Index fund is a way to completely copy the index according to the corresponding rules. Although it is a passive fund, it has become the main investment variety in mature markets, and its income often outperforms that of equity funds. What are the advantages of index funds? Mainly look at these three points.

What are the advantages of index funds?

1 Save time and effort: Unlike stocks, index funds weaken the technical requirements for stock selection and timing, and only need to make strategic arrangements. To put it simply, they just need to choose the right index fund and stick to their own fixed investment rules, which is simple and time-saving.

2 Simple and transparent: Don't worry about being cheated. With the outbreak of more and more wealth management products, there are fewer channels for safe investment, and the rules of index funds are completely open, free from the influence of investment managers. In contrast, instead of screening many investment channels that are difficult to distinguish between true and false, it is better to invest in index funds in a down-to-earth manner.

3 Avoid artificial influence: One of the main reasons for novice investors' losses is their emotions, and by setting a fixed investment, they can not only ensure that they will not trade in the day because of their emotions, but also help them develop the habit of saving.

The investment portfolio of index funds is equal to the weight ratio of market price index, and the income fluctuates with the current price index. Belonging to passive investment, it can eliminate systemic risks, reduce costs at the same time, follow the crowd in operation, and passively gain benefits in the overall economic rise.