The rest are primarily mid-cap stocks and a tiny sliver of small caps. VIG currently holds a little over 300 stocks, with nearly 83% large caps. Holdings are capped at a 4% weighting each. To be considered for the index, a stock must have a three-month median daily value traded of $1 million. Special cash payouts and stock dividends are excluded. Only regular quarterly cash dividends are considered for inclusion. Dividend Growers Index, a group of the best dividend stocks that have increased their annual dividend payments for 10 consecutive years. The fund tracks the performance of the S&P U.S. When it comes to the best index funds, the Vanguard Dividend Appreciation ETF ( VIG, $153.25) is an excellent choice if you value safety and income growth.

Expenses: 0.06%, or $6 annually for every $10,000 invested.This is a wide selection of the best ETFs and mutual funds that investors can choose from, including those with exposure to large-cap stocks, technology and international firms. Here are 9 of the best index funds to buy for various financial goals. 'Diversification reduces the risk of any one stock derailing your portfolio's performance.' 'They can include hundreds or even thousands of stocks or bonds across a range of sectors and sizes,' Hicks writes. What's more, index funds offer diversification. In early January, Malkiel released an updated 50th-anniversary edition of his book, which is considered one of the most influential pieces of writing on index funds. Malkiel is best known for his investment classic, A Random Walk Down Wall Street.

Each year about two-thirds of active managers underperform an index fund.' Echoing this, Princeton finance professor Burton Malkiel told CNBC in a January email interview that 'Standard & Poor's publishes annual reports showing how actively managed funds compare with index funds.

Best index funds