We use S&P 500 index as one of the benchmarks against which we measure performance
of the model portfolios. We also use the index as one of the components of the buy-and-hold
portfolio, and also of the trend following portfolio.
S&P 500 is an index of 500 large capitalization companies in the United States.
Many mistakenly say it's an index of 500 biggest US companies - this is not correct.
But it does represent quite well large companies in the US.
It is vastly preferable to the Dow Jones index - much better known, but consisting of only
For trading and tracking purposes, we will use a "spider", ticker symbol SPY - an exchange traded fund that mimics the S&P 500 index.
Here are top ten holdings of the SPY - notice that even the biggest of them do not exceed 4% of the index.
AT&T INC. 1.87%
BK OF AMERICA CP 1.57%
CHEVRON CORP 1.43%
CISCO SYS INC 1.47%
CITIGROUP INC 1.53%
EXXON MOBIL CP 3.74%
GEN ELECTRIC CO 3.09%
JOHNSON AND JOHNS DC 1.38%
MICROSOFT CP 2.17%
PROCTER GAMBLE CO 1.59%
We invite you to check with us now and then and see how the portfolios are doing.
2008 is shaping up to be a very interesting year.