Why Invest in Fidelity Total Market Index Fund?
Investors may consider choosing the Fidelity Total Market Index Fund as an efficient means for diversifying their portfolio and benefiting from global market opportunities. This fund invests in a wide variety of securities, such as domestic and international stocks, and is spread across large, mid and small cap stocks. This fund is not tied to any particular sector or industry, but instead allows for diversified exposure to many different investments.
Weighting the fund according to the size of the global stock markets is an effective way to achieve diversification and manage risk. With this fund, the US market represents almost 58% of the portfolio while the international markets make up nearly 42%. This global approach helps manage risk while expanding investment opportunities.
Benefits of Fidelity Total Market Index Fund
The Fidelity Total Market Index Fund provides a cost-effective way to gain access to a variety of investments while benefitting from professional management and regular rebalancing. This fund is managed by experienced investment professionals who use a passive management approach, which means that they are not actively selecting investments that they believe will outperform the market. This approach allows the fund to reduce management fees and expenses.
As investments in the fund are regularly rebalanced, the portfolio is kept up-to-date relative to the stock market. This helps ensure that investors remain properly diversified and that any risk associated with the fund is managed over time.
Risk Profile and Historical Performance
The Fidelity Total Market Index Fund has an average risk profile and is suitable for a variety of investment objectives. The fund has been in operation since July 31, 2016 and its historical performance has been strong. Over the past three years, the fund has outperformed the global stock market with an average annual return of over 10%.
As with all investments, there is risk associated with investing in the Fidelity Total Market Index Fund. It is important to take into consideration all personal objectives and assess any potential risks before investing.
The Fidelity Total Market Index Fund is a great option for investors who are interested in gaining exposure to a wide variety of stocks and benefiting from global market opportunities. This fund provides diversification and professional management and is suitable for a variety of investment objectives. Its historical performance has been strong, and investors should note the associated risk when evaluating whether to approach any investment.
Overview: Fidelity Total Market Index fund (FSKAX)
Fidelity Total Market Index Fund (FSKAX) is a passively managed fund offered by Fidelity Investments that seeks to track the performance of the US total stock market. This fund is an ETF, which, like mutual funds, generally trades at the net asset value (NAV) calculated at the end of each trading day. This fund is designed to provide exposure to a wide variety of stocks and is a great choice for investors seeking broad diversification over a range of asset classes. The main benefits of this ETF include low expenses, wide diversification, and potential tax savings due to its low turnover rate.
The Fidelity Total Market Index fund (FSKAX) is suitable for long-term investment and retirement accounts such as 401Ks and IRAs. The fund is passively managed; therefore, it does not contain any active management decisions. This type of fund has the advantage of being more tax-efficient and is less prone to the effects of trading costs and fees than an actively managed fund.
Rating and Performance Assessment
The Fidelity Total Market Index fund (FSKAX) has earned a 4 star rating from Morningstar, the independent rating agency, which rates most mutual funds. The fund has consistently outperformed its benchmark, the Bloomberg Barclays US Aggregate Bond Index, since inception in 2006. It has posted a consistent 10-year return of 10.05%, compared to 8.78% for its benchmark. It also has low volatility and low portfolio turnover, which is crucial for long-term investors. This fund was also being ranked 2 out of 11 among its Morningstar peers in the Moderate Target Risk category for three-year returns as of August 2019.
Fees and Expenses
The Fidelity Total Market Index Fund (FSKAX) offers some of the lowest fees compared with its competition. The fund has an expense ratio of only 0.005%, which is much lower than the 0.20% average for ETFs. Additionally, the fund does not charge any other fees for account maintenance or management, which can be a significant cost savings compared to actively managed funds. The fund also has no minimum investment and no transaction fees. Both of these features allow for more flexibility in managing individual accounts. Additionally, the fund has a high trading volume, which means investors can buy and sell their holdings quickly and easily.
In summary, the Fidelity Total Market Index Fund (FSKAX) provides investors with a great opportunity to gain exposure to the US stock market. The fund is passively managed, has low fees and expenses, and has a high trading volume. It also has consistently outperformed its benchmark and is suitable for long-term investments and retirement accounts. Investors should consider this fund for their portfolios to benefit from the potential tax savings and wide diversification.