what is the s&p 500

The S&P 500, or Standard & Poors 500 Index, is a market-capitalization-weighted index of 500 leading publicly traded companies in the U.S. The index includes 500 leading companies and covers approximately 80% of available market capitalization. The companies included in the index are selected based on certain criteria, including market capitalization, liquidity, and sector representation. The S&P 500 is regarded as one of the best gauges of prominent American equities performance, and by extension, that of the stock market overall. The index is float-weighted, meaning the market capitalizations of the companies in the index are adjusted by the number of shares available for public trading. The S&P 500 is seen as an accurate representation of the U.S. economy, and periods of economic growth and recessions are reflected in the index fund throughout history.