Vanguard and Fidelity are both major brokerage firms, with some of the largest client bases in the country. Each have broad financial offerings, from DIY brokerage accounts to financial advisors, robo-advisors and financial planning services. Vanguard is also widely known for its in-house selection of low-cost funds, as it runs a number of its own indexes. On the other hand, Fidelity offers in-depth investment tools that are great for veteran investors. Each firm has their own strengths and weaknesses, though, in relation to their fees, online experience and features. If you’d rather have someone who can help you invest and build a financial plan, consider working with a financial advisor.

Overview of Vanguard and Fidelity

There are few bigger names in the brokerage space than Vanguard and Fidelity. They consistently boast some of the largest client bases in the country, and for good reason. Both brokerages have extensive investing tools and platforms that make managing your investments and financial plans much easier.

Vanguard has long been known for its wide range of in-house index funds and exchange-traded funds (ETFs). If you’re looking to invest in funds, going directly to a main provider like Vanguard can significantly lower your costs. That’s because Vanguard can afford to offer lower expense ratios than other brokerages that allow you to invest in third-party funds.

While Vanguard stands out with its suite of funds, the brokerage is more limited when it comes to other offerings. However, it does allow investors to trade individual stocks and bonds. Conversely, Fidelity allows clients to invest in individual stocks, bonds, ETFs, options, mutual funds and more.

Vanguard vs. Fidelity: Fees

Fees are important to consider when picking a brokerage firm to open an account with. You’ll want to make sure that the fees are fair and within your budget, as an overbearing fee structure will have a large negative effect on your portfolio.

A commission-lowering wave has struck brokerage firms over the last couple years, and Fidelity and Vanguard have both followed suit. To trade stocks, ETFs, options and most mutual funds, clients of both firms will avoid commissions altogether. Options at Vanguard come with a minimal $1 contract fee, while Fidelity charges an even lower $ contract fee. There are also some transaction fee mutual funds that can incur costs, with Fidelity and Vanguard charging $ and $20 for them, respectively.

For bonds, Fidelity’s commission is cheaper at $1, as well as a $ fee if you initiate a broker-assisted transaction. Vanguard unfortunately doesn’t offer new issue bonds. However, its secondary market bonds come with a higher $25 broker-assisted fee.

Vanguard’s funds lower the expenses that ETFs charge to around %, which equates to about $10 per $10, invested. But with actively traded funds, investors may see expense ratios as high as %. Fidelity mutual fund costs can vary, but they often have expense ratios that are higher, especially for active funds. It’s no surprise that Vanguard is cheaper here, as the firm offers many of its own funds to clients.

In regards to account fees, Vanguard charges a $20 annual fee for brokerage and IRA accounts. On the other hand, Fidelity doesn’t charge anything. Vanguard has a few ways to waive this fee, including holding at least $10, in Vanguard ETFs and mutual funds, holding at least $50, in qualifying Vanguard assets, electing e-Statements or having an organization or trust account with a registered EIN.

Vanguard vs. Fidelity: Services and Features

Both Fidelity and Vanguard have a wide variety of low-cost mutual funds and ETFs. If you’re simply looking at the options offered by each firm, Fidelity has more options available. Vanguard has about 2, no-transaction-fee mutual funds and 1, commission-free ETFs, while Fidelity offers over 3, no-transaction-fee mutual funds.

However, when it comes to index funds, Vanguard offers the lowest expense ratio of any fund company on the market. Since Vanguard is essentially owned by its funds, which are then owned by the investors who hold the funds, expenses are minimized. However, many firms are trying to compete with Vanguard’s low-cost funds. Therefore, you may be able to find other firms that have lower expense ratios. In fact, depending on the funds you want to invest in, Fidelity may have funds with lower expense ratios.

Additionally, Fidelity has $0 account minimums and has several funds that have no minimums as well. While Vanguard also has a $0 account minimum the company often has fund minimums starting at $1, to $3, depending on the fund. Vanguard does not waive their minimums, even if you’re a repeat investor. But Vanguard may lower the minimums depending on the type of account that holds the funds, such as an educational savings account.

When it comes to investment options, both firms have offerings that may be suitable for your portfolio. If you’re unsure which firm has funds that meet your budget and investment objectives, you can compare funds by using each broker’s fund screener.

Fidelity and Vanguard both offer robo-advisor services, educational tools and mobile apps to help you better manage your money. However, for those who want to actively trade, Fidelity offers Active Trader Pro. This service helps investors stream data and customize charting. Vanguard doesn’t have a similar service.

For people who want investment advice, Vanguard has a hybrid robo-advisor service known as Vanguard Personal Advisor Services. This service has algorithms that help with portfolio construction and asset allocation. They also offer human advisors via phone or online who can help answer financial planning questions and concerns. Vanguard requires a $50, account minimum for this service and charges a % annual management fee.

Fidelity also offers a robo-advisor service known as Fidelity Go. This platform is best for self-directed investors, but also has brick-and-mortar locations where clients can find answers to some basic financial planning questions. If you don’t have a location in close proximity, you can also reach out to one of their call centers. There is no minimum for Fidelity Go, nor is there an annual fee if your account balance is less than $10, For accounts with a balance of $10, to $49,, there’s a $3 monthly fee. Any accounts above $50, are charged a % annual fee.

Vanguard vs. Fidelity: Online and Mobile Experience

Both brokerages have robust online and mobile experiences. So while each firm has features and investments that favor specific types of clients, the quality of their tools and platforms are unquestionably strong.

Vanguard’s trading platform and apps are fairly basic, in keeping with the general aesthetic of the company. You can do everything you need to do as a low-level investor; make trades, buy mutual funds and check your performance. The platforms don’t have all the bells and whistles an experienced investor might want, but for someone who just wants to manage a few basic investments, it works.

Fidelity, on the other hand, has a more complicated and extensive online and mobile experience. While this may be a bit overwhelming for someone without a ton of investing experience, if you have been trading for awhile, Fidelity may help you take your investing game to the next level.

In April , Vanguard’s mobile app has a major variance in its satisfaction level among users. For the Apple version, users rate it at stars out of 5 across over , reviews. But on the Google Play store, Android users rate it at just stars out of 5 across more than 5, reviews. The brokerage is releasing a new app called Vanguard Beacon, though, and it promises to have more features and tools for clients.

Fidelity’s mobile app has a much higher level of user approval than Vanguard’s does. In fact, more than million iPhone users have rated the app to an average of stars out of 5 in April And the app also holds a respectable star out of 5 rating on the Google Play store across more than 87, reviews.

Who Should Use Vanguard?

Vanguard built a reputation as a platform that creates and offers low-fee mutual funds and exchange-traded funds. This makes it a good brokerage for clients who want to make basic investments and not think too much about them.

In addition, if you want low-cost funds, Vanguard has also grown to offer stocks and bonds. Though, trading these individual equities is much more limited.

Vanguard might also make sense for clients who want to open an IRA and manage it in a very hands-off manner.

At its core, the brokerage is designed for investors who want a simple and straightforward experience. Its accounts and tools are easy to use, and its website boasts a number of educational resources. This makes it extremely welcoming to beginners.

Who Should Use Fidelity?

Fidelity is a robust trading platform that is known for its individual trading products, which include stocks and bonds.

Most clients would be happy with Fidelity, but it is especially suited for those with ample investing experience. Its advanced investment tools and platforms can be overwhelming if you’re a newbie. Beyond that, if you’re going to be making frequent trades, Fidelity is one of the best choices out there.

While Fidelity does not charge much for its investment resources, it is also worth noting that other brokerages and broker-dealers are shifting to fee-free investment models.

Keeping this in mind, you’d be hard-pressed to find a better selection of high-level tools at an established brokerage. Many competitors have smaller pools of potential investments and less overall reliability than Fidelity.

Bottom Line

If you want to actively trade within your accounts, Fidelity might be the better option. However, if you’re more focused on index investing, or you want to use a robo-advisor, Vanguard has a slight edge. While both institutions offer robo-advisors, Vanguard’s Personal Advisor Services, which is available to clients who can meet a $50, account minimum, offers a little more hands-on investment guidance and assistance with portfolio construction. Vanguard also has slightly lower expense ratios on their index funds.

If you want help with financial planning, mutual funds or retirement and brokerage accounts, both have great options. It’s best to compare costs and minimum account requirements of each firm and fund selection. By comparing your options you can discover the most suitable firm for your financial needs.

Tips for Investors

• Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors in your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
• If you decide to go with a brokerage, SmartAsset can recommend a few online options. Once you’ve considered the above factors and compared online brokerages, you’ll be in a position to find the best choice for you.

Photo credit: ©Vanguard/Fidelity, ©www.oldyorkcellars.com, ©Vanguard Beacon Apple Store Preview, ©Fidelity Investments Apple Store Preview, ©www.oldyorkcellars.com

Fidelity fairly recently entered the competitive space of low-cost ETFs, and their fees even beat Vanguard in some cases. Below we’ll check out some of the best Fidelity ETFs.

Disclosure:  Some of the links on this page are referral links. At no additional cost to you, if you choose to make a purchase or sign up for a service after clicking through those links, I may receive a small commission. This allows me to continue producing high-quality, ad-free content on this site and pays for the occasional cup of coffee. I have first-hand experience with every product or service I recommend, and I recommend them because I genuinely believe they are useful, not because of the commission I get if you decide to purchase through my links. Read more here.

Introduction – Fidelity ETFs

Fidelity is one of the oldest major brokerages. They closely rival and even beat Vanguard on things like fees, fractional shares, margin rates, etc.

Fidelity has ramped up its ETF offerings in recent years, in some cases with the lowest fees in the game. Weirdly though, Fidelity seems to keep its broad stock market index offerings (S&P , total U.S. stock market, etc.) as mutual funds; they don’t have ETFs available for these. Their ETF offerings focus more on factors, sectors, bonds, and actively managed funds. The factor funds are either very new or have extremely low AUM and are likely at risk of closure. The bond funds have unusually high fees. The sector funds, however, are the hidden gems in my opinion.

Let’s dive into the best Fidelity ETFs

FTEC – Fidelity MSCI Information Tech ETF

At the time of writing, Fidelity’s sector funds are the cheapest out there with expense ratios of %, compared to % for Vanguard. Given sufficient AUM and low tracking error, for any specific index, the Fidelity sector ETFs may be the way to go. FTEC is one of their most popular with over $5 billion in assets.

FUTY – Fidelity MSCI Utilities ETF

FUTY captures the Utilities sector via the MSCI USA IMI Utilities Index. I use a dash of FUTY in my own portfolio to diversify away from tech.

FREL – Fidelity MSCI Real Estate ETF

REITs deliver high dividends and exposure to the real estate market. FREL is one of the most affordable REIT ETFs.

Other Popular Fidelity ETFs Include:

• FSTA – Fidelity MSCI Consumer Staples ETF
• FDIS – Fidelity MSCI Consumer Discretionary ETF
• FENY – Fidelity MSCI Energy ETF
• FNCL – Fidelity MSCI Financials ETF
• FHLC – Fidelity MSCI Health Care ETF
• FIDU – Fidelity MSCI Industrials ETF
• FMAT – Fidelity MSCI Materials ETF
• FCOM – Fidelity MSCI Telecommunication Services ETF

Where To Buy These Fidelity ETFs

Luckily, all the above Fidelity ETFs should be available at any major broker. My choice is M1 Finance. The broker has zero trade commissions and zero account fees, and offers fractional shares, dynamic rebalancing, intuitive pie visualization, and a sleek, user-friendly interface and mobile app. I wrote a comprehensive review of M1 Finance here.

Disclosures:  I am long FUTY.

Interested in more Lazy Portfolios? See the full list here.

Disclaimer:  While I love diving into investing-related data and playing around with backtests, I am in no way a certified expert. I have no formal financial education. I am not a financial advisor, portfolio manager, or accountant. This is not financial advice, investing advice, or tax advice. The information on this website is for informational and recreational purposes only. Investment products discussed (ETFs, mutual funds, etc.) are for illustrative purposes only. It is not a recommendation to buy, sell, or otherwise transact in any of the products mentioned. Do your own due diligence. Past performance does not guarantee future returns. Read my lengthier disclaimer here.

Fidelity Investments has become the third asset manager to launch an actively managed ETF in a semitransparent wrapper.

The three new ETFs are modeled after existing mutual funds and use the same portfolio managers as those mutual funds. But because of some structural differences between mutual funds and ETFs, the new ETFs can only be described as “clonish,” according to Greg Friedman, Fidelity’s head of ETF management and strategy.

Fidelity’s launch follows semitransparent ETF launches by American Century in April and ClearBridge Investments in May.

What’s unique about the Fidelity launch is that this marks the first time the unique fund wrapper has been applied using a proxy-basket model to represent the underlying holdings.

Both American Century and ClearBridge licensed the technology from Precidian Investments, which uses a blind trust model to represent the underlying portfolio holdings.

Fidelity and Precidian represent two of the five companies that have received regulatory approval to license technology that enables the actively-managed ETFs to price and trade throughout the day while only reporting portfolio holdings on a quarterly basis like a mutual fund.

In addition to its own suite of funds, Fidelity is also anticipating a robust licensing business.

Goldman Sachs has already signed up to license Fidelity’s technology, and Friedman said 10 other asset managers have signed non-binding letters of intent.

“Our goal is to be a leader in this space,” he said. “We want Fidelity to be synonymous with active equity ETFs.”

To that end, Fidelity has filed with the Securities and Exchange Commission for exemptive relief to allow semitransparent ETFs for non-US equity and fixed income.

Currently, the SEC only allows semitransparent ETFs to invest in securities that trade at the same time the ETF is trading, which essentially limits the underlying investments to domestic stocks.

“I’m optimistic about it,” Friedman said. “I’ve been doing ETFs since and it’s always walk before you can run with the SEC. They want to see how these things work.”

Todd Rosenbluth, director of mutual fund and ETF research at CFRA, said the Fidelity brand will have a powerful impact on the growth of the new semitransparent wrapper.

“Fidelity has a well-established record of generating strong risk adjusted performance with active strategies as well as a prominent brand in the ETF market,” he said. “While the actively managed equity share remains small, Fidelity is likely to generate high interest among investors that seek the tax benefits and liquidity ETFs offer.”

The three new semitransparent funds are Fidelity Blue Chip Growth ETF (FBCG), Fidelity Blue Chip Value ETF (FBCV) and Fidelity New Millennium ETF (FMIL).

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[Updated in November after Fidelity and other major online brokers lowered their commission for online ETF trades to $0.]

What are the best index funds and ETFs for long-term investors using Fidelity? I have more money in Fidelity accounts than in Vanguard accounts. I will give my choices. These are purely my opinion. Fidelity didn&#;t make me write any of this.

All-In-One: Fidelity Freedom Index Funds

The all-in-one Fidelity Freedom Index Funds package other Fidelity index funds. You just pick one based on your target year and risk tolerance. They are convenient, low cost, broadly diversified, and automatically rebalanced. Unless you&#;d like to manage your own mix, these are great choices. All of them have no minimum investment requirement. You can literally start with just $1 and instantly have a low-cost globally diversified portfolio.

• Fidelity Freedom Index Fund (FJIFX, % net expense ratio)
• Fidelity Freedom Index Fund (FKIFX, % net expense ratio)
• Fidelity Freedom Index Fund (FLIFX, % net expense ratio)
• Fidelity Freedom Index Fund (FPIFX, % net expense ratio)
• Fidelity Freedom Index Fund (FQIFX, % net expense ratio)
• Fidelity Freedom Index Fund (FXIFX, % net expense ratio)
• Fidelity Freedom Index Fund (FIHFX, % net expense ratio)
• Fidelity Freedom Index Fund (FBIFX, % net expense ratio)
• Fidelity Freedom Index Fund (FIOFX, % net expense ratio)
• Fidelity Freedom Index Fund (FIPFX, % net expense ratio)
• Fidelity Freedom Index Fund (FDEWX, % net expense ratio)
• Fidelity Freedom Index Fund (FDKLX, % net expense ratio)

Please note these Fidelity Freedom Index Funds are not the same as the similarly named Fidelity Freedom Funds (without the word &#;Index&#; in the names). Read more in Fidelity Freedom Index Funds: Hidden Gems For Your IRA and k.

Mix Your Own &#; Index Funds and/or ETFs

Fidelity offers more than 20 Fidelity-branded index funds. All of them have no minimum investment requirement. Fidelity also charges no commission on all ETFs if you place the trades online. Whether you prefer mutual funds or ETFs, you can come up a great portfolio with only Fidelity index funds, only ETFs, or a mix-and-match between Fidelity index funds and ETFs.

US Broad Stock Market

Fidelity has an index fund Fidelity Total Market Index Fund (FSKAX) with an expense ratio of only %. Fidelity also offers a newer Fidelity ZERO Total Market Index Fund (FZROX) with 0% expense ratio.

Outside retirement accounts, an ETF is slightly more tax efficient. You can buy Vanguard Total Stock Market ETF (VTI, expense ratio %) or iShares Core S&P Total U.S. Stock Market ETF (ITOT, expense ratio %).

International Broad Stock Market

Fidelity&#;s index fund Fidelity Total International Index Fund (FTIHX, expense ratio %) is a well-rounded fund. It includes both developed and emerging markets and international small-caps. Fidelity also offers a newer Fidelity ZERO International Index Fund (FZILX) with 0% expense ratio, although it doesn&#;t cover international small-caps.

If you prefer an ETF, Vanguard Total International Stock ETF (VXUS, expense ratio %) and iShares Core MSCI Total International Stock ETF (IXUS, expense ratio %) both cover the same broad international stock markets.

US Fixed Income

Fidelity offers Fidelity U.S. Bond Index Fund (FXNAX, expense ratio %), which tracks the broad U.S. bond market. If you prefer an ETF, you can buy Vanguard Total Bond Market ETF (BND, expense ratio %) or iShares Core U.S. Aggregate Bond ETF (AGG, net expense ratio %).

For inflation-protected bonds, Fidelity offers Fidelity Inflation-Protected Bond Index Fund (FIPDX) with a % expense ratio. If you prefer an ETF, Schwab U.S. TIPS ETF (SCHP, expense ratio %) is a good choice.

Three-Fund Portfolio

The above three broad asset classes will cover pretty much everything anyone really needs. You just make two decisions:

1. How much in stocks versus bonds?
2. How much stocks in international?

Here&#;s an example of someone who answered 60% in stocks and 70% of stocks in international:

It translates into:

• 42% in U.S. stocks (60% * 70% = 42%)
• 18% in international stocks (60% * 30% = 18%)
• 40% in U.S. bonds

Then you will have a globally diversified portfolio.

Spice Up

It&#;s not necessary to go much beyond a three-fund portfolio but if you prefer to add to the broad coverage and overweight in certain areas, you still can.

US Small Cap Stocks

For US small cap stocks, Fidelity offers Fidelity Small Cap Index Fund (FSSNX, expense ratio %). If you prefer an ETF, you can buy iShares Core S&P Small-Cap ETF (IJR, expense ratio %), Vanguard Small-Cap ETF (VB, expense ratio %), Schwab US Small-Cap ETF (SCHA, expense ratio %), or SPDR Portfolio Small Cap ETF (SPSM, expense ratio %).

For US small cap value stocks, Fidelity offers Fidelity Small Cap Value Index Fund (FISVX, expense ratio %). If you prefer an ETF, you can buy Vanguard Small-Cap Value ETF (VBR, expense ratio %) or SPDR S&P Small Cap Value ETF (SLYV, expense ratio %).

US REITs

Fidelity offers Fidelity Real Estate Index Fund (FSRNX, expense ratio %). Good ETF choices include Vanguard Real Estate ETF (VNQ, expense ratio %), Schwab U.S. REIT ETF (SCHH, expense ratio %) and iShares Core U.S. REIT ETF (USRT, expense ratio %).

Emerging Markets

Fidelity offers Fidelity Emerging Markets Index Fund (FPADX) with a % expense ratio. If you prefer an ETF, you can buy Vanguard FTSE Emerging Markets ETF (VWO, expense ratio %), iShares Core MSCI Emerging Markets ETF (IEMG, expense ratio %) or SPDR Portfolio Emerging Markets ETF (SPEM, expense ratio %).

International Small Cap Stocks

Fidelity doesn&#;t offer an index fund for international small cap stocks. If you prefer to overweight international small cap stocks, you can buy Vanguard FTSE All-World ex-US Small-Cap ETF (VSS, expense ratio %).

***

For broad diversification with the easiest way to manage, just one Fidelity Freedom Index Fund will do. Just pick a year closest to your planned retirement age.

If I&#;m doing my own mix, I would use these:

1. Fidelity Total Market Index Fund (FSKAX), Fidelity ZERO Total Market Index Fund (FZROX) or Vanguard Total Stock Market ETF (VTI) for US stocks;
2. Fidelity Total International Index Fund (FTIHX) or Vanguard Total International Stock ETF (VXUS) for international stocks;
3. Fidelity U.S. Bond Index Fund (FXNAX) or Vanguard Total Bond Market ETF (BND) for US bonds. Maybe add some Fidelity Inflation-Protected Bond Index Fund (FIPDX) or Schwab U.S. TIPS ETF (SCHP) for inflation protection.

If I&#;d like to spice it up a little more with a higher risk, I would add some of the supporting players to the  core index funds/ETFs, maybe maximum 3 more funds/ETFs. Anything more than that would be an overkill.

Say No To Management Fees

If you are paying an advisor a percentage of your assets, you are paying x too much. Learn how to find an independent advisor, pay for advice, and only the advice.

Find Advice-Only

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* Prices do not include sales tax.

[Updated in November after Fidelity and other major online brokers lowered their commission for online ETF trades to $0.]

What are the best index funds and ETFs for long-term investors using Fidelity? I have more money in Fidelity accounts than in Vanguard accounts. I will give my choices. These are purely my opinion. Fidelity didn&#;t make me write any of this.

All-In-One: Fidelity Freedom Index Funds

The all-in-one Fidelity Freedom Index Funds package other Fidelity index funds. You just pick one based on your target year and risk tolerance. They are convenient, low cost, broadly diversified, and automatically rebalanced. Unless you&#;d like to manage your own mix, these are great choices. All of them have no minimum investment requirement. You can literally start with just $1 and instantly have a low-cost globally diversified portfolio.

• Fidelity Freedom Index Fund (FJIFX, % net expense ratio)
• Fidelity Freedom Index Fund (FKIFX, % net expense ratio)
• Fidelity Freedom Index Fund (FLIFX, % net expense ratio)
• Fidelity Freedom Index Fund (FPIFX, % net expense ratio)
• Fidelity Freedom Index Fund (FQIFX, % net expense ratio)
• Fidelity Freedom Index Fund (FXIFX, % net expense ratio)
• Fidelity Freedom Index Fund (FIHFX, % net expense ratio)
• Fidelity Freedom Index Fund (FBIFX, % net expense ratio)
• Fidelity Freedom Index Fund (FIOFX, % net expense ratio)
• Fidelity Freedom Index Fund (FIPFX, % net expense ratio)
• Fidelity Freedom Index Fund (FDEWX, % net expense ratio)
• Fidelity Freedom Index Fund (FDKLX, % net expense ratio)

Please note these Fidelity Freedom Index Funds are not the same as the similarly named Fidelity Freedom Funds (without the word &#;Index&#; in the names). Read more in Fidelity Freedom Index Funds: Hidden Gems For Your IRA and k.

Mix Your Own &#; Index Funds and/or ETFs

Fidelity offers more than 20 Fidelity-branded index funds. All of them have no minimum investment requirement. Fidelity also charges no commission on all ETFs if you place the trades online. Whether you prefer mutual funds or ETFs, you can come up a great portfolio with only Fidelity index funds, only ETFs, or a mix-and-match between Fidelity index funds and ETFs.

US Broad Stock Market

Fidelity has an index fund Fidelity Total Market Index Fund (FSKAX) with an expense ratio of only %. Fidelity also offers a newer Fidelity ZERO Total Market Index Fund (FZROX) with 0% expense ratio.

Outside retirement accounts, an ETF is slightly more tax efficient. You can buy Vanguard Total Stock Market ETF (VTI, expense ratio %) or iShares Core S&P Total U.S. Stock Market ETF (ITOT, expense ratio %).

International Broad Stock Market

Fidelity&#;s index fund Fidelity Total International Index Fund (FTIHX, expense ratio %) is a well-rounded fund. It includes both developed and emerging markets and international small-caps. Fidelity also offers a newer Fidelity ZERO International Index Fund (FZILX) with 0% expense ratio, although it doesn&#;t cover international small-caps.

If you prefer an ETF, Vanguard Total International Stock ETF (VXUS, expense ratio %) and iShares Core MSCI Total International Stock ETF (IXUS, expense ratio %) both cover the same broad international stock markets.

US Fixed Income

Fidelity offers Fidelity U.S. Bond Index Fund (FXNAX, expense ratio %), which tracks the broad U.S. bond market. If you prefer an ETF, you can buy Vanguard Total Bond Market ETF (BND, expense ratio %) or iShares Core U.S. Aggregate Bond ETF (AGG, net expense ratio %).

For inflation-protected bonds, Fidelity offers Fidelity Inflation-Protected Bond Index Fund (FIPDX) with a % expense ratio. If you prefer an ETF, Schwab U.S. TIPS ETF (SCHP, expense ratio %) is a good choice.

Three-Fund Portfolio

The above three broad asset classes will cover pretty much everything anyone really needs. You just make two decisions:

1. How much in stocks versus bonds?
2. How much stocks in international?

Here&#;s an example of someone who answered 60% in stocks and 70% of stocks in international:

It translates into:

• 42% in U.S. stocks (60% * 70% = 42%)
• 18% in international stocks (60% * 30% = 18%)
• 40% in U.S. bonds

Then you will have a globally diversified portfolio.

Spice Up

It&#;s not necessary to go much beyond a three-fund portfolio but if you prefer to add to the broad coverage and overweight in certain areas, you still can.

US Small Cap Stocks

For US small cap stocks, Fidelity offers Fidelity Small Cap Index Fund (FSSNX, expense ratio %). If you prefer an ETF, you can buy iShares Core S&P Small-Cap ETF (IJR, expense ratio %), Vanguard Small-Cap ETF (VB, expense ratio %), Schwab US Small-Cap ETF (SCHA, expense ratio %), or SPDR Portfolio Small Cap ETF (SPSM, expense ratio %).

For US small cap value stocks, Fidelity offers Fidelity Small Cap Value Index Fund (FISVX, expense ratio %). If you prefer an ETF, you can buy Vanguard Small-Cap Value ETF (VBR, expense ratio %) or SPDR S&P Small Cap Value ETF (SLYV, expense ratio %).

US REITs

Fidelity offers Fidelity Real Estate Index Fund (FSRNX, expense ratio %). Good ETF choices include Vanguard Real Estate ETF (VNQ, expense ratio %), Schwab U.S. REIT ETF (SCHH, expense ratio %) and iShares Core U.S. REIT ETF (USRT, expense ratio %).

Emerging Markets

Fidelity offers Fidelity Emerging Markets Index Fund (FPADX) with a % expense ratio. If you prefer an ETF, you can buy Vanguard FTSE Emerging Markets ETF (VWO, expense ratio %), iShares Core MSCI Emerging Markets ETF (IEMG, expense ratio %) or SPDR Portfolio Emerging Markets ETF (SPEM, expense ratio %).

International Small Cap Stocks

Fidelity doesn&#;t offer an index fund for international small cap stocks. If you prefer to overweight international small cap stocks, you can buy Vanguard FTSE All-World ex-US Small-Cap ETF (VSS, expense ratio %).

***

For broad diversification with the easiest way to manage, just one Fidelity Freedom Index Fund will do. Just pick a year closest to your planned retirement age.

If I&#;m doing my own mix, I would use these:

1. Fidelity Total Market Index Fund (FSKAX), Fidelity ZERO Total Market Index Fund (FZROX) or Vanguard Total Stock Market ETF (VTI) for US stocks;
2. Fidelity Total International Index Fund (FTIHX) or Vanguard Total International Stock ETF (VXUS) for international stocks;
3. Fidelity U.S. Bond Index Fund (FXNAX) or Vanguard Total Bond Market ETF (BND) for US bonds. Maybe add some Fidelity Inflation-Protected Bond Index Fund (FIPDX) or Schwab U.S. TIPS ETF (SCHP) for inflation protection.

If I&#;d like to spice it up a little more with a higher risk, I would add some of the supporting players to the  core index funds/ETFs, maybe maximum 3 more funds/ETFs. Anything more than that would be an overkill.

Say No To Management Fees

If you are paying an advisor a percentage of your assets, you are paying x too much. Learn how to find an independent advisor, pay for advice, and only the advice.

Find Advice-Only

Investing can be overwhelming for many new investors.

With so much money on the line, they&#;re worried that might make a mistake with even the most simple of investing tasks.

It&#;s like when you had to suture your first laceration in medical school. You were probably so nervous that you were going to screw it up and mess up that patient&#;s leg forever.

So we&#;re going to go really basic with this post, and discuss the process of how to buy a mutual fund.

Step 1: Picking a Mutual Fund

I am a big advocate for index funds, because these funds hold hundreds or thousands of stocks or bonds within a single investment. Because they are tracking an index that does not change often, it costs very little to manage an index fund, and those savings are passed on to you, the investor.

I think a diversified portfolio can be done with just three index funds. Here&#;s the list of mutual funds for a simple three-fund portfolio of U.S. stocks, international stocks, and U.S. bonds at Vanguard, Fidelity, and Schwab:

In general, when selecting your index fund, you should stick with the mutual fund company where you invest your money (i.e. invest in Vanguard funds in a Vanguard investment account and invest in Fidelity funds in a Fidelity investment account).

For example, if you try to invest in a Vanguard index fund from a Fidelity investment account, Fidelity will charge a $75 transaction fee, while it is free (not even a trading commission is charged) to invest in Fidelity mutual funds at Fidelity.

Step 2: Make sure that the mutual fund is the right investment and not an ETF

Sometimes a mutual fund is not the right way to invest in an index fund. Exchange-traded funds (ETF for short) are alternatives to mutual funds. They are essentially stock versions of mutual funds. These ETFs can be traded on the exchange just like any other stock. It&#;s slightly more complicated (but still really easy) to buy ETFs.

Here are the three major scenarios when you would prefer an ETF over a mutual fund in index investing:

1. You don&#;t have enough money to invest in the Premium share class

Fidelity (and Vanguard) have multiple share classes of the same mutual fund. For regular investors, the Fidelity share classes are the Investor Class and the Premium Class. The Premium Class has a $10, minimum investment, and has lower management fees (expense ratio) than the Investor Class. However, the ETF version of the mutual fund often has the same low expense ratio as the Premium class Mutual Fund. So if you don&#;t have enough money to invest in the Premium class of index fund, then you should invest in an ETF.

2. You are investing in a taxable account at a non-Vanguard brokerage

ETFs are more tax-efficient than mutual funds at Fidelity and Schwab (they are equivalent at Vanguard). Therefore, the after-tax return of ETFs are higher than that of mutual funds at Fidelity and Schwab. I invest in ETFs in my taxable accounts and mutual funds in my retirement accounts. Check out this article for more information on how to buy an ETF.

3. You prefer ETFs over mutual funds

Some people simply prefer ETFs over mutual funds. They like the concept of being able to trade an ETF intraday and can watch the price of their investment fluctuate during the trading day.

Step 3: Buy the mutual fund

Unlike stocks, you don&#;t buy mutual funds in an open market. The upside of this is that you can buy or sell your mutual fund at any time of day. This is particularly convenient if you&#;re busy at work all day and don&#;t have time to make a trade on your phone or at a computer during the normal trading hours of am &#; pm (don&#;t the traders have it nice &#; only hours of work!).

You don&#;t have to worry about market or limit orders, or the best time of day to trade. You&#;ll get the same price on your trade, whether you make the purchase at noon or at midnight.

Step 4: Enter trade information

Now let&#;s enter the trade information. I&#;ll go through how to buy a mutual fund with Fidelity, but the process at Vanguard, Schwab, or another broker will be similar.

Symbol

First, enter the ticker symbol into the &#;Symbol&#; section. For this example, let&#;s buy the Fidelity® Total Market Index Fund &#; Premium Class (FSTVX). The screen will transform into a mutual fund page with many fewer options.

Dollar Amount

Now all you need to enter is the amount you want to buy.

One of the benefits of a mutual fund over an ETF is that you don&#;t need to calculate fractional shares. If you want to invest $15, (or $15,), you can do that with mutual funds because they allow fractional shares. You have to purchase ETFs in whole share amounts, which means that you will need to calculate how many shares the amount of money you want to invest converts to.

Submit Order

Click Preview Order and then submit.

You&#;ll notice that there is no commission for purchasing a mutual fund.

The order does not &#;fill&#; instantaneously like a market order for a stock or ETF would, but you&#;ll get a message that the money will be invested at the &#;next available price.&#; The next available price is usually at the end of the current trading day during regular market hours, or the end of the next trading day if you trade outside market hours.

In any event, you can check your order at that time and confirm that your trade is completed and your money is invested in the mutual fund.

Conclusion

If you need any help with investing in a mutual fund at Fidelity, you can click on the &#;Help Me Trade&#; button at the top left corner of the trading window, or call customer service. Remember to have them help you enter the order online rather than have them place the order for you.

Investing your money isn&#;t complicated &#; and the major brokerages try to make it as simple as possible.

What do you think? Do you use primarily ETFs, mutual funds, or a mix of both in your investment accounts?

LOS ANGELES, April 29, — Capital Group, home of American Funds and one of the world’s largest investment management firms, has filed an application for exemptive relief with the Securities and Exchange Commission based on Fidelity’s active equity ETF methodology.

Earlier this year, Capital Group announced it will offer the firm’s first actively managed exchange-traded funds (ETFs). Capital Group plans to launch both equity and fixed income ETF strategies early in

“ETFs will be an important extension to our current suite of investment solutions,” said Holly Framsted, CFA, head of ETFs, Capital Group. “Fidelity’s innovative structure is one of the solutions we’ll consider as we plan for a robust ETF launch in early ”

Fidelity’s active equity ETF model employs a “tracking basket” methodology which maintains the benefits of the ETF structure, provides information to market participants to promote efficient trading of shares, and preserves the ability to add value through active management.

“We are excited for the opportunity to partner with Capital Group,” said Fidelity’s Head of ETF Management and Strategy Greg Friedman. “Fidelity is committed to the active equity ETF space, and our innovative methodology is designed to operate seamlessly within the existing ETF market.”

Since its founding in , Capital Group has evolved its offerings, starting with mutual funds and expanding into other services, including target date funds, Luxembourg funds, model portfolios, collective investment trusts and separately managed accounts.

“As we pursue superior long-term investment results for our investors, the introduction of ETFs continues our strategy of expanding choice for financial professionals, increasing their ability to select the vehicle most appropriate for their client’s long-term goals,” added Framsted.

About Capital Group

Celebrating its 90^th anniversary in , Capital Group, home of American Funds, has been singularly focused on delivering superior results for long-term investors using high-conviction portfolios, rigorous research and individual accountability. As of December 31, , Capital Group manages more than $ trillion in equity and fixed income assets for millions of individuals and institutional investors around the world.

Capital Group manages equity assets through three investment groups. These groups make investment and proxy voting decisions independently. Fixed income investment professionals provide fixed income research and investment management across the Capital organization; however, for securities with equity characteristics, they act solely on behalf of one of the three equity investment groups.

For more information, visit www.oldyorkcellars.com.

Fidelity fairly recently entered the competitive space of low-cost ETFs, and their fees even beat Vanguard in some cases. Below we’ll check out some of the best Fidelity ETFs.

Disclosure:  Some of the links on this page are referral links. At no additional cost to you, if you choose to make a purchase or sign up for a service after clicking through those links, I may receive a small commission. This allows me to continue producing high-quality, ad-free content on this site and pays for the occasional cup of coffee. I have first-hand experience with every product or service I recommend, and I recommend them because I genuinely believe they are useful, not because of the commission I get if you decide to purchase through my links. Read more here.

Introduction – Fidelity ETFs

Fidelity is one of the oldest major brokerages. They closely rival and even beat Vanguard on things like fees, fractional shares, margin rates, etc.

Fidelity has ramped up its ETF offerings in recent years, in some cases with the lowest fees in the game. Weirdly though, Fidelity seems to keep its broad stock market index offerings (S&P , total U.S. stock market, etc.) as mutual funds; they don’t have ETFs available for these. Their ETF offerings focus more on factors, sectors, bonds, and actively managed funds. The factor funds are either very new or have extremely low AUM and are likely at risk of closure. The bond funds have unusually high fees. The sector funds, however, are the hidden gems in my opinion.

Let’s dive into the best Fidelity ETFs

FTEC – Fidelity MSCI Information Tech ETF

At the time of writing, Fidelity’s sector funds are the cheapest out there with expense ratios of %, compared to % for Vanguard. Given sufficient AUM and low tracking error, for any specific index, the Fidelity sector ETFs may be the way to go. FTEC is one of their most popular with over $5 billion in assets.

FUTY – Fidelity MSCI Utilities ETF

FUTY captures the Utilities sector via the MSCI USA IMI Utilities Index. I use a dash of FUTY in my own portfolio to diversify away from tech.

FREL – Fidelity MSCI Real Estate ETF

REITs deliver high dividends and exposure to the real estate market. FREL is one of the most affordable REIT ETFs.

Other Popular Fidelity ETFs Include:

• FSTA – Fidelity MSCI Consumer Staples ETF
• FDIS – Fidelity MSCI Consumer Discretionary ETF
• FENY – Fidelity MSCI Energy ETF
• FNCL – Fidelity MSCI Financials ETF
• FHLC – Fidelity MSCI Health Care ETF
• FIDU – Fidelity MSCI Industrials ETF
• FMAT – Fidelity MSCI Materials ETF
• FCOM – Fidelity MSCI Telecommunication Services ETF

Where To Buy These Fidelity ETFs

Luckily, all the above Fidelity ETFs should be available at any major broker. My choice is M1 Finance. The broker has zero trade commissions and zero account fees, and offers fractional shares, dynamic rebalancing, intuitive pie visualization, and a sleek, user-friendly interface and mobile app. I wrote a comprehensive review of M1 Finance here.

Disclosures:  I am long FUTY.

Interested in more Lazy Portfolios? See the full list here.

Disclaimer:  While I love diving into investing-related data and playing around with backtests, I am in no way a certified expert. I have no formal financial education. I am not a financial advisor, portfolio manager, or accountant. This is not financial advice, investing advice, or tax advice. The information on this website is for informational and recreational purposes only. Investment products discussed (ETFs, mutual funds, etc.) are for illustrative purposes only. It is not a recommendation to buy, sell, or otherwise transact in any of the products mentioned. Do your own due diligence. Past performance does not guarantee future returns. Read my lengthier disclaimer here.

Vanguard and Fidelity are both major brokerage firms, with some of the largest client bases in the country. Each have broad financial offerings, from DIY brokerage accounts to financial advisors, robo-advisors and financial planning services. Vanguard is also widely known for its in-house selection of low-cost funds, as it runs a number of its own indexes. On the other hand, Fidelity offers in-depth investment tools that are great for veteran investors. Each firm has their own strengths and weaknesses, though, in relation to their fees, online experience and features. If you’d rather have someone who can help you invest and build a financial plan, consider working with a financial advisor.

Overview of Vanguard and Fidelity

There are few bigger names in the brokerage space than Vanguard and Fidelity. They consistently boast some of the largest client bases in the country, and for good reason. Both brokerages have extensive investing tools and platforms that make managing your investments and financial plans much easier.

Vanguard has long been known for its wide range of in-house index funds and exchange-traded funds (ETFs). If you’re looking to invest in funds, going directly to a main provider like Vanguard can significantly lower your costs. That’s because Vanguard can afford to offer lower expense ratios than other brokerages that allow you to invest in third-party funds.

While Vanguard stands out with its suite of funds, the brokerage is more limited when it comes to other offerings. However, it does allow investors to trade individual stocks and bonds. Conversely, Fidelity allows clients to invest in individual stocks, bonds, ETFs, options, mutual funds and more.

Vanguard vs. Fidelity: Fees

Fees are important to consider when picking a brokerage firm to open an account with. You’ll want to make sure that the fees are fair and within your budget, as an overbearing fee structure will have a large negative effect on your portfolio.

A commission-lowering wave has struck brokerage firms over the last couple years, and Fidelity and Vanguard have both followed suit. To trade stocks, ETFs, options and most mutual funds, clients of both firms will avoid commissions altogether. Options at Vanguard come with a minimal $1 contract fee, while Fidelity charges an even lower $ contract fee. There are also some transaction fee mutual funds that can incur costs, with Fidelity and Vanguard charging $ and $20 for them, respectively.

For bonds, Fidelity’s commission is cheaper at $1, as well as a $ fee if you initiate a broker-assisted transaction. Vanguard unfortunately doesn’t offer new issue bonds. However, its secondary market bonds come with a higher $25 broker-assisted fee.

Vanguard’s funds lower the expenses that ETFs charge to around %, which equates to about $10 per $10, invested. But with actively traded funds, investors may see expense ratios as high as %. Fidelity mutual fund costs can vary, but they often have expense ratios that are higher, especially for active funds. It’s no surprise that Vanguard is cheaper here, as the firm offers many of its own funds to clients.

In regards to account fees, Vanguard charges a $20 annual fee for brokerage and IRA accounts. On the other hand, Fidelity doesn’t charge anything. Vanguard has a few ways to waive this fee, including holding at least $10, in Vanguard ETFs and mutual funds, holding at least $50, in qualifying Vanguard assets, electing e-Statements or having an organization or trust account with a registered EIN.

Vanguard vs. Fidelity: Services and Features

Both Fidelity and Vanguard have a wide variety of low-cost mutual funds and ETFs. If you’re simply looking at the options offered by each firm, Fidelity has more options available. Vanguard has about 2, no-transaction-fee mutual funds and 1, commission-free ETFs, while Fidelity offers over 3, no-transaction-fee mutual funds.

However, when it comes to index funds, Vanguard offers the lowest expense ratio of any fund company on the market. Since Vanguard is essentially owned by its funds, which are then owned by the investors who hold the funds, expenses are minimized. However, many firms are trying to compete with Vanguard’s low-cost funds. Therefore, you may be able to find other firms that have lower expense ratios. In fact, depending on the funds you want to invest in, Fidelity may have funds with lower expense ratios.

Additionally, Fidelity has $0 account minimums and has several funds that have no minimums as well. While Vanguard also has a $0 account minimum the company often has fund minimums starting at $1, to $3, depending on the fund. Vanguard does not waive their minimums, even if you’re a repeat investor. But Vanguard may lower the minimums depending on the type of account that holds the funds, such as an educational savings account.

When it comes to investment options, both firms have offerings that may be suitable for your portfolio. If you’re unsure which firm has funds that meet your budget and investment objectives, you can compare funds by using each broker’s fund screener.

Fidelity and Vanguard both offer robo-advisor services, educational tools and mobile apps to help you better manage your money. However, for those who want to actively trade, Fidelity offers Active Trader Pro. This service helps investors stream data and customize charting. Vanguard doesn’t have a similar service.

For people who want investment advice, Vanguard has a hybrid robo-advisor service known as Vanguard Personal Advisor Services. This service has algorithms that help with portfolio construction and asset allocation. They also offer human advisors via phone or online who can help answer financial planning questions and concerns. Vanguard requires a $50, account minimum for this service and charges a % annual management fee.

Fidelity also offers a robo-advisor service known as Fidelity Go. This platform is best for self-directed investors, but also has brick-and-mortar locations where clients can find answers to some basic financial planning questions. If you don’t have a location in close proximity, you can also reach out to one of their call centers. There is no minimum for Fidelity Go, nor is there an annual fee if your account balance is less than $10, For accounts with a balance of $10, to $49,, there’s a $3 monthly fee. Any accounts above $50, are charged a % annual fee.

Vanguard vs. Fidelity: Online and Mobile Experience

Both brokerages have robust online and mobile experiences. So while each firm has features and investments that favor specific types of clients, the quality of their tools and platforms are unquestionably strong.

Vanguard’s trading platform and apps are fairly basic, in keeping with the general aesthetic of the company. You can do everything you need to do as a low-level investor; make trades, buy mutual funds and check your performance. The platforms don’t have all the bells and whistles an experienced investor might want, but for someone who just wants to manage a few basic investments, it works.

Fidelity, on the other hand, has a more complicated and extensive online and mobile experience. While this may be a bit overwhelming for someone without a ton of investing experience, if you have been trading for awhile, Fidelity may help you take your investing game to the next level.

In April , Vanguard’s mobile app has a major variance in its satisfaction level among users. For the Apple version, users rate it at stars out of 5 across over , reviews. But on the Google Play store, Android users rate it at just stars out of 5 across more than 5, reviews. The brokerage is releasing a new app called Vanguard Beacon, though, and it promises to have more features and tools for clients.

Fidelity’s mobile app has a much higher level of user approval than Vanguard’s does. In fact, more than million iPhone users have rated the app to an average of stars out of 5 in April And the app also holds a respectable star out of 5 rating on the Google Play store across more than 87, reviews.

Who Should Use Vanguard?

Vanguard built a reputation as a platform that creates and offers low-fee mutual funds and exchange-traded funds. This makes it a good brokerage for clients who want to make basic investments and not think too much about them.

In addition, if you want low-cost funds, Vanguard has also grown to offer stocks and bonds. Though, trading these individual equities is much more limited.

Vanguard might also make sense for clients who want to open an IRA and manage it in a very hands-off manner.

At its core, the brokerage is designed for investors who want a simple and straightforward experience. Its accounts and tools are easy to use, and its website boasts a number of educational resources. This makes it extremely welcoming to beginners.

Who Should Use Fidelity?

Fidelity is a robust trading platform that is known for its individual trading products, which include stocks and bonds.

Most clients would be happy with Fidelity, but it is especially suited for those with ample investing experience. Its advanced investment tools and platforms can be overwhelming if you’re a newbie. Beyond that, if you’re going to be making frequent trades, Fidelity is one of the best choices out there.

While Fidelity does not charge much for its investment resources, it is also worth noting that other brokerages and broker-dealers are shifting to fee-free investment models.

Keeping this in mind, you’d be hard-pressed to find a better selection of high-level tools at an established brokerage. Many competitors have smaller pools of potential investments and less overall reliability than Fidelity.

Bottom Line

If you want to actively trade within your accounts, Fidelity might be the better option. However, if you’re more focused on index investing, or you want to use a robo-advisor, Vanguard has a slight edge. While both institutions offer robo-advisors, Vanguard’s Personal Advisor Services, which is available to clients who can meet a $50, account minimum, offers a little more hands-on investment guidance and assistance with portfolio construction. Vanguard also has slightly lower expense ratios on their index funds.

If you want help with financial planning, mutual funds or retirement and brokerage accounts, both have great options. It’s best to compare costs and minimum account requirements of each firm and fund selection. By comparing your options you can discover the most suitable firm for your financial needs.

Tips for Investors

• Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors in your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
• If you decide to go with a brokerage, SmartAsset can recommend a few online options. Once you’ve considered the above factors and compared online brokerages, you’ll be in a position to find the best choice for you.

Photo credit: ©Vanguard/Fidelity, ©www.oldyorkcellars.com, ©Vanguard Beacon Apple Store Preview, ©Fidelity Investments Apple Store Preview, ©www.oldyorkcellars.com

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Investing can be overwhelming for many new investors.

With so much money on the line, they&#;re worried that might make a mistake with even the most simple of investing tasks.

It&#;s like when you had to suture your first laceration in medical school. You were probably so nervous that you were going to screw it up and mess up that patient&#;s leg forever.

So we&#;re going to go really basic with this post, and discuss the process of how to buy a mutual fund.

Step 1: Picking a Mutual Fund

I am a big advocate for index funds, because these funds hold hundreds or thousands of stocks or bonds within a single investment. Because they are tracking an index that does not change often, it costs very little to manage an index fund, and those savings are passed on to you, the investor.

I think a diversified portfolio can be done with just three index funds. Here&#;s the list of mutual funds for a simple three-fund portfolio of U.S. stocks, international stocks, and U.S. bonds at Vanguard, Fidelity, and Schwab:

In general, when selecting your index fund, you should stick with the mutual fund company where you invest your money (i.e. invest make money fast and easy uk Vanguard funds in a Vanguard investment account and invest in Fidelity funds in a Fidelity investment account).

For example, if you try how to invest in fidelity etfs invest in a Vanguard index fund from a Fidelity investment account, Fidelity will charge a $75 transaction fee, while it is free (not even a trading commission is charged) to invest in Fidelity mutual funds at Fidelity.

Step 2: Make sure that the mutual fund is the right investment and not an ETF

Sometimes a mutual fund is not the right way to invest in an index fund. Exchange-traded funds (ETF for short) are alternatives to mutual funds. They are essentially stock versions of mutual funds. These ETFs can be traded on the exchange just like any other stock. It&#;s slightly more complicated (but still really easy) to buy ETFs.

Here are the three major scenarios when you would prefer an ETF over a mutual fund in index investing:

1. You don&#;t have enough money to invest in the Premium share class

Fidelity (and Vanguard) have multiple share classes of the same mutual fund. For regular investors, the Fidelity share classes are the Investor Class and the Premium Class. The Premium Class has a $10, minimum investment, and has lower management fees (expense ratio) than the Investor Class. However, the ETF version of the mutual fund often has the same low expense ratio as the Premium class Mutual Fund. So if you don&#;t have enough money to invest in the Premium class of index fund, then you should invest in an ETF.

2. You are investing in a taxable account at a non-Vanguard brokerage

ETFs are more tax-efficient than mutual funds at Fidelity and Schwab (they are equivalent at Vanguard). Therefore, the after-tax return of ETFs are higher than that of mutual funds at Fidelity and Schwab. I invest in ETFs in my taxable accounts and mutual funds in my retirement accounts. Check out this article for more information on how to buy an ETF.

3. You prefer ETFs over mutual funds

Some people simply prefer ETFs over mutual funds. They like the concept of being able to trade an ETF intraday and can watch the price of their investment fluctuate during the trading day.

Step 3: Buy the mutual fund

Unlike stocks, you don&#;t buy mutual funds in an open market. The upside of this is that you can buy or sell your mutual fund at any time of day. This is particularly convenient if you&#;re busy at work all day and don&#;t have time to make a trade on your phone or at a computer during the normal trading hours of am &#; pm (don&#;t the traders have it nice &#; only hours of work!).

You don&#;t have to worry about market or limit orders, or the best time of day to trade. You&#;ll get the same price on your trade, whether you make the purchase at noon or at midnight.

Step 4: Enter trade information

Now let&#;s enter the trade information. I&#;ll go through how to buy a mutual fund with Fidelity, but the process at Vanguard, Schwab, or another broker will be similar.

Symbol

First, enter the ticker symbol into the &#;Symbol&#; section. For this example, let&#;s buy the Fidelity® Total Market Index Fund &#; Premium Class (FSTVX). The screen will transform into a mutual fund page with many fewer options.

Dollar Amount

Now all you need to enter is the amount you want to buy.

One of the benefits of a mutual fund over an ETF is that you don&#;t need to calculate fractional shares. If you want to invest $15, how to invest in fidelity etfs, (or $15,), how to invest in fidelity etfs, you can how to invest in fidelity etfs that with mutual funds because they allow fractional shares. You have to purchase ETFs in whole share amounts, which means that you will need to calculate how many shares the amount of money you want to invest converts to.

Submit Order

Click Preview Order and then submit.

You&#;ll notice that there is no commission for purchasing a mutual fund.

The order does not &#;fill&#; instantaneously like a market order for a stock or ETF would, but you&#;ll get a message that the money will be invested at the &#;next available price.&#; The next available price is usually at the end of the current trading day during regular market hours, or the end of the next trading day if you trade outside market hours.

In any event, you can check your order at that time and confirm that your trade is completed and your money is invested in the mutual fund.

Conclusion

If you need any help with investing in a mutual fund at Fidelity, you can click on the &#;Help Me Trade&#; button at the top left corner of the trading window, or call customer service. Remember to have them help you enter the order online rather than have them place the order for you.

Investing your money isn&#;t complicated &#; and the major brokerages try to make it as simple as possible.

What do you think? Do you use primarily ETFs, mutual funds, or a mix of both in your investment accounts?

LOS ANGELES, April 29, — Capital Group, home of American Funds and one of the world’s largest investment management firms, has filed an application for exemptive relief with the Securities and Exchange Commission based on Fidelity’s active equity ETF methodology.

Earlier this year, Capital Group announced it will offer the firm’s first actively managed exchange-traded funds (ETFs). Capital Group plans to launch both equity and fixed income ETF strategies early in

“ETFs will be an important extension to our current suite of investment solutions,” said Holly Framsted, CFA, head of ETFs, Capital Group. “Fidelity’s innovative structure is one of the solutions we’ll consider as we plan for a robust ETF launch in early ”

Fidelity’s active equity ETF model employs a “tracking basket” methodology which maintains the benefits of the ETF structure, provides information to market participants to promote efficient trading of shares, and preserves the ability to add value through active management.

“We are excited for the opportunity to partner with Capital Group,” said Fidelity’s Head of ETF Management and Strategy Greg Friedman. “Fidelity is committed to the active equity ETF space, and our innovative methodology is designed to operate seamlessly within the existing ETF market.”

Since its founding inCapital Group has evolved its offerings, starting with mutual funds and expanding into other services, including target date funds, Luxembourg funds, model portfolios, collective investment trusts and separately managed accounts.

“As we pursue superior long-term investment results for our investors, the introduction of ETFs continues our strategy of expanding choice for financial professionals, how to invest in fidelity etfs, increasing their ability to select the vehicle most appropriate for their how to invest in fidelity etfs long-term goals,” added Framsted.

About Capital Group

Celebrating its 90^th anniversary inCapital Group, home of American Funds, has been singularly focused on delivering superior results for long-term investors using high-conviction portfolios, rigorous research and individual accountability. As of December 31,Capital Group manages more than $ trillion in equity and fixed income assets for millions of individuals and institutional investors around the world.

Capital Group manages equity assets through three investment groups. These groups make investment and proxy voting decisions independently. Fixed income investment professionals provide fixed income research and investment management across the Capital organization; however, for securities with equity characteristics, they act solely on behalf of one of the three equity investment groups.

For more information, visit www.oldyorkcellars.com.

Fidelity Investments has become the third asset manager to launch an actively managed ETF in a semitransparent wrapper.

The three new ETFs are modeled after existing mutual funds and use the same portfolio managers as those mutual funds. But because of some structural differences between mutual funds and ETFs, the new ETFs can only be described as “clonish,” according to Greg Friedman, Fidelity’s head of ETF management and strategy.

Fidelity’s launch follows semitransparent ETF launches by American Century in April and ClearBridge Investments in May.

What’s unique about the Fidelity launch is that this marks the first time the unique fund wrapper has been applied using a proxy-basket model to represent the underlying holdings.

Both American Century and ClearBridge licensed the technology from Precidian Investments, which uses a blind trust model to represent the underlying portfolio holdings.

Fidelity and Precidian represent two of the five companies that have received regulatory approval to license technology that enables the actively-managed ETFs to price and trade throughout the day while only reporting portfolio holdings on a quarterly basis like a mutual fund.

In addition to its own suite of funds, Fidelity is also anticipating a robust licensing business.

Goldman Sachs has already signed up to license Fidelity’s technology, and Friedman said 10 other asset managers have signed non-binding letters of intent.

“Our goal is to be a leader in this space,” he said. “We want Fidelity to be synonymous with active equity ETFs.”

To that end, Fidelity has filed with the Securities and Exchange Commission for exemptive relief to allow semitransparent ETFs for non-US equity and fixed income.

Currently, the SEC how to invest in fidelity etfs allows semitransparent ETFs to invest in securities how to invest in fidelity etfs trade at the same time the ETF is trading, which essentially limits the underlying investments to domestic stocks.

“I’m optimistic about it,” Friedman said. “I’ve been doing ETFs since and it’s always walk before you can run with the SEC. They want to see how these things work.”

Todd Rosenbluth, director how to invest in fidelity etfs mutual fund and ETF research at CFRA, said the Fidelity brand will have a powerful impact on the growth of the new semitransparent wrapper.

“Fidelity has a well-established record of generating strong risk adjusted performance with active strategies as well as a prominent brand in the ETF market,” he said. “While the actively managed equity share remains small, Fidelity is likely to generate high interest among investors that seek the tax benefits and liquidity ETFs offer.”

The three new semitransparent funds are Fidelity Blue Chip Growth ETF (FBCG), Fidelity Blue Chip Value ETF (FBCV) and Fidelity New Millennium ETF (FMIL).

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