The Best S&P 500 ETF to Invest $5,000 in as 2026 Begins

Published: Thursday, January 8, 2026 at 10:04 am

S&P 500 ETFs: Navigating the Market in 2026

The S&P 500 index has demonstrated strong performance, concluding three consecutive years of gains exceeding 16%. This impressive streak has only occurred a handful of times in nearly a century. As investors look to capitalize on this momentum, several exchange-traded funds (ETFs) offer exposure to the index.

Several ETFs are prominent contenders in the S&P 500 market. The SPDR S&P 500 ETF Trust, managed by State Street, is the most popular based on trading volume and is the oldest ETF in the U.S. The Vanguard S&P 500 ETF holds the largest assets under management. The iShares Core S&P 500 ETF, managed by BlackRock, also boasts significant assets and trading volume. State Street also offers the State Street SPDR Portfolio S&P 500 ETF, a smaller fund. Finally, the Invesco S&P 500 Equal Weight ETF provides a different approach, weighting each stock equally, unlike the market-cap-weighted approach of the other ETFs.

The primary differences between these ETFs lie in their annual expense ratios and liquidity. Market-cap-weighted funds have shown similar returns over the last decade, while the equal-weighted ETF has delivered lower returns. This difference is largely attributed to the performance of large growth stocks.

The State Street SPDR Portfolio S&P 500 ETF is highlighted as a strong choice due to its low expense ratio. Liquidity is not a concern for any of the discussed S&P 500 ETFs. However, the Invesco S&P 500 Equal Weight ETF could potentially outperform if the growth of artificial intelligence stocks slows, as it has less exposure to these large-cap companies.

BNN's Perspective:

The choice of an S&P 500 ETF ultimately depends on individual investment goals and risk tolerance. While the State Street SPDR Portfolio S&P 500 ETF offers a compelling value proposition with its low expense ratio, investors should consider the potential for shifts in market dynamics. The equal-weighted ETF presents an interesting alternative, particularly if the current market leaders experience a downturn. Diversification and a long-term perspective remain crucial for navigating the market.

Keywords: S&P 500, ETF, SPDR, Vanguard, iShares, Invesco, State Street, investment, market, expense ratio, liquidity, equal weight, market cap, 2026

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