29
votes
Are the S&P 500 and Dow Jones Industrial Average securities?
Index is not a security, index is a math formula. You can't buy an index.
There are funds that track the indexes and are trying to reproduce the asset mix that would be created by following the ...
- 166k
13
votes
Are the S&P 500 and Dow Jones Industrial Average securities?
No, the indices are not securities. They are basically lists. The Dow Jones is a list of 30 companies, and the Standard & Poors 500 (as it says in the name) is a list of the 500 largest companies ...
- 9,506
7
votes
Accepted
Can ETFs be broken down into the stocks composing them without paying capital gains tax?
No. You can't exchange mutual funds or ETFs directly for the underlying holdings without selling the fund first and then buying the stocks directly.
- 53k
4
votes
Question to do with ETF price changes during the day
In my learnings I was told the nav price of an etf is calculated at the end of the trading day. So the next day trading resumes at that price but then fluctuates due to supply and demand for the etf ...
- 130k
3
votes
Accepted
How can an index fund experience price variations different than those of the index it tracks?
As Brian Borchers mentioned, it's due to the fact that S&P total market index and Vanguard U.S. Equity Index Fund are expressed in two different currencies in your graphs.
Converting the Vanguard ...
- 11.2k
3
votes
What's an Index Interest Strategy Charge Rate in a long-term care (LTC) insurance plan?
The answer is similar to that I gave here.
Insurance terms are defined per policy, and per insurance company. You should address this question to your insurance agent and to the specific insurance ...
- 166k
2
votes
Cheap indices in Europe
You can’t buy an index. An index only gives you a value, which is a weighted average of the stocks it is composed of (each index having their own criteria for deciding which stocks it contains and the ...
- 3,942
2
votes
What kind of investment strategies are typically employed when investing at the industry level?
On a high level you can apply several binary approaches to sectors, such as defensive vs. cyclical, value vs. growth, over-bought vs. oversold. These could be macro driven. E.g. energy, consumer ...
- 1,809
2
votes
What kind of investment strategies are typically employed when investing at the industry level?
Sector rotation. Google it. It works. For instance energy has done well this past year because we are "heading into a downturn" or at least that is what the market thinks including me.
Also ...
- 41
2
votes
Accepted
How does the definition of expense ratio and gross return fit into the net return on investment equation?
A fund has a gross return of 10% and an expense ratio of 1.5%.
Therefore the net return of the fund becomes 10% - 1.5% = 8.5%.
Isn't that exactly the answer.
The fund based just on the investments ...
- 136k
2
votes
Accepted
What happens if an Index Fund sell off occurs?
Putting my comment as an answer:
The fund has no meaning, it's just a bucket of stocks, essentially. Redemption of the fund lead to fund liquidating stocks to pay the redemption. Sell off of the fund ...
- 166k
2
votes
Understanding the weight of stocks in S&P 500 indexes
What's the problem of being equal here?
Suppose you created your own index of 5 equally-weighted stocks (A, B, C, D, and E) and wanted to create a fund that tracks that index. Suppose also for ...
- 130k
2
votes
Understanding the weight of stocks in S&P 500 indexes
https://www.investopedia.com/articles/investing/090414/sp-500-index-you-need-know.asp says:
The S&P 500 is calculated by adding each company's float-adjusted market capitalization.
This seems to ...
- 1,876
1
vote
How does mutual funds confiscate the stock dividends?
"Confiscate" is a loaded word. Mutual funds have various management costs, but they want to make these seem as low as possible. So they hide fees in other ways, such as keeping (some or ...
- 9,781
1
vote
Why do people claim that it's hard to outperform the S&P 500? It has only increased in value by ~1.5x in the past 5 years
Lots of good answers already. However, since this question was asked, a few things happened that make it worth to add yet another answer in my opinion.
The stock market declined in 2022:
S&P: -16....
- 2,451
1
vote
Bloomberg Ticker from Index ISIN and Index Key
You can simply use the API. =BDP(US0846707026&" ISIN", "PX_LAST"). You can also cell reference the ISIN (standard Excel logic).
No need to get the BBG ticker. Also F1F1 is the ...
- 2,451
1
vote
Are the S&P 500 and Dow Jones Industrial Average securities?
The S&P 500 and Dow Jones Industrial Average are not securities themselves, but rather they are indexes that track the performance of a group of securities. An index is a statistical measure of ...
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