Below are the best stocks in the S&P 500, measured by year-to-date performance.
Are these the best stocks to invest in right now? Not necessarily. Not only is predicting the future of even the current top-performing stocks a job the pros haven’t yet mastered, but the best stocks for your portfolio aren’t necessarily the best stocks for someone else’s portfolio.
If you’re looking for the best stocks to invest in, NerdWallet’s recommendation is to invest in stocks through index funds, devoting 10% or less of your overall portfolio to individual stocks. For more on index funds, jump to below this list.
Best stocks as of August 2019
|Symbol||Company Name||Security Price||Price Performance (This Yr)|
|CMG||Chipotle Mexican Grill Inc||$783.33||83.47%|
|APC||Anadarko Petroleum Corp||$73.17||68.25%|
|CDNS||Cadence Design Systems Inc||$68.72||63.91%|
|MKTX||MarketAxess Holdings Inc||$343.99||61.20%|
|TSS||Total System Services Inc.||$126.48||60.24%|
|AMD||Advanced Micro Devices Inc||$28.31||59.48%|
|GPN||Global Payments Inc.||$156.76||56.58%|
|XRX||Xerox Holdings Corp||$29.53||54.76%|
|SBAC||SBA Communications Corp||$247.85||53.57%|
|LHX||L3Harris Technologies Inc||$203.79||51.82%|
|LRCX||Lam Research Corp||$194.75||49.88%|
|FLT||FleetCor Technologies Inc||$271.17||49.77%|
Data is current as of August 5, 2019.
The answer for many: index funds
Picking individual stocks is difficult, which is why many investors turn to index mutual funds and exchange-traded funds, which bundle many stocks together.
When individual stocks come together into a diversified portfolio via index funds, they have a lot of power: The S&P 500 index — which includes approximately 500 of the largest companies in the U.S. — has posted an average annual return of nearly 10% since 1928.
An S&P 500 index fund or ETF will aim to mirror the performance of the S&P 500 by investing in the companies that make up that index. If you want to cast a wider net, you could purchase a total stock market fund, which will hold thousands of stocks.
» Learn more: How to invest in index funds
Within an index fund, the winners balance out the losers — and you don’t have to forecast which is which. That’s why we think low-cost index funds and exchange-traded funds — a type of index fund that is traded like a stock — should form the basis of a long-term portfolio.
Ready to invest in stocks or funds? Here are some of our recommended brokers, including one option that will invest in ETFs for you — a good fit if you want exposure to these stocks but don’t want to be hands-on in building a portfolio.
|Zacks Trade||Why we like them:|
Zacks Trade's stock-trading commissions are among the lowest you'll find.
» Read our full review
|Commissions: $0.01 per share ($3 minimum)
Account minimum: $2,500
Promotion: The minimum trade is just $1 for one year for those who fund an account in 2019.
|Why we like them:|
E-Trade offers high-quality educational resources and a wealth of stock research to help you make informed investment decisions.
» Read our full review
|Commissions: $6.95 ($4.95 for active traders)
Account minimum: $500
Promotion: Up to 500 commission-free trades with deposit of $10,000 or more
|Betterment||Why we like them:|
Betterment assembles and manages a portfolio for you out of ETFs, which hold many stocks in a single investment.
» Read our full review
|Account management fee: 0.25% to 0.40%
Account minimum: $0
Promotion: Up to 1 year free management with qualifying deposit.
» View the full list: Our picks for the best brokerage firms
Index funds won’t beat the market. They aren’t supposed to. An index fund’s goal is to match the returns posted by its benchmark — for an S&P 500 fund, that benchmark is the S&P 500. There are index funds that track a range of underlying assets, from small-cap stocks, to international stocks, bonds and commodities such as gold.
Index funds are inherently diversified, at least among the segment of the market they track. Because of that, all it takes is a few of these funds to build a well-rounded, diversified portfolio. They’re also less risky than attempting to pick a few could-be winners out of a lineup of stocks.
The downside: Some might argue they’re significantly less thrilling than chasing the current hot stocks. If you’re seeking that stock-picking rush, go for a happy middle ground: Dedicate 10% or less of your portfolio to predicting the next big thing, and use index funds for the rest.