The American market is inconsistent with the China market. After hundreds of years of development, there are very few retail investors specializing in short-term play in the American market, and such retail investors may be eliminated. The American market is dominated by institutional investors, such as long-term investors such as pensions and insurance. Institutions and institutions are just touching each other's pockets. Today, you may make money and I may lose money. Tomorrow, I may make money and you may lose money. It is difficult for institutions to continue to beat other institutions for a long time. Therefore, index funds are very effective in the American market, saving time and effort. All I have to do is buy index funds, and I can get the average.

2. Why is the index fund rate in the US market cheaper than that in China?

American market index funds are also Matthew effect. The funds of several large fund companies are dominant. The larger the scale, the smaller the impact of possible purchase and redemption, the more effective the tracking and the lower the management cost. You can refer to Tencent's WeChat. The marginal cost of one more user on WeChat is very low. The more users there are, the more feedback they may get and the more useful they will be, forming a positive incentive. Large companies have large scale, good liquidity and low rates, so small companies can only reduce their fees or find another way out.

In addition, index funds in the American market can lend some of their shares to obtain rental income, which can further reduce costs. It is no problem for me to reduce the management fee originally charged to fund investors. Anyway, I can still get the proceeds from renting stocks. A single American fund doesn't even charge management fees, and the cost can be covered by rental income alone.