The Dow-Jones index is the one name that most everyone knows. If you’ve ever read an article or comment about financial markets, or if you have even the most remote of interests in trading, you would know all about the Dow Jones, but if you dig just a little deeper and seek to educate yourself you would soon find out that nearly all financial experts agree that the Dow Jones and the 30 companies it represents are not the best or most accurate representation of the market status.

Enter the S&P 500, which, as the name may suggest, houses under its umbrella 500 publicly traded corporations and is widely regarded as the best reflection of the American market and its direction, but should the S&P 500 be your next binary options investment?

Standard & Poor’s began indexing various stock market companies as far back as 1923, but the current form of the S&P 500 did not begin tracking until decades later, on March 4th 1957.

In addition to the fact that it tracks many more companies than its Dow Jones counterpart the S&P 500 is widely regarded as having a better methodology for weighing various components and a much wider and more varied member list, allowing it to give a more complete snapshot of the US market at any given time.

Due to technological advances, the S&P 500 is also one of the few markets able to be calculated, analyzed and weighted in real time, as opposed to some markets that are only able to perform such actions in 15 minute or greater intervals, this allows traders, such as yourself greater awareness of market happenings in real time.

For companies to be added to the Index they require approval by the selecting committee, which considers a variety of factors such as market capitalization, financial viability, amount of time the company has been publicly traded and others, generally speaking, a company would have to have market capitalization exceeding $4 billion to even begin consideration for the index, companies also need to be listed on the NYSE or NASDAQ, the S&P allows for companies that are not US based to be included in the index, provided they are also were incorporated in the US at some point.

Like most other financial markets and indices, the past decade has been somewhat of a roller-coaster for the S&P 500 and people trading in its binary options.

Prior to the beginning of the 2008 world financial crisis the S&P had been trading at levels exceeding 1,500 points, but by the end of 2008 it had dropped down to nearly half of its previous high, hitting a low point of 752.44 points and dropping even further into 2009 with a 13 year low of 676.53 on March 9th.

Recovery began by slow and small increments, 2009 ended just above 1115 points, the market continued climbing with small periods of drops spread out in between, as markets are prone to do, but in recent times, it seems to have settled into a pattern of rises, and even concluded trading in August 2014 above 2,000 points for the first time in history.

Investing in S&P 500 binary options can be somewhat of a tricky proposition, but can be done, and with great profits for those who dare to do so, since tracking 500 companies can be a very taxing endeavor, not to mention nearly impossible, you might try to inquire which 10-20 companies are weighted to have the most impact on the market and consider tracking those companies alone, with the understanding that any movements they make will almost certainly have the most impact on the direction of the index as a whole.

Take your times to invest in the S&P 500 and your profits may also be weighted accordingly in your portfolio…