Fidelity Index US fund - how closely does it track S&P500?

[Heathwood]

Hey folks, I apologise in advance if this is a stupid question.

I have a few quid in the Fidelity Index US fund which I believe tracks the S&P500. However I’ve noticed of late that whilst the S&P is around 15% below it’s all time high achieved, I believe, towards the beginning of the year, the above mentioned fund is now within 3% of its all time high achieved around the same time.

Looking at performance charts side by side, it appears the tracker fund has quite noticeably outperformed the S&P during 2022. How is this possible? Or am I due a massive whoosh parrot?

[Derek Chevalier]

Heathwood said:

Hey folks, I apologise in advance if this is a stupid question.

I have a few quid in the Fidelity Index US fund which I believe tracks the S&P500. However I’ve noticed of late that whilst the S&P is around 15% below it’s all time high achieved, I believe, towards the beginning of the year, the above mentioned fund is now within 3% of its all time high achieved around the same time.

Looking at performance charts side by side, it appears the tracker fund has quite noticeably outperformed the S&P during 2022. How is this possible? Or am I due a massive whoosh parrot?

Are you looking at the S&P 500 in GBP? On a total return basis in GBP it's ~1% down YTD.

[LeoSayer]

Exchange rates have softened the blow of US market drops for UK investors who haven't hedged their currency exposure.

A year ago, 1 USD bought around 0.72 GBP, now it buys around 0.83 GBP.

I assume your fund isn't hedged.

[Panamax]

Here's a comparison of S&P 500 with your fund returns over 5 years,

2017 S&P 500 22% Fund 10%

2018 S&P 500 -4% Fund 0.2%

2019 S&P 500 31% Fund 26%

2020 S&P 500 18% Fund 14%

2021 S&P 500 29% Fund 31%