What are the advantages of index funds?
What will be an ideal response?
Answer: Index funds are set up to mimic or duplicate the stocks found in a market index like the S&P 500 or or Dow Jones Industrials. They are called passively managed funds because it does not take any expertise to select the stocks from the index, these funds do not require high paid managers or have a lot of trading costs or other expenses associated with a actively traded fund. Because of the low costs, most index funds are no-load funds with very low expense fees.
Because of the efficient markets, it is very difficult for an actively traded fund to consistently beat the market indexes over time. For a typical, dollar cost averaging, buy and hold investor, the index funds are a very good choice for their important savings.
You might also like to view...
The relative lack of success in bringing cybercriminals to justice has led to an increase in their numbers, boldness, and the global scale of their operations
Indicate whether the statement is true or false.
In additional to social networking and viral marketing, how do firms successfully increase brand awareness?
A) Reintroduction B) Globalization C) Rebranding D) Product placement E) Packaging