12annas NON RESIDENT INDIAN CONSULTANTS

Index Fund

index funds
4 Jul, 2017, 12:05PM UTC by Jaydip Mehta

Index funds are a kind of Mutual funds where portfolios are designed for tracking the performance of a particular Market Index (particular segment of market). Here the Market exposure is broad, while Operating Expenses and portfolio Turnover both are low. Stocks having similar characteristics such as the size, value, profitability and/or geographic location of the companies are grouped together in Index Funds. They are suitable for Investors having capability of bearing low risk.

 

There are two types of Index Funds –

  • Passive Index Funds – Invests in Stocks forming the Index they track, in the proportion as they constitute the index.
  • Active Index Funds – Invests in Stocks forming the Index in the same proportion as they comprise the index.

Advantages of investing in Index funds:

  • Diversification
  • Low Risk & Steady Growth
  • Low Fees
  • Liquidity
  • Some are exchange traded

 

Contact us to invest in Index funds

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