CONSIDERATIONS ON INVESTING IN INDEX FUNDS

People around the world are trying to find different solutions to keep their money. Not only will they keep money but also want to invest it to achieve capital growth on this investment. In common knowledge putting money in the bank is the best decision to save money while the interest rate programs in banks are three to four times lower than capital appreciation by placing savings within ETFs (Exchange Traded Funds), index funds or similar devices.The very idea of investing in shares can bring us to a defensive thinking of taking risks, but what happens if we think long-term? Banks currently offers an interest rate of 2-3% per year at a maximum rate of interest that is actually even lower after taxation. Investing in index funds can make a capital increase of up to 10% per year over a period of 5-10 years. Do these investments involve risk? Are these investments guaranteed? What is the liquidity of the money invested? These are some questions that we will try to answer in this article observing the reality that exists in their management and short history.