A relatively new type of mutual fund that tries to match the return of a certain index by owning the securities that make up the index. This is a form of passive investment management.
An index mutual fund owns a full participation in some portion of the stock market. An index fund matches the shareholdings of a target index, such as the Standard & Poor's 500 Composite Stock Price Index (S&P 500).
A passively managed mutual fund that attempts to reduce the risk associated with the selection of specific securities for investment by mirroring the performance of a specific index, such as the S&P REIT Composite Index.