Diversify your portfolio, mixing bond funds with stocks funds, and together with home and overseas funds. So since an S&P 500 index fund owns stock in all 500 of those firms — when the S&P 500 Index goes up, your fund goes up; when it goes down, your fund goes down. Index funds are a type of mutual fund, so before we get into how index funds work, let’s take a step again and first perceive mutual funds.

Since mutual funds are extra actively managed by a professional, they are costlier for buyers, because the professional has to select and … Read More...