Index fund that tracks gold and other commodities
I don't know answers that would be specific to Canada but one of the main ETF funds that tracks gold prices is GLD (SPDR Gold Trust) another is IAU (iShares Gold Trust). Also, there are several ETF's that combine different precious metals together and can be traded. You can find a fairly decent list here on the Stock Encylopedia site. Barclays offers an iPath ETN (not quite an ETF), DJP, which tracks the total return of the Dow Jones-AIG Commodity Index.
As has been pointed out, one isn't cheaper than the other. One may have a lower price per share than the other, but that's not the same thing. Let's pretend that the total market valuation of all the stocks within the index was $10,000,000. (Look, I said let's pretend.) You want to invest $1,000. For the time being, let's also pretend that your purchasing 0.01% of all the stock won't affect prices anywhere. One company splits the index into 10,000 parts worth $1,000 each. The other splits the same index into 10,000,000 parts worth $1 each. Both track the underlying index perfectly. If you invest $1,000 with the first company, you get one part; if you invest $1,000 with the second, you get 1,000 parts. Ignoring spreads, transaction fees and the like, immediately after the purchase, both are worth exactly $1,000 to you. Now, suppose the index goes up 2%. The first company's shares of the index (of which you would have exactly one) are now worth $1,020 each, and the second company's shares of the index (of which you would have exactly 1,000) are worth $1.02 each. In each case, you now have index shares valued at $1,020 for a 2% increase ($1,020 / $1,000 = 1.02 = 102% of your original investment). As you can see, there is no reason to look at the price per share unless you have to buy in terms of whole shares, which is common in the stock market but not necessarily common at all in mutual funds. Because in this case, both funds track the same underlying index, there is no real reason to purchase one rather than the other because you believe they will perform differently. In an ideal world, the two will perform exactly equally. The way to compare the price of mutual funds is to look at the expense ratio. The lower the expense ratio is, the cheaper the fund is, and the less of your money is being eroded every day in fees. Unless you have some very good reason to do differently, that is how you should compare the price of any investment vehicles that track the same underlying commodity (in this case, the S&P 500). "Funds which track the same index may have different nominal prices.  From an investors point of view, this is not important.  What is important is that when the underlying index moves by a given percentage, the price of the tracking funds also move by an equal percentage.  In other words, if the S&P500 rises by 5%, then the price of those funds tracking the S&P500 will also rise by 5%.  Therefore, investing a given amount in any of the tracking funds will produce the same profit or loss, regardless of the nominal prices at which the individual funds are trading. To see this, use the ""compare"" function available on the popular online charting services. For example, in Google finance call up a chart of the S&P500 index, then use the compare textbox to enter the codes for the various ETFs tracking the S&P500.  You will see that they all track the S&P500 equally so that your relative returns will be equal from each of the tracking funds.  Any small difference in total returns will be attributable to management fees and expenses, which is why low fees are so important in passive investing." "The difficulty with investing in mining and gold company stocks is that they are subject to the same market forces as any other stocks, although they may whether those forces better in a crisis than other stocks do because they are related to gold, which has always been a ""flight to safety"" move for investors. Some investors buy physical gold, although you don't have to take actual delivery of the metal itself.  You can leave it with the broker-dealer you buy it from, much the way you don't have your broker send you stock certificates.  That way, if you leave the gold with the broker-dealer (someone reputable, of course, like APMEX or Monex) then you can sell it quickly if you choose, just like when you want to sell a stock. If you take delivery of a security (share certificate) or commodity (gold, oil, etc.) then before you can sell it, you have to return it to broker, which takes time.  The decision has much to do with your investing objectives and willingness to absorb risk.  The reason people choose mutual funds is because their money gets spread around a basket of stocks, so if one company in the fund takes a hit it doesn't wipe out their entire investment.  If you buy gold, you run the risk (low, in my opinion) of seeing big losses if, for some reason, gold prices plummet.  You're ""all in"" on one thing, which can be risky. It's a judgment call on your part, but that's my two cents' worth." I quite like the Canadian Couch Potato which provides useful information targeted at investors in Canada. They specifically provide some model portfolios. Canadian Couch Potato generally suggests investing in indexed ETFs or mutual funds made up of four components. One ETF or mutual fund tracking Canadian bonds, another tracking Canadian stocks, a third tracking US stocks, and a fourth tracking international stocks. I personally add a REIT ETF (BMO Equal Weight REITs Index ETF, ZRE), but that may complicate things too much for your liking. Canadian Couch Potato specifically recommends the Tangerine Streetwise Portfolio if you are looking for something particularly easy, though the Management Expense Ratio is rather high for my liking. Anyway, the website provides specific suggestions, whether you are looking for a single mutual fund, multiple mutual funds, or prefer ETFs. From personal experience, Tangerine's offerings are very, very simple and far cheaper than the 2.5% you are quoting. I currently use TD's e-series funds and spend only a few minutes a year rebalancing. There are a number of good ETFs available if you want to lower your overhead further, though Canadians don't get quite the deals available in the U.S. Still, you shouldn't be paying anything remotely close to 2.5%. Also, beware of tax implications; the website has several articles that cover these in detail. Also, when they mean SP500 fund - it means that fund which invests in the top 500 companies in the SP Index, is my understanding correct? Yes that is right. In reality they may not be able to invest in all 500 companies in same proportion, but is reflective of the composition. I wanted to know whether India also has a company similar to Vanguard which offers low cost index funds. Almost all mutual fund companies offer a NIFTY index fund, both as mutual fund as well as ETF. You can search for index fund and see the total assets to find out which is bigger compared to others. "i know that hedge funds shouldn't be compared with index funds. they do different things. they serve different functions. but when the headline is they are reporting big gains, and then they report that ""Ken Griffin’s main Wellington and Kensington funds at Citadel rose almost 7 percent."" YTD, and ""Andreas Halvorsen’s Viking and an equity-focused quantitative fund at Renaissance are up more than 9 percent this year through July"" as reporting ""Big Gains"" it's a little silly when an index fund like SCHB is up 10.7% YTD with an ER of 0.03." "Most people advocate a passively managed, low fee mutual fund that simply aims to track a given benchmark (say S&P 500). Few funds can beat the S&P consistently, so investors are often better served finding a no load passive fund. First thing I would do is ask your benefits rep why you don't have an option to invest in a Fidelity passive index fund like Spartan 500. Ideally young people would be heavy in equities and slowly divest for less risky stuff as retirement comes closer, and rebalance the portfolio regularly when market swings put you off risk targets. Few people know how to do this and actually do so. So there are mutual funds that do it for you, for a fee. These in are called ""lifecycle"" funds (The Freedom funds here).  I hesitate to recommend them because they're still fairly new. If you take a look at underlying assets, these things generally just reinvest in the broker's other funds, which themselves have expenses & fees. And there's all kinds personal situations that might lead to you place a portion with a different investment." Virgin and AMP Flexible Super both offer funds that track Australian indexes.