Hey Investing Wise Academy Fam! Ready to level up your portfolio with the magic of index funds? This newsletter cracks the code on the hottest performers for 2024, all served with a side of fun facts and investment wisdom.
The Index Fund All-Stars:
#1: Fidelity 500 Index Fund (FXAIX): This OG tracks the S&P 500, the big kahuna of US stocks. Think Apple, Amazon, Microsoft – all stars in your investment basket. Average 5-year return? A sweet 14.76%! Plus, the expense ratio is like a tiny order of fries at McDonald's – practically free! Just remember, it focuses on large-cap companies, so no exposure to smaller businesses.
#2: Fidelity Total Market Index Fund (FSKAX): This powerhouse tracks the entire US stock market, giving you a slice of pretty much every US company out there. Think broad diversification on steroids! It boasts a rock-bottom expense ratio of 0.02% and a yummy 10-year average return of 12.36%. Plus, unlike its zero-fee cousin FZROX, you can easily transfer it to another broker if you ever switch allegiances.
#3: Fidelity NASDAQ Composite Index Fund (FNCMX): Buckle up for a tech ride! This fund zooms in on companies listed on the NASDAQ, home to tech titans like Apple and Google. It's delivered a stellar 17.31% average return over 5 years! The downside? A slightly higher expense ratio and a lack of diversification outside the tech world. Maybe pair it with another fund for a more balanced portfolio. ⚖️
#4: Fidelity Zero Large Cap Index Fund (FNILX): Calling all large-cap lovers! This bad boy tracks US companies with a market value exceeding $8.5 billion. Think household names you know and trust. It's churned out a fantastic 15.32% average return over 5 years. But remember, diversification is key! Don't put all your eggs in one basket – consider mixing it up with other asset classes.
#5: Fidelity Zero Total Market Index Fund (FZROX): The king of free! This groundbreaking fund charges a whopping $0 in fees. That's right, ZERO! Since its launch in 2018, it's delivered a mighty 14.27% average return. This fund tracks the US total market index, giving you a piece of pretty much every US company. Just remember, it's a new kid on the block, so a longer track record would be ideal.
Beyond the Basics:
This is just the tip of the iceberg, friends! Before diving in, remember:
Index funds aren't perfect: They may not outperform the market and can be susceptible to downturns.
Do your research: Understand the specific index a fund tracks and its expense ratio.
Diversify, diversify, diversify! Don't put all your eggs in one basket. Spread your investments across different asset classes.
Your Turn!
Now it's your time to shine! Share your thoughts on index funds in the comments below. What are the pros and cons you see? How do you plan to navigate potential risks? Let's build a smarter investing community together!
P.S. Stay tuned for future newsletters where we'll deep dive into more investment strategies and financial wisdom!
