Index Funds Offer Attractive Returns with Low Effort

The S&P 500, Nasdaq-100, and Dow Jones Industrial Average are popular stock indexes that track America's largest publicly traded companies.

Investors can earn attractive returns from these indexes with little effort by investing in index funds. Index funds provide diversification and reduce the risks of investing in individual stocks, but their broad exposure also means some individual stocks can dramatically outperform them.

The best index funds for tracking these major indexes include both exchange-traded funds (ETFs) and mutual funds from top providers like Fidelity and Vanguard. The largest and most popular index funds track the S&P 500, which includes around 500 of the largest stocks traded on American exchanges such as Nvidia and Apple.

The key differentiator between these funds is their expense ratio, ranging from 0% to 0.095%. ETFs are usually available to buy and sell wherever you can trade stocks, while mutual funds often charge a minimum initial investment. Investors looking for more dividend-paying investments should review the best dividend ETFs.