How to invest in the UK S&P 500 Index Fund | money farm (2023)


Most UK investors look to the FTSE 100 Index for opportunities when they start investing. But FTSE is only a small part of a much bigger picture. These are the other indices that most UK traders are comfortable with when looking to take a step forward in the industrysmart asset managementthe US S&P 500 index is at stake, so this article is about investing in the UK S&P 500 index.

❓ What is the S&P 500 index fund?Yes there is
💯 UK equivalent of the S&P 500?FTSE 100
💡️ Another way to invest in an index fund?Buy shares of companies included in an index fund or invest in mutual fund ETFs or indices

The initials "S&P" stand for Standard and Poor's. The "500" refers to the size of the index that lists the top 500 companies listed on the US stock market.

What is an index?

According toI'm looking for alphaHere are the top 10 dividend-paying S&P 500 companies in March 2022.

  • Restaurant Brand International (QSR): dividend yield 3.78%
  • Bank of Montreal (BMO): 3.66% dividend yield
  • Digital Realty Trust (DLR): dividend yield 3.36%
  • Tier T Price Group (TROW): Dividend Yield 3.30%
  • US Bancorp (USB) - dividend yield 3.21%.
  • Morgan Stanley (MS) - dividend yield 2.96%.
  • Advanced Auto Parts (AAP): dividend yield 2.92%
  • Balfour Beaty (BBY) – dividend yield 2.92%.
  • United Parcel Service (UPS) – 90% levering
  • Cummins (CMI): dividend yield 2.85%

We've used the word "index" a few times in our opening paragraphs, butwhat is indexing? Most readers will be familiar with the term "index" as a page in a book or file that leads to a particular chapter or section. But it does not have the same meaning when used in relation to FTSE 100 or S&P 500 index funds.

Used from an investment perspective, an index such as the FTSE 100 or S&P 500 shows how investors feel about the economy's progress. This is because it collects and displays various data from many companies in many industries. As for the S&P 500, this is the number of the 500 largest companies listed on the US stock exchange.

In a moment we will explain how you can invest in the UK S&P 500 index.

(Video) Investing for beginners UK 2023- Using Index funds and a Vanguard stocks and shares ISA.

Is it possible to invest in the S&P 500 from here in the UK?

The good news is that you can invest in US stocks and the stock market. Everything you need to know about investing in the UK S&P 500 index fund is explained, including the funds you can buy, the platforms you can use and how to get started.

First, let's make it clear that you cannot invest directly in an index. However, you can invest in stocks offered by companies listed on the S&P 500 or buy an ETF or index fund designed to track the overall performance of the S&P. So in terms of structureinvestment portfoliosyou have many options.

Set investment goals

Knowing your goals is the starting point for how to invest profitably in the UK S&P 500 Index.

Some index fund or ETF options are designed to track a specific number of stocks or are weighted by specific stocks. You must choose which of these goals best suits your goals.

Choose a platform

At one time, the only way for UK investors to invest in S&P 500 funds was to appoint a broker. However, thanks to the World Wide Web, many investors prefer to use online platforms. So when choosing a platform (or broker), keep in mind that you can only access certain exchange-traded funds (ETFs) through certain platforms.

The table below shows a small random selection of platforms that UK investors use to invest in S&P 500 stocks or mutual fund accounts.

Platformminimum first deposit£ per transactionFrequent exchange rateplatform fee
interactive converter0 €£7.99 + 1pm free change0 €9,99 EUR
investment engine100 pond0 €not applicable0% do 0.25%
IG stock trading250 pond8 pond£ 30 €
Rynki Saxo500 pond8 pondnot applicable0.12% per annum
Clock1 £9,95 EUR€ 4,950,25% p. M.
etoro10 pond0 €not applicable0 €

Data source as of June 2022 from each platform website. pm= monthly, pq= quarterly, pa= annually

S&P 500 index funds can be bought here in the UK

One of the questions investors ask when considering how to invest in affordable S&P 500 UK funds is the number of funds to choose from. When it comes to funds listed on the London Stock Exchange, there are more than 100. But if you open an account with a broker or platform that gives you direct access to the US stock exchange, there are even more options. According tokoopaandelen.comSome of the more popular wallpapers are:

  • Iboxx $ High Yield Corporate Bd Ishares (HYG)
  • iShares Core High Dividend ETF (HDV)
  • Invesco S&P 500 High Dividend Low Volatility ETF (SPHD)
  • iShares Asia Pacific Dividend UCITS ETF (IAPD.L)
  • iShares Core US Aggregate Bond ETF (AGG)
  • JPMorgan Ultra Short Income ETF (JPST)
  • Schwab US Dividend Equity ETF (SCHD)
  • Sequoia Economic Infrastructure Income Fund (SEQI.L)
  • Vanguard Growth ETF (VUG)
  • Vanguard Total Bond Market ETF (BND)

Key facts about the top UK S&P 500 ETFs

  • There are a wide variety of options for ETFs designed to track the S&P 500 index. When you invest in an index through these ETFs, you have access to a wide variety of options with varying risk tolerances.
  • The only fee you are generally charged when trading ETFs is the fee indicator. This ratio, usually calculated as a percentage, reflects the costs of administration, marketing and portfolio management. In other words, these are the operational costs of the supplier and must be taken into account as they affect the bottom line.

The behavior of the S&P 500 index in 2021

You would expect the performance of the S&P 500 index to suffer last year given the impact of the COVID-19 pandemic. It had no place. While the FTSE 100 closed at its highest level since 2016, the S&P 500 had its best year with 4,766.18 points.

(Video) How to INVEST £100 a month in Stocks & Shares | Vanguard UK

We make easy money for over 100,000 investors

Find your perfect ISA today

start now

Stocks at risk. Tax rules depend on your individual situation and may change in the future.

If you're looking for investment information on the S&P 500 index, there are several resources and articles available online to help you through the investment process.

Why invest in the S&P 500?

Your attitude to risk will influence your decision on whether or not to buy shares and how to invest in the available S&P 500 UK funds. The value of your investments can fall as well as rise. But as any good financial advisor will tell you, the way to minimize risk is to invest long term and build a diversified portfolio. openlygeneral investment accountthis may be the best choice.

The main reason people choose S&P 500 index funds to track the broader market is that they are a great choice for investors looking for consistent long-term growth without taking on too much risk. Once again, the closing position in 2021 is a good indicator.

Another option when considering how to invest in S&P 500 UK funds is to trade futures contracts on the S&P 500. Each contract is a direct and indirect investment in the performance of the index, and investors can go long or short, depending on their expectations of future performance.

(Video) Index Funds for Beginners (UK 2021)

What are the pros and cons?

  • Pro: Considered the most important benchmark for the US stock market.
  • Pro: Get to know the pulse of the US economy representing more than 500 of America's largest companies.
  • Con: It leaves out most of the SMBs that make up the bulk of the US economy.
  • Disadvantage: disproportionate burden on larger companies.

Financial information often prompts investors to buy stocks rather than put money in savings accounts. For example, if you know how to buy an S&P 500 index fund, UK options, or stocks in other indices like the FTSE 100, your return on investment is likely to be much higher than if you put your money in trading accounts. .

This is an important issue, especially here in the UK, where it has just been announced that inflation has reached its target9.1% - the highest in 40 years. In addition, the interest rate on money savings does not exceed a maximum of 1.8%, so cash will begin to depreciate at an alarming rate.

According to Rishi Sunak, the finance minister and most financiers, inflation will reach 8.7% by the end of the year. Some believe it could be even more than 10%, given the current fuel and energy crisis and the Russian invasion of Ukraine.

Is it safe to invest now?

With inflation skyrocketing in the UK, many people might consider investing to hedge against inflation. As long as you are willing to invest for the long term and build a diversified, inflation-protected portfolio. As Warren Buffett said at Berkshire Hathaway's 2021 annual shareholders' meeting, "I don't think the average person can pick stocks," and recommendedinvest in the S&P 500 index fund.

Let's say you prefer to take on a more passive role like many people. In this case, you can appoint a portfolio manager to manage your investments and adjust them if necessary to take advantage of current trends.

By looking, of coursehow to invest money,you need to think about the best way and you may want to know more about investing in available S&P 500 UK funds. In this case, you should speak to an FCA-approved personal property professional. There are many things to consider, including the companymaintenance costs.

After the Russian invasion of Ukraine, many investors now prefer US-oriented companies. If you feel the same way and the latest news about US gas exports to Europe could boost your economy, the S&P 500 may be your best bet.

Frequently Asked Questions

What is the S&P500?

The S&P 500 (Standard and Poor's 500) is an index that tracks the performance of the 500 largest companies listed on the US stock exchange.

What are the benefits of investing in UK index funds?

(Video) The S&P 500: Your Ticket to FREEDOM? (How to Invest in 2023)

You gain exposure to a wide variety of high performing companies and industries. The long-term returns are large and consistent. Index funds eliminate the need to spend hours analyzing and selecting stocks. In addition, they are very liquid.

Can I invest in the UK S&P 500 Index?

Yes, you can invest in the S&P 500, but you cannot invest directly in the index. However, you can buy stocks and shares of companies listed on the S&P 500 list. Another way to invest in an index is to buy index funds or index ETFs that track the performance of the S&P 500. index tracking.

Connect to your wallet and start investing today

Moneyfarm's simple, efficient and low-cost service helps you protect and grow your money over time.

Sign up with Moneyfarm today to connect with an investment portfolio built and managed to help you achieve your financial goals.

Effortlessly make your money work harder for you.

To start

(Video) Index Fund Buyers Guide - ETFs vs Mutual Funds

Stocks at risk. Tax rules depend on your individual situation and may change in the future.


How to invest in the UK S&P 500 Index Fund | money farm? ›

Yes! There are several ways you can invest in the S&P 500 from the UK. You can buy stocks in the companies that make up the S&P 500 or buy an index fund, such as a mutual or exchange-traded fund (ETF) that tracks the overall performance of the S&P 500 index.

Can I invest in S&P 500 index fund from UK? ›

Yes! There are several ways you can invest in the S&P 500 from the UK. You can buy stocks in the companies that make up the S&P 500 or buy an index fund, such as a mutual or exchange-traded fund (ETF) that tracks the overall performance of the S&P 500 index.

Is there a UK version of the S&P 500? ›

The S&P United Kingdom - a sub-index of the S&P Europe 350 - includes all UK-domiciled stocks from the parent index. The index is designed to be reflective of the UK market, yet efficient to replicate.

Where to buy index funds UK? ›

You can buy an S&P 500 index fund in the UK from investment platforms such as Interactive Investor, AJ Bell, and Vanguard. The UK version of the S&P 500 index fund is not very common, so most platforms only offer the UBS S&P 500 Index Fund (Income or Accumulation).

How do I buy into S&P 500 index fund? ›

How to Invest in the S&P 500 Index
  1. Open a Brokerage Account. If you want to invest in the S&P 500, you'll first need a brokerage account. ...
  2. Choose Between Mutual Funds or ETFs. You can buy S&P 500 index funds as either mutual funds or ETFs. ...
  3. Pick Your Favorite S&P 500 Fund. ...
  4. Enter Your Trade. ...
  5. You're an Index Fund Owner!

How to invest in S&P 500 UK Hargreaves? ›

Deal in an existing account

You can place a deal in the UBS S&P 500 Index Fund online now. Or top up an existing account first, using your debit card. You can also call our telephone dealers on 0117 980 9807 or download a postal dealing form.

Can I invest in UK stock market from abroad? ›

There are no restrictions on foreign investment in the UK and non-UK resident individuals investing in the UK are generally only subject to UK tax on limited UK source income and gains.

What is London S&P equivalent? ›

The Big Three credit rating agencies are S&P Global Ratings (S&P), Moody's, and Fitch Group. S&P and Moody's are based in the US, while Fitch is dual-headquartered in New York City and London, and is controlled by Hearst.

What is the UK equivalent of Vanguard Total Stock Market Index fund? ›

Vanguard FUND OF Funds

These products are structured as funds-of-fund. In a nutshell, it is a one ETF solution to gives you exposure to both Equities and Bonds. The LifeStrategy Funds differ by the asset allocation and risk profile. The European and UK Equivalents are Vanguard LifeStrategy UCITS ETFs.

What is the European alternative to the S&P 500? ›

The STOXX® Europe 600 index.

What is the best way to invest in index funds UK? ›

How to set up an index fund UK portfolio
  1. Determine the index you aim to clone.
  2. Calculate the percentage each stock or market sector occupies out of the whole fund and purchase the exact amounts.
  3. Consider buying stocks with the largest market share to minimise rebalancing.
  4. Rebalance the value of your portfolio every day.
Sep 1, 2022

How much tax do you pay on index funds UK? ›

Capital gains tax

If the profit you make when you sell your shares or investments exceeds £12,300, you will pay CGT on the additional profits. If you are a higher or additional rate taxpayer you will pay 28% CGT on your gains from residential property and 20% on your gains from other chargeable assets.

What are index funds called in UK? ›

An index fund (also known as a passive fund) aims to track the performance of a particular index, such as the FTSE 100 or the FTSE All Share. They offer a convenient way to gain exposure to a broad range of shares or bonds at a low cost.

How much would $10000 invested in the S&P 500 in 1980 be worth today? ›

Think about this: If you invested $10,000 in the S&P 500 at the start of 1980 and left the money untouched until 2022, you'd have accumulated nearly $1.1 million by the end of last year, according to the Hartford Funds. The S&P 500 has an annualized total return of more than 12% over the last decade.

How to buy S&P 500 in Europe? ›

It is, however, impossible to directly buy the S&P 500 index. What you can do is invest in the S&P 500 through an instrument replicating every movement of the S&P 500, like an Exchange Traded Fund (ETF). The table below shows the five biggest S&P 500 ETFs available to Europeans.

How to invest in S&P 500 without a broker? ›

The S&P 500 is a stock market index made up of about 500 publicly traded companies. You cannot directly invest in the index itself. You can buy individual stocks of companies in the S&P 500, or buy an S&P 500 index fund or ETF.

How to invest $1,000 pounds UK? ›

A SIPP is one of the best ways to invest £1,000 per month

So it's never too early to start squirrelling money away for your retirement – the more, the merrier. If you invest 1,000 pounds into a SIPP every month, you will soon have a considerable nest egg for your twilight years.

Can you invest in index funds UK? ›

Find out the benefits, the risks and how you can get started with investing in index funds in the UK. Index funds are a popular choice of investment, especially with beginners. In a nutshell, an index fund is a low-cost portfolio of shares and other assets that tracks a financial or stock market index.

How much does Hargreaves Lansdown charge for S&P 500? ›

The fund has an ongoing annual fund charge of 0.07%. There are no charges from HL to hold ETFs within the HL Fund and Share Account.

Can I buy UK stocks from the US? ›

You can also buy LSE-listed stocks if you live in the U.S. using American depositary receipts (ADRs) listed on U.S. stock exchanges through Interactive Brokers. Your selection of ADRs may be limited to larger U.K. companies if they are listed on the New York Stock Exchange (NYSE).

Can I invest in the UK as an American? ›

The main things you can invest in are direct securities like stocks and shares, and US domiciled funds that have received HMRC reporting rights. This can be a complex area, so it's worth seeking out a professional who can make sure you're keeping both HMRC and the IRS happy.

Can I invest in UK as a non resident? ›

Yes, non-UK residents can buy property in the UK without a visa. However, if you want to invest £2 million or more in the UK, you may apply for a Tier 1 (Investor) visa. To be eligible for a Tier 1 (Investor) visa, you must: Be 18 or over.

Which is better FTSE 100 or S&P 500? ›

As the name implies, the S&P 500 tracks a great deal more companies than the FTSE 100. Thus it is a more diversified stock universe. Additionally, the largest market cap companies have a greater impact on the FTSE 100, than the former. For example, the top 10 stocks in the S&P 500 make up around 30% of the index.

Is the S&P 500 the same as the FTSE? ›

As the name implies, the S&P 500 tracks more stocks than the FTSE 100. That means if I picked the best 20% here I'd end up with 100+ stocks in my portfolio. I consider that far too many for me to follow.

What is the difference between the S&P 500 and the FTSE 250? ›

FTSE 250 vs S&P 500: Which is bigger? The S&P 500 is made up of 500 stocks, while the FTSE 250 is just 250 stocks. The overall market capitalisation of the S&P 500 is significantly higher than that of the FTSE 250 because a lot of the companies in the FTSE 250 are smaller.

What is the alternative to Vanguard in the UK? ›

Hargreaves Lansdown has a wider array of products available than Vanguard. While both platforms offer stocks and shares ISAs, GIAs, JISAs and SIPPs, Hargreaves Lansdown also has savings accounts, a cash ISA, a fund and share account, a Junior SIPP and a LISA.

What is the best investment in Vanguard UK? ›

This includes:
  • Vanguard ESG Global All Cap UCITS ETF.
  • Vanguard FTSE 100 UCITS ETF.
  • Vanguard FTSE All-World UCITS ETF.
  • Vanguard Global Aggregate Bond UCITS ETF.
  • Vanguard UK Gilt UCITS ETF.
  • Vanguard Global Aggregate Bond UCITS ETF.
May 27, 2023

How to invest in Vanguard fund from UK? ›

You can get started with investing in three steps:
  1. Choose an account. You have four to choose from – a Stocks and Shares ISA, a Personal Pension, a Junior ISA and a General Account. ...
  2. Pick funds to invest in. ...
  3. Decide how much to invest.

Can you invest in S&P 500 from anywhere in the world? ›

It is widely followed, and investors from all over the world invest in S&P 500 firms through various mutual index funds and exchange-traded funds (ETFs). If you want to invest in S&P firms but don't want to go through the trouble of researching each one individually, you can invest in an S&P index fund.

Is there a global version of the S&P 500? ›

Yes, there is an equivalent to the S&P 500 for the entire world. It's called the MSCI World Index.

What is the German version of the S&P 500? ›

The DAX was created in 1988 and tracks 30 of the largest German companies, listed on the Frankfurt Exchange.

Where is the best place to invest $1,000 in UK? ›

Here are some of the established ways to invest £1k.
  • Stocks & shares ISAs. Invest your £1k in a stocks & shares ISA and you won't pay income tax or capital gains tax.
  • A pension. A great way to save for your retirement, and as you can tax relief on anything you pay in, within certain limits. ...
  • Shares. ...
  • Bonds.
Apr 27, 2023

Where is the best place to invest 100000 pounds? ›

You need to find the right investment option that works for you. However, some of the best ways to invest 100k include real estate, stocks and shares, ETFs, P2P lending, ISAs, pensions, high-yielding savings accounts or a diversified investment portfolio.

What is the difference between ETF and index fund UK? ›

Index funds only value and trade once a day, usually at midday. Unlike ETFs, investors won't know exactly what price they're buying or selling for until after the trade's taken place. ETFs on the other hand are funds traded on a stock exchange, like shares, and are a type of Exchange Traded Product.

Is S&P 500 tax-free UK? ›

Paid when: you buy a UK stock

It's a standard 0.5% sales tax paid on most UK-listed stocks, but not overseas shares or ETFs listed on UK exchanges that are domiciled overseas (that's the case for most UK-listed ETFs). You pay the tax at the point of purchase and it's applied to the total transaction cost.

What investments are tax-free UK? ›

Individual Savings Accounts (ISAs)

You can pay your whole allowance of £20,000 (for 2023/24) into a Stocks and shares ISA, or into a Cash ISA or any combination of these. You pay no Income Tax on the interest or dividends you receive from an ISA and any profits from investments are free of Capital Gains Tax.

How do I avoid Capital Gains Tax in the UK? ›

How to avoid capital gains tax: seven key steps
  1. Consider the timing of your capital gains.
  2. Utilise tax efficient wrappers.
  3. Bed and ISA, Bed and SIPP.
  4. Make the most of any losses.
  5. Married couples benefit from tax-free transfers.
  6. Manage your taxable income levels.
  7. Consider any inheritance tax implications.
Apr 13, 2023

What is the best S&P 500 index fund UK? ›

The highest-performing index fund over the last five years is the UBS S&P 500 Index Fund with a total return of 82% according to Trustnet. It has delivered a one-year total return of 2% and has an annual management charge of 0.09%.

What is the best money market fund in the UK? ›

The highest-yielding standard money market funds are Premier Miton UK Money Market (4.4%), Invesco Money (UK) No Trail (3.3%) and LF Canlife Sterling Liquidity (3.15%). Dzmitry Lipski, head of funds research at interactive investor, says: “Royal London Short Term Money Market stands out most to us in the sector.

What is the biggest UK index? ›

The FTSE 100 broadly consists of the largest 100 qualifying UK companies by full market value.

Can I invest in the US stock market from the UK? ›

Yes, you can buy US stocks in the UK. Most brokers allow you to buy and sell shares on the US market in the same account that you would normally use to buy UK shares.

Can you invest in the S&P 500 from abroad? ›

There is no citizenship requirement for owning stocks of American companies. While U.S. investment securities are regulated by U.S. law, there are no specific provisions that forbid individuals who are not citizens of the U.S. from participating in the U.S. stock market.

Can you invest in S&P 500 internationally? ›

No exposure to international companies: since the S&P 500 only includes U.S.-based companies, it won't provide stock exposure to companies in other parts of the world. This is less of a concern for new investors, but spreading your portfolio across different regions is another diversification strategy.

How to invest in S&P 500 index fund from Europe? ›

It is, however, impossible to directly buy the S&P 500 index. What you can do is invest in the S&P 500 through an instrument replicating every movement of the S&P 500, like an Exchange Traded Fund (ETF).

Why can't US citizens invest in the UK? ›

PFICs are taxed more severely by the US tax authorities than other assets. As a result, US investors in the UK or elsewhere should avoid owning them. This effectively means avoiding investing in the vast majority of popular collective vehicles, and creates a number of problems for American investors overseas.

Do I pay tax on US shares in UK? ›

Yes, UK residents are charged withholding tax (WHT) of 15% on dividends or income received from US stocks.

Can I use Charles Schwab in UK? ›

Please note that It is currently not possible to connect your Schwab account directly with an account at a non-US financial institution. The fastest way to fund your Schwab account from the UK is to instruct your bank to send an international wire and follow these instructions.

Is there a European equivalent to the S&P 500? ›

Top STOXX Europe 600 ETFs

Due to its broad market exposure, the STOXX Europe 600 index is often quoted as the European equivalent of the U.S. focused S&P 500 index.

What is the European equivalent of the S&P 500? ›

The equivalent of the S&P 500 in Europe is the STOXX Europe 600 index, as it represents the performance of European companies across various sectors.

Should I invest in the S&P 500 or the FTSE 100? ›

As the name implies, the S&P 500 tracks more stocks than the FTSE 100. That means if I picked the best 20% here I'd end up with 100+ stocks in my portfolio. I consider that far too many for me to follow. So, in theory, I see much more value in utilising an S&P 500 index fund.

Can I invest in index funds outside US? ›

You can use just a few funds to invest overseas. Each of these funds gives you access to a wide variety of international securities in a single, diversified fund or ETF. View the Vanguard Total International Stock Index Fund , which holds more than 7,700 non-U.S. stocks.


1. Why You SHOULDN'T Use A Stocks & Shares ISA
(Sasha Yanshin)
2. How to make $500 a month in halal dividends?
(Practical Islamic Finance)
3. Stock Market vs Property - Fastest To $1,000,000
(Investing Made Simple - Nathan Sloan)
4. Top 6 Vanguard Index Funds To Buy in 2023
(Joshua Mayo)
5. Wealthify vs Nutmeg vs MoneyFarm vs Wealthsimple - Best Passive Investing In The UK
(Sasha Yanshin)
6. Global Index Funds Have a HUGE Problem...


Top Articles
Latest Posts
Article information

Author: Virgilio Hermann JD

Last Updated: 14/09/2023

Views: 6097

Rating: 4 / 5 (41 voted)

Reviews: 80% of readers found this page helpful

Author information

Name: Virgilio Hermann JD

Birthday: 1997-12-21

Address: 6946 Schoen Cove, Sipesshire, MO 55944

Phone: +3763365785260

Job: Accounting Engineer

Hobby: Web surfing, Rafting, Dowsing, Stand-up comedy, Ghost hunting, Swimming, Amateur radio

Introduction: My name is Virgilio Hermann JD, I am a fine, gifted, beautiful, encouraging, kind, talented, zealous person who loves writing and wants to share my knowledge and understanding with you.