What Are Index Funds And How Do They Work?

Index funds are a type of mutual fund where the funds follow a portfolio so as to track the performance in the financial market index.

In index fund management, the portfolio fund manager does not pick up stocks manually to create strategies. Here, they create a portfolio, where the assets follow the securities of specific indices.

One of the major advantages of index funds is that it is less risky, and it also allows for a better diversification of your money.