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Mutual Funds vs Index Funds in the USA: Costs, Risks, and Returns

Choosing an investment fund can feel confusing, especially for beginners in the United States. Two terms you will often come across are mutual funds and index funds. However, they are not direct opposites. A mutual fund describes a type of investment vehicle, while an index fund describes an investment strategy. An index fund can be structured as a mutual fund or an exchange-traded fund (ETF).

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