Popularization of ETF Basics - What is the difference between SPX and SPY?

Many investors use the SPX and SPY to reference or track the performance or price movements of the S&P 500 Index. However, some investors confuse the two symbols and fail to realize that one is an index and the other is an ETF.

SPY is the ticker symbol for an exchange-traded fund that tracks the performance of the S&P 500 Index; it trades like a stock. SPX is simply a numerical value that represents the level of the S&P 500 and cannot be traded directly.

SPX is a numerical value that represents the level of the S&P 500 Index. The calculation method is a weighted average of the stock prices of the 500 companies in the index, and the weight is determined by the market value of each company. The SPX is often used as a benchmark for measuring the performance of U.S. large-cap stocks.

It's not possible to invest directly in the S&P 500, but investors can use investments that track the performance of the index, such as ETFs and index funds. The largest S&P 500 ETF by assets under management is the SPDR S&P 500 ETF Trust (SPY), and the largest S&P 500 index mutual fund is Vanguard 500 Index Fund Admiral Shares (VFIAX).

In short, the most fundamental difference is that one can trade and one cannot.