Index funds are investment funds that follow a benchmark index, such as the S&P 500 or the Nasdaq 100.. When you put money into an index fund, that cash is then used to invest in all the companies ...

A mutual fund is an investment that allows individuals to pool their money along with other investors and invest in a ...

Quick answer: An index fund is an investment fund that tracks the performance of an underlying benchmark index, such as the Standard & Poor's 500 Index (S&P 500) or the Nasdaq 100.

Index funds and mutual funds both pool investors' money to buy many different securities, but index funds use a passive investment strategy, while many mutual funds are actively managed.

Find out the definition of an index fund, the benefits and downsides of investing in them, and how to start building your portfolio today. ... Step 3: Buy Index Fund Shares.

Index funds and mutual funds let you invest in a variety of stocks, bonds, and assets. An index fund can be a type of mutual fund that's passively managed, but other mutual funds are actively managed.

Learn what a broad-based index fund is, how it works, and why it’s ideal for portfolio diversification. Explore key benefits, top fund examples, and how to invest in one today.

What's the difference between active and passive mutual funds? Active mutual funds use the help of fund managers who actively pick investments to try to beat market returns.

Small, mid, and large-cap funds: Some mutual funds exist to track portions of the stock market based on company size as measured by market capitalization. Small-cap funds invest in companies with ...