There are 100s of ETFs and HOLDRS covering key industry benchmarks such as the various Standard & Poor Indexes, Russell Indexes or the Dow Jones Averages. There are ETFs that cover the other less well known narrow based sectors.
You should know the major indexes that are either key benchmarks or have ETFs tied to them. For example SPY tracks the Standard & Poors 500 Composite Index and is the largest of the ETFs.
Standard & Poor: Standard & Poor (S&P) is the financial services segment of the McGraw Hill companies. It has been providing independent and objective financial information, analysis and research for nearly 140 years.
It is also the provider of equity indexes. These indexes are also used as the basis for wide variety of financial instruments such as Index Funds, Futures, Options and ETFs. Investors around the globe use S&P Indexes for investment performance measurement.
S&P 500 Composite is one of the most popular indexes in the global financial markets. It is also used as a key benchmark for money manager performance. Hundreds of companies around the world have licenses with the Standards & Poors for their index products. The influence and name recognition of S&P 500 is unparalleled.
The S&P 500 is a capitalization weighted index that tracks the performance of 500 large capitalization issues and each year thousands of money managers have the single minded goal of outperforming the S&P 500. S&P 500 represents more than 75% of the capitalization of the entire US Stock Market.
30 years back most of the stocks in S&P 500 were from the Industrial Sector. By 1970s, six of the top companies were from the Oil Sector. Over the years, the complexion of S&P 500 has changed. In 2000s, technology composed about one third of the capitalization of the index. The stocks in the S&P 500 are determined by a nine member committee in accordance with the general guidelines.
The other Standard & Poors indexes are the S&P Midcap 400 Index. It is based on 400 chosen domestic stocks and is also capitalization based. It measures the performance of the midsize companies of the US economy.
The S&P SmallCap 600 Index consists of 600 domestic stocks. These stocks are chosen for market size and liquidity. S&P SmallCap 600 is also capitalization weighted index and is of interest to institutional and retail investors. There are also sub-indexes based on these S&P Indexes.
NASDAQ: NASDAQ Composite Index contains more than 4500+ companies. It represents a market capitalization of trillions of dollars in the US economy. You will often hear in the media that the Nasdaq market being up or down on a given day.
There is another Nasdaq Index called the Nasdaq-100. It is composed of the top 100 nonfinancial companies in the Nasdaq Stock Market. The QQQ is based on the Nasdaq-100 Index. NASDAQ-100 is a modified capitalization weighted index.
You should know the major indexes that are either key benchmarks or have ETFs tied to them. For example SPY tracks the Standard & Poors 500 Composite Index and is the largest of the ETFs.
Standard & Poor: Standard & Poor (S&P) is the financial services segment of the McGraw Hill companies. It has been providing independent and objective financial information, analysis and research for nearly 140 years.
It is also the provider of equity indexes. These indexes are also used as the basis for wide variety of financial instruments such as Index Funds, Futures, Options and ETFs. Investors around the globe use S&P Indexes for investment performance measurement.
S&P 500 Composite is one of the most popular indexes in the global financial markets. It is also used as a key benchmark for money manager performance. Hundreds of companies around the world have licenses with the Standards & Poors for their index products. The influence and name recognition of S&P 500 is unparalleled.
The S&P 500 is a capitalization weighted index that tracks the performance of 500 large capitalization issues and each year thousands of money managers have the single minded goal of outperforming the S&P 500. S&P 500 represents more than 75% of the capitalization of the entire US Stock Market.
30 years back most of the stocks in S&P 500 were from the Industrial Sector. By 1970s, six of the top companies were from the Oil Sector. Over the years, the complexion of S&P 500 has changed. In 2000s, technology composed about one third of the capitalization of the index. The stocks in the S&P 500 are determined by a nine member committee in accordance with the general guidelines.
The other Standard & Poors indexes are the S&P Midcap 400 Index. It is based on 400 chosen domestic stocks and is also capitalization based. It measures the performance of the midsize companies of the US economy.
The S&P SmallCap 600 Index consists of 600 domestic stocks. These stocks are chosen for market size and liquidity. S&P SmallCap 600 is also capitalization weighted index and is of interest to institutional and retail investors. There are also sub-indexes based on these S&P Indexes.
NASDAQ: NASDAQ Composite Index contains more than 4500+ companies. It represents a market capitalization of trillions of dollars in the US economy. You will often hear in the media that the Nasdaq market being up or down on a given day.
There is another Nasdaq Index called the Nasdaq-100. It is composed of the top 100 nonfinancial companies in the Nasdaq Stock Market. The QQQ is based on the Nasdaq-100 Index. NASDAQ-100 is a modified capitalization weighted index.
About the Author:
Mr. Ahmad Hassam has done Masters from Harvard University. He is interested in day trading stocks and forex. Do Penny Stock Trading. Learn Forex Trading!
