Fidelity Investments recently made incredible advancements to its investment brokerage game, and these changes could eventually benefit all amateur investors.
Fidelity’s recent announcements regarding changes are certainly exciting: here are just a few:
Zero Minimum Investments to Open Accounts
Zero Account Fees (Including Closing/Transferring an account ) Zero Domestic Money Movement Fees (e.g. Bank Wire Fee) Whilst Fidelity Retail Mutual Funds and 529 Plans have No Minimum Invests or Investment Minimums to Consider.
Fidelity Index Mutual Funds have seen pricing significantly reduced and simplified, leading to lower fees overall.
Zero expense ratio mutual funds (Fidelity ZERO Index Funds)
These changes are all instantaneous and self-explanatory. I am particularly pleased by their simplification, reduced costs, and lack of “gotchas”, so am delighted by these innovations.
I will further examine each of these three, to demonstrate why I believe they could make an impactful statement about Fidelity customers and amateur investors alike.
1. No investment minimums on Fidelity retail and advisor mutual funds and 529 plans
Fidelity Zero Cost Funds This development is hugely important, as many index and managed mutual funds require minimum investments that make them inaccessible to many amateur investors. Because of this I made the switch from mutual funds to ETFs over time – something Vanguard was pleased to announce recently by expanding its commission-free ETF list from 77 managed by Vanguard alone to over 1,800+ from over 100 providers!
Fidelity’s move may make its mutual funds worth serious consideration and put pressure on other investment brokers to follow suit – for instance Vanguard minimums currently range between $1,000 to 3,000 for “Investor Shares” and $10,000 – 100,000 for “Admiral Shares”, respectively – it might be time for them to step it up here!
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