Final answer:
Spiders (SPDRs) are securities linked to the Standard and Poor's 500 Index (S&P 500), which tracks the performance of a diversified portfolio of companies across various sectors representing the overall market performance. The correct option is C.
Step-by-step explanation:
Spiders (SPDRs), which stands for Standard & Poor's Depositary Receipts, are financial securities designed to track the performance of a market index. The value of SPDRs is derived from the performance of the underlying securities that make up the index, and in this case, the correct answer to which index SPDRs are linked is: C) Standard and Poor's 500 Index.
The S&P 500 Index is known for being a weighted average market capitalization of the companies selected for the index. It covers a broad spectrum of the New York Stock Exchange (NYSE), AMEX (now part of the NYSE), and over-the-counter (OTC) markets and provides a representation of the market's overall performance.
Investing in an indexed mutual fund that mimics the S&P 500 allows for diversification, which can help mitigate some of the risks that accompany investing in individual stocks. Despite the diversification, investors should still prepare for the inevitable ups and downs in the stock market, as history has shown both significant climbs and drops over long periods.