>funds are traditionally not FDIC insured Index funds (whether exchange-traded or not) have exactly the volatility of the bundle of stocks they track; of cours

>funds are traditionally not FDIC insured Index funds (whether exchange-traded or not) have exactly the volatility of the bundle of stocks they track; of course they aren't FDIC-insured, because they're investments and not savings accounts. But for index funds diverse enough and time horizons long enough they have really nice risk/reward characteristics that suit most people. If you go to Fidelity or Vanguard's website you can use automated tools to calculate the distribution of index funds, bonds, and cash equivalents that best suit your risk appetite and time horizon for growing a nest egg.