The most-asked questions, with the simplest defensible answer for each.
Is the S&P 500 actually the 500 largest US companies?
No. The index is constructed by an Index Committee at S&P Dow Jones Indices that selects names meeting size, liquidity, profitability and float thresholds. It's a representative sample, not a strict top-500 list — Tesla, for example, was excluded for years despite qualifying on size.
Who decides which stocks are added or removed?
An Index Committee at S&P Dow Jones Indices, which is jointly owned by S&P Global (75%) and CME Group / News Corp (the remainder). The committee meets at least quarterly and announces changes after market close on a Friday.
What are the S&P 500 inclusion criteria?
The published rules require a US domicile, a primary listing on NYSE / Nasdaq / Cboe BZX, a market cap above the threshold S&P updates periodically (raised to $20.5bn in April 2024), positive earnings over the most recent quarter and the trailing twelve months, and adequate float and trading liquidity.
Is the S&P 500 weighted by market cap?
Yes — by free-float-adjusted market capitalisation. That means companies with restricted shares (insider lockups, government holdings) get a smaller weight than their headline market cap would suggest.
Why can't I buy 'the S&P 500' directly?
You can't buy the index itself because it's a list, not a security. You can buy ETFs that track it (SPY, IVV, VOO, SPLG) or replicate the holdings yourself — Arithmos can build the latter as a 500-stock custom index, capped however you like.
How often is the S&P 500 rebalanced?
Quarterly, with most changes announced in March, June, September and December. Mid-quarter additions happen for events like spin-offs and large IPOs.
How long has the S&P 500 existed?
The S&P 500 in its modern form launched on 4 March 1957. Its ancestor, the Standard Statistics 90, dates to 1926 — daily-return data is reconstructed back that far.
Has any active manager beaten the S&P 500 over 20 years?
A handful — but the SPIVA scorecard from S&P DJI shows roughly 90% of US large-cap active funds underperform the S&P 500 over rolling 20-year windows after fees.
Can I build my own S&P 500 with Arithmos?
Yes — describe "the S&P 500 holdings, market-cap weighted, capped at 5% per name" and the agent builds it. You can also tweak it ("S&P 500 ex-tobacco", "S&P 500 ex-fossil-fuels", "S&P 500 with quality tilt") in plain English.
