Keeping costs low can boost results in your stock, bond investments

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A Morningstar study reveals that passively managed index funds generally outperform actively managed funds.

Lower operating costs are a key factor in the superior performance of index funds.

This trend holds true for both stock and bond funds, especially over longer periods.

If there's one simple investment maxim that will improve your odds of success in any market climate, it's this: Keep your costs down.

This can be especially important with mutual funds and exchange-traded funds, as researcher Morningstar affirmed in a newly released study. The company found that funds of either type that buy and hold preselected baskets of stocks or bonds, as grouped in indexes, usually beat those managed by professionals trying to pick winners. The main reason: Index funds are