For decades, investors have debated a core question: which U.S. index offers the superior long-term return? To provide a data-driven answer, we used our Historical Dollar-Cost Averaging Calculator to simulate a simple yet powerful strategy: investing $500 every month for exactly 20 years.

We pitted the S&P 500 (via the SPY ETF) against the tech-heavy NASDAQ 100 (via the QQQ ETF). The interactive chart below shows the result for the S&P 500. Use the toggle to compare it directly with the NASDAQ 100 and see the dramatic difference in performance.

By the Numbers: A Clear Victory

The results of this 20-year backtest are striking. While both strategies turned a total investment of $120,000 into a substantial nest egg, one index was the undeniable winner.

S&P 500 (SPY): The consistent $500 monthly investment grew to approximately $491,784.
NASDAQ 100 (QQQ): The same strategy in the NASDAQ 100 resulted in a final value of approximately $879,264.

As you can see, the NASDAQ 100 portfolio was nearly 80% larger than the S&P 500 portfolio. This stark difference highlights the incredible impact of the tech sector's explosive growth over the past two decades, which is heavily represented in the NASDAQ.

Conclusion: Risk, Reward, and the Power of Consistency

While the NASDAQ 100 was the clear winner in this historical showdown, it's traditionally considered a more volatile, higher-risk index. The S&P 500 offers broader market diversification. The best choice always depends on an individual's risk tolerance and long-term goals.

However, the most important lesson from this dollar-cost averaging backtest is the power of consistency. Regardless of the index chosen, a disciplined, long-term investment strategy proved to be incredibly effective at building wealth.

Curious about other assets or timeframes? Run your own backtest with our calculator →