I'm looking to add an S&P500 ETF to my portfolio. I've narrowed my search down to two Vanguard ETF's: VSP (Vanguard S&P 500 Index ETF CAD-hedged) and VFV (Vanguard S&P 500 Index ETF unhedged). I looked at Vanguard's website and it shows that VFV has total net assets of $1.446 billion while VSP only has net assets of $0.571 billion ($571 million), so clearly retail investors favour VFV. I looked at the performance over the past 5 years and VFV comes out ahead too because it is unhedged, so it benefitted from the drop in the Canadian dollar's value (relative to USD). Here is a chart of VFV, VSP, and the S&P500 index...
As you can see, VSP (the hedged ETF in green) tracks very closely to the actual S&P500 (blue line), but VFV (in red) has outperformed in the past 4 years because it benefitted from the Canadian dollar's drop against the USD which started around 2015. VFV would likely UNDERPERFORM if the Canadian dollar strengthens against the USD. Both etf's have the same MER.
I'm having a difficult time picking. Which one would you pick - hedged CAD or unhedged CAD and why? Also what is your favourite S&P500 ETF? Thanks!