Decoder · Kinds of investments

Index

A published list of investments, chosen by written rules — for example, a list of large US companies, updated on a schedule. Nobody picks the list by gut feeling; the rules decide who is on it. Funds can then copy the list.

For your first $100: An index is just the list. Your $100 goes into a fund that follows a list like that — the fund is the thing you actually hold.

Stock, in plain words Share, in plain words Bond, in plain words

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See this word inside your order