investing

index fund

A type of mutual fund or ETF designed to replicate the performance of a specific market index, such as the S&P 500.

Example

"Warren Buffett has recommended index funds for most retail investors."

💡 Memory Tip

An INDEX fund tracks an INDEX — it buys all the stocks in a market index automatically.

Etymology

Index (a list tracking market performance) + fund (a pool of money) — a fund that tracks an index.

Common Misspellings

index fndindx fundindex fuundindex funnd

Related Terms

etf s&p 500 expense ratio

See Also

passive investing

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