when investing internationally.