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Vanguard to delist Hong Kong ETFs next month

Vanguard has announced that it will move to delist its Hong Kong-listed exchange traded funds within a month, putting an official end to its seven-year-old locally listed ETF business.

The US passive fund giant will apply to the Hong Kong stock exchange to delist all of its six local ETFs with May 10 being the last trading day, according to a notice issued by the company on Thursday.

Vanguard said it will pay back investors in a round of cash distribution, scheduled on or around June 9, if they still hold shares of the ETFs as of May 14.

The announcement confirms that the US asset manager has made up its mind to cease operations of the ETFs, which it commenced building up in 2013, rather than transferring the management of the products to another fund house.

Discussions with a number of suitors, including talks with Chinese brokerage-backed Haitong International, to take over its $590m Hong Kong ETF business have fallen through, people with knowledge of the matter told Ignites Asia last month.

Vanguard notified Hong Kong’s Securities and Futures Commission in February about its plan to wind down the products following the failure of those discussions.

The US fund giant decided to exit Hong Kong’s ETF and Mandatory Provident Fund pension market in August last year, saying that it would either sell or close the ETF range after closing down its Hong Kong office and relocating its regional headquarters to Shanghai.

However, last month, Vanguard surprisingly slashed its Shanghai-based team in half after suspending plans to apply for a public fund licence that would have enabled it to enter China’s onshore retail mutual fund and ETF market.

The Hong Kong-listed products that will be terminated include the Vanguard S&P 500 Index ETF, which had HK$1.92bn ($250m) in assets as of March 29, as well as the FTSE Developed Europe Index ETF, with HK$1.01bn in assets.

Its FTSE Asia ex Japan Index ETF, Total China Index ETF, FTSE Asia ex Japan High Dividend Yield Index ETF and FTSE Japan Index ETF, had HK$552m, Rmb$338m ($51.6m), HK$378m and HK$219m in assets respectively.

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Vanguard 500 Index Fund Investor Shares Fund , VFINX

Average Gain 1 Year3.92 Tracking Error 3 Years0.02 Trailing Performance 3 Months-0.47 Maximum Loss 20 Years-50.97 Trailing Return 8 Years14.55 Tracking Error 1 Year0.02 Sortino Ratio 20 Years0.88 Beta 1 Year1.00 Maximum Loss 5 Years-19.63 Maximum Loss 5 Years-19.63 Capture Ratio Up 1 Year99.74 R-Squared (R²) 15 Years100.00 Trailing Return 1 Year29.84 Sortino Ratio 10 Years1.97 Correlation 5 Years100.00 Trailing Return 10 Years18.19 Trailing Return 9 Months22.27 Trailing Return 1 Month-2.89 Capture Ratio Down 15 Years100.22 Beta 1 Year1.00 Average Gain 1 Year3.92 Tracking Error 3 Years0.02 Trailing Return Since Inception10.48 Maximum Loss 1 Year-4.66 Correlation 10 Years100.00 Trailing Return 5 Years16.74 Trailing Return 2 Years18.51 Tracking Error 15 Years0.02 Beta 20 Years1.00 Risk adjusted Return Since Inception12.82 Average Gain 5 Years3.19 Correlation 3 Years100.00 Low 1 Year281.76 Treynor Ratio 3 Years14.79 Treynor Ratio 15 Years9.30 Trailing Performance 1 Year24.77 Capture Ratio Up 10 Years99.61 Trailing Return 20 Years8.07 Average Gain 15 Years3.17 Trailing Return 7 Years15.27 Information Ratio 1 Year-6.80 Trailing Return 15 Years10.23 Batting Average 3 Years2.78 Risk adjusted Return Since Inception12.82 Tracking Error 5 Years0.01 Tracking Error 15 Years0.02 Maximum Loss 15 Years-50.97 Capture Ratio Up 1 Year99.74 R-Squared (R²) 10 Years100.00 Trailing Return 4 Years15.26 Beta 3 Years1.00 Trailing Return 6 Years16.50 Correlation 1 Year100.00 Trailing Return Since Inception11.47 Beta 10 Years1.00 Maximum Loss 20 Years-50.97 Trailing Return YTD - Year to Date22.27 R-Squared (R²) 1 Year100.00 Trailing Performance 3 Years65.32 Correlation 15 Years100.00 Alpha 1 Year-0.13 Sortino Ratio 10 Years1.97 Trailing Performance 1 Month-2.33 Tracking Error 10 Years0.02 Information Ratio 20 Years-4.09 Treynor Ratio 5 Years15.61 Batting Average 20 Years7.08 Alpha 5 Years-0.14 Information Ratio 3 Years-9.30 Average Loss 20 Years-3.83 Beta 15 Years1.00 Sortino Ratio 5 Years1.60 Maximum Loss 3 Years-19.63 Tracking Error 5 Years0.01 Capture Ratio Down 3 Years100.23 Capture Ratio Down 20 Years100.21 Sortino Ratio 15 Years0.97 Risk adjusted Return 5 Years12.75 Tracking Error 10 Years0.02 Beta 20 Years1.00 Sortino Ratio 5 Years1.60 Low 1 Year302.04 Batting Average 20 Years7.08 Trailing Return 5 Years16.03 Risk adjusted Return 5 Years12.75 Batting Average 1 Year8.33 Average Gain 10 Years3.02 Alpha 3 Years-0.13 Capture Ratio Up 10 Years99.61 Information Ratio 20 Years-4.09 Treynor Ratio 20 Years8.10 Capture Ratio Up 20 Years99.64 Average Gain 10 Years3.02 R-Squared (R²) 15 Years100.00 Maximum Loss 20 Years-50.97 Sortino Ratio 20 Years0.88 Trailing Performance 10 Years334.61 Trailing Return 3 Years14.08 Trailing Return 10 Years16.47 Trailing Return 8 Years15.00 R-Squared (R²) 10 Years100.00 Trailing Return 15 Years8.08 Treynor Ratio 1 Year29.78 Average Loss 20 Years-3.83 Correlation 1 Year100.00 Trailing Performance 6 Months6.05 Risk adjusted Return 3 Years10.62 Batting Average 1 Year8.33 Average Gain 5 Years3.19 Trailing Return 2 Months0.50 Trailing Return 7 Years13.47 R-Squared (R²) 3 Years100.00 Alpha 5 Years-0.14 R-Squared (R²) 20 Years100.00 R-Squared (R²) 20 Years100.00 Trailing Return 15 Years10.89 Correlation 20 Years100.00 Correlation 20 Years100.00 Batting Average 3 Years2.78 Tracking Error 10 Years0.02 Trailing Return 1 Month-4.66 Capture Ratio Up 1 Year99.74 R-Squared (R²) 15 Years100.00 Correlation 15 Years100.00 Information Ratio 15 Years-5.19 Alpha 1 Year-0.13 Information Ratio 5 Years-10.69 Capture Ratio Down 1 Year100.43 Tracking Error 3 Years0.02 Tracking Error 1 Year0.02 Batting Average 15 Years7.78 Trailing Return 9 Months22.22 Average Loss 3 Years-5.22 Trailing Return 2 Years18.19 Information Ratio 5 Years-10.69 Maximum Loss 15 Years-50.97 Sortino Ratio 20 Years0.88 Capture Ratio Up 3 Years99.76 Trailing Return 3 Years15.93 Average Loss 5 Years-4.69 Trailing Return 8 Years16.80 Treynor Ratio 3 Years14.79 Beta 10 Years1.00 Trailing Return 1 Month-2.91 Correlation 10 Years100.00 Capture Ratio Down 20 Years100.21 Alpha 15 Years-0.12 Trailing Return 9 Years15.06 Trailing Return 6 Months8.14 Alpha 20 Years-0.12 Batting Average 10 Years1.67 Beta 3 Years1.00 Treynor Ratio 10 Years15.86 Capture Ratio Up 15 Years99.67 Trailing Return YTD - Year to Date15.81 Average Loss 15 Years-4.02 R-Squared (R²) 5 Years100.00 Average Loss 1 Year-2.80 Trailing Performance 1 Week0.13 Batting Average 10 Years1.67 Risk adjusted Return 10 Years13.73 Sortino Ratio 3 Years1.26 R-Squared (R²) 3 Years100.00 Information Ratio 20 Years-4.09 Treynor Ratio 10 Years15.86 Trailing Return YTD - Year to Date22.22 Alpha 10 Years-0.14 Trailing Performance 2 Years51.09 Average Gain 20 Years3.01 Capture Ratio Up 5 Years99.66 Batting Average 5 Years1.67 Treynor Ratio 5 Years15.61 Maximum Loss 1 Year-4.66 Sortino Ratio 1 Year4.97 Capture Ratio Down 15 Years100.22 Alpha 1 Year-0.13 Average Gain 10 Years3.02 Low 1 Year260.62 Beta 15 Years1.00 Trailing Return 1 Year31.38 Information Ratio 10 Years-11.08 Trailing Return 3 Years15.85 Risk adjusted Return 3 Years10.62 Capture Ratio Down 20 Years100.21 Trailing Return 9 Years14.96 Average Loss 15 Years-4.02 Sortino Ratio 10 Years1.97 Capture Ratio Down 5 Years100.25 Beta 1 Year1.00 Trailing Return 5 Years15.85 Maximum Loss 10 Years-19.63 Capture Ratio Down 15 Years100.22 Tracking Error 15 Years0.02 Trailing Return 20 Years9.38 Trailing Return 7 Years13.86 Alpha 10 Years-0.14 Trailing Return 9 Years16.40 Maximum Loss 3 Years-19.63 Alpha 15 Years-0.12 Trailing Return 9 Months15.81 Beta 5 Years1.00 Trailing Performance 5 Years121.90 Beta 5 Years1.00 Average Loss 3 Years-5.22 Trailing Return 10 Years16.78 Maximum Loss 3 Years-19.63 Information Ratio 15 Years-5.19 Tracking Error 20 Years0.03 Treynor Ratio 20 Years8.10 Batting Average 15 Years7.78 Treynor Ratio 15 Years9.30 Average Gain 3 Years4.21 Risk adjusted Return 3 Years10.62 Average Gain 5 Years3.19 Batting Average 20 Years7.08 Capture Ratio Up 3 Years99.76 Information Ratio 15 Years-5.19 Capture Ratio Down 10 Years100.34 Trailing Return 3 Months0.56 Average Loss 10 Years-3.36 Alpha 20 Years-0.12 Capture Ratio Up 3 Years99.76 Alpha 3 Years-0.13 Average Loss 5 Years-4.69 Correlation 10 Years100.00 Average Loss 5 Years-4.69 Capture Ratio Up 10 Years99.61 Performance since Inception13,436.50 Maximum Loss 15 Years-50.97 Treynor Ratio 5 Years15.61 Average Gain 1 Year3.92 Treynor Ratio 1 Year29.78 Information Ratio 3 Years-9.30 Capture Ratio Up 5 Years99.66 R-Squared (R²) 5 Years100.00 Trailing Return 4 Years16.32 High 1 Year419.78 Trailing Return 6 Months9.10 Risk adjusted Return 10 Years13.73 Capture Ratio Down 5 Years100.25 Trailing Return 6 Years15.60 Tracking Error 1 Year0.02 Maximum Loss 10 Years-19.63 Trailing Return 2 Months1.10 High 1 Year391.59 Batting Average 3 Years2.78 Risk adjusted Return 5 Years12.75 Average Gain 15 Years3.17 Information Ratio 1 Year-6.80 Batting Average 1 Year8.33 Trailing Return 1 Year31.84 Trailing Return 6 Months10.64 High 1 Year362.21 Sortino Ratio 3 Years1.26 Information Ratio 5 Years-10.69 Average Gain 20 Years3.01 R-Squared (R²) 1 Year100.00 Correlation 15 Years100.00 Capture Ratio Up 15 Years99.67 Trailing Return 2 Months-1.78 Risk adjusted Return 10 Years13.73 Average Gain 20 Years3.01 Trailing Performance 4 Years82.55 Sortino Ratio 5 Years1.60 Beta 5 Years1.00 Trailing Return 20 Years6.41 Trailing Return 3 Months2.90 Information Ratio 10 Years-11.08 Average Loss 1 Year-2.80 Beta 15 Years1.00 Performance Current Year17.01 Sortino Ratio 1 Year4.97 Tracking Error 5 Years0.01 Batting Average 15 Years7.78 Batting Average 10 Years1.67 Maximum Loss 5 Years-19.63 Sortino Ratio 3 Years1.26 Information Ratio 1 Year-6.80 Capture Ratio Up 5 Years99.66 Tracking Error 20 Years0.03 Information Ratio 10 Years-11.08 Average Loss 3 Years-5.22 Capture Ratio Down 5 Years100.25 Trailing Return 6 Years15.77 Risk adjusted Return Since Inception12.82 Treynor Ratio 10 Years15.86 Alpha 20 Years-0.12 Capture Ratio Down 1 Year100.43 Maximum Loss 10 Years-19.63 Average Loss 1 Year-2.80 Correlation 3 Years100.00 Sortino Ratio 15 Years0.97 Correlation 5 Years100.00 Trailing Return 2 Years22.19 Sortino Ratio 15 Years0.97 Alpha 3 Years-0.13 R-Squared (R²) 20 Years100.00 Sortino Ratio 1 Year4.97 Capture Ratio Down 1 Year100.43 R-Squared (R²) 1 Year100.00 Beta 3 Years1.00 Correlation 1 Year100.00 Treynor Ratio 20 Years8.10 Average Gain 3 Years4.21 Beta 20 Years1.00 Average Loss 10 Years-3.36 Trailing Return 4 Years16.90 Average Loss 15 Years-4.02 Tracking Error 20 Years0.03 Capture Ratio Down 3 Years100.23 Capture Ratio Up 20 Years99.64 Alpha 10 Years-0.14 Capture Ratio Down 10 Years100.34 Batting Average 5 Years1.67 Trailing Return 3 Months1.48 Capture Ratio Down 10 Years100.34 Correlation 3 Years100.00 Correlation 5 Years100.00 Average Loss 10 Years-3.36 Treynor Ratio 3 Years14.79 Average Gain 15 Years3.17 R-Squared (R²) 3 Years100.00 Capture Ratio Up 20 Years99.64 Trailing Return Since Inception9.08 Information Ratio 3 Years-9.30 Capture Ratio Down 3 Years100.23 Batting Average 5 Years1.67 Maximum Loss 1 Year-4.66 Average Loss 20 Years-3.83 Beta 10 Years1.00 Correlation 20 Years100.00 R-Squared (R²) 5 Years100.00 R-Squared (R²) 10 Years100.00 Treynor Ratio 15 Years9.30 Average Gain 3 Years4.21 Treynor Ratio 1 Year29.78 Capture Ratio Up 15 Years99.67 Alpha 5 Years-0.14 Alpha 15 Years-0.12
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The 7 Best Vanguard Index Funds To Buy For Financial Freedom

Best index funds in October 2021

Index funds are popular with investors because they promise ownership of a wide variety of stocks, greater diversification and lower risk – usually all at a low price. That’s why many investors, especially beginners, find index funds to be superior investments to individual stocks.

Among the best are index funds based on the Standard & Poor’s 500 Index (S&P 500). The index includes hundreds of the largest, globally diversified American companies across every industry, making it a relatively low-risk way to invest in stocks. Of course, as 2020 showed, even the whole market can fluctuate dramatically, especially if something momentous happens.

This index is the very definition of the market, and by owning a fund based on the index, you’ll get the market’s return, historically about 10 percent per year. It’s among the most popular indexes.

Here’s everything you need to know about index funds, including five of the top index funds to consider adding to your portfolio this year.

Best index funds for October 2021

The list below includes S&P 500 index funds from a variety of companies, and it includes some of the lowest-cost funds trading on the public markets. When it comes to an index fund like this, one of the most important factors in your total return is cost. Included are two mutual funds and three ETFs:

1. Fidelity ZERO Large Cap Index

2. Vanguard S&P 500 ETF

3. SPDR S&P 500 ETF Trust

4. iShares Core S&P 500 ETF

5. Schwab S&P 500 Index Fund

1. Fidelity ZERO Large Cap Index (FNILX)

The Fidelity ZERO Large Cap Index mutual fund is part of the investment company’s foray into mutual funds with no expense ratio, thus its ZERO moniker. The fund doesn’t officially track the S&P 500 – technically it follows the Fidelity U.S. Large Cap Index – but the difference is academic. The real difference is that investor-friendly Fidelity doesn’t have to cough up a licensing fee to use the S&P name, keeping costs lower for investors.

Expense ratio: 0 percent. That means every $10,000 invested would cost $0 annually.

2. Vanguard S&P 500 ETF (VOO)

As its name suggests, the Vanguard S&P 500 tracks the S&P 500 index, and it’s one of the largest funds on the market with hundreds of billions in the fund. This ETF began trading in 2010, and it’s backed by Vanguard, one of the powerhouses of the fund industry.

Expense ratio: 0.03 percent. That means every $10,000 invested would cost $3 annually.

3. SPDR S&P 500 ETF Trust (SPY)

The SPDR S&P 500 ETF is the granddaddy of ETFs, having been founded all the way back in 1993. It helped kick off the wave of ETF investing that has become so popular today. With hundreds of billions in the fund, it’s among the most popular ETFs. The fund is sponsored by State Street Global Advisors — another heavyweight in the industry — and it tracks the S&P 500.

Expense ratio: 0.09 percent. That means every $10,000 invested would cost $9 annually.

4. iShares Core S&P 500 ETF (IVV)

The iShares Core S&P 500 ETF is a fund sponsored by one of the largest fund companies, BlackRock. This iShares fund is one of the largest ETFs and like these other large funds, it tracks the S&P 500. With an inception date of 2000, this fund is another long-tenured player that’s tracked the index closely over time.

Expense ratio: 0.03 percent. That means every $10,000 invested would cost $3 annually.

5. Schwab S&P 500 Index Fund (SWPPX)

With tens of billions in assets, the Schwab S&P 500 Index Fund is on the smaller side of the heavyweights on this list, but that’s not really a concern for investors. This mutual fund has a strong record dating back to 1997, and it’s sponsored by Charles Schwab, one of the most respected names in the industry. Schwab is especially noted for its focus on making investor-friendly products, as evidenced by this fund’s razor-thin expense ratio.

Expense ratio: 0.02 percent. That means every $10,000 invested would cost $2 annually.

Why are index funds so popular?

The S&P 500 index fund continues to be among the most popular index funds. S&P 500 funds offer a good return over time, they’re diversified and a relatively low-risk way to invest in stocks.

  • Attractive returns – Like all stocks, the S&P 500 will fluctuate. But over time the index has returned about 10 percent annually. That doesn’t mean index funds make money every year, but over long periods of time that’s been the average return.
  • Diversification – Investors like index funds because they offer immediate diversification. With one purchase, investors can own a wide swath of companies. One share of an index fund based on the S&P 500 provides ownership in hundreds of companies.
  • Lower risk – Because they’re diversified, investing in an index fund is lower risk than owning a few individual stocks. That doesn’t mean you can’t lose money or that they’re as safe as a CD, for example, but the index will usually fluctuate a lot less than an individual stock.
  • Low cost – Index funds can charge very little for these benefits, with a low expense ratio. For larger funds you may pay $3 to $10 per year for every $10,000 you have invested. In fact, one fund (listed above) charges you no expense ratio at all. When it comes to index funds, cost is one of the most important factors in your total return.

While some funds such as S&P 500 index funds allow you to own companies across industries, others own only a specific industry, country or even investing style (say, dividend stocks).

How to invest in an index fund in 3 easy steps

It’s surprisingly easy to invest in an index fund, but you’ll want to know what you’re investing in, not simply buy random funds that you know little about.

1. Choose an index fund to invest in

Your first step is finding what you want to invest in. While an S&P 500 index fund is the most popular index fund, they also exist for different industries, countries and even investment styles. So you need to consider what exactly you want to invest in and why it might hold opportunity:

  • Location: Consider the geographic location of the investments. A broad index such as the S&P 500 owns American companies, while other index funds might focus on a narrower location (France) or an equally broad one (Asia-Pacific).
  • Business: Which industry or industries is the index fund investing in? Is it invested in pharma companies making new drugs, or maybe tech companies? Some funds specialize in certain industries and avoid others.
  • Market opportunity: What opportunity does the index fund present? Is the fund buying pharma companies because they’re making the next blockbuster drug or because they’re cash cows paying dividends? Some funds invest in high-yield stocks while others want high-growth stocks.

You’ll want to carefully examine what the fund is investing in, so you have some idea of what you actually own. Sometimes the labels on an index fund can be misleading. But you can check the index’s holdings to see exactly what’s in the fund.

2. Decide which index fund to buy

After you’ve found a fund you like, you can look at other factors that may make it a good fit for your portfolio. The fund’s expenses are huge factors that could make – or cost – you tens of thousands of dollars over time.

  • Expenses: Compare the expenses of each fund you’re considering. Sometimes a fund based on a similar index can charge 20 times as much as another.
  • Taxes: For certain legal reasons, mutual funds tend to be less tax-efficient than ETFs. At the end of the year many mutual funds pay a taxable capital gains distribution, while ETFs do not.
  • Investment minimums: Many mutual funds have a minimum investment amount for your first purchase, often several thousand dollars. In contrast, many ETFs have no such rule, and your broker may even allow you to buy fractional shares with just a few dollars.

3. Purchase your index fund

After you’ve decided which fund fits in your portfolio, it’s time for the easy part – actually buying the fund. You can either buy directly from the mutual fund company or through a broker. But it’s usually easier to buy a mutual fund through a broker. And if you’re buying an ETF, you’ll need to go through your broker.

Things to consider when investing in index funds

As you’re looking at index funds, you’ll want to consider the following factors:

  • Long-run performance: It’s important to track the long-term performance of the index fund (ideally at least five to ten years of performance) to see what your potential future returns might be. Each fund may track a different index or do better than another fund, and some indexes do better than others over time. Long-run performance is your best gauge to what you might expect in the future, but it’s no guarantee, either.
  • Expense ratio: The expense ratio shows what you’re paying for the fund’s performance on an annual basis. For funds that track the same index, such as the S&P 500, it makes little sense to pay more than you have to. Other index funds may track indexes that have better long-term performance, potentially justifying a higher expense ratio.
  • Trading costs: Some brokers offer very attractive prices when you’re buying mutual funds, even more so than the same mutual fund company itself. If you’re going with an ETF, virtually all major online brokers now allow you to trade without a commission. Also, if you’re buying a mutual fund, beware of sales loads, or commissions, which can easily lop off 1 or 2 percent of your money before it’s invested. These are easy to avoid by choosing funds carefully, such as those from Vanguard and many others.
  • Fund options: Not all brokers will offer all mutual funds, however. So you’ll need to see whether your broker offers a specific fund family. In contrast, ETFs are typically available at all brokers because they’re all traded on an exchange.
  • Convenience: It may be a lot easier to go with a mutual fund that your broker offers on its platform rather than open a new brokerage account. But going with an ETF instead of a mutual fund may also allow you to sidestep this issue.

Can an index fund investor lose everything?

Putting money into any market-based investment such as stocks or bonds means that investors could lose it all if the company or government issuing the security runs into severe trouble. However, the situation is a bit different for index funds because they’re often so diversified.

An index fund usually owns at least dozens of securities and may own potentially hundreds of them, meaning that it’s highly diversified. In the case of a stock index fund, for example, every stock would have to go to zero for the index fund, and thus the investor, to lose everything. So while it’s theoretically possible to lose everything, it doesn’t happen for standard funds.

That said, an index fund could underperform and lose money for years, depending on what it’s invested in. But the odds that an index fund loses everything are very low.

What is considered a good expense ratio?

Mutual funds and ETFs have among the cheapest average expense ratios, and the figure also depends on whether they’re investing in bonds or stocks. In 2020, the average stock index mutual fund charged 0.06 percent (on an asset-weighted basis), or $6 for every $10,000 invested. The average stock index ETF charged 0.18 percent (asset-weighted), or $18 for every $10,000 invested.

Index funds tend to be much cheaper than average funds. Compare the numbers above with the average stock mutual fund (on an asset-weighted basis), which charged 0.54 percent, or the average stock ETF, which charged 0.18 percent. While the ETF expense ratio is the same in each case, the cost for mutual funds generally is higher. Many mutual funds are not index funds, and they charge higher fees to pay the higher expenses of their investment management teams.

So anything below the average should be considered a good expense ratio. But it’s important to keep these costs in perspective and realize that the difference between an expense ratio of 0.10 percent and 0.05 percent is just $5 per year for every $10,000 invested. Still, there’s no reason to pay more for an index fund tracking the same index.

Is now a good time to buy index funds?

If you’re buying a stock index fund or almost any broadly diversified stock fund such as an S&P 500 fund, it can be a good time to buy. That’s because the market tends to rise over time, as the economy grows and corporate profits increase. In this regard, time is your best friend, because it allows you to compound your money, letting your money make money. That said, narrowly diversified index funds (such as funds focused on one industry) may do poorly for years.

Investors need to take a long-term mindset, however, and experts recommend adding money to the market regularly. You’ll take advantage of dollar cost averaging and lower your risk. A strong investing discipline can help you make money in the market over time. Investors should avoid timing the market, that is, jumping in and out of the market to capture gains and dodge losses.

Index fund FAQ

If you’re looking to get into index funds, you may still have a few more questions. Here are answers to some of the most frequently asked questions that investors have about them.

How do index funds work?

An index fund is an investment fund – either a mutual fund or an exchange-traded fund (ETF) – that is based on a preset basket of stocks, or index. This index may be created by the fund manager itself or by another company such as an investment bank or a brokerage.

These fund managers then mimic the index, creating a fund that looks as much as possible like the index, without actively managing the fund. Over time the index changes, as companies are added and removed, and the fund manager mechanically replicates those changes in the fund.

Because of this approach, index funds are considered a type of passive investing, rather than active investing where a fund manager analyzes stocks and tries to pick the best performers.

This passive approach means that index funds tend to have low expense ratios, keeping them cheap for investors getting into the market.

Some of the most well-known indexes include the S&P 500, the Dow Jones Industrial Average and the Nasdaq 100. Indexing is a popular strategy for ETFs to use, and most ETFs are based on indexes.

What sort of fees are associated with index funds?

Index funds may have a couple different kinds of fees associated with them, depending on which type of index fund:

  • Mutual funds: Index funds sponsored by mutual fund companies may charge two kinds of fees: a sales load and an expense ratio.
    • A sales load is just a commission for buying the fund, and it may happen when you buy or when you sell or over time. Investors can usually avoid these by going with an investor-friendly fund company such as Vanguard, Schwab or Fidelity.
    • An expense ratio is an ongoing fee paid to the fund company based on the assets you have in the fund. Typically these are charged daily and come out of the account seamlessly.
  • ETFs: Index funds sponsored by ETF companies (many of which also run mutual funds) charge only one kind of fee, an expense ratio. It works the same way as it would with a mutual fund, with a tiny portion seamlessly deducted each day you hold the fund.

ETFs have become more popular recently because they help investors avoid some of the higher fees associated with mutual funds. ETFs are also becoming popular because they offer other key advantages over mutual funds.

Bottom line

These are some of the best S&P 500 index funds on the market, offering investors a way to own the stocks of the S&P 500 at low cost, while still enjoying the benefits of diversification and lower risk. With those benefits, it’s no surprise that these are some of the largest funds on the market.

Learn more:

Editorial Disclaimer: All investors are advised to conduct their own independent research into investment strategies before making an investment decision. In addition, investors are advised that past investment product performance is no guarantee of future price appreciation.

Sours: https://www.bankrate.com/investing/best-index-funds/

500 vanguard index

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Vanguard 500 Index Fund VFIAX - The BEST Investment You Can Make

Only he felt good. He finished in my mouth and I licked every last drop. During the whole blowjob, his hand quickly and quickly wielded between my legs, so that I myself almost finished, but he poured into me first.

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But no, it splashes out a stream of thoughts and with a clever air dumps out platitudes, expecting that the interlocutor will listen, rolling. His eyes and trembling at the source of wisdom. For the fifth time he started talking about how important it is to observe the regime and get enough sleep when his head.

Stuck his head out of the doorway. Not a drop of sleepiness on my face.



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