S&P 500

The S&P 500 is a market-cap-weighted index of roughly 500 large US companies chosen by a committee to represent the broad economy, and it is the benchmark most US fund managers and retirement accounts are measured against. Larger companies (by float-adjusted market cap) move the index more than smaller ones.

Because it is weighted by size, the index's return is not the average return of 500 equal stocks; a handful of the largest companies can drive a large share of the total gain or loss in a given year. That concentration is a recurring debate for anyone assuming an S&P 500 index fund is automatically diversified across 500 equally-sized bets.