ETF Investing for Beginners in Australia (2025) — VOO vs VAS vs IVV Compared
TL;DR Summary (5 key points)
- VOO (Vanguard S&P 500) and IVV (iShares S&P 500) track the U.S. market, while VAS tracks the Australian market (ASX 300).
- All three are index ETFs — low-cost, diversified, and designed for long-term growth.
- VOO and IVV give exposure to large U.S. companies like Apple and Microsoft, while VAS gives exposure to local leaders like BHP, Commonwealth Bank, and Woolworths.
- Annual management fees are very low — 0.03% for VOO, 0.04% for IVV, and 0.10% for VAS.
- Australian investors can buy all three ETFs easily through brokers like CommSec, Pearler, or SelfWealth.
Why ETFs matter in Australia (2025)
Exchange-Traded Funds (ETFs) are one of the easiest ways to invest in shares without picking individual stocks. They help Australians access diversified portfolios, including overseas markets, at low cost. With the rise of zero-commission apps and simple brokers, ETF investing has become mainstream in 2025.
Comparison Table — VOO vs VAS vs IVV
| Feature | VOO (Vanguard S&P 500) | IVV (iShares S&P 500) | VAS (Vanguard Australian Shares) |
|---|---|---|---|
| Market exposure | U.S. (S&P 500) | U.S. (S&P 500) | Australia (ASX 300) |
| Management fee (MER) | 0.03% | 0.04% | 0.10% |
| Top holdings | Apple, Microsoft, Amazon | Apple, Nvidia, Alphabet | BHP, CBA, NAB, Woolworths |
| Dividend yield (2025 est.) | ~1.5% | ~1.5% | ~4.3% |
| Currency exposure | USD (no hedging) | USD (no hedging) | AUD |
| Listing exchange | NYSE (U.S.) | ASX (Australian version) | ASX |
| Best for | U.S. market exposure | U.S. market exposure via ASX | Australian income-focused investors |
Who Each ETF Is Best For
- VOO: Ideal for investors using international brokers or USD accounts seeking long-term U.S. exposure.
- IVV: Perfect for Australians wanting U.S. exposure but trading directly on the ASX in AUD.
- VAS: Great for dividend-focused investors who prefer Australian companies and franking credits.
Step-by-Step — How to Start Investing in ETFs
- Choose a broker — e.g. CommSec, Pearler, SelfWealth, or Stake.
- Open an account and verify ID (takes 1–2 business days).
- Deposit funds in AUD and search the ETF ticker (VAS, IVV, or VOO).
- Place a buy order (market or limit order) and confirm the trade.
- Hold and reinvest dividends for long-term compounding growth.
Cost / Fees / Tax Considerations
- Brokerage fee: Typically $5–$20 per trade depending on platform.
- ETF management fee (MER): 0.03–0.10% per year (deducted automatically from fund performance).
- Currency risk: U.S. ETFs (VOO, IVV) are affected by AUD/USD exchange rates.
- Dividends: Australian ETFs like VAS provide franking credits; U.S. ETFs may withhold 15% tax under the tax treaty.
- Capital gains tax: Applies when you sell ETFs for a profit; CGT discount may apply for holdings over 12 months.
Decision Guide — Which ETF Should You Choose?
| Goal | Recommended ETF | Why |
|---|---|---|
| Exposure to U.S. tech giants | VOO or IVV | Tracks the S&P 500 including Apple, Microsoft, Amazon |
| Prefer investing in AUD via ASX | IVV or VAS | Traded on ASX; no USD conversion needed |
| Focus on dividends & franking credits | VAS | High yield and Australian tax benefits |
| Long-term global diversification | Mix of IVV + VAS | Combines U.S. and Australian exposure |
FAQ (Australia 2025)
Is ETF investing safe for beginners?
ETFs are diversified and generally lower-risk than individual shares, but prices can still fluctuate with the market.
Do I need a U.S. account to buy VOO?
Yes, VOO trades on the U.S. exchange (NYSE). Australians can access it via international brokers like Stake or Interactive Brokers.
What’s the difference between IVV and VOO?
Both track the same S&P 500 index. IVV trades on the ASX in AUD, while VOO trades in USD on the NYSE.
Which ETF pays more dividends?
VAS generally pays higher dividends (~4–5%) than U.S. ETFs (~1.5%).
Can I lose money with ETFs?
Yes, if the underlying market falls. ETFs follow market performance — they’re not risk-free.
How much do I need to start investing?
You can start with as little as $100–$500 through most Australian brokers, depending on platform minimums.
Sources / Official References
- Vanguard Australia — VAS ETF
- iShares Australia — IVV ETF
- Vanguard US — VOO ETF
- ASIC Moneysmart — ETFs explained
Disclaimer:
This article is for general information only and is not financial advice. Please check official ETF providers, ATO guidance, or consult a licensed financial adviser before investing.