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An index fund is a mutual fund or ETF designed to match the performance of a market index, such as the S&P 500 or Nasdaq 100.
Index funds offer broad market exposure, low fees, and passive management. Studies show most active managers underperform indexes long-term.
Popular index funds include Vanguard 500 (VOO/VFIAX), Fidelity ZERO, and Schwab S&P 500.
Understanding index fund helps you make better investment decisions and plan for taxes. Explore related concepts below to deepen your knowledge.