new to investing

#1
Hello,

I just opened up a vanguard account. I put in some money into the vanguard s&p 500 index mutual fund. i read conflicting articles on dollar cost avaraging. what are your thoughts on this? also is this a good index to invest in? i notice that mutual fund price is $118 per share, and its counterpart 500 index in ETF fund is like $52 per share. is it better to invest in ETF being that I can get more shares per dollar?
 

yodlee99

Active Member
#2
Vanguard is a known name for low-cost mutual funds and ETFs, world-over. Do not invest looking at their current NAV but look at the potential growth in their NAV.
 

milind

Active Member
#3
Hello,

I just opened up a vanguard account. I put in some money into the vanguard s&p 500 index mutual fund. i read conflicting articles on dollar cost avaraging. what are your thoughts on this? also is this a good index to invest in? i notice that mutual fund price is $118 per share, and its counterpart 500 index in ETF fund is like $52 per share. is it better to invest in ETF being that I can get more shares per dollar?
Congratulations for taking the jump into world of investments. Please make sure you educate yourself with the investment basics before you go too far ahead.

- Performance of managed funds in US is questionable, ETFs should be able to provide you all the necessary instruments to invest, with reasonable cost and liquidity. All the major indexes have their ETF counterparts e.g. SPY (S&P500), QQQQ (NASDAQ100).
- Cost of individual unit of ETF/fund is not important
- You have posted this question on a site that specifically addresses Indian market. It differs significantly with US market.
- Lumpsum investment is not very good idea. Dollar cost averaging puts you in good habit of saving regularly. However, please do your own analysis (simple spreadsheet exercise with Monthly index data will suffice) to convince yourself.

-- Milind
 

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