What is the S&P 500?

The S&P 500 is a market-capitalization-weighted index that tracks the performance of 500 of the largest publicly traded corporations in the United States. Maintained by S&P Dow Jones Indices, it covers approximately 80% of total available U.S. equity market capitalization. Historically, the S&P 500 has generated an average annualized nominal return of approximately 10% (or ~7% real return after adjusting for inflation) over rolling 30-year periods, making low-cost index funds tracking it (like Vanguard VOO or SPDR SPLG) the cornerstone of modern passive wealth building.