How to Invest into Index Funds
The Volatility index just hit a new low. Valuewalk reported:
“The technical picture is clearly bullish on Wall Street, thanks to this week’s rally, and all of the key trend indicators are pointing higher again following the August correction. The S&P 500, the Nasdaq, and the Dow are still well above their flat 200-day moving averages, and the benchmarks are finally back above their flat 50-day moving averages as well. Small-caps continue to show relative weakness compared to the large-cap indices, and although the Russell 2000 recovered above its 200-day moving average, it’s still stuck below its short-term indicator.
The Volatility Index (VIX) hit its lowest level in five weeks together with the major indices, dropping below both its 50- and 200-day moving averages, and it closed the week near 16, well below the key 20 level.
Market internals improved for the second week in a row, and even though the weakness in small-caps is still weighing on the most reliable indicators, the overall picture is consistent with a healthy bull market. The Advance/Decline line hit new bull market highs thanks to the broad rally in stocks, as advancing issues outnumbered decliners by a 5-to-1 ratio on the NYSE, and by a 6-to-1 ratio on the Nasdaq. The average number of new 52-week highs increased on both exchanges, climbing to 105 on the NYSE and 58 on the Nasdaq.
The number of new lows collapsed in the meantime, falling to 35 on the NYSE and 63 on the Nasdaq. The percentage of stocks above the 200-day moving average is finally back above 50% in the wake of this week’s risk-on shift, and the closing value of 52% is the indicator’s highest reading since the start of the correction.” Read more…
Do you believe that the world economy will grow? Do you believe that US economy will grow? I do. The major stock indexes are indicators of economy grow. You can make money use this opportunity buying index funds. Investing into index mutual funds is easy, interesting, and profitable. It takes 5 minutes every month! If you are long-term investor, index funds is for you!
It doesn’t matter what index you choose. This index will grow due to economy sector grow rate. There are many indexes in the world. But how to get money from indexes grow?
There are many indexes mutual funds. Fund share price change accordance index performance. There are thousands of mutual funds have S&P 500 as a base of their portfolio. The differences from one fund to other are operating company and expenses. Choose fund with fell known operating company and smallest expenses.
Small expenses are very important. If fund have big expenses, the managers steal investors’ money. Index fund manager don’t buy expensive stock market researches, don’t arrive at a difficult decision witch stock to buy. Index fund manager buy stock included into index only. It isn’t expensive!
The best investment strategy for indexes mutual funds is to invest some dollar amount monthly. And be the long-term investor – invest for 10 years or more. Our computer modeling of this strategy shows that you will receive profit, if you invest on monthly base during 10 years. I can’t give you guaranties that you will get profit but the probability of this is close to 100%.
And the last, if you can, diversify you portfolio. Divide you portfolio into three parts. Buy large capitalization company index fund (S&P 500, DJA), small capitalization index fund (S&P 600) and developed market index fund or international index fund. It makes you portfolio more profitable and more stable.
