Educational purposes only. This content does not constitute investment advice. Read our disclaimer
StockCram is not a broker-dealer, investment adviser, or financial institution. All content is for educational and informational purposes only and should not be construed as personalized investment advice. Consult a qualified financial professional before making investment decisions. Past performance does not guarantee future results.Simple Definition
An index tracking 500 largest US companies. The main benchmark for US stocks.
Why It Matters
The S&P 500 is THE benchmark everyone compares against. When someone says 'the market is up 20%,' they usually mean the S&P 500. It includes Apple, Microsoft, Amazon, and 497 other large US companies. Historically, it has returned about 10% annually - which is why Warren Buffett tells most people to just buy an S&P 500 index fund.
Key Points
- The 500 companies represent about 80% of total US stock market value
- Popular S&P 500 ETFs: SPY, VOO, IVV - all track the same index with tiny fee differences
- It's market-cap weighted, so Apple and Microsoft have more influence than smaller companies
Related Terms
Common Questions
An index tracking 500 largest US companies. The main benchmark for US stocks. The S&P 500 is THE benchmark everyone compares against. When someone says 'the market is up 20%,' they usually mean the S&P 500.
The S&P 500 is THE benchmark everyone compares against. When someone says 'the market is up 20%,' they usually mean the S&P 500. It includes Apple, Microsoft, Amazon, and 497 other large US companies. Historically, it has returned about 10% annually - which is why Warren Buffett tells most people to just buy an S&P 500 index fund.
The 500 companies represent about 80% of total US stock market value
Popular S&P 500 ETFs: SPY, VOO, IVV - all track the same index with tiny fee differences
It's market-cap weighted, so Apple and Microsoft have more influence than smaller companies