A bit every month, in Australian dollars.

Why they land apart

Tax on dividends. Australia has an income tax treaty with the US. So when a fund based in the US, like VOO or QQQ, pays you a dividend, the US generally keeps 15%, once your broker has your W-8BEN form. Funds based in Australia, like IVV and NDQ, have US tax taken off inside the fund, and you can usually claim it against your Australian tax as a foreign income tax offset. A fund based in Ireland, like CSPX or CNDX, also has 15% taken off inside the fund, but that is generally not something you can claim back. So the Irish route that suits Singapore investors gives Australians no tax advantage.

The yearly fee. Each fund takes a small slice every year to run itself. It is already inside the price, so you never see a bill.

Paid out or kept in. Funds that pay dividends out leave you to reinvest them yourself. Our sums assume you did, every month, after tax. Funds that keep them in do it for you.

One more for US-based funds. If you are not a US citizen or resident, US estate tax can apply when you die holding more than US$60,000 of US assets, and shares in a US-based fund count. Australia has an estate tax treaty with the US that can change this, so check how it applies to you. Shares in an Irish-based fund generally do not count. The IRS explains the US$60,000 rule, and our CSPX guide covers the detail.

Two indexes, two personalities

The S&P 500 is a list of about 500 large US companies across every industry: banks, shops, drug makers, oil and tech.

The Nasdaq 100 is the 100 largest companies on the Nasdaq exchange, leaving out banks and other financial firms. It leans much harder into tech. Start the Nasdaq 100 in March 1999 and look at the scary bit: the swings are bigger both ways.

How the sum works

Each month, we spend your amount at that month’s closing price and count the units you would own. Then we value them all at the latest price, on 9 October 2026.

Each month we change your Australian dollars into US dollars at that month’s closing rate, then buy. At the end, the whole pot is changed back at the rate on 9 October 2026, which was A$1.4370 for each US dollar. Rates: the US Federal Reserve’s daily figures, published on FRED, taking the last day of each month. The 9 October rate is Yahoo Finance’s closing rate, because the Federal Reserve figures arrive about a week late. The ASX funds are bought straight in Australian dollars.

For the S&P 500, the big number uses the index itself from January 1988, with all dividends reinvested and no fees or tax. For the Nasdaq 100 we use QQQ from March 1999, the oldest fund that copies it, with dividends reinvested. QQQ’s prices already have its yearly fee taken out (0.18% today), so for the Nasdaq 100 the funds below are compared with a fund, not the bare index. The fund list uses each fund’s real prices, with dividends from US-based funds cut by 15%, and distributions from IVV and NDQ reinvested as paid, before Australian tax.

What it leaves out

• Broker fees. Commissions are not taken off. On small monthly amounts a fixed fee can eat a big share, so check your broker’s charges.
• Currency fees. We use the market exchange rate. Your broker’s rate for buying US-listed funds will be a little worse. The ASX funds avoid this step.
• Whole units. Some funds cost hundreds of US dollars a unit. The sums assume you can buy part of one. If your broker only sells whole units, you would save up and buy one every few months instead.
• Tax where you live. Many countries also tax dividends or gains. Only the tax the US keeps back is counted here.
• The future. These are past prices. The next 20 years could be better, worse, or very different.

This is general information to help you understand how index investing works. It is not advice to buy any fund.