S&P 500 VS. Wilshire 4500 index funds

[gotsmack]

I have to make a choice of how I want to invest my retirement money. I haven't been contributing much at all (next to nothing), but I'm going to stary putting in a fair amount starting this pay period. I have something like 40 more work years ahead of me. The question is:

Is the Wilshire 4500 or the S&P 500 a stronger index fund. Which one is less likely to tank (or take less of a hit) if we hit another recession?




the Wilshire 4500 stock index is made up of common stocks of smaller companies not in the S&P 500.

I do not have enough right now to really invest in both funds and treasuties, so I can only choose 1.

 

[cipher00]

I do not have enough right now to really invest in both funds and treasuties, so I can only choose 1.

Really? Most plans let you put really small amounts into funds. The amounts build up quickly, too.

Anyway, look at costs. Index funds are cheap to run, but some are cheaper than others. The 4500 will have representations in industries different than the 500, and that'll be a big driver. The 4500 will also be small(er) cap, and so usually more volatile.

Bear in mind that the 500 is what S&P wants it to be - it's chosen by committee, and so it's an active fund. Most people forget that.

Good luck.

 

[gotsmack]

I was serious when I said I didn't have enough, I got a letter a few days back to do my stuff online. I have set a 0% contribution and my agency gives me 1% free.

so now I have like not even 3 digits in the account. I'm going to contribute 5% as soon as I can track down the forms and get a match +1% =10%

I think I'm putting my money in the S&P 500 index fund