“One of the simplest places to start investing is in the S&P 500, which gives you exposure to 500 of the largest publicly traded U.S. companies,” says Mark Andraos, associate portfolio manager at Regency Wealth Management. “This index is widely regarded as a benchmark for the broad domestic equity market. Investors can gain exposure to the S&P 500 through mutual funds or ETFs.”
For risk-tolerant investors looking to make an initial $5,000 investment compound over the long term, funds tracking the S&P 500 index can provide a combination of low costs and transparency. “When picking an S&P 500 ETF, cost should be a key focus as most of the larger ETF providers like Vanguard or BlackRock provide them for expense ratios of less than 0.1%,” Andraos says.