The S&P 500 is the stock-market index that includes 500 of the largest U.S. companies by market capitalization.
Standard & Poor’s created the modern S&P 500 in 1957. It is designed to represent the large-cap segment of the U.S. equity market and includes companies from many industries, including technology, health care, finance, communications, and consumer goods.
The index is weighted by market capitalization, so the largest companies have the greatest influence on its movements. This means a price change in a mega-cap company can affect the index more than a similar percentage change in a much smaller constituent.
The S&P 500 is not simply a list of the 500 biggest firms. An index committee applies eligibility rules involving factors such as U.S. incorporation, liquidity, public float, and profitability.