# Do ETF trackers suck? **URL:** \ **Category:** General\ **Created:** [15 July 2023 13:38 UTC](https://community.investengine.com/t/do-etf-trackers-suck/1060 "2023-07-15T13:38:09Z")\ **Posts on this page:** 13\ **Page:** 1
**Author:** ![stuart](https://avatars.discourse-cdn.com/v4/letter/s/cab0a1/32.png) [@stuart](https://community.investengine.com/u/stuart)\ **Post date:** [15 July 2023 13:38 UTC](https://community.investengine.com/t/do-etf-trackers-suck/1060/1 "2023-07-15T13:38:09Z")
My wife wanted to get started with investing so I suggested she try an S&P 500 tracker. She chose iShares S&P 500 (CSP1) 2 weeks back, and looking at the performance now we can see the ETF is not performing as expected. Here is the performance of the ETF (on 15th July 2023) last year +7.52% last month -0.24% Here is the performance of the S&P 500: last year +16.63% last month +1.80% The ETF is doing a terrible job of tracking the index over long and short time period. Firstly, does anyone know why they diverge so much? And secondly, assuming this is a function of the nature of ETFs, do ETF trackers just suck? ---
**Author:** ![Ted](https://avatars.discourse-cdn.com/v4/letter/t/db5fbb/32.png) [@Ted](https://community.investengine.com/u/Ted)\ **Post date:** [15 July 2023 18:12 UTC](https://community.investengine.com/t/do-etf-trackers-suck/1060/2 "2023-07-15T18:12:24Z")
Comparing them both in the same currency? ---
**Author:** ![Optimisery](https://avatars.discourse-cdn.com/v4/letter/o/ed8c4c/32.png) [@Optimisery](https://community.investengine.com/u/Optimisery)\ **Post date:** [15 July 2023 20:43 UTC](https://community.investengine.com/t/do-etf-trackers-suck/1060/3 "2023-07-15T20:43:59Z")
Your tracking after 2 weeks of investing? šŸ˜­ ---
**Author:** ![Josh](https://avatars.discourse-cdn.com/v4/letter/j/45deac/32.png) [@Josh](https://community.investengine.com/u/Josh)\ **Post date:** [16 July 2023 08:55 UTC](https://community.investengine.com/t/do-etf-trackers-suck/1060/4 "2023-07-16T08:55:07Z")
![image](https://europe1.discourse-cdn.com/flex017/uploads/investengine/original/1X/44bb9a5ffb6f63bcd462b459f16d0d63890a1492.png) Hopefully this image can answer your question. You have currency risk in your ETF. Which is fine by the way! But more importantly before investing please do your research so that you avoid surprises like this. Nothing has gone wrong šŸ™‚ ---
**Author:** ![stuart](https://avatars.discourse-cdn.com/v4/letter/s/cab0a1/32.png) [@stuart](https://community.investengine.com/u/stuart)\ **Post date:** [16 July 2023 09:15 UTC](https://community.investengine.com/t/do-etf-trackers-suck/1060/5 "2023-07-16T09:15:29Z")
Thanks Ted and Josh, the fund is valued in GPX so yes, the discrepancy is the change in GBP-USD exchange. Given the relative volatility of the pound in the last 9 months we might look at a hedged fund instead. ---
**Author:** ![stuart](https://avatars.discourse-cdn.com/v4/letter/s/cab0a1/32.png) [@stuart](https://community.investengine.com/u/stuart)\ **Post date:** [16 July 2023 09:19 UTC](https://community.investengine.com/t/do-etf-trackers-suck/1060/6 "2023-07-16T09:19:15Z")
Celia, my wife comes from a family who have no savings. She is 40, has no investments (until 2 weeks ago), no pension and no savings other than whatā€™s in her bank account. Sheā€™s very nervous about investing and has read a couple of books to educate herself before getting started. Iā€™m sorry that she didnā€™t live up to your expectations of not looking at her first ever investment for months or years on end. ---
**Author:** ![Rishi](https://avatars.discourse-cdn.com/v4/letter/r/90db22/32.png) [@Rishi](https://community.investengine.com/u/Rishi)\ **Post date:** [16 July 2023 11:14 UTC](https://community.investengine.com/t/do-etf-trackers-suck/1060/7 "2023-07-16T11:14:32Z")
Itā€™s exciting that your wife has now started her investment journey Stuart. We have walked a similar path. ---
**Author:** ![Omian](https://avatars.discourse-cdn.com/v4/letter/o/71e660/32.png) [@Omian](https://community.investengine.com/u/Omian)\ **Post date:** [16 July 2023 13:14 UTC](https://community.investengine.com/t/do-etf-trackers-suck/1060/8 "2023-07-16T13:14:00Z")
Welcome Stuart and wife. Perhaps a savings account instead/in addition to your ETF might be a consideration. Take a look at justetfā€¦com for some impartial information. ---
**Author:** ![Optimisery](https://avatars.discourse-cdn.com/v4/letter/o/ed8c4c/32.png) [@Optimisery](https://community.investengine.com/u/Optimisery)\ **Post date:** [19 July 2023 06:10 UTC](https://community.investengine.com/t/do-etf-trackers-suck/1060/9 "2023-07-19T06:10:19Z")
Stuart, I wasnā€™t meaning to be rude šŸ˜Š I canā€™t comment on that particular ETF - But I can suggest that you maybe add a small allocation of her portfolio to CSH2 money market fund. Iā€™ve done this with my other half who is also new to investing & it reassuringly stays in the green whilst his All World tracker fluctuates. Less worry šŸ˜Š Good luck šŸ‘ ---
**Author:** ![shrimper](https://avatars.discourse-cdn.com/v4/letter/s/8dc957/32.png) [@shrimper](https://community.investengine.com/u/shrimper)\ **Post date:** [21 July 2023 19:54 UTC](https://community.investengine.com/t/do-etf-trackers-suck/1060/10 "2023-07-21T19:54:39Z")
CSH2 isnā€™t really investing - itā€™s a ā€˜bank depositā€™ savings equivalent that will roughly track Bk of England interest rate, but with (low) default risk. Itā€™s not a bad option whilst interest rates are relatively high - but if rates fall again then returns on CSH2 will reduce quickly ---
**Author:** ![Nic](https://avatars.discourse-cdn.com/v4/letter/n/45deac/32.png) [@Nic](https://community.investengine.com/u/Nic)\ **Post date:** [24 July 2023 10:27 UTC](https://community.investengine.com/t/do-etf-trackers-suck/1060/11 "2023-07-24T10:27:39Z")
It might not count as ā€œinvestingā€ in your eyes, but the returns are more predictable and consistent then dividend investing for example, where most ETFs bring in a return of just 2-4%. And unlike putting money into a Cash ISA, the returns from CSH2 are immediately changing if the BoE rate changes - in both directions. So ATM this is a better investment in my eye then many of the stock/dividend ETFs. But of course YMMV. ---
**Author:** ![shrimper](https://avatars.discourse-cdn.com/v4/letter/s/8dc957/32.png) [@shrimper](https://community.investengine.com/u/shrimper)\ **Post date:** [27 July 2023 18:10 UTC](https://community.investengine.com/t/do-etf-trackers-suck/1060/12 "2023-07-27T18:10:35Z")
Donā€™t get me wrong - I have exposure to CSH2, I like it as a proxy to a savings account - but itā€™s more equivalent to a savings product than an investment product ---
**Author:** ![Nic](https://avatars.discourse-cdn.com/v4/letter/n/45deac/32.png) [@Nic](https://community.investengine.com/u/Nic)\ **Post date:** [28 July 2023 07:00 UTC](https://community.investengine.com/t/do-etf-trackers-suck/1060/13 "2023-07-28T07:00:31Z")
True. The beauty of it is that one can always mix and match from inside an S&S ISA without the hassle of moving funds between an Cash ISA and a S&S ISA.