Investing and Trading the S&P 500 Index
Why Trade & Invest in the S&P 500 with WisunoFX?
Customer Support
Access 24/5 localized, one-on-one customer support along with various tools and educational resources.
Competitive Spreads
Enjoy highly competitive spreads on S&P 500 trades.
Effective Risk Management
Utilize risk management tools such as stop-loss and limit orders to protect your investments.
Zero Commission
Benefit from tight spreads, allowing you to pay less when opening a position.
S&P 500 Futures vs. S&P 500 Index
While the charts for both the S&P 500 index and its futures may seem similar, their differences become apparent in bar or candlestick charts. The S&P 500 index reflects price movements during active trading hours, specifically from 9:30 AM to 4:00 PM Eastern Time, excluding holidays and weekends. Price activities outside these hours will not appear on the live charts. Conversely, the S&P 500 futures chart showcases continuous price activity, reflecting the index's CFD asset price even when the live market is closed. Traders should note that any price divergence between the two will usually correct towards the futures asset when the market opens.
Advantages of Investing in the S&P 500 CFD Asset
Trading the S&P 500 index as a CFD offers several benefits:
1. Passive Investment
It allows for a less hands-on approach while still providing exposure to the index.
2. Long-Term Investment Suitability
The S&P 500’s historical performance makes it an excellent choice for long-term investors.
3. Potential for Larger Profits
The S&P 500 index has shown significant growth over time, with traders using dynamic strategies potentially achieving returns of 300% to 500% annually.
Why Use the S&P 500 as a Benchmark?
The S&P 500 index represents over 80% of the entire US stock market capitalization, making it a reliable benchmark for market performance. Research indicates that investing in the S&P 500 often outperforms actively managed portfolios.
What is the S&P 500 and What Does it Measure?
The S&P 500 index tracks the performance of the 500 largest public companies in the US by market capitalization, accounting for approximately $39 trillion of the total US stock market.
Top 10 Companies in the S&P 500 (2022)
1. Apple Inc
2. Microsoft Corp
3. Amazon.com Inc
4. Tesla Inc
5. Alphabet Inc Class A (GOOGL)
6. Alphabet Inc Class C (GOOG)
7. Nvidia Corp
8. Berkshire Hathaway Inc
9. Meta Platforms Inc (formerly Facebook)
10. UnitedHealth Group Inc
Start Investing in the S&P 500 in 3 Simple Steps
Open Your Account
Complete the Live Trading Account application form. Your account will be set up after identity verification.
Fund Your Account
Deposit funds using a credit card, E-Wallet, or bank transfer to start trading.
Start Trading
Trade on any device, including PC, Android, iPad, iPhone, or through a web browser.
FREQUENTLY ASKED QUESTIONS
The best time to invest in the S&P 500 is after it has experienced a correction from its recent highs. This allows for a better entry price, enabling you to purchase at a lower cost compared to peak levels.
Investing in the S&P 500, whether through an index fund or ETF, generally provides more consistent returns over time with less risk than trading individual stocks. The S&P 500 exposes you to a diverse range of assets, reducing the risk associated with the poor performance of any single stock.
The value of the S&P 500 will typically decline significantly if the top 10 stocks within the index are adversely affected during a market crash.
The Dow Jones Industrial Average is a price-weighted index that tracks 30 stocks, while the S&P 500 is a market capitalization-weighted index that tracks 500 stocks.
The S&P 500 index was established in 1957.
The S&P 500 has several symbols, including US500, SPX500, and SP500.
For long-term investors, dollar-cost averaging can be effective. This strategy involves buying a fixed amount of stock monthly. When the index falls, you can increase the amount purchased. As long as the U.S. economy continues to grow over time, the S&P 500 is expected to perform well.
Momentum indicators, such as the Relative Strength Index (RSI), can help identify when the S&P 500 is overbought. An RSI reading between 70 and 100 indicates overbought conditions.
