Nancy Graham CPA, CA, CIM, CFP, TEP

Portfolio Manager
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Is a “Basic” Index Fund Too Basic for You?

November 17, 2016 - 0 comments

Today, let’s tackle another question I often hear: “Nancy, why would I buy an index fund?”


I hear this question from successful professionals who have had to work hard for their wealth. I hear it from affluent families who worry they should be doing something more elaborate with their portfolio. I hear it from investors of modest means, who figure there must be better ways to stretch for the higher returns they want or need to earn.

In other words, an index fund’s greatest advantages – it’s potential to earn almost all of the returns a market has to deliver, without having to be incredibly clever or lucky to do so – is often instead perceived as a weakness. Index funds sometimes come across as so simple and so basic that they’re mistaken as only being appropriate for “dumb” money.

In today’s “No Dumb Question” video, I’ll cover why a transparently managed, low-cost index fund can sometimes be the right solution for even the smartest money around. I’ll also predicate the conversation with a related question of equal significance: What IS an index fund?

So, get ready to have your preconceived notions about index funds turned upside down. If you like what you hear, subscribe to my YouTube channel to stay in the “No Dumb Questions” loop. And please send me your own financial questions. No question is too basic here!

By: Nancy Graham with 0 comments.
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