Ask a Fool: What is the S&P 500?

In the spirit of better investing, and in celebration of the first annual Worldwide Invest Better Day (WWIBD) coming up on September 25, Motley Fool analysts will be answering user- and reader-submitted questions leading up to the big event. "Ask a Fool" anything, and we'll do our best to help you investbetter.

The S&P 500 (INDEX: ^GSPC) is a capitalization-weighted index whose components are weighted by the total market value of outstanding shares. Because it's weighted this way, companies that are disproportionately larger -- like Apple (NAS: AAPL) and Exxon (NYS: XOM)  -- have the most influence over the index, while those on the smaller end, like MAKO Surgical (NAS: MAKO) and First Solar (NAS: FSLR) , have a much lower weighting. In the following video, analyst Austin Smith goes over everything that investors need to know about the S&P 500.


Click the green button below to join the thousands of people celebrating Worldwide Invest Better Day on September 25!

The article Ask a Fool: What is the S&P 500? originally appeared on

Austin Smith owns shares of Apple and MAKO Surgical. The Motley Fool owns shares of Apple, MAKO Surgical , and ExxonMobil. Motley Fool newsletter services recommend Apple, First Solar, and MAKO Surgical . Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Can't get enough business news?

Sign up for Finance Report by AOL and get everything from retailer news to the latest IPOs delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.