Understanding Fidelity Investments Funds Performance and Fees

Fidelity Investments offers a wide range of funds to choose from, with over 400 actively managed and index funds available.

Fidelity's funds have consistently delivered strong performance over the years, with many of their funds ranking among the top performers in their respective categories.

The fees associated with Fidelity's funds vary, but the average expense ratio for their actively managed funds is around 0.5% to 1.0%.

Fidelity's index funds, on the other hand, tend to be much cheaper, with expense ratios typically ranging from 0.03% to 0.10%.

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Your monthly statement and Performance Reporting figures may not match due to differences in how transaction data is used.

The standard performance calculation, also known as your "Personal Rate of Return", can give different results than your monthly statement. This is because it uses transaction data in a different way.

To put your return in context, it's essential to select a benchmark. Benchmarks help evaluate the performance of your investments by comparing it to the performance of similar investments.

Here's why benchmarks are important:

You can select a benchmark by following these steps, but unfortunately, we don't have the details here.

Fidelity index mutual funds offer some of the lowest prices in the industry. This is a significant advantage for investors looking to save on fees.

Fidelity has a wide range of index funds to choose from, including the Fidelity 500 Index Fund, which tracks the S&P 500 index. This fund has no management fees and is a popular choice among investors.

Here are some of the key benefits of Fidelity's index funds:

Fidelity's low prices and wide range of index funds make it a great option for investors looking to save on fees and achieve their financial goals.

Index funds from Fidelity offer a range of options to suit different investment goals.

Fidelity has a large lineup of index funds, including the Fidelity 500 Index Fund and the Fidelity Extended Market Index Fund.

You can choose from various fund options, such as Fidelity Large Cap Growth Index Fund, Fidelity Large Cap Value Index Fund, and Fidelity Mid Cap Index Fund.

Some funds are even labeled as "NEW" indicating they are recent additions to the lineup.

Here are some of the index funds from Fidelity's various fund categories:

Fidelity also offers index funds for international markets, such as the Fidelity Emerging Markets Index Fund and the Fidelity Global ex-U.S. Index Fund.

Note that some index funds are labeled as "sustainable" or "sustainability" indicating they have environmental or social responsibility features.

You can also find index funds for bonds, such as the Fidelity Inflation-Protected Bond Index Fund and the Fidelity Intermediate Treasury Bond Index Fund.

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Your Personal Rate of Return is calculated using a money-weighted methodology, which takes into account the timing and amount of your investments. This is in contrast to the time-weighted investment rate of return, which only considers the returns on your investments.

To put your returns in context, it's essential to select a benchmark that represents the segments of the market you're most heavily invested in. You can choose from 26 single market and blended benchmarks, or use the Guided Portfolio Summary tool to determine your current asset allocation.

Benchmarks are useful for evaluating the performance of your investments and comparing it to similar investments. They can also help you identify areas for improvement in your portfolio.

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Your Personal Rate of Return is calculated using a money-weighted methodology, which takes into account the actual returns on your investments and the timing of your deposits and withdrawals.

There are two main types of rates of return: Personal (money-weighted) and Investment (time-weighted). The main difference between them is that Personal Rate of Return considers the timing of your cash flows, while Investment Rate of Return does not.

You can't choose the calculation methodology for your account, as it's automatically set to Personal Rate of Return.

The Total Portfolio Return calculation includes all your accounts, except for your Workplace Savings Account, which you can add if you want.

Annualized Return and Cumulative Return are two different ways to measure your investment performance. Annualized Return shows the average return over a year, while Cumulative Return shows the total return over a period of time.

Fees are handled in the Performance Calculation by reducing the performance by the effect of all applicable fees, including management and annuity fees on your investments, and bank charges, advisory, and brokerage fees related to your account.

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Here's a breakdown of the fees displayed in the "What drove your change in balance?" table:

Unfortunately, you can't get your returns calculated at the position level.

Withdrawals will affect your performance, as they reduce the amount of money you have invested.

Your Stock Plan Service activity is included in the calculation of your Personal Rate of Return.

There may be differences between your monthly statement and your Performance Reporting figures due to the way historical performance figures are calculated, which changed on October 31, 2008.

Benchmarks are essential for evaluating the performance of your investments. They help put your return in context by comparing it to the performance of similar investments.

To select a benchmark, consider the segments of the overall market that you're most heavily invested in. You can choose from 26 single market and blended benchmarks on the Performance page.

Your benchmark should represent your account's asset allocation. If your account is primarily made up of municipal bonds, a single market index like the Barclays Municipal Bond Index might be a good fit. However, if your account is a mix of stocks and bonds, a blended benchmark like "Aggressive Growth" could be more suitable.

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Blended benchmarks combine different market indexes and can often be a better fit for your account. You can leverage the Guided Portfolio Summary tool to determine your current asset allocation and choose the right benchmark.

To view your benchmarks, check the Compare Your Returns to the Market section at the bottom of the performance page. You can also add or modify benchmarks by clicking Change/Add Market Indexes.

Here are some common reasons why your returns might be below the benchmark index:

Note that you can't select a different blended benchmark when viewing account details for your managed account. This is because the relevant blended benchmark is automatically displayed and would not accurately reflect your account's strategy.

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If your investments aren't performing as well as you'd hoped, it's natural to wonder what's going on. You should consider what's driving the poor performance in your account.

To determine whether changes to your account values are due to your actions or the broader market, you can look at your Personal Rate of Return (money-weighted) calculation. This type of calculation takes into account changes in asset values, dividends and interest earned, fees paid, and the size and timing of additions and withdrawals.

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You can compare your Personal Rate of Return to the Investment (time-weighted) Rate of Return, which measures the performance of the underlying investments and eliminates the impact of additions and withdrawals. This can help you see how your investment manager is doing and whether your actions are affecting your returns.

Here are some key differences between Personal and Investment Rate of Return:

It's also worth noting that benchmarks, like the one used to compare your returns, don't include fees and don't reflect your personal trades or transactions. This means that it's not always easy to outperform benchmarks, but it's still worth trying to optimize your asset allocation to support your investment strategy.

Interpreting returns can be a bit tricky, but understanding the difference between Annualized Return and Cumulative Return can help you make sense of your investment performance.

Annualized Return shows how much your investments have grown or declined – on average – over each year of a multi-year period.

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To put it simply, if your investments have had a rough year, a low Annualized Return might make you worry, but it's essential to consider the broader market impact. What is driving the poor performance in your account?

The key is to compare apples to apples – in this case, Annualized Returns of different periods, as opposed to Cumulative Returns. In certain instances, it may be more informative to compare Annualized returns of different periods, but not Cumulative returns of different periods.

Here's a quick summary to help you keep track:

If you're wondering what's behind the fluctuations in your account values, consider whether the changes are due to your actions or the broader market.

If you're looking at your monthly statement and your Performance Reporting figures, you might notice some differences. This can be a bit confusing, but it's actually due to how the standard performance calculation uses transaction data.

The standard performance calculation, also known as your Personal Rate of Return, uses transaction data differently than your monthly statement. This can lead to different results.

To understand why this happens, let's take a look at an example. According to Fidelity, the standard performance calculation may give different results than your monthly statement, as seen in the examples below.

Here's a breakdown of the differences:

These differences can affect the accuracy of your returns, so it's essential to understand how they work. By knowing these differences, you can make more informed decisions about your investments.

Fidelity's Total Bond Fund has consistently outperformed the market, with a 5-year average annual return of 3.14%, compared to the Bloomberg Barclays US Aggregate Bond Index's 2.54% return.

Fidelity's Total Stock Market Index Fund has also been a top performer, with a 5-year average annual return of 14.15%.

The fund's low expense ratio of 0.015% is a significant factor in its success, allowing more of investors' money to be invested in the market.

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Fidelity's Total Bond Fund has a portfolio turnover rate of 25%, indicating that the fund is actively managed to maximize returns.

The fund's average credit quality is AA+, indicating a high level of creditworthiness among its holdings.

Fidelity's Total Stock Market Index Fund has a low minimum investment requirement of $2.95, making it accessible to a wide range of investors.

The fund's expense ratio is just 0.015%, making it one of the lowest-cost index funds available.

Fidelity's Total Bond Fund has a 1-year return of 4.23%, outperforming the Bloomberg Barclays US Aggregate Bond Index's 2.54% return.

Fidelity's Total Stock Market Index Fund has a 1-year return of 18.11%, significantly outperforming the S&P 500's 13.69% return.

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If your investments aren't performing as well as you'd hoped, the first step is to identify the issue. You can ask yourself what's driving the poor performance in your account.

To determine whether the changes to your account values are due to your actions or the broader market, it's essential to understand how investment performance is interpreted. This can help you make informed decisions about your portfolio.

If you're looking to diversify your investments, Fidelity offers a diverse set of investment capabilities across asset classes, disciplines, and styles. This includes over 450 mutual funds to choose from.

Some of these funds have received high ratings from Morningstar, with more than 150 4- and 5-star rated funds available. This can be a great starting point for finding a fund that suits your investment goals.

If you're interested in asset allocation funds, Fidelity offers a range of options managed by experienced investment professionals. For example, the Fidelity Advisor Managed Retirement 2025 Fund is managed by Brett Sumsion and Andrew Dierdorf and has received a Lipper Award in the Retirement Income category for the 10-year period.

Here are some of the services Fidelity offers to help you manage your investments:

Fidelity offers a range of investment options, including index funds, actively managed funds, and ETFs.

These options cater to different investment strategies and risk tolerances, allowing investors to choose the best fit for their goals. Fidelity's index funds, for instance, track a specific market index, such as the S&P 500, to provide broad market exposure.

The fees associated with Fidelity's investment options vary depending on the type of fund and the investor's account type. For example, the expense ratio for Fidelity's Total Market Index Fund is 0.015%, which is relatively low compared to other actively managed funds.

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Fees are handled in the performance calculation by reducing the performance by the effect of all applicable fees. This means you'll see the impact of fees on your investments.

The performance calculations are net of fees, so you won't have to worry about calculating fees separately. This includes fees related to the purchase of your underlying investments.

Mutual fund management and annuity separate account fees, as well as bank charges, advisory and brokerage fees, are all included in the performance calculation. These fees can add up, so it's essential to understand how they affect your investments.

Certain ongoing, asset-based fees, such as mutual fund management and annuity separate account fees, are not displayed in the fees column, even though they're reflected in the performance calculation. This can be a bit confusing, but it's essential to understand what fees are included and what's not.

The fees column generally only includes maintenance and servicing related account fees, such as advisory fees, bank charges, and brokerage account fees.

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Fixed income funds are a type of investment that can provide a relatively stable source of returns. They're often a good option for investors who want to generate income without taking on too much risk.

The Fidelity Advisor Convertible Securities Fund, for example, has been recognized for its performance in the Convertible Securities category, winning Lipper Awards for the 3- and 5-year periods.

Here are some key details about Fidelity's fixed income funds:

By investing in fixed income funds like these, you can potentially earn consistent income and grow your wealth over time.

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Your Personal Rate of Return is calculated using the Personal Rate of Return (money-weighted) calculation, which considers changes in the value of your assets, dividends, interest, fees, and the size and timing of your additions and/or withdrawals.

This calculation is based on a number of factors, including changes in the value of the assets you own, dividends and interest you earned, fees that you may have paid, and the size and timing of your additions and/or withdrawals.

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The Personal Rate of Return is used to evaluate the combined investment decisions of both the investment manager and the individual investor, whereas the Investment (time-weighted) Rate of Return is commonly used to evaluate the performance of a fund or an investment manager.

The Total Portfolio Return calculation includes all of your Fidelity Brokerage accounts, as well as any other accounts that you have access to view or trade. However, Workplace Savings Accounts, Brokerage Flex, Brokerage Link and certain Insurance/Annuity accounts are all excluded from the Total Portfolio Return.

Fees are handled in the performance calculation by reducing the performance by the effect of all applicable fees, including mutual fund management and annuity separate account fees on your underlying investments and any fees related to their purchase.

Here's a breakdown of the types of fees that are included in the fees column of the "What drove your change in balance?" table:

It's worth noting that certain ongoing, asset-based fees, such as mutual fund management and annuity separate account fees, that are reflected in the performance calculation are not displayed in the fees column.

Some investors might wonder if a fund's past performance can guarantee future success. The answer is no, past performance is not a reliable predictor of future results.

Fidelity's Total Bond Market Index Fund has consistently delivered returns that beat the market average over the past decade, with a 4.5% annual return compared to the 3.6% return of the Bloomberg Barclays US Aggregate Bond Index.

Investors should be wary of the dangers of confirmation bias, where they tend to focus on the fund's past successes and ignore its past failures. This can lead to poor decision-making and a lack of diversification in their portfolio.

The Fidelity Contrafund has historically been a top-performing fund, with a 13.4% annual return over the past 10 years, making it an attractive option for investors seeking long-term growth.

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