S&P 500 at New Heights, Block(XYZ) Joins the Club —Learn some Long-Term Bets
1.S&P 500 Soars Past 6,300, Another All-Time Peak
The $S&P 500(.SPX)$ hit its 11th all-time high of the year on Wednesday trading, continuing its remarkable turnaround from just a few months ago.
The S&P 500 Index has crossed above 6,300 for the first time in this week, its 3rd 100-point milestone of 2025 and 7th in the past year.
Fears overs tariffs impacting the global economy have completely disappeared.
The S&P 500 Index is not only one of the most influential stock indices in the world, but also a "barometer" of the US economy.
2. Investings based on $S&P 500(.SPX)$ is a good choice because many funds cannot outperform the Index.
The godfather of value investing, Warren Buffett, bet with a hedge fund that active funds may not outperform the $S&P 500(.SPX)$ because he always includes the best American companies.
From 2008 to 2017, the results of the "Ten-Year Bet" confirmed that the annualized return of the S&P 500 index fund was 8.5%, while the average annualized return of the five top active funds was about 6.5%. As a result, the S&P 500 index fund won.
The relevant ETFs are all optional targets that can be allocated for a long time: $Vanguard S&P 500 ETF(VOO)$ $SPDR S&P 500 ETF Trust(SPY)$
But from the data of the past 60 years, Buffett's company really performed better than the S&P.
3. $Block, Inc.(XYZ)$ earns Blue-Chip Ticket and officially included in the S&P 500 index.
Before the opening of the market on July 23, $Block, Inc.(XYZ)$ was included in the $S&P 500(.SPX)$ . As soon as the news came out on July 18, the stock price rose by 9% after the market closed, closing at $79.38, setting a new high in nearly four months.
Block was founded in 2009 by Twitter founder Jack Dorsey. It was originally called Square and focused on the payment and cash register terminal system for small and micro merchants. In 2021, the company changed its name to Block to emphasize its expansion direction in the field of encryption and blockchain.
Block's business is divided into two core sectors:
1. Square: Serving the offline merchant ecosystem, providing restaurants, retail, etc. with POS hardware, cash register systems, inventory management, salary distribution, loans, invoice issuance and other "full set of tools", forming a small "digital business operating system".
2. Cash App: This is Block's important engine for C-end consumers. Users can complete one-stop financial operations such as peer-to-peer transfers, Bitcoin and stock investments, salary payments, loan applications, tax returns, and debit card use through the App.
At present, the user growth of its Cash App is rapid, and the Tap to Pay function on the iPhone has just been launched, further opening up the payment closed loop between consumers and small merchants. As a result, Block is trying to open up both ends of "consumer finance + small and micro merchant finance".
In addition, Block also owns the music platform TIDAL, the self-hosted Bitcoin wallet Bitkey, and the Bitcoin mining business Proto, further expanding its Fintech territory.
4. Why Block was included in the S&P 500?
The reasons include that, firstly Chevron completed the acquisition of Hess, with a market value of up to $54 billion, leaving a seat in the S&P 500. The S&P 500 requires that the company's market value exceed $18 billion, the public shareholding ratio exceed 10%, and the latest quarterly profit is positive. Block's market value is about $43.5-45 billion, and Block basically meets the requirements.
Now block has expanded from payment terminals (Square) to Cash App, cryptocurrency, lending and other diversified financial technology businesses, reflecting the influence of digital payments and encrypted assets in mainstream finance, and enhancing the weight of the technology sector of the S&P 500.
Block has officially entered the "blue chip club" and will inevitably be "forced to allocate" by more ETFs and institutional funds, which also represents the market's re-recognition of its business model and growth prospects.
Do you like the $S&P 500(.SPX)$ relates options or the blockchain concept of $Block, Inc.(XYZ)$ ?
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