The S&P 500 is one of the world’s most influential stock market indices, reflecting the combined performance of the 500 largest companies in the US, including a handful of trillion dollar giants such Apple, Microsoft and Alphabet, Google’s parent company.
In terms of value, the index accounts for about 80% of the 4,000-plus companies that are publicly listed in the US. It is therefore thought of as a reliable gauge of the country’s overall stock market performance.
Despite the impact of the Covid-19 pandemic on worldwide returns, not to mention the hammering endured by most global stock markets last year, the 500 or so stocks that make up this index have produced a net gain of more than 50% over the past five years.
UK investors looking for global exposure and large US companies in particular have various options at their disposal – from buying shares in individual businesses, to investing in funds that do the job for them.
For investors considering the funds route, one way of gaining blanket exposure to US corporations is via so-called ‘passive’ investments including index tracker funds.
We’ve asked Jason Hollands, managing director of the investment service Bestinvest, to pick a handful of S&P 500 index trackers that fit the bill for investors to consider. We’ve listed Jason’s choices below, plus an alternative that offers exposure to a wider selection of US companies.
Investing in the stock market is speculative, not suitable for everyone, and puts capital at risk. It is possible for investors to lose some, or all, of their money. Nothing in this article is intended to be or should be construed as advice.
