The Vanguard 500 Index Fund tracks the performance of the S&P 500. To do so the fund buys shares in each S&P 500 company ________.

Question

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The Vanguard 500 Index Fund invests in each company in proportion to its market capitalization weight (i.e., the total market value of a company's outstanding shares). This ensures that the fund closely tracks the performance of the S&P 500, which is also a market-cap-weighted index.

The Vanguard 500 Index Fund Tracks the Performance of the S&P