5 Best Fidelity Index Funds of 2020

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Investing for retirement is a must if you want to enjoy your post-retirement years without worrying about money.

Fidelity is one of the best brokerage firms in America and I trust them personally with my SEP IRA retirement accounts. I hold a mix of stocks & index funds in my SEP IRA to provide further protection from market volatlity and as a way to hedge my portfolio.

Index funds provide a lot of benefits because they invest in a large group of stocks like a mutual fund. However, Index funds have much lower fees yet can generate outstanding returns over the long run.

Fidelity offers over 20+ index funds from a wide range of assets classes. In this article, I'm going to talk about the 5 best Fidelity index funds for retirement accounts such as an IRA or 401k. These funds providee the best long term returns along with the lowest risk & fees.

Best Fidelity Index Funds

Name Net Assets (USD) Expense Ratio
Fidelity Zero Total Stock Market index Fund (FZROX)$5.1 billion0%
Fidelity Zero Large Cap Index Fund (FNILX)$1.6 billion0%
Fidelity Zero International Index Fund (FZILX)$1.5 billion0%
Fidelity Long Term Treasury Bond Index Fund (FNBGX)$2.6 billion0.03%
Fidelity Real Estate Index Fund (FSRNX)$2.5 billion0.07%

Fidelity Zero Total Stock Market index Fund (FZROX)

This index fund is probably the #1 best index fund for anyone who wants to invest along with the US stock market until retirement. Best of all, it's 100% free to invest with no minimums or expense ratios.

The fund attempts to match the gains of the overall US Stock market. Some of the top 10 biggest holdings include:

  • Apple
  • Microsoft
  • Amazon
  • Facebook
  • JP Morgan
  • Berkshire Hathaway
  • Google
  • Johnson & Johnson
  • VIsa

I really like this index fund and it's done well for me since I bought it in May 2019.

Fidelity Zero Large Cap Index Fund (FNILX)

This index fund is very similar to FZROX except for the preference for large cap stocks. Large cap stocks are companies with a market capitalization of $5 billion or more. If you want more safety and less volatility then I recommend FNILX.

This fund is great for retirees or people very close to retirement because the fund's holdings are all well establish, strong American companies.

Some of the top 10 biggest holdings include:

  • Apple
  • Microsoft
  • Amazon
  • Facebook
  • JP Morgan
  • Berkshire Hathaway
  • Google
  • Johnson & Johnson
  • VIsa

Fidelity Zero International Index Fund (FZILX)

This fund is recommended for younger investors (Under 30) who want exposure to international markets (mostly Asian stocks). However, I would invest with caution now because Asian stocks are falling due to the US-China trade issues & Coronavirus concerns.

Some of the top 10 holdings include:

  • Nestle
  • Alibaba
  • Tencent
  • Samsung
  • HSBC
  • Taiwan Semiconductor
  • Toyota

I know Asian stocks will rebound in the future but there is a lot of risk holding these companies at the moment. This is a great long term fund though.

Fidelity Long Term Treasury Bond Index Fund (FNBGX)

For investors already at retirement age, you don't want to risk your money at all. Long term treasury bonds provide steady income without the worry of a stock market crash.

This fund provides a decent return along with passive income once you decide to stop working.

Fidelity Real Estate Index Fund (FSRNX)

This fund invests in a broad mix of REITs (real estate investment trusts) to give you some exposure outside of traditional stocks. Even though REITs have underperformed hot sectors like technology, I still like the consistent nature of real estate in general. Land becomes more valuable over time so I recommend at least 10% of your portfolio goes towards real estate or REITs.

Some of the funds top 10 holdings include:

  • Prologis
  • Simon Property Group
  • Welltower
  • Public Storage
  • Avalon Bay
  • Equity Residential
  • Ventas
  • Essex Property Trust
  • Boston Properties

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