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A Financial Mystery: Investors Paying Tens of Billions of Dollars to Underperforming Mutual Funds -- When Index Funds are Cheaper and Perform Better

The Motley Fool

In 2021, investors paid almost $90 billion in total fees on about $14 trillion of actively managed mutual funds to an industry flogging a product demonstrably inferior to index funds. Active vs. passive funds It's quite a problem, and a seemingly puzzling one, too.

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Surprise: You're Probably Paying a Lot More in Investing Fees Than You Think

The Motley Fool

38% of mutual fund investors think they don't pay any mutual fund fees or expenses. If your broker is charging you for trades and you trade frequently enough, it might be worth switching brokerages. Expense ratios : An expense ratio is an annual fee charged by mutual funds and exchange-traded funds (ETFs).

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How Should a Beginner Invest in Stocks? 1 Simple Investment for a Lifetime of Security.

The Motley Fool

But let's focus on stock investing -- and i f there's one product that is perfect for beginners, it has to be exchange-traded funds (ETFs). In short, ETFs are like mutual funds , but they trade like stocks. That makes them accessible, cheap, and omnipresent.

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Nvidia Stock Is Joining the Dow Jones Industrial Average Stock Index and Intel Is Being Booted

The Motley Fool

A Dow index membership means that mutual funds and exchange-traded funds (ETFs) designed to track the Dow will have to buy shares of Nvidia. And the numbers speak for themselves: Amazon: if you invested $1,000 when we doubled down in 2010, you’d have $20,993 !*

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History Says Being Added to S&P 500 Will Have This Impact on Palantir Stock

The Motley Fool

stocks and there is an enormous amount of investor money tied to the index because so many exchange-traded funds (ETFs) and mutual funds track/mimic its performance. pps 2000 to 2010 +3.64 pps 2000 to 2010 -1.69 The index is widely viewed as the benchmark for U.S. percentage points during this period.

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Looking for a Simple and Safer Way to Invest in the Chip Industry? This ETF Could Be Your Best Option

The Motley Fool

Investors often like to turn to vehicles such as exchange-traded funds (ETFs) rather than individual stocks. The fund charges an ETF expense ratio of 0.35%. According to Morningstar, expense ratios average 0.36% for ETFs and mutual funds in 2023. This can be particularly true of semiconductor stocks.

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Think Hedge Funds Are Super Secret? They're Often Not -- and You Can Invest in Many of the Same Stocks.

The Motley Fool

What are hedge funds? A hedge fund has a lot in common with a standard actively managed mutual fund. Like a typical mutual fund , it pools the money of investors, and its managers decide how to invest that money. Hedge funds tend to charge significantly higher fees than mutual funds.