A stock market index tracking 500 large U.S. companies; widely used as a benchmark.
The S&P 500 (Standard & Poor's 500) is a stock market index containing 500 large-cap U.S. companies, representing about 80% of total U.S. stock market value. The S&P 500 is the most widely used benchmark for stock market performance and is considered a proxy for the overall health of the U.S. economy. Index funds tracking the S&P 500 are among the most popular investments because they offer broad market exposure with low fees. Historical returns: roughly 10% annually (including dividends) over long periods, though with significant short-term volatility. The S&P 500 is market-cap weighted, meaning larger companies (Apple, Microsoft, etc.) have larger index weights. For passive investors, a simple strategy of buying S&P 500 index funds and holding long-term has historically beaten most actively managed funds.