what is S&P index?

Question

What is the S&P index? From what i heard from, it's a collection of the diversified stocks that is expected to go up in value. Is this right? Can i buy an S&P stock? Where can i find the price of S&P index? Please bear with me. im new to the stock market. very new.

Answer 1

You are partially mostly on your definition. It's a group of diversified stocks, but they hope they'll go up, which they may or may not do. :-)

Here's another definition as well.
http://www.fool.com/school/indices/sp500.htm

Typically, you'll hear about the Dow or the S&P. The DOW is a group of 30 very large stocks. The S&P500 is 500 companies that Standard and Poors tracks.

Since the index represents several stocks, many people get get a feel for how the market is doing by hearing how the various indexes do on a day to day basis.

And that's why you hear that the market may be up/down or whatever. Typically, approx 70+% of the stocks within a market will go in the same direction as the index!

To find the price of the index, you can go just about anywhere. Even http://finance.yahoo.com.

Since the index is a collection of stocks, you can buy the index, or an ETF (like a stock) that represents the S&P, or you can buy any/all of the S&P stocks.

Hope that helps!

Answer 2

Standard & Poors 500 are the largest 500 publickly owned companies (stocks). The list start with companies like GE and moves through the next 499 companies.

Check out the ETF's on the S&P 500 index;

SPY and IVV are two of the most popular (and least expensive).