Best S&P 500 Index Funds for Smart Investors

Investing in index funds provides exposure to a broad range of stocks at a lower cost, offering diversification and reduced risk. Over recent years, index funds have gained popularity over individual stock picks. The top funds listed here are based on the S&P 500, which includes 500 leading large-cap companies across various sectors.

We've highlighted the best S&P 500 index funds that offer low expense ratios and strong performance.

Fidelity Zero Large Cap Index (FNILX)
While this fund tracks the Fidelity Large Cap Index—similar to the S&P 500—it stands out because it charges no expense ratio, making it highly attractive for cost-conscious investors.

Fidelity's choice to omit the S&P 500 name allows for lower costs. Long-term expenses greatly impact overall returns, making low-cost funds ideal for investors.

Schwab S&P 500 Index Fund (SWPPX)
This fund aims to replicate the S&P 500's performance by allocating at least 80% of its assets to the same stocks, weighted similarly. It seeks to mirror the index's total returns with a minimal expense ratio of 0.02%.

SPDR S&P 500 ETF Trust (SPY)
Established in 1993, SPY is one of the most widely traded ETFs that tracks the S&P 500 index. Its high liquidity and lower trading costs make it a popular choice for short-term and long-term investors alike, with an expense ratio of 0.09%.

Vanguard 500 Index Fund Admiral Shares (VFIAX)
As one of the earliest funds of its kind, Vanguard’s 500 Index Fund Admiral Shares manages approximately USD 740 billion in assets, making it the largest index fund. Its low expense ratio of 0.04% helps investors keep more of their returns. The fund mirrors the S&P 500's composition to deliver similar performance.

iShares Core S&P 500 ETF (IVV)
Issued by global investment giant BlackRock, IVV is another top ETF tracking the S&P 500. With a very low expense ratio of 0.03%, it offers competitive yields and substantial liquidity, appealing to investors seeking cost efficiency and reliable dividends.