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Passive Index Investing: What You Need to Know

Are you ready to start investing but don’t want to spend all your time buying and selling? Or maybe you don’t want to spend all your money paying an adviser to do it for you. That’s where passive index investing comes in. It could be exactly what you need for your investments.

Passive index investing means you’ll ‘buy in’ on an index of accounts. But then you’re going to let them sit for an extended period. While some people love the idea of day trading (who hasn’t watched a movie with an active stock market scene set in New York City where everyone is yelling and running around?), it’s a lot more work than you might expect.

It also costs much money if you’re paying someone to do it for you. The next step down is still active trading but at a much slower pace. Active traders might trade daily but not continuously. Or they might trade less frequently but still maintain a strong handle on their current account setup.

With passive index investing, however, you don’t need to do any of that. What you do is buy and hold. So, you’ll invest in an index, a wide range of different accounts, and then let them sit. You don’t need to worry about selling them or buying new stocks (unless you want to, but that wouldn’t be passive investing).

Passive Index Investing for the Future

This type of investing can be suitable if you’re using the money for something in the distant future. Generally, a buy-and-hold strategy isn’t getting you a significant return quickly. It’s going to take time to reap the benefits. But that can be good too. It means you’re going to ride out the highs and lows with your account to see future benefits.

With passive investing, however, you need to leave your accounts alone. For some people, this can be challenging. Seeing negative changes in your investment reports can be difficult, and some people want to get out of those accounts fast. Unfortunately, the stock market is unpredictable, and getting out when things start down is not the way to go. That’s why passive investing is such an excellent option for some.

If you’re interested in learning more about passive index investing or if you’re ready to start yourself, make sure to contact Zacks Trade to find out more. You’ll be prepared to start your new investment portfolio in no time, and you’ll be glad that you did when it all pans out.

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