Advertisement
Index funds allow Canadians to invest in hundreds of assets at once. Learn how index funds work at the MoneySense Glossary.
Index funds are mutual funds or exchange-traded funds (ETFs) designed to closely track, or mimic, the performance and characteristics of a specific index. An index isn’t an investment—instead it is measurement of the performance of a group of securities or assets. The S&P 500, for example, is a stock market index that includes about 500 large public companies in the United States. An index fund tracking the S&P 500 holds shares in all of its listed companies, or a representative sample. The composition of index funds doesn’t change very often, and these funds are passively managed, both of which help to keep fees low.
Example: “Because they contain hundreds or thousands of different securities, index funds can offer broad diversification.”
Share this article Share on Facebook Share on Twitter Share on Linkedin Share on Reddit Share on Email
The co-founder of online prenuptial agreement startup Jointly talks about leaving Big Law, tracking spending as a system, and...
The Index Matrix vividly illustrates how different assets performed in the past. Here’s how Canadians can use it to...
Canadian investors have several options for investing in bitcoin and other cryptocurrencies. Here are the pros and cons of...
Both mutual funds and ETFs have their place, and the right one for you comes down to your financial...
A MoneySense reader wants to give money to his spouse to invest. Can he avoid Canada’s income attribution rules?
Whether you want the highest interest rate or no service fees, these savings accounts will meet your needs.
Find the best GIC rates in Canada. Plus, everything you need to know about how they work.
Many retailers offer buy now, pay later programs to encourage spending. Understand the risks, including how your BNPL data...
Which ETFs should you invest in? Which ones best suit your risk tolerance? What about personal ethics? Check out...
These top 10 Canadian momentum stocks all returned more than 40% over the past three months.