The S&P 500 is one of the most followed indices in the world, and buying it from Europe is easier than it looks. First, though, there are three traps worth knowing: a legal one, a currency one and a concentration one.
What the S&P 500 is
It is a list of the 500 largest listed companies in the United States, created by Standard & Poor’s on 4 March 1957 and run today by S&P Dow Jones Indices. Apple, Microsoft, Google, Amazon and 496 more. When you hear “the American stock market is up 1% today”, it is often this index.
They do not all weigh the same. Each company counts according to its stock market value, like a residents’ association where everyone votes by the size of their flat: the big penthouses decide more than the studios. That is why the big tech companies move the index far more than a mid-sized utility.
Why so many people start here
On 19 December 2007 Warren Buffett bet a million dollars, for charity, that a simple S&P 500 index fund would beat whatever the professionals picked over ten years. The firm Protégé Partners took the bet and chose five funds of funds that in turn invested in more than 200 hedge funds, run by some of the best-paid professionals on Wall Street.
In 2008 all five lost less than the index, which fell 37.0%. After that, in each of the following nine years, the five as a group fell behind. By the end of 2017 the index fund had gained 125.8%, 8.5% a year. The five funds of funds, between 2.8% and 87.7%. Their fees, around 2.5% a year according to Buffett, were charged every year, win or lose.
You do not need to know more than anyone else. You just need not to pay someone who claims to.
How to buy it from Europe
Nobody buys the 500 companies one by one. You buy a product that holds them all, and there are two ways.
An S&P 500 index fund. You buy it from the fund manager or a fund platform. In some countries, such as Spain, it has a tax advantage: you can switch it to another fund without paying tax.
An S&P 500 ETF. You buy it on the stock exchange, through a broker. For example, the iShares Core S&P 500 UCITS ETF, ISIN IE00B5BMR087, charges 0.07% a year, is domiciled in Ireland and reinvests the dividends. We name it so you can see what one looks like, not as a recommendation.
Which of the two suits you we explain in Index fund or ETF: what is the difference. The ISIN is the product’s number plate: search for it by ISIN rather than by name, because there are many with almost identical names.
The legal trap: why you cannot buy VOO or SPY
Search online and you will see Americans talk about ETFs like VOO or SPY. From Europe, as a retail investor, you normally cannot buy them. Since 2018 the EU’s PRIIPs regulation requires every product of this kind sold to retail investors to have a key information document in the European format, and American fund managers do not produce one because they do not sell here. European brokers block the purchase.
It does not matter: the same fund managers have European versions, the ones with UCITS in the name, that track the same index.
The currency trap
Even if you buy the ETF in euros, what is inside are American companies valued in dollars. If the index does not move but the dollar falls 10% against the euro, your investment is worth 10% less in euros. And the other way round if the dollar rises. It is like collecting rent on a flat in New York: the flat may not change in price, but what reaches your account in euros does.
The concentration trap
Five hundred companies sounds like a lot, but they are all from one country, and a good share from one sector: technology made up 38.0% of the index on 30 June 2026. If the United States or its tech companies have a bad few years, the whole index feels it.
The S&P 500 is a great investment, but it should not be the only one. What spreads the risk is combining it with companies from other countries and sectors, and with some gold, which depends on no company and no country. We explain it in The safest investment there is.
How to do it, in order
First, decide an amount you can put in every month without fail, however small. Second, choose the format, index fund or ETF, and look it up by its ISIN with a low-cost broker: we compare the main ones in The best brokers for investing from Europe. Third, set up the monthly contribution and leave it alone when the market falls, because it will. Time does the rest: you can see it in the compound interest calculator.
What to combine it with and in what proportion for your situation is what we work on in the first session. If you are starting from scratch, the earlier steps are in Start investing from scratch.
Educational content. Not personalised financial advice or a recommendation to buy any product. Past performance does not guarantee future results.