I've been reading up recently on Index Funds as a different way to invest my limited money, instead of letting it collect dust in a bank. I've read about a couple of the larger ones, Fidelity, Vanguard, S&P 500. I'm really just trying to wrap my head around exactly what the specifics of owning an Index Fund. I'm looking to invest a rather small amount (3,000 or so) and also not looking to park it for too long (1-2 years) How much do I get penalized or taxed for taking my gains out? What exactly is an expense ratio and how does it affect my initial costs for owning an Index Fund as well as what it will cost during the life of my investment in an Index Fund. Thanks a lot and if anything needs clarifying I will try to explain better.