Got $1,000 to Invest in Stocks? Put It in This Index Fund.
If you've been a student of the market for any meaningful length of time, you've likely stumbled across advice to just buy and hold an S 500 index fund like the SPDR S 500 ETF Trust (NYSEMKT: SPY). And it's a good tip. Not only is such a plan simple enough for anyone to execute, but it also sidesteps all the inherent risks of picking individual stocks.
If you're a true long-term investor, though, there's a better option for the idle money in your account. Instead consider taking a stake in a mid-cap exchange-traded index fund like the SPDR Portfolio S 400 Mid Cap ETF (NYSEMKT: SPMD) or Vanguard S Mid-Cap 400 ETF (NYSEMKT: IVOO), both of which are meant to mirror the S 400 MidCap index.
You'll likely produce stronger returns with exposure to this often-overlooked sliver of the stock market. The numbers say so.
Source Fool.com
