How to Invest in Non Profit Index Funds
An index fund is a passive type of mutual fund that mimics the performance of a securities market index. Unlike actively managed mutual funds, an index fund doesn't try to buy and sell securities to generate returns. Instead it purchases the same securities found in recognized indexes such as the S&P 500 or the NASDAQ. Because of the lack of active management, investors can expect lower annual fees for management with index funds. Some fund families operate as a "non-profit," which helps mitigate high fees as well.
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Instructions
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Locate non-profit mutual fund providers, companies operating as non-profit structures devoted to increasing investor returns.
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Contact the mutual fund provider and ask about the options for investing in index funds.
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Determine which index funds are available with the mutual fund provider. Choose an index in which you want to invest.
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Buy the fund directly from the fund provider or through your existing brokerage firm account. Keep in mind that there may be additional fees when purchasing a mutual fund through a brokerage account. Speak with your financial adviser about additional fees associated with your account.
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Tips & Warnings
Index funds are not FDIC insured and fluctuate in value. Evaluate all risks before investing in any mutual fund.
Read the prospectus for all fees associated with fund purchases. Just because a fund is offered by a non-profit doesn't mean it is the least expensive fund you can find.
