There are several instruments available to trade the S&P 500. Since the S&P 500 is a stock index, you can’t trade it directly (unless you buy all the stock in the index at the exact ratio used to calculate the index). Instead, there are two easier methods of trading the S&P index, using CFDs, or contracts for difference, is one such popular instrument. Essentially traders speculate whether the value of the S&P 500 will rise or fall within a specified time period and place trades accordingly with a CFD broker like London Capital Group. The advantage of trading with a CFD broker is they don’t typically charge a commission for trading indices and they allow you to trade on leverage. Since you don’t actually technically own anything when you trade on the S&P 500, you aren’t charged stamp duty tax on your trades either. For example, LCG offer traders the US 500 to trade the S&P 500. They offer a minimum spread of 0.8, minimum trades from 0.1 lot, and a margin requirement of 0.20%. This means at the current value of the S&P Index of 2,380, a trader would need a minimum account size of $238 to open an $11,900 position. 2,380 *0.1 (min lot)*$50 (value per point) = $11,900 $11,900*.002% (margin requirement) = $238 *Example is for illustrative purposes only. All information collected from https://www.lcg.com/uk/, see website for full terms and conditions. Your capital is at risk. Last updated on February 27, 2017. Another popular trading strategy, though not unique to the S&P 500, is trading on index funds. Index funds mirror the selected stocks in each fund with the aim being that investor results match the performance of the index. These are typically attractive investment opportunities for investors who do not actively manage their investments because they provide broad market exposure with low operating expenses. Returns are usually quite modest but they are considered to be among the safer option for the risk-averse, often beating out smaller, more actively managed funds in the long term. Pay close attention to funds offering this, as a fund that is properly weighed and tracked against the S&P 500 can be expensive – a number of shares of each of the 500 companies equivalent to its free float market-cap must be purchased to genuinely track the index and there are very few investment funds with large enough capital to achieve both that goal and provide adequate liquidity for investor withdrawals.