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Ask a Fool: What is the S&P 500?

In the spirit of better investing, and in celebration of the first annual Worldwide Invest Better Day (WWIBD) coming up on September 25, Motley Fool analysts will be answering user- and reader-submitted questions leading up to the big event. "Ask a Fool" anything, and we'll do our best to help you invest better.

The S&P 500 (INDEX: ^GSPC  ) is a capitalization-weighted index whose components are weighted by the total market value of outstanding shares. Because it's weighted this way, companies that are disproportionately larger -- like Apple (Nasdaq: AAPL  ) and Exxon (NYSE: XOM  )  -- have the most influence over the index, while those on the smaller end, like MAKO Surgical (Nasdaq: MAKO  ) and First Solar (Nasdaq: FSLR  ) , have a much lower weighting. In the following video, analyst Austin Smith goes over everything that investors need to know about the S&P 500.


Click the green button below to join the thousands of people celebrating Worldwide Invest Better Day on September 25!

Austin Smith owns shares of Apple and MAKO Surgical. The Motley Fool owns shares of Apple, MAKO Surgical , and ExxonMobil. Motley Fool newsletter services recommend Apple, First Solar, and MAKO Surgical . Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Read/Post Comments (1) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On September 25, 2012, at 12:41 AM, PepeShalamar wrote:

    I was surprised to see this article on The Motley Fool, considering how many errors are in the article. Not sure where the author of this article got his information from.

    The S&P 500 is a stock market index containing the stocks of 500 American Large-Cap corporations. The S&P 500 index is NOT made up of the 500 largest corporations in the U.S.

    In 2005, the Index was changed to be "float" weighted - the index weighting is determined by the amount of shares available for public trading.

    It's great that The Motley Fool owns 3 of the 4 stocks mentioned in the article. Won't be using this site as a reference for anything anymore.

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Today's Market

updated Moments ago Sponsored by:
DOW 18,059.70 -102.65 -0.57%
S&P 500 2,131.81 -9.53 -0.45%
NASD 5,231.77 -10.06 -0.19%

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Related Tickers

10/21/2016 9:38 AM
^GSPC $2131.40 Down -9.94 -0.46%
S&P 500 INDEX CAPS Rating: No stars
AAPL $116.60 Down -0.46 -0.39%
Apple CAPS Rating: ****
FSLR $41.55 Down -0.53 -1.25%
First Solar CAPS Rating: ***
MAKO.DL $0.00 Down +0.00 +0.00%
MAKO Surgical CAPS Rating: ****
XOM $86.27 Down -0.94 -1.08%
ExxonMobil CAPS Rating: ****