Ofis amarket capitalization weighted indexof 500 major US companies that, measured by market value, account for 80% of US stocks. It is widely considered the best benchmark for major US stocks and is often referred to as the market because it consists of stocks covering all market sectors. Some of the largest components of the S&P 500 include:
- Microsoft (MSFT)
- Appel (AAPL)
- Amazon (AMZN)
- Alphabet (GOOGL)
- Tesla (TSLA)
There are many funds whose stock portfolios are designed to track those in the S&P 500 due to the index's popularity as a barometer of the U.S. stock markets, including mutual funds and mutual funds.Exchange Traded Funds (ETF's). ETFs differ from mutual funds because they are listed on stock exchanges and trade throughout the day, just like regular stocks.
Below we look at the best S&P 500index funds, one with the lowest costs and the other with the highest liquidity. All information below applies from February 15, 2023.
Key learning points
- Index investing has boomed over the past decade, with passive funds often outperforming their active counterparts at lower costs.
- Among index investors, the S&P 500 is the most watched benchmark index to follow.
- The index is widely regarded as a barometer of the U.S. large-cap stock market.
- Investors can consider index funds offered by Fidelity, Schwab, Vanguard and State Street.
- State Street has a viable ETF option that tracks the performance of the S&P 500.
Lowest price S&P 500 Index Fund: Fidelity 500 Index Fund (FXAIX)
FXAIX is oneinvestment association. Because index funds will track the performance of the index, one of, if not the, biggest determinant of long-term returns is the amount of fees it charges.
- Cost ratio:0,015%
- Return 2022:-18,13%
- Yield:1,33 %
- Assets under management (AUM):$373.8 billion
- Minimum investment:$ 0
- Starting date:February 17, 1988 (share class start date: May 4, 2011)
- Issuing company:Fidelity
Second Lowest Price: Schwab S&P 500 Index Fund (SWPPX)
Schwab's S&P 500 Index Fund seeks to track the total return of the S&P 500 Index. The fund generally invests at least 80% of its net assetsactiva(including, for this purpose, any loans for investment purposes) in these shares. The actual percentage is usually considerably higher. In general, it will attempt to replicate the performance of the index by assigning the same weighting to a given stock as the index.
- Cost ratio:0,02%
- Return 2022:-18,13%
- Yield:1,35%
- AUM:$60.8 billion
- Minimum investment:$ 0
- Starting date:19 mei 1997
- Issuing company:Charles Schwab
Second Lowest Price: Vanguard 500 Index Fund Admiral Shares (VFIAX)
Vanguard was the original index fund and still has the largestassets under management, currently holding over $792.6 billion in Vanguard 500 Index Fund Admiral Shares January 31, 2023. The investment seeks to track the performance of a benchmark index that measures the investment returns of large-cap stocks. The fund uses an indexing investment approach designed to track the performance of the Standard & Poor's 500 Index.
- Cost ratio:0,04 %
- Return 2022:-18,15%
- Yield:1,58 %
- AUM:$792.6 billion
- Minimum investment:$ 3.000
- Starting date:13 november 2000
- Issuing company:Forefront
As with any investment, you should do your research before purchasing mutual funds or ETFs. When in doubt, reach out to a financial professional you can trust to help point you in the right direction.
Second Lowest Price: State Street S&P 500 Index Fund Class N (SVSPX)
Also in the running are State Street's offerings, which also closely track the S&P 500 index. However, this fund does need oneminimal investmentvan $ 10.000.
- Cost ratio:0.16% (net)
- Return 2021:28.54% (last available)
- Yield:1,76 %
- AUM:$1.3 billion
- Minimum investment:$ 10.000
- Starting date:30 december 1992
- Issuing company:State Street
Most Liquid S&P 500 Index Fund: SPDR S&P 500 ETF (SPY)
SPY is an ETF, not a mutual fund, and it's not even the cheapest S&P 500 ETF. However, that's mostly itliquidS&P 500 fonds.Liquidityindicates how easy it will be to trade an ETF, with higher liquidity usually meaning lower trading costs. Trading costs are not a major concern for people who want to hold ETFs for the long term, but if you are interested in trading ETFs regularly, it is important to look for funds with high liquidity to minimize trading costs.
- Cost ratio:0,09 %
- Return 2022:18,14 %%
- Yield:1,56%
- AUM:$382.1 billion
- Minimum investment:$ 464,68
- Starting date:January 22, 1993
- Issuing company:State Street
The comments, opinions and analyzes expressed herein are for informational purposes only and should not be considered individual investment advice or recommendations to invest in securities or adopt any investment strategy. Although we believe the information in this document to be reliable, we cannot guarantee its accuracy or completeness. The views and strategies described in our content may not be suitable for all investors. Because market and economic conditions are subject to rapid change, all comments, opinions and analyzes in our content are as of the date of posting and are subject to change without notice. The material is not intended to be a complete analysis of every material fact relating to any country, region, market, industry, investment or strategy.
