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VFIAX vs FXAIX: Which Is The Best S&P 500 Fund?

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In this article, we will explore the difference between VFIAX vs FXAIX.

Choosing between Vanguard’s 500 Index Fund Admiral Shares (VFIAX) and Fidelity’s 500 Index Fund (FXAIX) can be challenging.

Vanguard 500 Index Fund Admiral Shares, VFIAX, is a popular fund focusing on long-term growth.  The fund invests in several sectors and has a low expense ratio.

Fidelity 500 Index Fund, FXAIX, is one of the most straightforward funds to invest in right now.  And, unlike other index funds, it has a low turnover rate.

This comparison will make it easy to decide which one is right for you.

VFIAX vs FXAIX Graphic

 

VFIAX vs FXAIX

The main difference between VFIAX and FXAIX is the company that offers the fund.  VFIAX is offered by Vanguard, while Fidelity offers FXAIX.

Vanguard offers VFIAX

Fidelity offers FXAIX

Another difference between VFIAX and FXAIX is their expense ratio.  Both have low expense ratios, but FXAIX is among the lowest in the industry.

VFIAX Has An Expense Ratio Of 0.04%

FXAIX Has An Expense Ratio Of 0.015%

They are both mutual funds instead of Exchange Traded Funds (ETFs).  However, VFIAX does have an equivalent ETF which is Vanguard S&P 500 ETF (VOO).

Now, let’s keep comparing VFIAX and FXAIX.

 

VFIAX Overview

  • Fund Inception: 2000
  • 10-Year Performance 16.51%
  • Aims For Diversification
  • Expense Ratio: 0.04%
  • Number Of Stocks: 507
  • Top 10 Holdings: 30%
  • Yield 1.20%

Vanguard 500 Index Fund Admiral Shares (VFIAX) is an index fund that tracks 500 large U.S. companies.  VFIAX is the admiral version of the Vanguard S&P 500 ETF (VOO).

The fund has $856.1 billion in total net assets.

 

VFIAX Performance

VFIAX and the S&P 500 have performed identically over the last 10 years.  This performance makes sense since the fund tracks the same returns as the S&P 500.

Here is the performance of VFIAX over the last 10 years:

VFIAX Performance Chart

Here is VFIAX and the S&P 500:

VFIAX vs S&P500 Performance

As you can see, VFIAX and the S&P 500 will always have similar returns.

 

VFIAX Holdings

Vanguard’s VFIAX is comprised of over 500 stocks and is similar in composition to the S&P 500.  These are the top 10 holdings for VFIAX:

VFIAX Top Holdings

VFIAX is primarily made up of Apple, Microsoft, Alphabet, Amazon, and Tesla and provides exposure to over 500 stocks.

 

FXAIX Overview

  • Fund Inception: 1988
  • 10-Year Performance 16.54%
  • Expense Ratio: 0.015%
  • Number Of Stocks: 508
  • Top 10 Holdings: 29.29%
  • Yield 1.30%

Fidelity 500 Index Fund (FXAIX) is a fund that aims to invest at least 80% of assets in stocks that are in the S&P 500 Index.

The S&P 500 is a choice for many investors because of the opportunity to diversify their portfolios.

This diversification makes FXAIX a good option for retirement.

FXAIX has $379.81 billion in net assets.  This fund is well-liked by retail and institutional investors alike.

 

Is FXAIX The Same As S&P 500?

FXAIX is not the same as the S&P 500, but with a 10-year return of 16.37%, it resembles the returns provided by the S&P 500.

Fidelity’s FXAIX tracks at least 80% of the S&P 500 Index, and so it will always follow the Index’s returns.

Here is FXAIX’s performance over the last 10 years:

FXAIX Performance

FXAIX expense ratio is 0.015%, which is low, and this fund does not have 12b1, front-end, or back-end sales fees.

 

VFIAX vs FXAIX Performance

Many factors are taken into account while comparing the performance of VFIAX and FXAIX.  You might want to compare their returns to see how well they do.

VFIAX vs FXAIX Comparison Chart

The VFIAX fund invests all its assets in the stocks that make up the target index to duplicate them.

The FXAIX fund invests at least 80% of its assets in the common equities part of the Index.

I give a slight edge to VFIAX because it will deliver more consistent returns alongside the S&P 500.

Winner: VFIAX

 

VFIAX vs FXAIX Holdings

VFIAX and FXAIX invest in identical investments.  As a result, their holdings create a diverse portfolio.

These funds are both large-blended U.S. stock funds.

Below are the top ten holdings of VFIAX and FXAIX.

VFIAX vs FXAIX Holdings Comparison

 

VFIAX vs FXAIX Cost

Fees are one of the biggest killers of portfolio performance.  Over 30 years, the difference between a 2% cost and a 0.04% fee might result in your portfolio losing half of its value.

FXAIX has a 0.015% expense ratio, whereas VFIAX has a 0.04% expense ratio.

In this case, both of these funds have a similar cost.

The Vanguard 500 Index Fund Admiral Shares (VFIAX) is less expensive than 96% of rival funds.

VFIAX has an expense ratio of 0.04%

FXAIX has an expense ratio of 0.015%

 

VFIAX vs FXAIX Size

One factor to consider when looking for assets to invest in is size.  A vast fund does not imply that it is a good fund.

It is one factor to consider when determining the best fund.

VFIAX and FXAIX both manage around the same amount of assets.

VFIAX manages $856.1 billion, and FXAIX manages $380 billion.

 

Which Is Better FXAIX or VFIAX?

FXAIX and VFIAX are similar in performance.  In addition, FXAIX offers exposure to the S&P 500 at a lower expense ratio of 0.015%.  However, if you are not a Fidelity investor, you will have to pay commissions to buy FXAIX.

VFIAX, on the other hand, can be purchased commission-free by purchasing its equivalent ETF (VOO) with Vanguard or M1 Finance. ***(Get $50 When You Use This Link)***

It’s fundamental investors buy FXAIX or VFIAX commission-free.  Fees can take away from your portfolio returns and compound over time.

I expect FXAIX and VFIAX to perform the same over 10 years.  The expense ratio isn’t a significant difference.

 

Is FXAIX a Good Fund?

If you are seeking exposure to the S&P 500, FXAIX is a good fund option that is consistent with low fees.

A good investment aims to replicate the target index returns at the lowest cost possible.  Therefore, investors should look for the lowest-cost fund that meets their investment goals.

 

My Winner: VFIAX

VFIAX and FXAIX are identical. Both track the same stocks (the S&P 500 Index) and are similar in dividend yield and annual returns.  They also offer low fees.

Yet, VFIAX is a Vanguard fund while FXAIX is a Fidelity fund.  Vanguard’s ownership structure provides an incentive to continue to offer low-cost options.

Fidelity is not guaranteed to keep their prices low.  As a result, they could increase the expense ratio of FXAIX in the future.

This shouldn’t discourage you from considering FXAIX, especially if you buy the fund through Fidelity.

The decision might come down to which brokerage you prefer.

If you already have an account at Vanguard, then VFIAX might fit you best.

If you are with Fidelity, then FXAIX is an excellent option to consider.

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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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