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FNILX vs VOO: Which Is The Best Option For You?

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The topic of FNILX vs VOO compares two popular investment funds.  FNILX is a mutual fund provided by Fidelity and VOO is an exchange-traded fund (ETF) offered by Vanguard.

Investment funds started as a way for people to pool their money together and invest it in various assets.

These assets include stocks, bonds, or commodities.

This allows them to spread their risk around and hopefully achieve better returns than they could if they invested independently.

There’s one significant difference between ETFs and mutual funds.  You can access ETFs on third-party investment apps and websites, while mutual funds are only offered on the platform that provides them.

Whether mutual funds or ETFs, both FNILX and VOO are containers to hold investments inside of them.

The question is, which one should you choose?

This article will compare FNILX vs VOO to help you decide which option is the best for your needs.

FNILX vs VOO Graphic Comparison

 

FNILX vs VOO

The main difference between FNILX and VOO is the brokerage that offers the fund.  Fidelity offers FNILX, while Vanguard offers VOO.  Another difference between FNILX vs VOO is VOO is an Exchange-Traded Fund (ETF), and FNILX is a Mutual Fund.

VOO is an Exchange Traded Fund (ETF)

FNILX is a Mutual Fund

Here you can see a more detailed comparison of an ETF vs a Mutual Fund.

Since VOO is an ETF, it trades all day while FNILX only trades once a day like a typical mutual fund.

FNILX

  • Tracks The S&P 500 Index
  • Expense Ratio: 0%
  • No Minimum Investment
  • Holds 503 Stocks
  • Is a Mutual Fund
  • Offered By Fidelity

VOO

  • Tracks The S&P 500 Index
  • Expense Ratio: 0.03%
  • No Minimum Investment
  • Holds 513 Stocks
  • Is an Exchange-Traded Fund (ETF)
  • Mutual Fund Equivalent (VFIAX)

 

What Is FNILX?

Fidelity ZERO Large Cap Index Fund (FNILX) is a mutual fund established in 2018 and is one of four zero fund choices.  FNILX has over $5.4 billion in portfolio net assets.

Also, it boasts consistent returns by investing in 100% domestic equity while keeping costs at zero.

FNILX is categorized as a large blend fund and has 4 out of 5 stars from Morningstar.  Currently, FNILX has a turnover rate of 5% and charges investors an expense ratio of 0%.

A good advantage of FNILX is there is no minimum initial purchase requirement which means you can invest as little as $100.

Fidelity also offers professionally managed portfolios across nine risk levels, ranging from conservative to aggressive.

Some other platforms offer both mutual funds and ETFs.  However, because FNILX is a mutual fund, only fidelity funds offer FNILX, which is the platform that issues FNILX.

FNILX’s fees are very low compared to similar funds, but eventually, Fidelity will raise prices.

To purchase FNILX, you will have to start a fidelity account.

 

FNILX Performance

Since FNILX’s inception in 2018, its performance has been good.  FNILX’s performance for the past 3 years has averaged 19.9% growth annually.

FNILX also had no significant down year in the last three years.

FNILX is categorized as a large blend fund.  As a large blend fund, it makes for an excellent investment for those looking at buying and holding over the long term.

Furthermore, FNILX has a beta of 1.00 and a standard deviation of 17.77.

 

FNILX Returns

FNILX Performance Chart

 

FNILX Pros and Cons

Pros

  • Fidelity’s FNILX Provides Consistent Returns
  • Zero Expense Ratio
  • Fidelity Is A Reputable Brokerage
  • No Minimum Investment
  • No Significant Down Years In The Last Three Years
  • FNILX Tracks The S&P 500 Index

Cons

  • Lacks Proven Long-Term Returns
  • Fidelity Will Likely Increase FNILX’s Expense Ratio
  • Only Available On Fidelity’s Platform
  • Annual Dividends

 

FNILX Holdings

Here are the top 10 Holdings with total assets of 26.81%.

FNILX Top Holdings

 

What Is VOO?

Vanguard S&P 500 ETF (VOO) is an ETF that invests in companies from the S&P 500 index.  It was established in 2010 and boasts about $816.6 billion worth of assets under management.  Like FNILX, VOO has no minimum initial purchase requirement and charges investors a 0.03% expense ratio.

VOO was founded by Vanguard, an investment company that operates with lower costs to increase returns for investors.  VOO also invests in domestic equity and is considered a large blend fund.

Vanguard started as an outlet to offer low-cost index funds.  These funds can be traded through brokers like FNILX and the rest of the stock trading brokerage companies.

VOO’s portfolio is passively managed to track the S&P 500 Index as its benchmark.  This is something VOO does exceptionally well with a beta of 1.00.

VOO has total net assets of $816.6 billion.

Compared to FILNX, which distributes yearly dividends to shareholders, VOO pays dividends to shareholders every quarter.

Because of these, many new investors do not acquire enough money in dividends to buy a full share.

Since the dividends will not be reinvested, they will be moved into your money account as an investor.

One thing to note is that VOO can be offered on several websites and investment apps like M1 Finance(Use this link for $50 when you open a new account)

 

VOO Performance

VOO has been around for over 10 years, and the performance over the years has been outstanding.  Before the fees and expenses are deducted, VOO strives to mirror the performance of the S&P 500 index (Standard and Poor’s 500).

This is because the S&P 500 index quantifies the large-capitalization sector of the U.S. equity market.

This year, VOO has lost around -9.06% but has gained 23.30% and 20.64% over the last year and 3 years.

Also, it has traded about $346.03 and $439.25 within the past 52 weeks.

VOO as an ETF has a standard deviation of 22.38% and a beta of 1.00 for a training period of three years.  With this, it is regarded as a medium-risk choice.

The ETF has about 513 holdings, and it diversifies company-specific risk effectively.

 

VOO Returns

VOO Performance Returns

 

VOO Pros and Cons

Pros

  • VOO Includes All 500 Stocks In The S&P 500
  • Expense Ratio Of 0.03%
  • Beta Of 1.00 Means VOO Tracks The S&P 500 Perfectly
  • Quarterly Dividends
  • VOO Is An Exchange-Traded Fund (ETF)

Cons

  • Intraday Trading (Can Encourage Day Trading)
  • No Automatic Investment Feature (Unless You Use M1 Finance)

 

VOO Holdings

Here’s a list of the top 10 Holdings of VOO, and the total assets are 30%.

VOO Top Holdings

 

FNILX vs VOO Similarities

Though both FNILX and VOO have distinctive features that make them stand out, they also have some similarities; they include:

  • In the last 3 years, both FNILX and VOO have had similar returns
  • Both funds are the same because they track the S&P 500 Index Fund using a computer algorithm
  • FNILX and VOO can permit automatic withdrawals and investments
  • Both funds own the same allocation of stocks
  • Both funds have a mutual lack of fees, and they both hold a large number of different stocks

 

Why Do Investors Choose FNILX and VOO?

Investors choose FNILX vs VOO for different reasons.  However, the main one is likely the brokerage they prefer to use.  FNILX would be preferred for current Fidelity customers, while VOO would be a preferred ETF for Vanguard customers.

FNILX vs VOO Comparison Chart

FNILX offers you the chance to track the performance returns of the S&P 500 index at zero cost, whereas VOO would cost you slightly more in commissions.

Fidelity’s FNILX costs are zero, so you keep all of your invested capital while VOO’s annual fee is 0.03%.

FNILX has slightly outperformed the market and comparison ETFs.  In FNILX’s best year so far, FNILX returned 20.20%, while the S&P 500 managed 19.74%.

VOO is more popular compared to FNILX despite VOO’s 0.03% expense ratio.

FNILX can be purchased through Fidelity, while VOO can be bought through Vanguard and platforms like M1 Finance.

FNILX has roughly the same number of individual holdings as VOO, and both are top-tier choices for investors looking to get exposure to a large number of U.S. stocks through one fund.

Both VOO and FNILX have no minimum investment to start.

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How to Invest in FNILX and VOO

FNIAX can be purchased through Fidelity.  FNILX doesn’t charge any commissions and has an expense ratio of 0%.

FNILX requires no minimum initial purchase, while VOO requires an investment of at least 1 share unless you use platforms that allow for buying fractional shares.

Therefore, FNILX is only available to investors with a Fidelity brokerage account, while VOO is available to Vanguard clients and third-party platforms.

If you want to buy VOO, here are the steps you can follow:

 

FNILX vs VOO Winner

There is not much difference between FNILX and VOO; instead, they are similar because they track the S&P 500.

Both can be great options, and it depends where you would like to have an investment account, either Fidelity, Vanguard, or a third-party app.

I prefer VOO because I am a big Vanguard fan, and I know they will continue to offer low-expense ratio funds.

There is a high likelihood they will increase expenses of these zero expense ratio funds with Fidelity.

Lastly, the major differences between both funds are expense ratio discrepancies, real-time pricing, and index fund versus ETF.

 


Disclaimer
This post may have affiliate links, which means I may receive commissions if you choose to purchase through links I provide (at no extra cost to you). Thank you for supporting the work I put into this site!

This information is my opinion and is for information purposes only. It is not intended to be investment advice. Seek a duly licensed professional for investment advice.
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