The S&P 500 Price index returned 26.61% in 2021. Using a better calculation which includes dividend reinvestment, the S&P 500 returned 28.41%.
Maximizing 2021 S&P 500 Return: Buy It, Hold It, and Reinvest It
There are two ways to compute an annual return, and the numbers I just quoted you assume you did all your investing in a single year. Specifically, the above returns assume you bought the market open on January 4, 2021, and sold at the exact close on December 31, 2021.
If you alternatively meant a "one-year span", those two returns, respectively, are 26.893% and 28.705%. This assumes, instead, that you bought the December 31, 2020 close.
S&P 500 Index Price Calculation
| Price Based On | 2021 Begin | Dec 31 Close | Return |
| Jan 4 Open | 3764.61 | 4766.18 | 26.605% |
| Dec 31 Close | 3756.07 | 4766.18 | 26.893% |
S&P 500 Total Return Price Calculation
| Price Based On | 2021 Begin | Dec 31 Close | Return |
| Jan 4 Open | 7,777.41 | 9,986.70 | 28.407% |
| Dec 31 Close | 7,759.35 | 9,986.70 | 28.705% |
Dividends Matter
Annually, I talk about how the exact date you pick doesn't much matter... as long as you keep your timeframes consistent. However, you do need to mind those dividends!
Even with a pandemic raging in the background and all sorts of geopolitical worries, companies continued to pay dividends consistently. Even if you didn't reinvest your dividends, unless you burned your dividend checks or otherwise discarded your proceeds, you do need to account for that extra gain.
Source on the 2021 S&P 500 Return Calculations
S&P Dow Jones Indices owns the S&P 500 Index and the total return index. They only added the total return index in 1987; before then, you have to construct your own index proxy to see how the index has fared.
We have a collection of investing calculators and tools – most including provisions for dividend, coupon, or interest reinvestment. Here are some which highlight the S&P 500:
- S&P 500 Dividend Reinvestment Calculator
Dividend reinvestment calculations on the S&P 500 back as far as we can cover them – 1871, as of now - S&P 500 Periodic Reinvestment and Dividend Calculator
A tool which additionally tries to estimate fees and taxes. Allows periodic scheduled additions to investments. - S&P 500 Historical Return Calculator
See the average, median, best, and worst returns on the S&P 500 over a time period.
The 2021 S&P 500 Return
You can find the S&P 500 and Total Return index at Yahoo!. Here's a graph showing the delta in 2021:
All you had to do to pick up an extra 1.802 percentage points of return? Reinvest your dividends.Yes, it's not exact due to the timing of your payments and purchases, slippage if you had actually made the order instead of only in theory, taxes, and the like. However - it was a very real amount.
Other years:
