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Posted by Sarah (MONEY FORUMS: 5, Answers: 1)
Asked on November 25, 2015 5:00 pm
Index funds are one of the most sensible ways to invest. Vanguard index funds were the first of its kind for individual investors and are beneficial additions to any portfolio as they are low cost, low risk, and tax efficient.
Index funds are the bee's knees. The stock market earns roughly 11% annually. An index fund seeks to replicate those earnings. So if you're happy with 11% (I am), start index investing.
Hi Sarah, this is a good question. An index fund is a mutual fund -- basket of stocks -- that tracks a broad market. The market could be represented in the form of S&P 500 Index or the FTSE-100 or even the Nasdaq index. The biggest advantage of putting money in an index fund is that you are not 'left out' when the overall markets are rising. You also don't have to do much homework on it, neither do you