S&P 500 vs NASDAQ | Which Index Fund to Invest in?

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Disclaimer: Information provided in the video are not meant to be taken as professional financial advice and are strictly for entertainment purposes only. The content shared is based on the creator’s personal experience and results may vary from each individual’s personal finance situation i.e. DYOR

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When it comes to index funds, we are more familiar with S&P500 Index which tracks the 500 largest US companies by market cap. But do you know that there is another index fund you could invest in if you want more tech companies exposure?

S&P 500
What
* The S&P 500 Index features 500 leading U.S. publicly traded companies, with a primary emphasis on market capitalization.

Why:
- Depth and diversity, the S&P 500 is widely considered one of the best gauges of large U.S. stocks, and even the entire equities market
- Self cleansing criteria. Weak companies are kicked out of the index
To be eligible for S&P 500 index inclusion, a company should be a U.S. company, have a market capitalization of at least USD 11.8 billion, be highly liquid, have a public float of at least 10% of its shares outstanding, and its most recent quarter’s earnings and the sum of its trailing four consecutive quarters’ earnings must be positive.

How:
* You can't directly invest in the S&P 500 because it's an index, but you can invest in one of the many funds that use it as a benchmark, tracking its composition and performance.
* Dividend yield ~1.5%, WHT advantage for Ireland domiciled funds
* Tickers: CSPX (LSE), VOO, SPLG

NASDAQ
What: NASDAQ is the market. We are more familiar with the composite index which tracks a number of NASDAQ companies e.g. NASDAQ 100
Why: More focused on Large tech companies e.g. Apple, Microsoft, Google
How:
- Low dividends, WHT not much impact
- Tickers: QQQ, QQQM, CNDX (LSE)

S&P500 vs NASDAQ
- Historical Performance: NASDAQ performed better because of higher weightage of Large tech firms leading the growth
- Volatility: NASDAQ more violent up and down trends
- Exposure: Broad-base companies across industries vs tech focused. Top few companies are similar, but weightage different e.g. Apple 6% in S&P500 vs 12% in QQQ

Understand your risk appetite and companies preferences or do a percentage allocation based on your own choice

[HoneyMoneySG]

If you sign up for any of these services using my link, I will earn a small commission which helps support my channel at NO additional cost to you. And you will definitely get some referral benefits as listed here!

Disclaimer: Information provided in the video are not meant to be taken as professional financial advice and are strictly for entertainment purposes only. The content shared is based on the creator’s personal experience and results may vary from each individual’s personal finance situation i.e. DYOR

[Sethisfy]

Prefer QQQ's tech focus. Everything is tech now and in the foreseeable future

[ngmingjie]

What's the difference between QQQ and QQQM? What's your views on TQQQ?

[yewalvin]

Do qqq has any cleansing like s&p500? I mean does nasdaq Qqq will eliminate company that does not requirement like s&p500, which will kick out and add another company into s&p500 periodically?

[vanithakannan]

its a very very wonderful informational video. Thanks so much!!!

[leekiatchin]

Very detailed, thanks Chris for all the research and presenting it to us in very digestible content.

[yewalvin]

Does qqq nasdaq have any eliminate like s&p500? I mean like s&p500, which will kick out company that do not met requirement and add company that met requirement into s&p500 periodically?

[djchua]

Hi Chris, for a Singaporean investor trying to get exposure to S&P500, which way is best in terms of low dividend tax and estate tax and factoring brokerage fees?

Is it via S27 listed on SGX or the CSPX on LSE?
Is it S27 for SRS and CSPX for cash given former is low volume?
Another way to ask is which way will you use?

Thanks!!

[qrshe]

Hi Chris, appreciate if you could share your thoughts, if I have only 5 to 10 years horizon, as I am already in my late 50s, wise to put in lump sum into S&P index fund?

[donlyone]

Should i just DCA monthly into VOO & QQQM ?

[gparamaeswary]

No need to pay tax on capital gains only on dividends?