The S&P 500, widely recognized as a benchmark for the U.S. stock market, has long been a preferred choice for investors seeking stable, long-term growth.
Representing 500 of the largest publicly traded companies in the United States, the index provides inherent diversification and exposure to blue-chip stocks while offering significant growth potential.
The legendary investor Warren Buffett has consistently championed the S&P 500, calling it “the best thing to do” for most people who want to participate in the stock market.
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With the index recently hitting an all-time high, many are left wondering how much an early investment in the S&P 500, particularly during the financial crisis lows of 2008 – 2009, would be worth today.
As of the market close on December 17, the index stood at 6,050.61, boasting a remarkable year-to-date gain of 27.57% and an impressive five-year growth of 87%.
How much would a $1,000 investment be worth today?
Although direct investment in the S&P 500 is impossible, investors can replicate its performance through index funds like SPDR S&P 500 ETF (SPY) or Vanguard S&P 500 ETF (VOO).
Considering the historic lows of the 2008-2009 financial crisis, the long-term potential of such an investment becomes evident. An investment of $1,000 in the SPDR S&P 500 ETF at its low on March 9, 2009, when the S&P 500 index stood at 676, and SPY was priced at $67.95, would have acquired approximately 14.72 shares of SPY.
Fast forward to December 17, 2024, with SPY now trading at $604.29, the initial $1,000 investment would have grown to approximately $8,460. This represents an impressive 789.32% increase, highlighting the remarkable recovery and growth of the index over the past 15 years.
What is next for the S&P 500 in 2025
As the S&P 500 continues to surge, analysts are already setting ambitious targets for its trajectory in the coming years. Wells Fargo’s (NYSE: WFC) Christopher Harvey predicts the index will close 2025 at 7,007 points, driven by favorable business policies from the incoming administration, the Federal Reserve’s dovish stance, and a resilient domestic economy.
UBS has set its sights on 6,400, while Oppenheimer offers a more optimistic projection of 7,100, citing robust labor markets, current monetary policy, and strong economic fundamentals.
Some of the most bullish predictions, such as those from Yardeni Research, even forecast the S&P 500 reaching 10,000 by the end of the decade.
However, concerns loom over potential overvaluation and the growing dominance of the “Magnificent Seven” tech giants, now making up nearly 33% of the S&P 500, raising fears about portfolio concentration as reported by Finbold.
Despite these concerns, historical trends suggest the rally could continue into 2025, driven by the Federal Reserve’s rate cuts in September 2024, which have often been followed by positive market performance.
Furthermore, Investors can take cues from Warren Buffett’s enduring advocacy for low-cost S&P 500 index funds as part of a balanced portfolio, reinforcing the index’s role as a vehicle for both stability and growth.
With projections for another year of gains, 2025 could offer yet another chapter in the S&P 500’s remarkable growth story.
Featured image via Shutterstock
