The S&P 500

A way to understand the US market

 

When investors talk about the US market, the S&P 500 is often at the center of the conversation. The index includes many of the largest publicly traded companies in the United States and has become one of the most widely followed benchmarks in the world.

 

For Brazilian investors exploring international opportunities, understanding the S&P 500 can help provide context around some of the businesses, industries, and long-term trends shaping the global economy, and the role US equities may play within a diversified portfolio.
 

What is an index?

Before understanding the S&P 500, it helps to understand the concept behind it: an index.

 

An index is a measure designed to track the performance of a select group of investments. In the case of stock market indexes, an index typically follows a group of companies that represent a specific market, sector, or investment category. Rather than analyzing each stock individually, investors can look at an index to get a broader view of how that group is performing.

 

Indexes may help investors monitor market trends, compare investment results, and gain insight into market conditions over time. In Brazil, one of the most widely followed examples is the Ibovespa. In the United States, the S&P 500 plays a similar role and is widely used as a benchmark for the performance of large-cap US equities.

 

An index is unmanaged and cannot be invested in directly. Index performance does not reflect fees, expenses, or transaction costs. Past performance is not indicative of future results. This material is provided for educational purposes only and should not be construed as investment advice or a recommendation to buy or sell any security.

 

What is the S&P 500?

The S&P 500, short for Standard & Poor’s 500, is an index that tracks approximately 500 of the largest publicly traded companies in the United States. These companies are listed primarily on the New York Stock Exchange (NYSE) and Nasdaq and operate across a wide range of industries within the US economy.

 

Because the companies included in the index account for a significant share of the US stock market’s total value, the S&P 500 is often used as a market reference for understanding the performance of large North American businesses.

 

The composition of the index changes over time. The S&P 500 is weighted by market capitalization, so larger companies carry more weight within the index. A company’s market capitalization is determined by multiplying its share price by the number of outstanding shares. As a result, larger companies may have a greater impact on the index’s performance than smaller companies. As of June 30, 2026, the top 10 companies represent approximately 36.4% of the S&P 500*. Companies are reviewed periodically and may be added or removed based on established eligibility criteria. As a result, the composition of the index may change over time.

 

*Source: spglobal.com / factsheet, date as of June 30, 2026

The S&P 500 Index is an unmanaged index and cannot be invested in directly. Index performance does not reflect fees, expenses, or transaction costs. Past performance is not indicative of future results. This material is provided for educational purposes only and should not be construed as investment advice or a recommendation to buy or sell any security.

 

Why it matters to global investors

For investors considering international diversification, the S&P 500 can serve different roles within a portfolio. Because the index includes companies across multiple industries, investment products designed to track it can provide access to a range of large US companies through a single vehicle.

 

Exposure to the index may help investors complement domestic holdings. For investors whose portfolios remain heavily concentrated in Brazil, US equities may offer an additional layer of diversification.

 

Snapshot of companies in the S&P 500

One of the reasons the S&P 500 is so widely followed is the range of companies and sectors it includes, from technology and healthcare to financial services, energy, and industrials.

 

This representation helps show that the S&P 500 is not driven by one type of business alone. It includes companies with different sources of revenue, economic sensitivities, and roles within the US economy.

 

Some of the companies currently included in the index are:

Sector	Examples of companies in the S&P 500
Technology	Apple, Microsoft, NVIDIA
Healthcare	Johnson & Johnson, CVS Health, Quest Diagnostics, Pfizer
Financials	JPMorgan Chase, Bank of America, Goldman Sachs
Consumer Discretionary	Nike, General Motors
Consumer Staples	Kraft Heinz, The Estée Lauder Companies
Energy	ExxonMobil, Phillips 66, Valero Energy
Communication Services	Netflix, The Walt Disney Company
Utilities	NRG Energy, AES Corporation

 

Data as of October 28, 2026.

The examples provided are for illustrative purposes only. They do not constitute investment recommendations.

 

Among the hundreds of companies that make up the S&P 500, a small group has attracted particular attention in recent years. Often referred to as the “Magnificent 7,” Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla are recognized for their scale, innovation, and influence across global markets.

 

Because these companies have represented a meaningful share of the index in recent years, their performance can have a notable influence on overall S&P 500 movements.

 

Why do investors pay attention to the S&P 500?

Investors, analysts, and financial institutions follow the S&P 500 because it turns the performance of many individual companies into a general view of the overall market. Instead of relying on the movements of a single stock, the index helps investors observe how a meaningful group of large US companies is performing over time.

 

The S&P 500 is commonly used by investors to:

• Gauge market sentiment
  Movements in the index can provide insight into how market participants are responding to economic conditions, company earnings, interest rates, and broader market developments.
• Evaluate long-term trends
  Because of its history, the S&P 500 is often used as a reference point to observe how markets have behaved across different economic cycles.
• Offer perspective on a meaningful portion of the US markets
  By including companies across multiple sectors, the index offers a consolidated view of a meaningful portion of the US equity market.

 

While investments linked to the S&P 500 may give investors access to a diversified group of US companies, they are still subject to risk. Their value may rise or fall over time depending on market conditions, economic developments, interest rates, company-specific factors, and investor sentiment.

 

How can investors gain exposure to the S&P 500?

Because the S&P 500 is an index, it cannot be purchased directly. Instead, investors can gain exposure through investment products designed to track the index or use it as a benchmark, such as ETFs and mutual funds. Bradesco Investments offers access to a range of global investment solutions that may provide exposure to the US equity market, depending on each investor’s objectives, risk profile, and overall portfolio strategy.

 

ETFs (Exchange-Traded Funds)

ETFs that track the S&P 500 are designed to seek investment results that generally correspond to the performance of the index, before fees and expenses. They typically invest in many or all of the companies included in the index, allowing investors to access a range of large US companies through a single listed vehicle. Actual returns may differ from the index due to fees, expenses, tracking differences, market conditions, and other factors. Examples of ETFs designed to track the S&P 500 Index include VOO (Vanguard S&P 500 ETF), IVV (iShares Core S&P 500 ETF), SPY (SPDR S&P 500 ETF Trust), and SPYM (SPDR Portfolio S&P 500 ETF), PHDG (iShares S&P 500 Growth ETF).

 

These are not recommendations. The examples provided are for illustration purposes only.

 

Mutual funds that use the S&P 500 as a benchmark

Some mutual funds use the S&P 500 as a comparison when evaluating performance. While these funds may invest in companies that are included in the index, they are not required to hold all constituents or mirror the index’s composition. Portfolio managers may selectively invest in certain companies, sectors, or themes based on the fund’s investment strategy and objective, such as trying to outperform the benchmark.

 

How can it fit into a portfolio?

The S&P 500 is not only a benchmark for the US equity market. For investors looking beyond their domestic market, it can also serve as a useful reference point for understanding global companies, long-term market trends, and the role of international diversification in a portfolio.

 

While exposure to the index involves risks and may not be suitable for every investor, it can be one component of an investment strategy when aligned with individual objectives, time horizon, and risk tolerance. Through Bradesco Investments, clients can evaluate investment solutions linked to the S&P 500.

Important Disclosures:

This material is provided for general informational and educational purposes only and does not constitute investment advice, a recommendation, or an offer to buy or sell any security, investment product, or strategy.

 

The information presented is not personalized and does not consider an individual’s financial situation, investment objectives, risk tolerance, or time horizon. As a result, the content may not be suitable for all investors.

 

The views expressed are those of the author and do not necessarily reflect the official position or recommendations of Bradesco Investments, Inc. Views and information are subject to change without notice.

 

All investing involves risk, including the possible loss of principal. Asset allocation and diversification strategies do not guarantee profits or protect against losses. Past performance is not indicative of future results.

 

For Brazilian investors, the value of US investments may be affected by fluctuations in the exchange rate between the U.S. dollar and the Brazilian real. As a result, returns measured in Brazilian reais may differ from returns measured in U.S. dollars.

 

Investments outside the United States may involve additional risks, including currency fluctuations, political or economic instability, and differences in regulatory, legal, or accounting standards.

 

This content is not intended to replace professional advice. Investors should conduct their own research and consult with qualified and licensed financial, tax, or legal professionals before making any investment decisions.