Why SPY? The S&P 500 Is Not Everyone’s Benchmark – etf.com
The S&P 500 Is Not the Only Benchmark to Consider
Many people automatically think of the S&P 500 when they hear the term “benchmark.” However, this popular index may not be the best fit for everyone’s investment goals.
While the S&P 500 is a widely recognized measure of the U.S. stock market, it may not accurately reflect an individual investor’s risk tolerance, time horizon, or investment objectives. Some investors may prefer to use a different benchmark that better aligns with their specific needs.
For example, investors looking for international exposure may choose to use the MSCI EAFE Index or the FTSE Developed Markets Index as their benchmark. Others may be more interested in small-cap stocks and opt for the Russell 2000 Index.
Ultimately, the key is to choose a benchmark that closely matches your investment strategy and goals. While the S&P 500 is a popular benchmark, it is not the only option available. By considering your own objectives and preferences, you can select a benchmark that is the best fit for your individual investment needs.