NDX vs S&P 500: 2020–2025 at a Glance

NDX vs S&P 500: 2020–2025 at a Glance

Period / Metric	Nasdaq-100 (NDX) / Total Return Index	S&P 500 (SPX) / Total Return Index
Long-term performance (≈ 2007–2025)	+ ~996% cumulative return; ~14.9% annualized return indexes.nasdaqomx.com+1	+ ~436% cumulative return; ~10.2% annualized return indexes.nasdaqomx.com+1
Relative performance (2025 YTD, Q3)	Leading YTD: ~18.1% vs S&P’s ~14.8% as of Sept 30, 2025 Nasdaq	~14.8% YTD (as of Sept 30, 2025) Nasdaq
Volatility (recent years)	Slightly higher volatility: historically more volatile than S&P 500 ScienceDirect+1	Lower volatility compared to Nasdaq-100 indexes.nasdaqomx.com+1

Key takeaway: Over the long run (nearly two decades), Nasdaq-100 has outperformed S&P 500 substantially — almost 2.3× in cumulative total return (996% vs 436%). indexes.nasdaqomx.com+1 In more recent timeframes (e.g. 2025), Nasdaq-100 continues to lead — though both indices show solid performance. Nasdaq

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🎯 Why Nasdaq-100 Has Outperformed — and What S&P 500 Offers

✅ Strengths of Nasdaq-100 (NDX)

• Growth & Innovation Bias: Nasdaq-100 is heavily weighted toward technology and growth-oriented companies. That means during periods of strong tech adoption, innovation cycles (cloud, AI, digital services), Nasdaq benefits disproportionately. JustETF+2Nasdaq+2

• Higher Potential Returns: As seen in the long-term data, over periods spanning many years, Nasdaq’s high-growth tilt has rewarded investors with higher cumulative and annualized returns. indexes.nasdaqomx.com+1

• Momentum in Bull Markets: When markets are bullish — risk appetite is high and growth stocks are in favor — Nasdaq tends to handily outperform broader, more diversified indices. This often results in sharp upside rallies.

✅ Strengths of S&P 500 (SPX)

• Diversification & Stability: Because S&P 500 tracks 500 large companies across many sectors (not just tech), it spreads risk more broadly. This helps cushion against sector-specific downturns (e.g. weak tech, commodity swings, etc.). JustETF+1

• Lower Volatility: Compared to Nasdaq-100, S&P 500 historically shows lower volatility — which may suit investors with moderate risk tolerance or those seeking steadier growth rather than swingy returns. indexes.nasdaqomx.com+1

• Balanced Exposure: Because of its sector and company diversity, S&P 500 captures gains in value, cyclical, defensive, and growth segments — making it a good “core” for a diversified portfolio.

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⚠️ Tradeoffs, Risks & What to Watch

• Higher Volatility with Nasdaq-100: The same growth tilt that fuels returns can also amplify drawdowns if growth stocks falter — e.g. economic slowdown, interest-rate hikes, regulatory risks affecting big tech. ScienceDirect+1

• Sector Concentration Risk: Nasdaq-100’s performance heavily depends on a handful of sectors (primarily technology & consumer-discretionary). If those underperform, the index could lag badly even if other sectors are doing fine, which is one reason investors are often advised not to “go all in.”

• Stability vs Growth: S&P 500 may lag in bull runs compared to Nasdaq-100, but it's often more resilient across varying economic cycles — making it potentially less prone to large drawdowns.

• Correlation & Market-wide Shocks: Both indices are correlated (i.e. a broad market crash tends to hit both). Nasdaq+1

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🧩 What it Means for Different Types of Investors

Depending on your investment horizon, risk tolerance, and goals, one index (or a mix) might suit you better:

• Long-term growth-oriented investors — willing to tolerate volatility and cycles: Nasdaq-100 offers high potential returns and a growth tilt.

• Balanced investors seeking steadiness + diversification: S&P 500 provides diversified exposure and lower volatility, better for long-term core holdings.

• Portfolio diversification strategy: Many investors combine both — using S&P 500 as a “core” for stability + Nasdaq-100 as a “satellite” for growth.

• Risk-averse or retirement-focused investors: S&P 500’s diversification and lower volatility might suit better, especially if you prefer smoother ride over maximum returns.

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✍️ Suggested Structure for Your Blog Post

When you publish this on your blog, you could structure as:

1. Introduction — Why compare NDX vs S&P 500 (setting the scene for 2020–2025).

2. Overview of Both Indexes — What they represent; how they differ.

3. Data Comparison (2020–2025 + Long-term) — Use tables + charts.

4. Drivers Behind Performance — Sector composition, economic cycles, tech-growth tilt.

5. Risk & Tradeoffs — Volatility, concentration, macro risks.

6. What Type of Investor Each Index Suits — Based on goals/horizon/risk appetite.

7. Conclusion + Personal View — Which mix could make sense now.