The S&P percentage that I reported on last week can also represent an Index fund and I just now realized that I really haven't discussed Index funds and how they differ from mutual funds.

So, let's take a look. Just a reminder that mutual funds are typically managed by someone else. You put your money into these funds and hold your breath while someone else makes the decisions about what to buy and sell. There is also a price tag for someone else providing us with this service. It also appears to take some of the fun out of investing, but is considered a valuable resource for many people.

Index funds are similarly run by someone else, only the stocks that make up these funds are the ones found in the major exchanges. The price for this service is typically less expensive than the costs associated with mutual funds.

We can invest our money in any of these funds, just remember that we're trying to beat the stock market and if we can't, the Fools encourage us to consider investing in a major index fund.

We looked at the S &P Index fund before and I've located several others for your review.

Quicken.com has a very nice description of the individual indexes and what they track.

Mutual Fund Café has an informative article on the pros and cons of both the Dow Jones Industrial Index and the S & P 500 Index.

And if you started from ground zero and knew absolutely nothing about the stock market, similar to me, test how much you've learned by reading the above article. I read it, it made sense to me and I understood it completely. Had I read that article 6 months ago, it may as well have been written in hieroglyphics.

We've come a long ways Moms. Let's keep going.

So, we're now perusing index funds and getting to know how they operate.

I also located an excellent article at Indexfunds.com entitled "Indexing Basics." When you invest using this type of strategy, it is called "indexing". The article also explains nicely this type of investing and why it appears to be a superior choice over and above investing in mutual funds. Its appeal is in the cost-savings of paying for "buying and selling" that many mutual fund managers engage in. Indexing does not do as much trading within the portfolio, but rather appears to do more "buying and holding."

And one more informative article at iVillage.com "What Are Index Funds?" with additional information about indexing.

And as I study my portfolio of stocks a little closer, I believe I own a mini-index fund of Web stocks. Remember that most of my stocks are in the little-riskier-than-others technology companies and one is the tried and true of the Dow. So, why am I and the Motley Fools using the S&P 500 to track my portfolio? Shouldn't I be using a NASDAQ index fund to see if I'm beating the stock market?

Aagh! More questions! Answers, hopefully, next time.

Thank you for joining me,

Joyce