What is the most popular S&P 500 index fund?
An S&P 500 index fund can be used for a high-conviction, long-term bet on U.S. large-cap stocks. Our recommendation for the best overall S&P 500 index fund is the Fidelity 500 Index Fund (FXAIX). With a 0.015% expense ratio, this fund is the cheapest one on our list.
An S&P 500 index fund can be used for a high-conviction, long-term bet on U.S. large-cap stocks. Our recommendation for the best overall S&P 500 index fund is the Fidelity 500 Index Fund (FXAIX). With a 0.015% expense ratio, this fund is the cheapest one on our list.
The largest S&P 500 ETF is the SPDR S&P 500 ETF Trust (SPY). Other ETFs that track the S&P 500 include the iShares Core S&P 500 ETF (IVV) and the Vanguard 500 Index Fund (VOO).
- Expense ratio. As index funds are passively managed, expense ratios, which represent the fees you pay for the upkeep of your fund, should be nominal. ...
- Minimum investment. ...
- Dividend yield. ...
- Inception date.
Market exposure: The most popular index is the S&P 500 index, but index funds track dozens of other indexes. Choose an index that offers the market exposure you want, then focus on funds that track the index.
Vanguard S&P 500 ETF (VOO)
Expense ratio: 0.03 percent. That means every $10,000 invested would cost $3 annually. Who is it good for?: Great for investors looking for a broadly diversified index fund at a low cost to serve as a core holding in their portfolio.
The Bottom Line. Both index mutual funds and ETFs can provide investors with broad, diversified exposure to the stock market, making them good long-term investments suitable for most investors. ETFs may be more accessible and easier to trade for retail investors because they trade like shares of stock on exchanges.
Key Takeaways. The S&P 500 index tracks some of the largest stocks in the United States, many of which pay out a regular dividend. The index's dividend yield is the total dividends earned in a year divided by the index's price. Historical dividend yields for the S&P 500 have typically ranged from between 3% to 5%.
All three are very low-cost ways to invest in the 500 companies comprising the S&P 500 index. Fidelity has the lowest costs, with a 0.015% expense ratio. Schwab's is only slightly higher at 0.02%, while the Vanguard 500 Index Fund Admiral Shares has a 0.04% expense ratio.
Fidelity® 500 Index Fund is a diversified domestic large-cap equity strategy that seeks to closely track the returns and characteristics of the S&P 500® index. The S&P 500® is a market-capitalization-weighted index designed to measure the performance of 500 large-cap U.S. companies.
How should a beginner invest in the S&P 500?
The easiest way is to invest in an S&P 500 index fund. You can do this in a tax-advantaged account like a 401(k), IRA, HSA, or 529 plan. You could also open a taxable brokerage account to purchase an S&P 500 index fund.
Vanguard S&P 500 ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, VOO is a great option for investors seeking exposure to the Style Box - Large Cap Blend segment of the market.
![What is the most popular S&P 500 index fund? (2024)](https://i.ytimg.com/vi/ACByf1j3RGY/hq720.jpg?sqp=-oaymwEcCNAFEJQDSFXyq4qpAw4IARUAAIhCGAFwAcABBg==&rs=AOn4CLDfRTaM33vVde16uK3yBWRcERBaaQ)
An S&P 500 index fund alone can absolutely achieve the growth needed to make you into a millionaire. But you probably don't want that to be your sole investment, particularly when you're close to retirement.
For beginners, the vast array of index funds options can be overwhelming. We recommend Vanguard S&P 500 ETF (VOO) (minimum investment: $1; expense Ratio: 0.03%); Invesco QQQ ETF (QQQ) (minimum investment: NA; expense Ratio: 0.2%); and SPDR Dow Jones Industrial Average ETF Trust (DIA).
Within the world of corporate governance, there has hardly been a more important recent development than the rise of the 'Big Three' asset managers—Vanguard, State Street Global Advisors, and BlackRock.
- 9 Safest Index Funds and ETFs to buy in 2024. ...
- Vanguard S&P 500 ETF (VOO 0.1%) ...
- Vanguard High Dividend Yield ETF (VYM -0.04%) ...
- Vanguard Real Estate ETF (VNQ 0.22%) ...
- iShares Core S&P Total U.S. Stock Market ETF (ITOT 0.2%) ...
- Consumer Staples Select Sector SPDR Fund (XLP 0.24%) ...
- iShares 0-3 Month Treasury Bond ETF (SGOV 0.01%)
According to our calculations, a $1000 investment made in February 2014 would be worth $5,971.20, or a gain of 497.12%, as of February 5, 2024, and this return excludes dividends but includes price increases. Compare this to the S&P 500's rally of 178.17% and gold's return of 55.50% over the same time frame.
In 1980, had you invested a mere $1,000 in what went on to become the top-performing stock of S&P 500, then you would be sitting on a cool $1.2 million today.
The bottom line on the S&P 500
But this index does have some shortcomings. Its market-cap weightings may favor some companies, or sectors, over others; the bandwidth doesn't always reflect the entire domestic stock market, and it excludes companies that aren't based in the US.
- Trading fees.
- Operating expenses.
- Low trading volume.
- Tracking errors.
- The possibility of less diversification.
- Hidden risks.
- Lack of liquidity.
- Capital gains distributions.
Why buy ETF instead of index?
And, in general, ETFs tend to be more tax efficient than index mutual funds. You want niche exposure. Specific ETFs focused on particular industries or commodities can give you exposure to market niches.
Trade like stocks throughout the day, allowing for more flexibility and real-time pricing. 2. Often have lower fees and minimum investment requirements than index funds. By investing in both index funds and ETFs, you can benefit from the strengths of each, such as diversification, lower costs, and trading flexibility.
Name | Price | Analyst Price Target |
---|---|---|
T AT&T | $17.12 | $20.89 (22.02% Upside) |
IBM International Business Machines | $188.79 | $191.69 (1.54% Upside) |
CVX Chevron | $156.47 | $175.87 (12.40% Upside) |
EOG EOG Resources | $127.25 | $143.56 (12.82% Upside) |
Stock | Dividend yield |
---|---|
Enbridge Inc. (ENB) | 7.6% |
Ecopetrol SA (EC) | 14.6% |
United Parcel Service Inc. (UPS) | 4.2% |
OneMain Holdings Inc. (OMF) | 8.3% |
Average Market Return for the Last 30 Years
Looking at the S&P 500 for the years 1993 to mid-2023, the average stock market return for the last 30 years is 9.90% (7.22% when adjusted for inflation).
References
- https://financhill.com/blog/investing/what-stocks-does-suze-orman-recommend
- https://www.fool.com/investing/2023/11/26/want-to-outperform-92-of-professional-fund-manager/
- https://www.fool.com/the-ascent/buying-stocks/articles/heres-what-happens-when-you-only-invest-in-sp-500-etfs/
- https://www.investopedia.com/terms/a/aggressivegrowthfund.asp
- https://www.nasdaq.com/articles/dave-ramsey:-heres-how-much-money-you-should-have-in-savings
- https://www.livemint.com/money/personal-finance/what-is-the-100-age-rule-of-asset-allocation-mintgenie-explains-11704719222344.html
- https://www.tipranks.com/compare-stocks/dividend-stocks
- https://www.investmentfundlawblog.com/resources/investments-by-funds/investments-investment-companies/
- https://finance.yahoo.com/news/vanguard-p-500-etf-voo-112006029.html
- https://time.com/personal-finance/article/best-index-funds/
- https://www.tiktok.com/@daveramsey/video/7317666328783932715
- https://finance.yahoo.com/news/invest-401-k-index-fund-140022535.html
- https://powerzerotax.com/dave-ramsey-is-wrong-about-fixed-indexed-annuities/
- https://www.forbes.com/advisor/investing/how-to-invest-in-sp-500/
- https://www.forbes.com/advisor/investing/best-sp-500-index-funds/
- https://www.cnbc.com/2017/05/12/warren-buffett-says-index-funds-make-the-best-retirement-sense-practically-all-the-time.html
- https://smartasset.com/retirement/401k-vs-index-funds
- https://www.businesstoday.in/mutual-funds/best-mf
- https://www.vectorvest.com/blog/retirement/best-index-funds-for-retirement-investing/
- https://www.investopedia.com/why-bond-etfs-go-down-8303231
- https://corporatefinanceinstitute.com/resources/career-map/sell-side/capital-markets/index-investing/
- https://curvo.eu/article/etf-risk
- https://www.cbsnews.com/news/retirement-savings-million-dollars-stretch-money-analysis-gobankingrates-years/
- https://www.forbes.com/advisor/retirement/best-vanguard-mutual-funds/
- https://www.etmoney.com/mutual-funds/featured/best-low-risk-mutual-funds/21
- https://stockanalysis.com/article/can-you-beat-the-market/
- https://www.bankrate.com/retirement/retire-a-millionaire/
- https://money.usnews.com/funds/etfs/rankings/aggressive-allocation
- https://investor.vanguard.com/accounts-plans/529-plans/profile/4509
- https://www.titan.com/articles/etf-drawbacks
- https://money.usnews.com/funds/mutual-funds/aggressive-allocation/american-funds-growth-portfolio/gwpax
- https://www.etf.com/topics/aggressive
- https://www.financialsymmetry.com/5-reasons-to-consider-not-only-investing-in-the-sp-500-ep-209/
- https://www.rocketmortgage.com/learn/1-rule-real-estate
- https://smartasset.com/financial-advisor/where-do-millionaires-keep-their-money
- https://www.screener.in/screens/355766/highest-return-in-1-year/
- https://www.usatoday.com/money/blueprint/investing/best-sp-500-index-funds/
- https://www.etf.com/topics/sp-500
- https://www.investopedia.com/articles/exchangetradedfunds/11/advantages-disadvantages-etfs.asp
- https://www.investopedia.com/financial-edge/0711/how-to-double-your-money-every-6-years.aspx
- https://money.usnews.com/money/retirement/articles/what-is-the-25x-rule-for-retirement-saving
- https://www.marketwatch.com/picks/with-2-4-million-tik-tok-followers-this-former-wall-street-trader-says-this-is-how-the-ultra-wealthy-really-invest-and-psst-its-pretty-simple-33264249
- https://twitter.com/DaveRamsey/status/1740392947818905964
- https://www.nasdaq.com/articles/dave-ramsey:-how-to-determine-which-retirement-accounts-are-best-for-you
- https://www.linkedin.com/pulse/why-doesnt-everyone-invest-index-funds-one-gayathiri-sri-rangan
- https://www.nerdwallet.com/article/investing/best-performing-mutual-funds
- https://www.nerdwallet.com/article/investing/how-to-invest-in-index-funds
- https://www.fool.com/investing/how-to-invest/index-funds/
- https://www.fool.com/the-ascent/buying-stocks/articles/2-reasons-dave-ramsey-is-dead-wrong-about-where-to-invest-your-retirement-money/
- https://money.usnews.com/investing/articles/best-vanguard-funds-for-retirement
- https://fundresearch.fidelity.com/mutual-funds/summary/316069210
- https://www.bankrate.com/investing/best-s-p-500-index-funds/
- https://www.linkedin.com/pulse/could-you-actually-own-100x-stock-austin-lieberman-gjd2e
- https://www.marketwatch.com/tools/top-25-mutual-funds
- https://www.bankrate.com/investing/best-index-funds/
- https://money.usnews.com/funds/mutual-funds/rankings/aggressive-allocation
- https://simplestudies.com/accounting-dictionary/letter/R/rule_of_69.html
- https://smartasset.com/investing/roth-ira-vs-mutual-fund
- https://m.economictimes.com/mf/analysis/5-low-cost-mutual-fund-schemes-with-highest-3-year-returns-check-details/articleshow/108637688.cms
- https://finance.yahoo.com/news/invested-1000-p-global-decade-133005715.html
- https://www.globalatlantic.com/professionals/thriving-practice/market-insights/rule-120
- https://timesofindia.indiatimes.com/business/faqs/mutual-fund-faqs/mutual-fund-risks-can-all-money-be-lost-in-a-mutual-fund/articleshow/67638471.cms
- https://www.investopedia.com/financial-edge/0711/the-highest-priced-stocks-in-america.aspx
- https://groww.in/mutual-funds/hybrid-funds/aggressive-funds
- https://www.wallstreetmojo.com/rule-of-69/
- https://www.ramseysolutions.com/retirement/daves-investing-philosophy
- https://www.sofi.com/learn/content/average-stock-market-return/
- https://www.investopedia.com/stock-analysis/2012/7-of-the-highest-stock-prices-in-history-brk-b-aapl-seb-nvr1114.aspx
- https://www.nasdaq.com/articles/is-the-sp-500-all-you-need-to-retire-a-millionaire-12
- https://money.usnews.com/investing/articles/best-dividend-stocks-to-buy-this-year
- https://www.fidelity.com/learning-center/investment-products/etf/drawbacks-of-etfs
- https://www.morningstar.com/news/marketwatch/2024032786/momentum-stocks-are-outperforming-sp-500-by-widest-margin-since-2008-investors-should-be-concerned
- https://www.100x.vc/news-coverage/desi-vc-podcast-e1-sanjay-mehta-founder-and-partner-100-x-vc-100x.vc-team-2020-startups
- https://money.usnews.com/investing/articles/9-best-mutual-funds
- https://www.investopedia.com/articles/exchangetradedfunds/09/etf-out-of-business.asp
- https://www.investopedia.com/terms/r/ruleof72.asp
- https://www.investopedia.com/articles/markets/071616/history-sp-500-dividend-yield.asp
- https://www.fool.com/investing/how-to-invest/index-funds/best-sp-500-index-funds/
- https://www.investopedia.com/investing-in-index-funds-4771002
- https://money.usnews.com/investing/articles/best-performing-401-k-funds
- https://www.trackinsight.com/en/education/how-many-etfs-should-you-own
- https://www.investopedia.com/articles/exchangetradedfunds/08/etf-mutual-fund-difference.asp
- https://www.bankrate.com/investing/stocks-vs-etfs/
- https://www.livemint.com/money/personal-finance/5-top-performing-large-cap-mutual-funds-in-the-past-10-years-11697191429395.html
- https://www.quora.com/Is-it-beneficial-to-invest-in-both-index-funds-and-ETFs-or-is-it-redundant
- https://www.thetimes.co.uk/article/how-to-get-11-5-on-your-money-r2rb2835x
- https://www.fidelity.com/bin-public/060_www_fidelity_com/documents/SHDOCS/FXAIX/hosts/sh_comm_qfr.000650.RETAIL_pdf.pdf
- https://www.fool.com/investing/2024/03/24/you-can-do-better-than-sp-500-buy-this-etf/
- https://fundselectorasia.com/10-funds-that-beat-the-sp-500-by-over-20-in-2023/
- https://www.schwab.com/learn/story/etf-vs-mutual-fund-it-depends-on-your-strategy
- https://www.forbes.com/advisor/in/investing/best-index-funds-in-india/
- https://www.linkedin.com/pulse/what-10x-rule-real-estate-ben-lovro
- https://www.investopedia.com/ask/answers/033015/whats-difference-between-index-fund-and-etf.asp
- https://www.fool.com/the-ascent/buying-stocks/vanguard-brokerage-review/
- https://www.canstar.com.au/investor-hub/buy-sell-hold-etfs/
- https://blogs.law.ox.ac.uk/oblb/blog-post/2023/04/giant-asset-managers-big-three-and-index-investing
- https://www.edvest.com/investment/multi-fund/active-based-aggressive-portfolio/
- https://medium.com/@dontworkanotherday/how-to-turn-50k-into-100k-tips-to-double-50k-cac46fbf5558
- https://www.bankrate.com/investing/what-is-the-rule-of-72/
- https://www.usatoday.com/money/blueprint/investing/best-mutual-funds/
- https://www.fool.com/investing/2023/06/25/if-you-invested-10000-in-the-sp-500-20-years-ago/
- https://www.investopedia.com/ask/answers/10/mutual-funds-advantages-disadvantages.asp
- https://www.liquiditygroup.com/resource-funding/aggressive-growth-fund
- https://www.forbes.com/advisor/investing/average-stock-market-return/
- https://www.fool.com/investing/how-to-invest/index-funds/safest-index-funds/
- https://www.tokenmetrics.com/blog/how-to-make-money-in-crypto
- https://www.franklintempleton.com/planning-and-learning/learn-about-investing/investing-principles/cost-of-timing-the-market
- https://www.investors.com/etfs-and-funds/etfs/sp500-cheap-etf-pays-off-more-than-everything-else-long-term/
- https://www.etmoney.com/blog/how-long-can-we-invest-in-index-funds/
- https://www.quora.com/What-are-the-benefits-of-investing-in-index-funds-for-retirement-Can-someone-retire-early-by-solely-investing-in-an-S-P-500-index-fund
- https://www.fool.com/investing/2024/01/24/billionaires-cant-get-enough-of-this-etf-in-2024/
- https://www.investopedia.com/articles/stocks/09/buying-stock-or-etf.asp
- https://www.investopedia.com/articles/stocks/09/reasons-to-avoid-index-funds.asp
- https://etfdb.com/etfs/investment-style/aggressive-growth/
- https://www.unbiased.com/discover/retirement-investing/can-you-retire-on-1-million
- https://www.100x.vc/press-releases/100-x-vc-announces-class-10-with-15-new-funded-startups-with-a-total-investment-of-usd-2-3-mn-usd-160-k-per-startup
- https://www.businessinsider.com/personal-finance/what-is-the-sp-500
- https://time.com/personal-finance/article/how-to-invest-in-index-funds/
- https://finance.yahoo.com/news/much-interest-earn-1-million-150000229.html
- https://money.usnews.com/investing/articles/best-investments-during-a-recession
- https://fortune.com/recommends/investing/investing-during-a-recession/
- https://www.sharebuilder401k.com/blog/how-the-rule-of-72-helps-you-understand-how-your-savings-can-grow/
- https://www.quora.com/Is-it-possible-to-become-wealthy-by-only-saving-and-investing-into-index-funds-no-real-estate-stocks-etc-over-a-long-period-of-time
- https://www.investopedia.com/ask/answers/050115/what-are-some-reallife-examples-8020-rule-pareto-principle-practice.asp
- https://www.fool.com/investing/general/2013/09/21/the-best-performing-stock-on-the-sp-500-since-1980.aspx