Even if you’re brand new to investing, you’ve probably heard of the S&P500. This famous An index is a tool we can use to measure movement over time. In the stock market, we use indices to track the performance of a selection of listed companies. This could include all the companies listed on the market, or all the companies in a certain sector. In inflation, we use an index to track the price of certain tracks the performance of the 500 biggest companies When a company or product is listed, you can buy and sell its shares on a stock exchange like the JSE. Listing on a stock exchange makes it possible for members of the public to invest in a company using the infrastructure provided by the exchange and its brokers instead of going directly to the company to buy shares. on the New York Stock Exchange. The index is weighted by Market capitalisation refers to the size of a company within a market. It is determined by multiplying the number of shares the company issued on the exchange (which is the market) by the current share price. This metric is often used when putting together an index. Companies with a higher market capitalisation take up more space in the index., which means bigger companies take up more of the index and have a greater impact on its performance. While the companies are listed in the United States, they operate all over the world, making products that track this index appealing for a globally diversified In the world of finance, a "portfolio" is a term to describe all the assets you own. It includes shares, cash, bonds, physical property, your retirement savings, your tax-free savings and any other financial instruments you might hold. It excludes insurance products like life insurance. Your overall portfolio can be made up of a number of portfolios held at different.
TIP: An index is a way to track the price movement of a group of companies or products. ETF issuers mimic the index by buying shares in all the companies the index tracks according to the rules of the index. The price movement of an ETF reflects the price movement of the index, minus costs. An index can exist without an ETF, but an ETF can’t exist without an index.
Over the past three years, a number of products tracking the S&P500 index listed on the JSE. These products are available to South African investors through local stockbrokers in rands. Since they’re locally listed, they don’t affect the individual Offshore investments refer to investments made in countries other than the one you live in. These investments allow you to take advantage of a better investment environment, different tax regulations, or simply to protect your portfolio from risks affecting your local investments. An asset or item that is purchased with the hope that it will generate income or appreciate in the future. In an economic sense, an investment is the purchase of goods that are not consumed today but are used in the future to create wealth. In finance, an investment is a monetary asset purchased with the idea that the asset More allowance and are available within the tax-free investment environment. It should be noted, however, that any international dividend withholding taxes above the 20% local rate are still paid offshore.
While the products listed below all track the same index, they do it in different ways. Some of them are ordinary An exchange-traded fund (ETF) is a listed investment product. ETFs are usually index-tracking products, which means a single ETF share gives the holder exposure to an entire index—sometimes consisting of thousands of individual shares. ETFs give investors the opportunity to invest in entire markets easily and cheaply. ETF units (also called shares) can be bought wherever you buy ordinary shares, More that buy the underlying shares according to their weighting in the index. This costs more, since the ETF issuers have to create ETF units by buying and selling shares that make up the index.
The S&P 500 index is also available in feeder funds. These are ETFs that buy other ETFs instead of all the individual constituents. Since these ETFs only have to buy one other share and are not responsible for the correct weightings of all the individual shares that make up the index, they are much cheaper.
The S&P500 index is designed to reflect what’s hot in the American market. At the moment, information technology firms like Microsoft and Apple and social media communications companies like Facebook and Google dominate the index. You can also expect to see some holdovers from a previous generation in the form of oil companies and banks affecting the performance of the ETF.
ETFs weighted by market capitalisation will always hold whatever is performing well at the moment and organically down-weight or eject companies that fall out of favour. If a huge company like Microsoft-which is currently the king of the 500 biggest companies in the index-should go bankrupt, the falling share price will negatively affect the share price in the short term. However, as other companies grow to take its place, the ETF will recover.
TIP: In this article we explain how this works using the example of Steinhoff in the Top 40.
Where you can get it
Below is a list of products that track the S&P500 index. If all of them perform exactly the same, the one with the lowest cost will make you most money. For that reason, we also list the last available total expense ratio (The total expense ratio (TER) The TER is the measure we use to determine how much it costs to run an ETF. Your ETF return is whatever the market delivers minus the cost of running the ETF. We only know the exact TER at the end of a period (usually a year), because even if the issuer can predict its More).
|CoreShares S&P500 (CSP500)||0.50%|
|Satrix S&P 500 Feeder Portfolio (STX500)||0.25%|
|STANLIB S&P500 Index Feeder ETF (ETF500)||0.27%|
|Sygnia iTrix S&P500 (SYG500)||0.16%|