index funds 101

Generally speaking the more diversified your portfolio is, the less violent the short-term price moves.

While Index Fund investors will never generate better returns than the index their fund is tracking, they are more likely to match the long-term 10% average annual returns by buying and holding an index fund over a 10-year period, than they would trading stocks on their own.

The tradeoff however, is that you are giving up the opportunity to potentially outperform the market which can happen with individual stocks.