An index fund is a type of mutual fund or ETF portfolio that tracks a broad segment of the U.S. stock market. The beauty of index funds is that you’ll get a neat package of bundled stocks. You don’t have to pay a money manager to choose your investments for you. This means that index funds typically give way to high returns and lower fees. However, you want the best index funds because both reduce your risk and potentially increase profits.
Quick Look at the Best Index Funds:
- Schwab U.S. Large-Cap ETF (NYSEARCA: SCHX)
- iShares Core S&P 500 ETF (NYSEARCA: IVV)
- Vanguard Total Stock Market ETF (NYSEARCA: VTI)
- Invesco S&P 500® Equal Weight ETF (NYSEARCA: RSP)
- Vanguard S&P 500 ETF (NYSEARCA: VOO)
Best Index Funds Right Now
Benzinga has compiled a list of a few of the best index funds, and they include the following:
Schwab U.S. Large-Cap ETF (NYSEARCA: SCHX)
| Ticker | Company | ±% | Price | Invest | ||
|---|---|---|---|---|---|---|
| SCHX | Schwab U.S. Large-Cap ETF | 1.1% | $23.80 | Buy stock | ||
Schwab U.S. Large-Cap ETF has been on the market since 2009. It tracks the Dow Jones U.S. Large-Cap Total Stock Market Index and consists of over 750 of the largest U.S. companies. This ETF has holdings in companies from industrial sectors such as information technology, healthcare, consumer discretionary, communication services and finance. A few of these companies include Apple (AAPL), Microsoft (MSFT), Facebook (FB), Tesla (TSLA) and JPMorgan(JPM).
iShares Core S&P 500 ETF (NYSEARCA: IVV)
| Ticker | Company | ±% | Price | Invest | ||
|---|---|---|---|---|---|---|
| IVV | iShares Core S&P 500 ETF | 1.07% | $604.01 | Buy stock | ||
iShares Core S&P 500 ETF has been open to trade since 2000. It tracks the S&P 500 index and consists of more than 500 leading companies in the U.S. The index has companies from industrial sectors such as IT, healthcare and consumer staples. These companies include NVIDIA, Home Depot (HD), Procter & Gamble (PG) and Visa (V).
Vanguard Total Stock Market ETF (NYSEARCA: VTI)
| Ticker | Company | ±% | Price | Invest | ||
|---|---|---|---|---|---|---|
| VTI | Vanguard Total Stock Market ETF | 1.06% | $297.12 | Buy stock | ||
Vanguard Total Stock Market ETF has been listed on the stock exchange since 2001. It tracks the CRSP US Total Market Index and consists of more than 3,500 companies. Companies from industrial sectors such as basic materials, consumer staples, energy and finance are part of the index. These companies include Amazon (AMZN), Visa (V), JP Morgan (JPM) and Apple (AAPL).
Invesco S&P 500® Equal Weight ETF (NYSEARCA: RSP)
| Ticker | Company | ±% | Price | Invest | ||
|---|---|---|---|---|---|---|
| RSP | Invesco S&P 500 Equal Weight ETF | 0.75% | $177.61 | Buy stock | ||
Invesco S&P 500® Equal Weight ETF has been open to trade since 2003. It tracks the S&P Equal Weight Index and has holdings in over 500 companies. The index contains companies from industrial sectors such as IT, healthcare and finance. These companies include Alexion Pharmaceuticals (ALXN), NortonLifeLock (NLOK) and PayPal (PYPL).
Vanguard S&P 500 ETF (NYSEARCA: VOO)
| Ticker | Company | ±% | Price | Invest | ||
|---|---|---|---|---|---|---|
| VOO | Vanguard S&P 500 ETF | 0.95% | $552.41 | Buy stock | ||
Vanguard S&P 500 ETF has been on the market since 2010. It tracks the S&P 500 and consists of over 500 U.S. companies. The index contains companies from industrial sectors such as communication services, consumer discretionary and healthcare. These companies include Mastercard (MA), Amazon (AMZN), Home Depot (HD) and UnitedHealth Group (UNH).
Where to Buy Index Funds
Check out the recommended brokers below to get started with index funds.
- Best For:Active and Global TradersVIEW PROS & CONS:Securely through Interactive Brokers’ website
Index Funds for the Win?
If there’s one takeaway, just remember that passively managed index funds can beat managed funds over time. The best performing index funds are not necessarily stacked with brokers, fancy slogans and a mission statement longer than the tax code. If you’re interested in finding the best financial tools to hold for the long term—that won’t eat up your money through expenses—seriously consider index funds for your portfolio.
Frequently Asked Questions
What is an index fund?
An index fund is a bundle of stocks.
Are fees lower on index funds?
You won’t have to pay a broker for individual trades when buying an index fund, so yes, you will pay lower fees.
About Melissa Brock
Melissa Brock is a versatile freelance writer and financial editor, recognized for her expertise in higher education, personal finance, and investing. With over a decade of experience in online content creation, Melissa has established herself as a trusted source for insightful financial advice and educational resources. Her writing prowess extends to diverse topics, including trading, cryptocurrency, and college savings. Melissa’s commitment to empowering readers with practical knowledge and actionable insights is evident in her contributions to various reputable platforms. As a dedicated financial editor, she meticulously covers the complexities of personal finance, ensuring readers have the tools they need to make informed decisions. Melissa’s work exemplifies her passion for educating and informing audiences on matters of financial literacy and investment strategies.