To be more complete: an index fund is a mutual fund that tracks the value of an index by consisting of components of that index. You can't buy shares of the Dow or S&P or Nasdaq, but you can buy DIA, SPDR, and QQQ.
Its a good way to park money you want to track with the value of the market (decent inflation hedge that way).
To be more complete: an index fund is a mutual fund that tracks the value of an index by consisting of components of that index. You can't buy shares of the Dow or S&P or Nasdaq, but you can buy DIA, SPDR, and QQQ.
Its a good way to park money you want to track with the value of the market (decent inflation hedge that way).