Fidelity Zero Expense Ratio Index Funds

Investing
#1

Hello,

Thanks for breaking down ETF Vs. Index funds during last week’s office hours. I’ve been conducting additional research, and I have some questions.

1.	During my research, I came across FNILX, which is 1 of 4 of Fidelity's new zero-cost index funds. FNILX basically mirrors FXAIX and has slightly outperformed FXAIX since 2018. ***My question is, do you recommend investing in FNILX or the more established FXAIX index fund?***

Please see the pros and cons listed below.
Pros - FNILX has a zero Expense ratio
Cons - FNILX pays dividends once a year in December.

2.	**Do you think it's better to invest in total stock market index funds such as FZROX or FSKAX vs. index funds that track the S&P 500 that usually contains only large-cap stocks?** 

3.	**I read that's it's better to invest in index funds that track the S&P 500 in accounts like your 401k and Roth IRA rather than individual accounts since they both have incentives such as employee's match and tax savings. What are your thoughts?**

Thank you,
Mimo

#2

In the end, don’t index funds track similarly between the total market and the S&P 500?

If anything, the total market fund is less volatile. No/

1 Like
#3

It really doesn’t matter. Picking between US index funds is an extreme case of splitting hairs. Check out this article:

That said, I’d be more concerned about what you’re missing. i.e. if you just buy a US index fund, you don’t own an international fund or a bond fund. I might consider a target date fund as a simple way to have a more diverse portfolio.