Investments

Q&A: What is the Standard & Poor’s (S&P) 500?

The S&P 500 is a market-capitalization-weighted index of the 500 largest U.S. publicly traded companies. This means that the largest companies have the largest weight in the index.

For example, as of May 28th, 2020, the top 5 weightings in the index represent 20% of the index’s value: Microsoft (MSFT), Apple (AAPL), Amazon (AMZN), Facebook (FB), and Alphabet (GOOG and GOOGL)
Source: https://www.etf.com/SPY#overview

The average annual return of the S&P 500 over the last 30 years (1980-2019) has been 8.9% per year.

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