S&P 500 Index Benchmark

I love reading everyone’s monthly summaries and their comparisons to the Buffet-endorsed standard, the S&P 500. One problem with using the raw price of the S&P, however, is dividends. As the Managing Director of the S&P Dow Jones Indices points out, over the past 10 years reinvesting the dividends roughly doubled the value of the investment. (http://www.indexologyblog.com/2013/08/08/inside-the-sp-500-d… ) And since the stocks discussed on this board rarely pay dividends, there really needs to be some way have an apples to apples comparison.

The answer is the S&P 500 total return index ^SP500TR

You can find it on Google here: https://finance.google.com/finance?q=INDEXSP%3ASP500TR&e…

Here it is on Yahoo, compared against the S&P 500 for the past 10 years: https://finance.yahoo.com/quote/%5ESP500TR/chart?p=^SP500TR#…

Google’s data doesn’t go back as far as Yahoo’s, but on both sites you can enter start and end dates to enable apples to apples comparisons with your own portfolio’s returns. Since ^SP500TR reinvests dividends daily, there will be some bumpiness depending on which stocks in the index pay dividends when. But, it’s as real as you can get.

BTW, if you wanted to follow Buffett’s no-brainer investment strategy, I’d recommend simply buying VOO if you have a Vanguard account since it’s commission free and has low expenses (0.04%), or VFIAX if you have $10K to invest via Vanguard, and setting that for DRIP. I just did that to both have in-account tracking, and so my wife knows where to put our money should I die first.

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