This Day In Market History: The S&P 500 Index Launches

Each day, Benzinga takes a look back at a notable market-related moment that occurred on this date.

What Happened: On March 4, 1957, the Standard & Poors launched the S&P 500 index.

Where The Market Was: The Dow closed at 471.48 and the S&P 500 traded at 44.06.

What Else Was Going On In The World: In 1957, the Soviet Union launched Sputnik 1, the first ever space satellite. Toy company Wham-O released the Frisbee in the U.S. market. The average price of a new car was $2,749.

S&P 500 Born: S&P launched its first stock index way back in 1923, but its S&P 500 index launched in 1957 has become the gold standard of U.S. stock indices. The S&P 500 is an index comprised of the largest 500 U.S. equities, and it's calculated based on a free-floating market-cap-weighted formula.

“I would say it’s the primary index,” TD Ameritrade chief market strategist J.J. Kinahan told Benzinga. “It’s an amazing advancement because although the Dow at its time was revolutionary, it’s only 30 stocks and it's price weighted.”

Since its launch, the S&P 500 has generated an overall return (excluding dividends) of 6,500%, outpacing the Dow Jones Industrial Average’s 5,600% return in that same time.

Excluding dividends, the S&P 500 index itself has produced an average compound annual growth rate above 7%.

Photo from the "I Feel Pretty" musical number from "West Side Story." Pictured from left: Elizabeth Taylor, Carmen Gutierrez, Marilyn Cooper, Carol Lawrence.