What does Standard & Poor's 500 mean?
The full name of the S&P 500 Index is the S&P 500 Index, which was compiled by S&P Company on 1957 and consists of 500 sample stocks. These include 400 industrial stocks, 20 transportation stocks, 40 public utilities stocks and 40 financial stocks.
Although the Standard & Poor's 500 Index has fluctuated since its establishment, it has been rising on the whole. Its constituent shares are selected by a committee and will be replaced regularly, so the final company will be replaced. The index represents a country's economy, and the rigor of the S&P 500 can fully represent the economic situation of the United States. Therefore, when the economic aggregate increases, the index will rise.
The Standard & Poor's 500 Index is often used as a benchmark for performance comparison, similar to the domestic Shanghai and Shenzhen 300 Index. However, unlike the Shanghai and Shenzhen 300 Index, which is compiled only by market value weight, the Standard & Poor's 500 pays more attention to the proportion of different industries and is committed to selecting leading enterprises in various industries. The Standard & Poor's 500 is an excellent index in terms of compilation method and historical performance, which is one of the reasons why it is difficult for active funds to beat it.
The Standard & Poor's 500 index itself is excellent, but it is not easy to improve the income on this basis. In addition, with the maturity of the market and the progress of science and technology, the information advantage and analysis advantage of active fund managers are becoming less and less obvious, and it is of course more and more difficult to obtain excess returns.
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