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The Impact of Market Volatility on Low-Cost Index Funds

The Impact of Market Volatility on Low-Cost Index Funds

19 May 2025 | 7 mins read

Investors seeking a less expensive, passive investment strategy often turn to low-cost index funds. These funds track market indices and offer diversification at minimal expense. However, market volatility — the rapid and unpredictable movement of stock prices — can significantly influence their performance. While these funds aim to provide stable, long-term returns, understanding how they react to market fluctuations is essential for making informed investment decisions.

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