3 Reasons to Invest in Index Funds (and 1 Reason Not to)
An index fund is a type of mutual fund or exchange-traded fund (ETF) that is put together to mirror a specific market index. For example, the S&P 500, which is likely the most famous index, consists of the 500 largest American companies by market cap. An S&P 500 index fund consists of and tracks those 500 companies.
Index funds can be one of the greatest tools in investing when used, and they can be especially helpful for those who may be new on their investing journey. But, as with everything else, there are pros and cons. Here are three reasons to invest in index funds and one reason not to.
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Source Fool.com
