Index Fund

Instead of picking individual stocks, an index fund holds all (or a representative slice) of the companies in a given market index, like the S&P 500, in roughly the same proportions. The goal isn't to outperform the market, it's to match it, cheaply and with minimal ongoing management. Decades of data show most actively managed funds fail to beat their index over the long run after fees, which is the core reason index funds have become the default recommendation in a lot of mainstream personal finance advice.