• Marie

Simple Investing with Index Funds | Ep. 5 | Winenance Wednesday

Updated: Nov 14, 2020

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What you’ll learn in this episode:

1. Why Index Funds Are Simple & Effective

  • When you understand the stock market always (eventually) goes up, then you understand why Index Funds are one of the best investments.

  • You'll always perform as well as the market.

2. What is an Index Fund?

  • Index Funds are a type of investment fund which tracks a particular sector or index (i.e. Financial Sector, Tech Sector, or S&P 500).

  • They can be passively managed or actively managed, though passively managed tend to perform better.

  • Index funds allow you to own a small portion of many (or all) the companies in that index or sector.

3. Index Funds are Already Diversified

  • Index funds offer diversification and minimal risk in one simple package.

  • Index Funds which track the S&P 500 or total U.S. stock market have enough international exposure due to the globalization of many of the companies within the fund.

4. Index Funds are (typically) "Low-Risk" Investments

  • Broad market index funds can take the “lose it all” fear out of investing.

  • Index Funds are "self-cleansing" meaning if one company fails, there's another ready to take it's place in line.

Challenge of the Week

Get out of your comfort zone!

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