The S&P 500 consists of 500 companies that issue a total of 505 stocks, as some companies, such as Berkshire Hathaway, have issued multiple classes of shares. The top 10 largest holdings are listed on the official Standard & Poor's website. However, S&P does not currently provide the total list of holdings, at least not for free. Subscribers to S&P's research unit, Capital IQ, can get access to the entire list.

Key Takeaways

  • A constituent is a member or component of a market index like the S&P 500.
  • Companies must meet certain requirement criteria, which are determined by the publishers of the index, before being added to an index.
  • The value of an index is based on mathematical formulas that consider the share prices of all constituents within the index.
  • The S&P 500 index is market capitalization weighed, where it gives a higher percentage allocation to companies with the largest market cap.

S&P 500 Inclusion Criteria

The S&P 500 is one of the most widely quoted stock market indexes because it represents the largest publicly traded companies in the U.S. The S&P 500 focuses on the U.S. market's large-cap sector.

To be added to the S&P 500, a stock must meet a broad set of criteria, including a total market cap of at least $8.2 billion. Additionally, the stock must be issued by a U.S. company, have a positive sum of four consecutive quarters of trailing earnings, and also meet certain liquidity requirements. Companies may be removed from the S&P 500 if they deviate substantially from these standards.

$28.94 trillion

The total combined market cap of the 500 companies in the S&P 500 as of Oct. 5, 2020.

S&P 500 Calculation

The S&P 500 is a free-float market capitalization-weighted index. This means that the more valuable an individual company's stock becomes, the more it contributes to the S&P 500's overall return. It is not uncommon for three-quarters of the index's return to be linked to only 50 to 75 stocks.

Therefore, the addition or subtraction of smaller companies from the index will not have a noticeable impact on the overall return of the index. However, the removal or addition of even just one of the largest stocks can have a major impact.

S&P 500 components are weighted by free-float market capitalization. Larger companies affect the value of the index to a greater degree.

Top 25 Components by Market Cap

As of Oct. 5, 2020, the following are the twenty-five largest S&P 500 index constituents by weight:

  1. Apple Inc. (AAPL)
  2. Microsoft Corp (MSFT)
  3. Amazon.com Inc (AMZN)
  4. Facebook Inc (FB)
  5. Alphabet Inc- A shares (GOOGL)
  6. Alphabet Inc- C shares (GOOG)
  7. Berkshire Hathaway (BRK.B)
  8. Johnson & Johnson (JNJ)
  9. Procter & Gamble Company (PG)
  10. Visa Inc (V)
  11. NVIDIA Corporation (NVDA)
  12. Home Depot (HD)
  13. Mastercard Incorporated (MA)
  14. JP Morgan Chase & Co (JPM)
  15. UnitedHealth Group (UNH)
  16. Verizon Communications (VZ)
  17. Adobe Inc. (ADBE)
  18. salesforce.com (CRM)
  19. Paypal Holdings (PYPL)
  20. Netflix (NFLX)
  21. Walt Disney Company (DIS)
  22. Intel (INTC)
  23. Comcast Corporation Class A (CMCSA)
  24. Merck & Co. Inc. (MRK)
  25. AT&T Inc. (T)

Notably, Google parent Alphabet has two classes of shares—when combined, Google's weighting in the S&P 500 is effectively 4th behind Amazon.com.