The S&P 500 for Beginners: What It Is and How to Invest or Trade It

The S&P 500 is the benchmark of the US stock market: about 500 large companies, each weighted by its market value. When people ask “how is Wall Street doing”, they usually mean this index. Over the last ten years it rose 257.3% (13.6% a year, before dividends), and it set its latest record close on October 6, 2026.

What moves it

• Company earnings, above all from the largest companies, which weigh heavily in the index.
• The Fed and interest rates: higher rates make funding dearer and tend to weigh on valuations.
• US data: inflation, jobs and GDP, released at 8:30 a.m. ET.
• Sentiment: the VIX “fear index” measures the volatility S&P 500 options expect.

Ways to invest or trade it

Trading hours

The New York stock market trades 9:30 a.m. to 4:00 p.m. ET. S&P 500 futures trade almost 24 hours, Sunday evening to Friday afternoon, but with less liquidity outside the cash session (market hours and clock changes).

If you are going to trade it

On a normal day the S&P 500 moves tens of points; on one ES that is hundreds of dollars. Size contracts from your risk and your stop in points, and start with the micro if your account is small. Futures calculator · futures guide · long-term index investing.

S&P 500 data from FRED (St. Louis Fed). Information only, not investment advice.

What one point is worth depending on how you trade it

The same S&P 500 move is worth very different amounts depending on the product. On the ES future each point is $50; on the micro MES, $5. On an index CFD it depends on the size you choose: many brokers pay $1 per point per lot, but not all.

Example: a 20-point move is $1,000 on one ES, $100 on one MES and $20 on a $1-per-point CFD. With a $50,000 account and 1% risk ($500), a 10-point stop allows one ES or ten MES. With a 20-point stop the ES no longer fits and you would drop to five MES.

The Nasdaq-100 usually moves more in percentage terms than the S&P 500, and the Dow less; if you switch index, recalculate the stop in points before keeping the same number of contracts.