Are Index Funds Sound Investments?

Are index funds effective at growing your money? Will they generate 7% over the long term? The price for which you pay for one of these funds determines the returns.

Index funds managers buy the whole market or specific sectors of the market. The fund managers are continually purchasing shares in the fund at the current market prices. They are not waiting for the price of these stocks to get to an intrinsic value that is cheap. As money flows into the fund, they buy more shares in publicly traded businesses. If you purchase an index fund at the top of the market and the market crashes, you will have to wait until the prices of the stocks in that index fund reach their previous levels at which you bought it. That could take 20 years.

In our opinion, the most effective way to buy stocks is to buy individual stocks with high operating margins for low prices when the market is in extreme fear. Investing in stocks or private businesses requires valuation and patience.

ARTICLE: How is Value & Money Created in an Economy?
https://www.redtoblackpodcast.com/content/articles/how-is-value-money-created-in-a-economy

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