Index funds are popular investment choices. They hold the same stocks found in certain market benchmarks, such as the Dow Jones Industrial Average or the S&P 500. Because index funds seek only to mimic the behavior of their target benchmarks, they cost less to run than funds that are actively managed and that rely on a more hands-on approach. Index funds often perform as well as, or better than, actively managed funds. Their good performance combined with their low cost have made index funds highly sought after in recent years.
Vanguard is the company that is probably best known for its index funds. Vanguard was the first company to offer an index fund for individual investors, ...
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Index funds are popular investment choices. They hold the same stocks found in certain market benchmarks, such as the Dow Jones Industrial Average or the S&P 500. Because index funds seek only to mimic the behavior of their target benchmarks, they cost less to run than funds that are actively managed and that rely on a more hands-on approach. Index funds often perform as well as, or better than, actively managed funds. Their good performance combined with their low cost have made index funds highly sought after in recent years.
Vanguard is the company that is probably best known for its index funds. Vanguard was the first company to offer an index fund for individual investors, which it did in 1976. The company's funds are often praised for their low expenses.
Fidelity is another company that is well established in the index fund business, with over 20 years of experience in indexing.
Perhaps index funds follow the same benchmarks. Therefore, if you are comparing funds from one company or fund family to another, you should always factor in the expenses. Other things to consider are whether the fund company has offices near you, whether you find its website easy to navigate, and whether you already have funds invested with a particular company.
To learn more about index funds, see the links on this Business.com page.
