401k fund options: FDIKX or VTRIX

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justus
Posts: 97
Joined: Sat Oct 27, 2012 10:08 pm

401k fund options: FDIKX or VTRIX

Post by justus »

I'm new here and just coming onboard to the bogleheads philosophy. I am trying to decide which fund to buy for international. My two options are

FDIKX Fidelity® Diversified International Fund - Class K: 1 Yr +19.61% 3 Yr +4.31% 5 Yr -3.83% 10 Yr +8.85% ER: 0.84%
VTRIX Vanguard International Value Fund Investor Shares: 1 Yr +20.18% 3 Yr +3.28% 5 Yr -3.01% 10 Yr +9.46% ER: 0.41%

Is there much difference in either of these funds? Should I just go with the one with the lowest ER?
Elbowman
Posts: 578
Joined: Tue Apr 03, 2012 2:25 pm

Re: 401k fund options: FDIKX or VTRIX

Post by Elbowman »

Both are primarily large cap. The vanguard has a little more emerging markets (14% vs 6%). The biggest difference is probably that the Vanguard fund has a slight value tilt, while the Fidelity fund has a larger growth tilt. When it comes to growth vs value, people here tend to like either balanced funds or value tilted funds. It seems the Vanguard fund is better in both of these respects, since it A) has a slight value tilt, yet B) is still closer to "balanced" than the Fidelity fund (the tilt is smaller). Considering its expense ratio is also considerably lower, I would go with the Vanguard fund.
Topic Author
justus
Posts: 97
Joined: Sat Oct 27, 2012 10:08 pm

Re: 401k fund options: FDIKX or VTRIX

Post by justus »

Thank you, elbowman. Why do people prefer balanced or value over growth funds?
Elbowman
Posts: 578
Joined: Tue Apr 03, 2012 2:25 pm

Re: 401k fund options: FDIKX or VTRIX

Post by Elbowman »

There is a huge amount of discussion about that here. Check out this link for a basic explanation http://www.bogleheads.org/wiki/Value_Tilting_-_Stock . You could also search for "Value Tilting" in the search box at the top right to get more information.
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