I need a little help with s&p 500?
I'm looking to invest in s&p. The problem is that I'm new to the index funds. I know Vanguard has low annual fees, but I don't know what other fees I have to look out for. Is it a bad idea to put in $100 every week or so as opposed to saving for 2 months and then putting $1000 in. I've heard invest larger amounts at a time so I was just wondering.
- PETER MLv 71 decade agoFavorite Answer
I wouldn't invest in the S&P just yet as the S&P and the entire stock market will drop some more before it gets closer to hitting bottom. I suggest you just save the $100.00 a week and keep it in your checking account for future investment in the S&P. The symbol for the S&P 500 ETF is SPY and were you to look at a chart of SPY you will notice that it is on a downward trend. When you see it starting an upward trend it is time to buy, but I would be careful to watch the entire stock market to see if the market as a whole is starting to look better and the Dow and the Nasdaq are also rising rather than falling as they both have been for about the past two weeks. When you see an upturn in the Dow and the Nasdaq you will also see an upturn in the S&P which may or may not be a good time to buy the S&P as sometimes there are short upward rallies that may last a week or so and then start going downward. When the hedge funds start buying the volume of trading in many stocks and ETF's will increase and that is a signal to buy as the hedge funds have the most money with which to invest and they do so by buying fast, usually at either the opening or closing of trading where hundreds of millions of shares are traded. When you see the hedge funds buying large amounts of SPY at the opening or at the closing of trading for a given day it is worth considering buying SPY or buying a call option on SPY that is at least two or three months ahead so you have more time with the option before it expires worthless. Were you not to know about buying options you can learn about options at the Chicago Board of Options Exchange. I will give you the web site so you will have it and be able to learn a lot that will help you with your investing. Good luck to you and I wish you the best in your investing. Don't forget that investing isn't gambling so keep that in mind at all times and use due dilligence when investing by doing research on the particular stock or ETF you are thinking of investing your hard earned money. Don't get greedy and learn to take profits. I always take profits when the stock or ETF I buy gains twenty percent and then if the stock is still on an upward trend I may buy it back on a dip if the price is less than the price I sold it and then I ride it up again.Source(s): http://www.cboe.com/
- Anonymous1 decade ago
If you want to invest in the S&P then it's best to just buy the SPDRs.
Trades just like a stock and you own all the companies in the index and there's no management fees or anything. If you open an online account you can buy/sell for $10-$12 commish which is cheap.
If you really want a managed fund then research how their fund matched up against the index itself. I read something crazy a while ago that said that 9 out of 10 actively managed S&P funds do not beat the index itself. That means that the "experts" trading within the index can't beat the index. It's nutty but true.
Btw, if you're young it's good advice to do what you're doing by investing in the S&P but we are entering dangerous times so it's no slam dunk. There's a good chance we will have a period of deflation which is very bad and this country has never experienced it. During deflation, cash is king.
But then after a deflationary period (may last several months or even years) we are very likely to go into a very high inflationary period. When that happens you want to be invested in commodities and gold.
Might be best to hold off a while before diving into the market. That's all I'm trying to say. Research deflation and inflation first. The S&P is at 1022 right now and I think it's going much lower over the next couple of years. Probably to the 800-850 level.
Good luck though whatever ya decide to do.Source(s): http://finance.yahoo.com/q?s=SPY also check out >> www.kitco.com lots and lots of good stuff re: metals and currencies
- JamesLv 61 decade ago
Check out other S&P 500 mutual funds as well. Read the prospectuses for the funds. This will detail how the fund will attempt to emulate or track the S&P 500. It will also give you the fees that that particular fund charges.
It is a good idea to invest smaller amounts over time. While you may pay more in transaction fees (if you are purchasing the fund through a broker instead of directly from the investment manager), you will be doing what is known as dollar cost averaging. As you may know, the value of a stock or fund investment varies on a daily basis. If you invest on a consistent, regular, periodic basis, then you will average out cost of your purchases over the run of your investments. If you save and do a lump sum purchase, then you risk purchasing at a higher cost than you could have previously.
- Anonymous4 years ago
i do no longer comprehend what the vanguard 500 index fund is...yet whilst it is meant to replicate the S&P 500, you may purchase the ETF(Electronically Traded funds) secret agent(spyder)...it is resembling procuring a inventory, whether it tracks the S&P 500.