What is the difference between a mutual fund an index fund?

Mutual fund is a group of different stocks, usually 100 or more.
An index fund is all the stocks in something like the Dow Jones 30, or it could all the stocks on the NYSE, or all the stocks in the utility arena.

There are several differences worth noting. 1. an index fund is more or less an unmanaged fund where as the classical mutual fund is managed by someone or someones. 2. an index fund generally has little or no year end realized gains. A managed fund might but maybe not this year. 3. an index fun normally has lower expense ratios (some of them anyway).

But there are so many screwball index funds popping up that it is getting difficult to tell the difference. Actually, it should be noted that an index fun is a sub class of mutual funds.

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