ETF
5 questions
- Finance
How do I pick an index fund?
Start with what index the fund tracks, then check the expense ratio (under 0.10% is the target), and confirm there's no minimum investment or sales load. For most people, one broad US market index fund covers the core of a long-term portfolio.
- Finance
What is a brokerage account?
A brokerage account is an investment account you open with a licensed firm that lets you buy and sell stocks, ETFs, mutual funds, and bonds. Unlike a 401k or IRA, there are no contribution limits and no restrictions on when you can withdraw your money.
- Finance
What is an expense ratio and why does it matter?
An expense ratio is the annual fee a fund charges as a percentage of your invested assets — deducted automatically, not billed separately. Even a small difference in expense ratios compounds into thousands of dollars over a long investment horizon.
- Finance
What is an index fund and should I invest in one?
An index fund tracks a market index like the S&P 500 — you own a tiny piece of hundreds of companies at once. Low fees and automatic diversification make them the default recommendation for most investors.
- Finance
What is the difference between an ETF and a mutual fund?
ETFs trade on stock exchanges throughout the day like individual stocks, while mutual funds are priced once daily after market close. Both can hold the same underlying investments — for most investors, a low-cost index ETF and a low-cost index mutual fund are functionally identical.