Why invest in an index fund when you can just invest directly

Sure you can get the holding list of an ETF and buy the stocks outright, but why would you waste so much money in commissions doing that? You could buy VOO or SPY paying 1 cost of commissions or possibly free if your brokerage offers no commissions on ETFs, or you could buy all stocks in the S&P yourself paying 500x the commissions.

>>1514020
So the excessive fees involved make it a bad decision. If you were going to hold on to them for the long term it could be more profitable though, right?

>>1514032

No.

>>1514032
You would be exposed to much more risk holding only a few companies and you wouldn't replicate the index anyway.

>>1514013
Index funds generally have such low expense ratios (often around 0.1%), it isn't worth the expense to buy all of the stocks individually. Even if you were able to trade commission free, you'd still have to spend the time rebalancing your portfolio any time the index rebalances if you want to truly replicate the index.

>>1514037
>>1514043
>>1514051
Well that pretty much clears things up. Thanks guys.