Author Topic: Is this a scam or a good buy for a Fidelity 401k Fund?  (Read 2821 times)

moss

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Is this a scam or a good buy for a Fidelity 401k Fund?
« on: May 09, 2017, 02:15:00 PM »
Please see the pictures below. This is a fund in my friends 401k through fidelity. I think it's something offered to Dell employees.

Is this a good deal or should he put his money in a different fidelity index fund like whatever fidelity's version of VTSAX is?

The expense ratio say is .005 and that there are target, actively managed and passively managed funds in this.

moss

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Re: Is this a scam or a good buy for a Fidelity 401k Fund?
« Reply #1 on: May 09, 2017, 02:17:23 PM »
Last picture, thanks in advance for everyones advice!

Proud Foot

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Re: Is this a scam or a good buy for a Fidelity 401k Fund?
« Reply #2 on: May 09, 2017, 02:30:52 PM »
It looks like it is probably a special S&P500 or Total Market Index for just the Dell employees.  Searching the Fidelity site I could not find that fund in any of their listings.  From your pictures it seems to be a completely passive fund.  Your picture showing Target, Active, and Passive funds is the listing of funds your friend is invested in.  It wouldn't make much sense for a fund to be invested in itself.

Definitely jealous of your friend for having that option!

moss

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Re: Is this a scam or a good buy for a Fidelity 401k Fund?
« Reply #3 on: May 09, 2017, 02:33:16 PM »
My brother in law has a fund through Fidelity that may be similar to this and it's expense ratio was something crazy low like .004. I'll ask for pictures to post that too. He works for AT&T.

I thought both of these were too good to be true and that there may be something wrong with them. If that's not the case, please let me know.

ZiziPB

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Re: Is this a scam or a good buy for a Fidelity 401k Fund?
« Reply #4 on: May 09, 2017, 02:44:06 PM »
Looks like a proprietary index fund tracking S&P 500 that's being offered at a really low cost (subsidized by the employer, most likely).  It's very common to see something like that offered by large 401k plans.  I have one like that in my 401k, although not as cheap.  I'd say definitely legit and definitely a good choice.

chasesfish

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Re: Is this a scam or a good buy for a Fidelity 401k Fund?
« Reply #5 on: May 10, 2017, 08:34:09 AM »
Do you work for a large company?  If so, it might be.  For the longest time, the Fidelity Spartan Fund was the lowest cost index fund.  Fidelity

My 401k has a Vanguard Index Fund with a 0.02% ratio.  When I look it up online, the minimum investment amount is $200mil.

PDXTabs

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Re: Is this a scam or a good buy for a Fidelity 401k Fund?
« Reply #6 on: May 10, 2017, 08:56:16 AM »
I work for HP and we have a similar fund through Fidelity with a 0.03% expense ratio. These are large companies with tens of thousands of employees. Perhaps Fidelity is cutting them a deal to get customers into their managed funds?

Car Jack

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Re: Is this a scam or a good buy for a Fidelity 401k Fund?
« Reply #7 on: May 10, 2017, 09:13:59 AM »
On the open market, Fidelity offers 2 funds at 0.015%.  A 500 and total market fund institutional premium with minimum of $100M.  I know from my own 401k that I'm able to get similar funds at ERs that are lower than those published by Fidelity so am not surprised that Dell is able to offer these.  The other thing to look for is ANY management fee documented within the Dell/Fidelity/netbenefit site for that specific 401k.  My wife has held on to a 15 year old 401k because it had a Vanguard bond fund at an ER lower than what we could get for an admiral level fund inside of Vanguard itself.  This January, on my usual check, they added a 0.5% management fee and I immediately moved it out to her Fidelity IRA.  This can happen at any time with an employer and they don't seem to have to tell you.  Or perhaps in the 300 page plan booklet that's sent as a PDF every year, it's on page 255 in 1/2 point font.

tarheeldan

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Re: Is this a scam or a good buy for a Fidelity 401k Fund?
« Reply #8 on: May 10, 2017, 10:09:29 AM »
It's an S&P 500 fund, looks good:

Equity Index Fund
Primary Investment Objective: Seeks to match the performance of the S&P 500 Index.
Investment Strategy: The fund is invested in virtually all of the S&P 500 Index stocks in their
appropriate capitalization weights. The fund is designed to replicate the returns of the S&P

From: https://cache.hacontent.com/ybr/R511/05977_ybr_ybrfndt/downloads/DellInc401kPlanSPD.pdf

ChpBstrd

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Re: Is this a scam or a good buy for a Fidelity 401k Fund?
« Reply #9 on: May 12, 2017, 03:15:43 PM »
Just make sure the find print doesn't describe its holdings as another fund or funds, whose ER is not included in that bargain number.

MDM

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Re: Is this a scam or a good buy for a Fidelity 401k Fund?
« Reply #10 on: May 12, 2017, 04:18:41 PM »
These are called Collective Investment Trusts and yes they can be a legitimately good deal.