3 index funds I’d buy with £10k today

first_img3 index funds I’d buy with £10k today “This Stock Could Be Like Buying Amazon in 1997” I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner.But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared.What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations.And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Enter Your Email Address Rupert Hargreaves | Sunday, 12th January, 2020 The FTSE 250 might have experienced a strong 2019, but the index still appears to offer excellent value for money, considering its growth prospects and international diversification.As such, I think if you’re looking to invest £10,000 today, buying a low-cost FTSE 250 tracker fund is a great place to start.5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…FTSE 250 trackerAs tracker funds only replicate their underlying index, it’s pretty easy to choose the best one on the market because it’s all about cost. The lowest cost FTSE 250 tracker fund at the moment is HSBC’s FTSE 250 Index tracker.This fund charges an ongoing fee of 0.18%, although if you buy it through Hargreaves Lansdown, the cost falls to just 0.08%.Such a low fee you could help you grow your wealth rapidly over the long term. Since inception, the FTSE 250 has produced an average annual return of 12%, which would be enough to double your money every six years.Equity IncomeAnother low-cost tracker fund that appears to offer value at present is Vanguard’s FTSE UK Equity Income Index Fund. This aims to track the performance of the UK Equity Income Index, an index of the best income stocks listed on the London market.Unlike actively-managed equity income funds, Vanguard’s offering doesn’t try and pick investments. All the fund does is buy the stocks that make up the underlying equity index, so there’s no risk of a Neil Woodford-style disaster. There are 125 stocks in a portfolio with an average price-to-earnings (P/E) ratio of 13.2 and price-to-book (P/B) ratio of just 1.4.The fund’s average yield is 5.6%, which implies the investment could produce a growing passive income stream for investors and offer an attractive risk-reward profile at current levels. An annual management fee of only 0.14% sweetens the appeal and allows investors to buy a share in this well-diversified income fund for a minimal cost.US Index fundFinally, Legal & General’s US Index fund would make an attractive addition to any portfolio. This tracks the performance of the S&P 500, the world’s largest and most liquid stock market.While it’s a US market tracker made up of US companies, most of these businesses are global enterprises so, in many respects, the index is a global stock market.The S&P 500 has also produced the best returns of any major blue-chip stock market over the past 100 years or so. The index has produced an average annual return of around 9%. That compares to about 7% for the FTSE 100.With a management fee of 0.1% per annum, or 0.06% if you buy the fund through Hargreaves Lansdown, Legal & General’s offering is a fantastic way to gain exposure to the world’s largest stock market at minimal cost.The bottom lineThis relatively simple portfolio of index funds offers a mix of income and value as well as growth, which could improve your chances of building a substantial nest egg. It could even allow you to retire early. Rupert Hargreaves owns the FTSE U.K. Equity Income Index Fund. The Motley Fool UK has recommended Hargreaves Lansdown. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. 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