Key Takeaways
- Indexing is a statistical measure for tracking economic data, like inflation and GDP growth.
- Indexes serve as benchmarks for assessing the performance of fund managers and portfolios.
- Passive investment strategies often use indexing to track market index returns, offering diversification and lower costs.
- Popular indexes include the S&P 500 and Dow Jones, which help track market and economic performance.
- Index funds generally have lower management fees and are more tax-efficient than actively managed funds.
What Is Indexing?
Indexing is the practice of compiling economic or financial market data into a single metric or comparing data to such a metric. In economics, indexes can directly impact people’s livelihoods, for…
