Widely regarded as the ideal single indicator of substantial-cap US equities, the S&P 500 index has crossed a milestone figure of 4,000 for the very first time in its 64 years of history. S&P 500 index has generated a compounded annualized development price of more than 12 per cent in the last 10 years. According to Bloomberg information, although it took just about 5 years for the index to rise from the 2,000 milestone to 3,000 in July 2019, the most recent 1,000-point trip took about 21 months. The current rise in the index is on back of the rise in stock rates of power and economic sectors. YTD returns for the S&P 500 index are practically 12 per cent.
As an Indian investor searching to diversify your investment portfolio, S&P 500 index presents the chance to make revenue across international stocks. The ideal US stock marketplace index and also the most significant US stock index could almost certainly be the S&P 500 index and is deemed to be the top rated-most single indicator of substantial-cap US stocks.
“It took the index 23 years to grow from 1,000 to 4,000 but it may only take a decade to reach 10,000 from here”, says Larry Adam, Chief Investment Officer, Raymond James Financial.
S&P 500 functionality
Over the last 1-year, 3-year and 5-year, the annualized returns in the S&P 500 index has been about 44 per cent, 15 per cent and 14.5 per cent respectively.
(As on April 16, 2021)
S&P 500 index sectors
S&P 500 Index incorporates practically 500 top corporates across about 11 sectors. The top rated 3 sectors in the S&P 500 are Information Technology, Health Care and Communication Services totaling about 50 per cent of the index. The breakdown of a variety of sectors is as follows:
Information Technology – 26.6 per cent
Health Care – 13 per cent
Communication Services – 10.9 per cent
Financials – 11.3 per cent
Consumer Discretionary – 12.4 per cent
Industrials – 8.9 per cent
Consumer Staples – 6.1 per cent
Utilities – 2.7 per cent
Energy – 3 per cent
Real Estate – 2.5 per cent
Materials – 2.7 per cent
Top S&P 500 stocks
If you want to personal the top rated S&P 500 stocks, the top rated 3 options could be Microsoft, Apple and Amazon by index weightage. Some other top rated US stocks are as follows:
Microsoft Corp – Information Technology
Tesla Inc. – Consumer Discretionary
Apple Inc. – Information Technology
Amazon.com Inc – Consumer Discretionary
Facebook Inc A – Communication Services
Alphabet Inc A – Communication Services
Alphabet Inc C – Communication Services
Johnson & Johnson – Health Care
Berkshire Hathaway – Financials
Johnson & Johnson – Health Care
JP Morgan Chase & Co – Financials
While most Indian investors opt for the more preferred Nasdaq index stocks, don’t forget that the Nasdaq is an Information Technology heavy index, although the S&P 500 Index is a a great deal broader based index. There are one hundred stocks listed on the Nasdaq entire on the S & P 500 Index, there are 500 stocks as a result providing a a great deal diversified flavour to these who want to diversify their international portfolio. Further, there are substantial and mid-cap stocks listed on Nasdaq although S&P 500 Index only has substantial-cap stocks. If you want to invest in the complete lot of S&P 500 index stocks, you can look at investing in the SPDR S&P 500 ETF also recognized as SPY that tracks the S&P 500 index.