Vanguard 500 Index Investor

• The first index fund corresponds to the Standard & Poor's (S&P) 500 Index. The S&P 500 contains 500 companies representing the broad range of business and industry in the United States. The Vanguard 500 Index Investor opened to investors in 1975. The fund's best one year return was 33.19 percent in 1997; the worst year was -37.02 percent return in 2008. The average annual return for the fund since inception is 10.62 percent as of December 31, 2010. The average performance for the ten-year period ending December 31, 2010 was only 1.30 percent.
  
  

S&P 500 Index Funds

• Index funds have become popular with investors. As of December, 2010 there were 160 S&P 500 index funds sponsored by various financial firms. The average return for the 107 S&P 500 index funds in existence for the past ten years was 0.90 percent. Returns vary depending on the securities in each fund, sales charges, expenses, fees and market conditions.
  
  

The Wilshire and Russell Indexes

• The Wilshire 5000 Total Market Index is one of the oldest indices, dating to 1970, and comprises most U.S. companies. Average annual performance for the ten-year period ending December 31, 2010, was 2.50 percent. The Russell 2000 Index of small companies averaged 6.33 percent for the ten-year period ending December 31, 2010. The iShares Russell 2000 index fund averaged 6.20 percent for the same time period. Low fees and expenses allow index mutual funds to come very close to market index performance.
  
  

Other Index Funds

• Today there are indices representing the broad domestic stock markets, and indices for specific market sectors such as precious metals, utilities, transportation, technology and real estate. There are indices representing international markets, regional markets, and individual countries. The MSCI EAFE index of international companies averaged returns of 1.06 percent for the period 2001 to 2010. There are also bond market index funds. The T-Bill 3-Month Index Trust averaged 2.12 percent for the 2001 to 2010 decade.