FSTVX or FZROX
FSTVX or FZROX
Hey Bogleheads,
I am getting ready to transfer a previous company's Roth 401k to a soon-to-be opened Roth IRA. My plan was to roll it over to FSTVX, but should I consider FZROX? I am somewhat skeptical about how new the FZROX fund is so I was wondering if that should be a reason for concern.
Thanks for the help.
I am getting ready to transfer a previous company's Roth 401k to a soon-to-be opened Roth IRA. My plan was to roll it over to FSTVX, but should I consider FZROX? I am somewhat skeptical about how new the FZROX fund is so I was wondering if that should be a reason for concern.
Thanks for the help.
Re: FSTVX or FZROX
At 1.5 basis points of expense, I would use FSKAX (the successor to FSTVX). Probably doesn’t matter, though, in a tax-advantaged account (where you don’t care about tax efficiency of the fund).
Re: FSTVX or FZROX
In a Roth IRA, the distinction between the two will be meaningless. Not worth your time to worry about. Pick one and move on.
Amateur investors are not cool-headed logicians.
Re: FSTVX or FZROX
+1 FSKAX (previously FSTVX) has a long track record and at 0.015% ER that's pretty competitive compared to Vanguard and Schwab equivalent mutual funds.
Bogleheads Wiki: https://www.bogleheads.org/wiki/Main_Page
Re: FSTVX or FZROX
Is FSTVX no more? This is the first I am hearing of FSKAX.
Re: FSTVX or FZROX
Correct - Fidelity consolidated and removed minimums.
Re: FSTVX or FZROX
Fidelity unified the share classes of a bunch of their funds over the last few months. FSTVX has been rolled into FSKAX, which has a lower expense ratio of 0.015% compared to FSTVX which used to be 0.04% if I recall correctly. These changes were announced alongside the announcement of the "zero" funds like FZROX, but apparently few people paid attention to that part of the announcement

Anyway, to answer your original question, I'd go with FSKAX. It has a longer track record, it follows an independent third-party index, and it owns more individual stocks than FZROX. The slightly higher ER of 0.015% compared to 0% is really not important IMO.
Re: FSTVX or FZROX
Or you could look at the FZROX performance and see that it exactly tracked the total market performance since inception and pay no fees.
Re: FSTVX or FZROX
Here's FZROX vs FSKAX since the inception of FZROX:

If you make a prediction from this plot by annualizing the difference in return, FZROX will underperform FSKAX by 1.11% annually, which is horrible.
Of course, this means nothing since it's barely been 5 months since FZROX came into being. Furthermore, when you say it "exactly tracked the total market performance" you don't specify what index you're talking about. FZROX and FSKAX follow different indices so they're not 100% comparable in the first place.
-
- Posts: 107
- Joined: Tue Mar 27, 2018 11:35 am
Re: FSTVX or FZROX
Try changing the start date on that morningstar chart to 8/3/18 instead of 8/2. The FZROX jumps out to a slight lead. Something weird happened on Day 1 of the fund but it probably isn't indicative of what happened after or will happen in the future.sarabayo wrote: ↑Thu Jan 03, 2019 11:45 pmHere's FZROX vs FSKAX since the inception of FZROX:
If you make a prediction from this plot by annualizing the difference in return, FZROX will underperform FSKAX by 1.11% annually, which is horrible.
Of course, this means nothing since it's barely been 5 months since FZROX came into being. Furthermore, when you say it "exactly tracked the total market performance" you don't specify what index you're talking about. FZROX and FSKAX follow different indices so they're not 100% comparable in the first place.
Re: FSTVX or FZROX
Portfolio visualizer shows same performance on VTSAX, FSKAX and FZROX - within a few dollars. It doesn't matter, the performance is spot on and picking either won't matter. The tin foil hats come out when Fidelity is mentioned.
Use any of these:
FZROX
FSKAX
VTSAX
VTI
VOO
ITOT
IVV
You will perform like "the market"
Use any of these:
FZROX
FSKAX
VTSAX
VTI
VOO
ITOT
IVV
You will perform like "the market"
Re: FSTVX or FZROX
Yup, that's right. I just chose that start date because nix4me specifically said "since inception". As I said in the second part of my post, nothing about that chart is really indicative of what will happen in the future.StrangePenguin wrote: ↑Thu Jan 03, 2019 11:52 pmTry changing the start date on that morningstar chart to 8/3/18 instead of 8/2. The FZROX jumps out to a slight lead. Something weird happened on Day 1 of the fund but it probably isn't indicative of what happened after or will happen in the future.
Re: FSTVX or FZROX
I mean, yeah, they're both close enough. But if I had to pick one I'd still put FSKAX just slightly above FZROX due to lack of track record so far, and lower number of stocks sampled.
Re: FSTVX or FZROX
Thank you all for the very detailed responses and comparison between the funds. Seeing it laid out eases my mind with my choice since it ultimately doesn’t matter. I can’t believe I missed the FSKAX announcement. 

Re: FSTVX or FZROX
Fidelity's zero expense ratio funds are great in tax advantaged accounts. One problem with holding them in a taxable account is one can't change brokerages without selling and repurchasing the the new brokerage's fund and that makes for a taxable event. I highly doubt in-kind transfers would be accepted at other brokerages. I don't know this positively, just a hunch. I may be wrong.
Best Wishes, SpringMan
-
- Posts: 4781
- Joined: Wed Feb 19, 2014 10:11 am
Re: FSTVX or FZROX
The problem might be morningstar - go graph it elsewhere (e.g. Yahoo for instance) and you will see FZROX in the lead.StrangePenguin wrote: ↑Thu Jan 03, 2019 11:52 pmTry changing the start date on that morningstar chart to 8/3/18 instead of 8/2. The FZROX jumps out to a slight lead. Something weird happened on Day 1 of the fund but it probably isn't indicative of what happened after or will happen in the future.sarabayo wrote: ↑Thu Jan 03, 2019 11:45 pmHere's FZROX vs FSKAX since the inception of FZROX:
If you make a prediction from this plot by annualizing the difference in return, FZROX will underperform FSKAX by 1.11% annually, which is horrible.
Of course, this means nothing since it's barely been 5 months since FZROX came into being. Furthermore, when you say it "exactly tracked the total market performance" you don't specify what index you're talking about. FZROX and FSKAX follow different indices so they're not 100% comparable in the first place.
OP: I would go with FZROX. Only time will tell which of the two might have some slight advantage in other ways; but the one thing we know for sure is that FZROX has a small advantage in fees.
-
- Posts: 10437
- Joined: Tue Dec 31, 2013 7:05 am
- Location: 26 miles, 385 yards west of Copley Square
Re: FSTVX or FZROX
On 8/6, I split my FSTVX potion in 2. Half staying in FSTVX (which became FSKAX) and half in FZROX. Why? I saw it as a low risk to see how the new zero fund (with cool theme music) would do. As of yesterday:
FSKAX: $289,358.55
FZROX: $289,406.83
These are in a tIRA, so I won't see any tax treatment differences. If you're looking at taxable, you'll want to do a bit more research. My very preliminary conclusion is: "it doesn't matter" wrt my own choice between these 2 funds.
FSKAX: $289,358.55
FZROX: $289,406.83
These are in a tIRA, so I won't see any tax treatment differences. If you're looking at taxable, you'll want to do a bit more research. My very preliminary conclusion is: "it doesn't matter" wrt my own choice between these 2 funds.
Bogle: Smart Beta is stupid
-
- Posts: 2630
- Joined: Sun Oct 08, 2017 7:16 pm
Re: FSTVX or FZROX
Thanks for doing this experiment!Jack FFR1846 wrote: ↑Fri Jan 04, 2019 9:29 amOn 8/6, I split my FSTVX potion in 2. Half staying in FSTVX (which became FSKAX) and half in FZROX. Why? I saw it as a low risk to see how the new zero fund (with cool theme music) would do. As of yesterday:
FSKAX: $289,358.55
FZROX: $289,406.83
These are in a tIRA, so I won't see any tax treatment differences. If you're looking at taxable, you'll want to do a bit more research. My very preliminary conclusion is: "it doesn't matter" wrt my own choice between these 2 funds.
Re: FSTVX or FZROX
Excellent information! Thanks!Jack FFR1846 wrote: ↑Fri Jan 04, 2019 9:29 amOn 8/6, I split my FSTVX potion in 2. Half staying in FSTVX (which became FSKAX) and half in FZROX. Why? I saw it as a low risk to see how the new zero fund (with cool theme music) would do. As of yesterday:
FSKAX: $289,358.55
FZROX: $289,406.83
These are in a tIRA, so I won't see any tax treatment differences. If you're looking at taxable, you'll want to do a bit more research. My very preliminary conclusion is: "it doesn't matter" wrt my own choice between these 2 funds.
Re: FSTVX or FZROX
+1, glad we needed an experiment to prove this.Jack FFR1846 wrote: ↑Fri Jan 04, 2019 9:29 amOn 8/6, I split my FSTVX potion in 2. Half staying in FSTVX (which became FSKAX) and half in FZROX. Why? I saw it as a low risk to see how the new zero fund (with cool theme music) would do. As of yesterday:
FSKAX: $289,358.55
FZROX: $289,406.83
These are in a tIRA, so I won't see any tax treatment differences. If you're looking at taxable, you'll want to do a bit more research. My very preliminary conclusion is: "it doesn't matter" wrt my own choice between these 2 funds.
Amateur investors are not cool-headed logicians.
-
- Posts: 4781
- Joined: Wed Feb 19, 2014 10:11 am
Re: FSTVX or FZROX
Funny - I did something similar (not to track - since we could do that anyway - but just because I couldn't make up my mindJack FFR1846 wrote: ↑Fri Jan 04, 2019 9:29 amOn 8/6, I split my FSTVX potion in 2. Half staying in FSTVX (which became FSKAX) and half in FZROX. Why? I saw it as a low risk to see how the new zero fund (with cool theme music) would do. As of yesterday:
FSKAX: $289,358.55
FZROX: $289,406.83
These are in a tIRA, so I won't see any tax treatment differences. If you're looking at taxable, you'll want to do a bit more research. My very preliminary conclusion is: "it doesn't matter" wrt my own choice between these 2 funds.

I did the same with international.
I'm now thinking of moving the rest to Zero to simplify - are you going to continue with your experiment or converge down to Zero?