Author Topic: Index Funds and their Specifics  (Read 1360 times)

Scubatoad

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Index Funds and their Specifics
« on: May 08, 2014, 06:21:06 AM »
Hello Community,

I was wanting to invest into an index Fund through my normal banking at USAA. This link: https://www.usaa.com/inet/imco_mutualfund/ImMutualFunds?FundGroup=IX is what I was looking through to select a fund.  As I was reading through them, I noticed that they say "Normally at least 80% of the portfolio's assets will be invested in stocks of companies or other financial instruments that are included in or correlated with securities in the" certain market.  Is that normal for most total market index funds?

Additionally, there are three numbers at the bottom of each fund that I do not fully understand - being expense ratios before reimbursement and after reimbursement.  I know you can clikc on them and it explains that they are:

"A measure of the expenses associated with operating a mutual fund before(or after) the fund's management reimburses the fund for some portion of the expenses. The expenses of the fund are divided by the fund's average net assets to arrive at a percentage amount."

I am a little unsure of when this fee is applied to the money.  If I put in $10k into the fund, i would pay .50% as a fee being $50, and then the after reimbursement would be as i drraw money out, its applied?

I am mainly just trying to figure out if these USAA funds are competitive with some of the other funds mentioned on this site, so that I can continue to do most of my banking in one spot.