Index funds are investment funds or mutual funds that track a market index such as the Nifty 50 or the BSE Sensex. They are designed to replicate the performance of a benchmark index’s stock portfolio and to provide investors with a low-cost way to gain exposure to a wide range of stocks.
These funds are typically passively managed and are relatively low-cost compared to actively managed funds. They are a popular choice for investors who prefer a ‘buy and hold’ approach to investing.
They are a cost-effective investment option since they have low expense ratios and are ideal for investors who are looking for long-term investments. Furthermore, index funds are easy to understand, highly diversified, and can be bought and sold easily.
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