Are Index Funds a Good Investment?


Quick Answer

Index funds are a good investment option, according to Kiplinger, as they have historically been more profitable than most actively managed funds. An index fund is a mutual fund with a portfolio designed to match the S&P 500 or another key market index.

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Are Index Funds a Good Investment?
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Full Answer

Index funds offer the ability to invest at a lower cost than many other investments, as they are not actively managed. Index funds are weighted based upon index performance, and profitability is based upon the status of the market at a given time. They are also beneficial because the investor knows exactly what he is investing in thanks to clearly described benchmark rules.

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