The S&P 500 continues to rise, and institutions have raised their target prices one after another. How can I invest in the S&P 500 through ETFs?
$S&P 500 Index(.SPX.US$It has continued to rise since May, with a monthly increase of 4.8%. As of June 14, the S&P 500 closed at 5431.60 points, a monthly increase of 2.92%.
As the index continues to rise, the target prices called out by Wall Street bosses are also higher one by one.Julian Emanuel (Julian Emanuel), chief stock and quantitative strategist at Evercore ISI, raised his year-end forecast for the S&P 500 index to 6,000 points. Emmanuel said that the decline in inflation and the boom in artificial intelligence will push the stock market further higher.
In terms of inflation, the US CPI increased 3.3% year on year in May, a slight decrease from the previous value and the expected value of 3.4%; while the US PPI fell 0.2% month-on-month in May, this is the biggest month-on-month decline since October 2023, lower than the estimated 0.1%, and much lower than the 0.5% in April.
On the AI side, according to data compiled by EPFR Global and Bank of America, inflows into the US technology sector reached 2.1 billion US dollars last week, the highest level since March.
In addition,On Friday, Goldman Sachs strategist David Kostin's team sharply raised the S&P 500 forecast for the end of this year from 5,200 points to 5,600 points. The target price increase was 7.7%.The main reason is similar to Evercore ISI.
In a report to clients on Friday, Kostin et al. “Our 2024 and 2025 earnings estimates remain unchanged, but the outstanding earnings growth of the five major tech companies offset the typical pattern of negative revisions to earnings per share expectations.”
The increase comes a month after Kostin reaffirmed the S&P 500 target point of 5,200 points. At the time, he said that by the end of December this year, there was no room for further growth in the US stock market. During this period, the US released cooling CPI and PPI data. Wall Street generally expects the Federal Reserve to cut interest rates at least twice this year, and US stocks have risen markedly recently.
Facing the benefits of declining inflation and the boom in artificial intelligence, how can we choose the right investment targets?Buffett believes that the passive investment model is ideal for ordinary investors. It not only saves time to research individual stocks, but also has a better chance of profit, and is suitable for investors interested in long-term deployment of US stocks:
What I often recommend is a low-cost S&P 500 index fund, but only a few humble friends will take my word for it. Hardly any of the richest investors, fund managers, and pension funds actually followed my advice; they politely thanked me. However, he turned his head around and was persuaded by the asset management manager, who charged high management fees, and chose a different investment method.
ETF index equity funds linked to the S&P 500 include $SPDR S&P 500 ETF(SPY.US$、 $iShares Core S&P 500 ETF(IVV.US$with $Vanguard S&P 500 ETF(VOO.US$。
In which, $SPDR S&P 500 ETF(SPY.US$It is the first ETF in US history. It was founded in 1993, and is also the largest ETF in the world. SPY has extremely high liquidity and huge daily trading volume, which makes it easy for investors to buy or sell, and the spread (spread) is usually very small, which is particularly beneficial to large traders.
$iShares Core S&P 500 ETF(IVV.US$It is an ETF issued by iShares, a subsidiary of BlackRock, which also aims to track the performance of the S&P 500 index. The cost ratio of IVV is lower than SPY, which is around 0.03%. Although IVV's liquidity is not as high as SPY, for most investors, its average daily trading volume is still sufficient to meet normal trading needs.
$Vanguard S&P 500 ETF(VOO.US$It is an ETF managed by Vanguard Group, a well-known low-cost fund manager, and also closely tracks the S&P 500 index. VOO's fee ratio is usually around 0.03%, which is a reflection of Vanguard's long-standing low-cost investment strategy.
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In addition to this, there are still a large number of index ETFs on the US stock market for investors to choose from. Mooers canClick here to check out the ETF topic!
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