How do I invest in index funds?

1. Choose an index To invest in index funds, start by choosing the index you want your fund to track. An index is simply a list of securities that represent a subset of the entire stock market. There are thousands of different indexes tracking just about every sector of the economy you can think of.

How much should I invest in an index fund?

The share price of the index fund, and your investing budget, will likely determine how much you're willing to spend. For instance, if you have $1,000 you'd like to invest in an index fund, and the fund you're looking at is selling for $100 a share, you'd be able to purchase 10 shares. » Want to cut to the chase?

Are index funds a good investment for beginners?

Index funds are great investments for beginners because they allow you to own a wide variety of stocks in one fund. This diversifies your portfolio and is less risky than investing in individual stocks. If you’re just starting out on your investing journey, don’t fret—investing in index funds is a lot simpler than you might think. 1.