The index is associated with many ticker symbols, including: ^GSPC, INX, and $SPX, depending on market or website. The index value is updated every 15 seconds, or 1,559 times per trading day, with price updates disseminated by Reuters.
In the derivatives market, the Chicago Mercantile Exchange (CME) offers futures contracts that track the index and trade on the exchange floor in an open outcry auction, or on CME's Globex platform, and are the exchange's most popular product. Ticker symbols are /SP for the full-sized contract and /ES for the E-mini S&P contract that is one fifth the size of /SP. In May 2019, the CME started trading a Micro E-mini futures contract that is one tenth the size of the S&P E-mini contract, i.e. 1/50 the size of the full-sized (SP) contract. The Micro E-mini S&P 500 Index contract's ticker symbol is /MES.
In 1860, Henry Varnum Poor formed Poor's Publishing, which published an investor's guide to the railroad industry.
In 1923, Standard Statistics Company (founded in 1906 as the Standard Statistics Bureau) began rating mortgage bonds and developed its first stock market index consisting of the stocks of 233 U.S. companies, computed weekly.
In 1926, it developed a 90-stock index, computed daily.
On Monday, March 4, 1957 the index was expanded to its current 500 companies and was renamed the S&P 500 Stock Composite Index.
In 1962, Ultronic Systems became the compiler of the S&P indices including the S&P 500 Stock Composite Index, the 425 Stock Industrial Index, the 50 Stock Utility Index, and the 25 Stock Rail Index.
To remain indicative of the largest public companies in the United States, the index is reconstituted quarterly; however, efforts are made to minimize turnover in the index as a result of declines in value of constituent companies.
A stock may rise in value when it is added to the index since index funds must purchase that stock to continue tracking the index.
The index is a free-float capitalization-weighted index;:150 that is, companies are weighted in the index in proportion to their market capitalizations. For purposes of determining the market capitalization of a company for weighting in the index, only the number of shares available for public trading ("public float") is used; shares held by insiders or controlling shareholders that are not publicly traded are excluded from the calculation.
The formula to calculate the S&P 500 index value is:
where is the price of the i-th stock in the index, is the corresponding number of shares publicly available ("float") for that stock, and is a normalization factor.
The , currently below 8.3 billion, is a number that is adjusted to keep the value of the index consistent despite corporate actions that affect market capitalization and would otherwise affect the calculation formula, such as additional share issuance, share buybacks, special dividends, constituent changes, rights offerings, and corporate spin-offs. Stock splits do not affect the divisor since they do not affect market capitalization. When a company is dropped and replaced by another with a different market capitalization, the divisor needs to be adjusted in such a way that the value of the S&P 500 index remains constant. All divisor adjustments are made after the close of trading and after the calculation of the closing value of the S&P 500 index.:290
The average annual total return and compound annual growth rate of the index, including dividends, since inception in 1926 has been approximately 9.8%, or 6% after inflation; however, there were several years where the index declined over 30%. The index has posted annual increases 70% of the time. However, the index has only made new highs on 5% of trading days, meaning that on 95% of trading days, the index has closed below its all-time high.
On February 12, 1997, the index closed above 800 for the first time.
On February 2, 1998, the index closed above 1,000 for the first time.
On March 24, 2000, at the peak of the dot-com bubble, the index reached an intraday high of 1,552.87; this high was not exceeded until May 30, 2007. On October 10, 2002, during the stock market downturn of 2002, the index fell to 768.83, a decline of approximately 50% from its high in March 2000.
On May 30, 2007, the index closed at 1,530.23, setting its first all-time closing high in more than 7 years. The index achieved a new all-time intraday high on October 11, 2007 at 1,576.09.
Between the bankruptcy of Lehman Brothers on September 15, 2008, and the end of 2008, the index closed either up or down 3% in one day 29 times. On October 13, 2008, the index closed up 11.6%, its best single-day percentage gain since being founded in 1957.
On November 20, 2008, the index closed at 752.44, its lowest since early 1997.
The index ended 2008 at 903.25, a yearly loss of 38.5%. The index continued to decline in early 2009, closing at 676.53 on March 9, 2009, its lowest close in 13 years. The drawdown from the high in October 2007 to the low in March 2009 was 56.8%, the largest since World War II.
On April 29, 2011, the index closed at a post-crisis high of 1,363.61. However, after the August 2011 stock markets fall, on October 4, 2011, the index briefly broke below 1,100.
The index rose 13% in 2012 despite significant volatility amid electoral and fiscal uncertainty and round 3 of quantitative easing. On December 31, 2012, the index closed at 1,426.19, an annual gain of 13% and its biggest gain in 3 years.
On March 28, 2013, the index surpassed its closing high of 1,565.15, recovering all its losses from the Great Recession. On April 10, 2013, it closed above the intraday high from 2007.
On August 26, 2014, the index closed above 2,000 for the first time.
On March 2, 2015, the index reached an all-time closing high, while the Nasdaq Composite closed above 5,000 for the first time since 2000.
For the full year 2017, the index was up 19.4%, its best year since 2013. On September 25, 2017, the index closed above 2,500 for the first time.
The index rose sharply in January 2018, extending one of its longest monthly winning streaks, only to fall 4% in February 2018 during a month of extremely high volatility, including a day in which the VIX doubled. It was the first monthly decline in 11 months. In the third quarter of 2018, the index posted its best quarter since 2013. However, the index fell 11% in the month of December 2018, its worst December performance since the Great Depression. The index fell 6% in 2018, its worst year in a decade.
However, in 2019, the index posted its best first half in 22 years including the best June since 1938. On July 10, 2019, the index reached 3,000 for the first time. The index rose 31.5% in 2019, one of its best years.
On February 19, 2020, the index hit a new closing peak of 3,386.15, only to fall 10% in the next 6 trading days, its fastest drop from a new peak. Analysts attributed the drop to fears of the spread of COVID-19 from its first outbreak in China. By the 2020 stock market crash low on March 23, 2020, the index had fallen 34% from its peak.
The index fell 20% during the first quarter of 2020, its worst quarter since 2008. This was followed by a 20% gain in the second quarter, its biggest quarterly gain since 1998. It recovered from its COVID-19 crash over a 6 month span and reached a new record on August 18, 2020. In the following months the index reached several all-time highs. On April 1, 2021, the index closed above 4,000 for the first time.
Returns are generally quoted as price returns (excluding returns from dividends). However, they can also be quoted as total return, which include returns from dividends and the reinvestment thereof, and "net total return", which reflects the effects of dividend reinvestment after the deduction of withholding tax.