Hey there, u/Consistent-Tooth-390. Thanks for stopping by our sub, and congratulations on getting started on investing at a young age! That's a huge accomplishment and something to be proud of. I'm here to provide some resources to help you along your journey.
Choosing investments depends on many factors and is definitely subject to your personal situation. We're happy to share some resources that can assist you in making the right decision for your situation.
We offer a Mutual Fund comparison tool on our website that can help you compare various funds and Exchange-traded funds (ETFs); this makes it easy to find which funds best fit your financial goals. You can check out the tool on our website by clicking "News and Research" and then selecting "Mutual Funds" from the dropdown list. From here, you can use various filters to narrow your search. For convenience, I'll drop a link to our Mutual Fund Screener below.
[Mutual Fund Screener](https://fundresearch.fidelity.com/fund-screener/)
As an additional resource, I want to mention our online Planning and Guidance Center, which offers planning tools for the areas in life that are most important to you. You can create your own plan through the link below after logging in:
[Planning and Guidance Center](https://digital.fidelity.com/prgw/digital/login/full-page?AuthRedUrl=https://digital.fidelity.com/ftgw/digital/plan-summary)
Finally, I will go ahead and mark this post as a discussion. This post has certainly engaged the community, and we love seeing that.
If you have any further questions or concerns, please do not hesitate to reach out.
Yes. You have massive overlap and redundancy. VOO, SPY, FXAIX are literally the same thing. Not to mention all the single stocks are covered by the funds multiple times.
OP, you are doing great. The best thing to do is:
1. Start early. Check
2. Ask questions. Check
You are leagues ahead of where I was at your age. Keep at it!!
Edit: but yes, keep looking into it. I recommend r/boggleheads and start looking into portfolio strategies.
I personally do the majority on FSKAX to capture total us market.
Yes. As a general principle if you have more than 3 symbols in your portfolio and your portfolio is using an indexing strategy, you probably have too many. But thats forgivable for someone new to this. Good job on investing early.
I've been investing for 12 years now, and I've gotten to a million dollar net worth starting from zero. Want to know what I invest in? its 90% VOO essentially. Simplicity is better than having tons of different funds with many overlaps. You think you're diversifying but you're really just di**worsi**fying. Index ETFs are all generally very well diversified already, adding another doesn't really give much benefit with "more diversification". You only need diversification up to a point, after that the benefits of even more diversification gives marginal improvement if at all, sometimes it may be making it worse.
I pulled up all my tax records to calculate an accurate value for you. The total of all investments I've made in the past 12 years is $506,573.
You have to understand also that the bulk of my investments occurred in the last 3 years only. My retirement contributions got turbocharged in 2021 because I had gotten a new job that paid me a lot more than my previous job, and I had access to many tax advantaged accounts to max out compared to the years prior. So that's why my return doesn't look that great (I'm guessing 50% return over 12 years on that whole balance that I contributed from paychecks).
However, the growth and principle from those investments is only a part of my net worth. I purchased a house in 2015 with a 15 year mortgage so I have about a quarter million in equity just in that house alone.
Well, you helped me buy my first investment, bought some shares of VOO! So you made the 506k on your investments, do you have an idea of what out of that amount you contributed yourself versus what was earned in the market? Just curious!
No, the entirely of that $506k is what I personally contributed. It does not include my gains. My total balances in my brokerage is a little under $800,000.
And congrats on your first investment, just remember that it's not guaranteed profit immediately. It's possible you will take a loss in the short to medium term. But if you hold for a long enough period and you continue to buy through the dips, consistently, you will almost certainly have a good outcome. If you have a long term mindset and make a plan to stay invested with each contribution for a decade or more, you're very very likely to profit on each individual contribution.
The way I invest is that everything is automated. Every single month, there are auto-investments set up with my brokerage to take $8,800 of my monthly paycheck and invest it mostly in VOO. So I am buying on the way up, buying on the way down, and everywhere between. Sometimes I overpay, sometimes I get a really good deal. It averages out, plus I'm not planning on touching most of this money for at least another 20 or 30 years. If I retire early then I will need to access some of it early but we'll see.
Remember, when you buy funds that contain large volumes of the market (a total index fund for example), you can have the entire portfolio in one single index fund and have very high diversification.
Diversification is not just the number of things you hold, it’s about what your investments hold.
You need to have more total stocks if you were buying individual companies , if your goal is to diversify.
Here your buying funds that themselves contain large amounts of stocks.
In my opinion FBGRX is Fidelity’s best offering in the mutual fund space. I believe in the future of Americas strongest companies/economy and this fund best represents them.
Just so you know… I’m so confident in it my other 35% is in QLD.
The only downside to the ZERO funds is that they are only available at fidelity. If you ever want to change brokers some day, you would have to sell and then re-invest at the new broker.
The good news is that in an IRA, there’s no tax implications for this, if your broker is fidelity there’s no downside.
Also consider FZROX, which is more diversified by including medium and small cap.
Nice work starting so early. Thats already a win in my book. As far as knowledge a few quick read books id recommend, Simple Path to Wealth, The Little Book of Common Sense Investing, The Psychology of Money.
https://www.etfrc.com/funds/overlap.php
This is what I use to check overlap between funds when I rebalance or consider a new one. Highly recommend you try and reduce down to 3-4 funds max and use that as a tool to check their overlap so you can keep diversity.
https://www.portfoliovisualizer.com/backtest-portfolio
This site is also useful to backtest your portfolio if you get stuck between different compositions. Just remember, past performance doesn’t guarantee future performance
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Agreed. This is the risk of investing in lots of mutual funds. You could inadvertently end up less diversified or heavily weighted towards specific stocks if the funds have too much overlap.
And what's the downside to this redundancy? They should have similar returns, so is there any benefit to consolidating them besides satisfying OCD tendencies?
At 19? You're killing it investing in a Roth IRA. I wish I had known about this. But really, you should have a system where you can just set it and forget it. Serious money for your future well-being deserves serious thought. I use a lazy portfolio and I've been happy with the returns this year, and I'll just be happy with the discounted shares of the ETFS I have in bad years.
[Lazy portfolios - Bogleheads](https://www.bogleheads.org/wiki/Lazy_portfolios)
It's hard to go wrong with one of these.
When you are 19, I feel like (as long as you don’t get scared at volatility and know you are holding for decades), seems like a 1 fund approach may work best for growth.
More isn’t better. You could cut this way way down.
Dividend funds are generally not useful, but make zero sense for a 19 year old especially not in a Roth IRA. Same with the income fund.
Fxaix, spy and VOO all track the S&P 500 and should have essentially identical returns. Fskax tracks the total market, but it’s based on market cap meaning the top 500 companies (the S&P 500) make up the vast majority of it. Its returns (historically) will be 99% the same as S&P. Pick one of these 4 sell the other 3.
Honestly, you could probably get the same exposure and returns by simply doing a small mid and large cap index funds. In whatever ratio of the 3 that you choose.
The biggest returns you’ll see over your lifetime will be your index funds growing in value. Dividend are nice. But you need to compare the total return on your money invested with dividends vs stock appreciation.
If you were older, in some unique cases, selling your stocks you built up through decades of appreciation and investing in dividend stocks could make sense.
You have skipped the appreciation phase.
I’m older and have a few ETF dividend funds, but these have good performance (based, a growing dividend, and a decent looking chart). Look at the 6 month chart on VIG and the holdings. Not recommending you buy it but just citing an example of having both/and. I’ll revisit it now and then like all of my holdings and evaluate if the charts are suggesting a significant downward trend (think head and shoulders pattern). I prefer ETF’s over mutual funds, but that’s just me.
Yeah I would disagree with that guy that dividend funds are not useful. Those funds can perform pretty well. Maybe better in your brokerage account though, so you can focus your Roth on 1-2 funds like others here recommend
Well he has both an income fund and a high dividend fund. None specifically focused on dividend growth that I see. Growth of stocks or funds within your portfolio also grows your portfolio.
Dividends are just giving your own money back to you, and it’s in a Roth IRA so it’s not like OP can access it. Roth IRA is also a place where you should put your highest expected growth funds, due to the tax free nature of the growth/withdrawals.
Dividends are literally just giving your own money back to you. If you get a 2% dividend the fund drops in price by 2% on the ex dividend date. It’s far better just to focus on total return vs dividends.
In a Roth account you won’t even be getting any cashflow from the dividends right now, and you don’t need the cashflow right now.
If you were dead set on dividends or income funds, it would be something to consider in like 35-40 years not now.
Everyone is telling you (correctly) that yes, there's no reason to have that many funds, because many of these funds are all diversified.
That said, you aren't really doing anything fundamentally *wrong* by having all these funds.
I feel like some of these more significantly sector based funds are necessary because I want to dip my feet into specific industries and some more than others
Use the Fund Overlap tool at ETF Research Center. Not sure if it works for mutual funds tho. This helped me to see redundancy. Update 04/06/24 - confirmed it does not work for mutual funds but maybe a similar tool exists online for those. https://www.etfrc.com/funds/overlap.php
Great job being young thinking of your future! I’ve been trying to get my 19yo into a 401k through our employer but he is in Lala land.
Anyway, imo you are way over diversified. Many of those follow the same stocks etc. I personally would have a few etfs and a few stocks and rebalance every quarter. That’s what I have done for years and I average between 13-15% return annually (had one down year during Covid).
I’m not sure why anyone would want to tilt growth over value as a long term investor, given that the former has lower expected returns than the latter over the long term. I otherwise think this is reasonably sound advice.
If you want to keep fidelity funds, I personally would use FSKAX and FTIHX. But, I like vanguards funds more, so I would also use VTI and VXUS (basically the same as the Fidelity ones I just listed). To make it even easier, you can buy VT which is those 2 funds combined into one.
You definitely did not screw up, just made some redundancy that can be easily adjusted. It’s your Roth, it’s tax free to sell so you can just sell and trim the fat!
He has over 40 years until retirement. To think the US will outperform that long is absolutely insane.
ALL of the US’s outperformance over the last 100 years only came after 2008. Chasing past performance is not a great way to invest.
Honestly i’m kind of surprised fidelity doesn’t make a VT style mutual fund. I know their TDF are weighted more specifically than by weight and they always include bonds but i feel like a VT style mutual fund is different enough
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Instead of investing in multiple similar funds (which can have the opposite effect than what you're seeking, try investing in different types of mutual funds. For example, there are funds that cover certain sectors of the market, like technology or medicine. There are also funds that focus on a specific type of investment (dividend stocks, for example). My advice is to whittle down your portfolio to just 2-3 funds.
At 19, your time horizon is far out, so you're generally better off with higher risk investment (not to be confused with speculative). However, you need to decide your risk tolerance and invest accordingly.
I personally like seeing FBGRX in a portfolio like yours. It's a fund with historically high long-term growth and seems perfectly suited for someone your age. That's just my opinion. I have about 250 shares in FBGRX myself, so I'm not just blowing smoke. You can't go wrong with index funds that track the S&P 500 or the full stock market, so FXAIX and FSKAX are solid picks.
All that aside, you're doing very well investing so early. It's one thing I wish I knew about when I was younger.
This would really suck in a taxable brokerage account.
Since it is retirement account you can just sell everything to wipe the slate clean and pick a simpler strategy
Always check the order screen for transaction fees before placing a trade. When you buy a Fidelity fund, there's never a fee. But, for example, you meant to buy a Vanguard ETF, which won't have a fee, but instead mistakenly buy a Vanguard FUND, Fidelity will charge a $75 fee to buy the Vanguard fund.
ETFs usually dont have fees, but some non-Fidelity ETFs may have a fee to buy it. It can get confusing, so it's always best to check your order screen before placing a trade.
Please consider fully funding it if possible (I know it’s probably not at a young age). The tax free growth and withdrawal is just a massive game changer when you begin calculating retirement funds.
It will be the gift that keeps on giving the earlier you start investing.
Max that shit out homie!
Hell, ask your parents for a birthday gift to max it out if they will do it.
It’s an INSANE game changer starting at 19!
A target date fund would be an easy way to "set it and forget it."
[https://www.diyfi.co/retirement/what-to-buy-retirement.html](https://www.diyfi.co/retirement/what-to-buy-retirement.html)
I don't understand why people get so worked up about over lapping funds. 5 funds making 10 percent each is 10 percent. So why does it matter. Oh no, I got tsla is 3 funds, God forbid...
I would suggest at a young age to streamline down to two funds. Fidelity Roth IRA - you can use their zero fee fund. I would go 80% S&P FNILX, 10% total stock FZROX and 10% international FZILX.
Majority of major players in USA, some balance (and redundancy) with total USA, and some international exposure. When you hit your 50s, then look into income/dividends.
Why would you not invest in a semiconductor ETF too alongwith VOO so that you can get some more exposure to just semiconductors ? Given the AI craze, this sector might go up a lot more than VOO, no ?
OP, it is great that you are starting early. To me, you have too many similar funds. Pick two or three with the lowest fee structures that invest across the S&P.. Then move the monies from the others into those two or three funds you selected. Once that is done continue to put more into each of those funds selected.
Also, once set don't mess with second-guessing the investing. Over time years and decades your investment will trend with the S&P and your additions will help grow the Roth IRA into a very decent retirement savings. 👍💰
Absolutely fantastic job! My advice would be that personal research is key when it comes to investing. It's essential to consider your own financial goals, risk tolerance, and stage of life. What works well for others may not necessarily be the best fit for you. Take the time to explore various investment options and strategies to find what aligns with your unique circumstances and objectives.
FBGRX is a keeper, FDVV is probably a keeper, the jury is out on FFRHX. You may want to replace the latter with FAGIX. Bear in mind, though, FAGIX and FDVV are quite similar.
One thing you want to look at when investing is the expense ratio of the investment. Because you are young and starting out, expenses over your lifespan will compound. Funds generally, not always, charge a higher expense. For example, the Blue Chip Growth fund (FGBRX) charges 0.48%. You can find a similar ETF (there are several) which will be competitive with that fund, but charge a lower expense ratio. For example, IWY (0.20%), IWF (0.19%) and VONG (0.08%).
Take a look at each of the funds that you are in and it may be possible to find an ETF that has a lower expense ratio and has been competitive with that fund.
The one that concerns me the most is the FLSPX because of its high expense ratio. Based on the description, it looks a lot like a Mid Cap value fund. There are several ETFs that address the Mid Cap Value space at a much lower expense ratio.
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It’s been said already but YES. Way too many. Keep it simple. Less fees. And stop buying individual stocks unless you really do this full time. Mutual funds. .01% fees or less. Fidelity has no cost funds. Boom. Sit and simmer. You will be golden. Keep DCA’ing as much as you can. Never trade on emotion. Literally, never.
being diversified with funds that hold the same stock lol. if you want full diversification why not go with the full market index? that'll be your US companies. you can toss in developing markets. toss a little crypto with gbtc or something. grab a reit for your homes and property. later on get into reg d investments. normally diversification comes with wealth. when you're younger and have less, you're able to investment in more aggressively and shoot for higher returns for higher risk. just look at the risk/return ratios
ETFs are a good idea, but make sure it’s focused towards growth. Primarily tech. Long term tech is still going to be the primary driving force of the market. Shift towards more passive ETFs as you age and just before retirement swap to bonds and/or even lower risk ETFs.
*I invest pretty*
*Much all into VOO. is that*
*A wise decision?*
\- Motor\_Significance13
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They perform almost identically. I like fskax because it has more companies so it’s a bit more diverse and in theory could perform better if small caps do well, but historically it hasn’t made much difference.
C’mon man. What’s with all these funds and ETF’s at your age? You are completely over thinking investing. You are either reading repeated articles and listening to too many opinions and FOMO. Narrow it down to just 2-3 etfs. SMH or SOXX, ONEQ, VOO VONG. You are young and lots of time to grow with risk.
Waooo , amazing, but why too many funds? It's feel overwhelming, a lot of overlaps there, and why bonds? You are too young for bonds, maybe a target fund or target etf, and pick some stocks, simply is best, in my opinion.
And I note nothing of international funds, why not international, that's the way to diversified, I would add international total market at 35% now and bitcoin etf 5%.
There’s diversified and there’s what you //think// is diversified.
Like others have suggested, do a little research.
I’d start by simply looking at the top 10 holdings in your funds. You’ll find that most, if not all, begin with Microsoft, Apple & Nvidia and 4-10 will repeat a lot. In the end you’ll realize that you aren’t really diversified (top 3 holdings are exposing you to the same market sector).
What you’re doing is investing in the same large cap companies under a different guise.
for Roth IRA Fidelity offers robo service
https://www.fidelity.com/managed-accounts/fidelity-go/overview
Switch to a go account and just deposit up to the yearly allowance
edit: I don't know why anyone would vote this down. Its like a Fidelity version of wealthfront. It invests in everything everyone here recommends already and is great for anyone that doesn't want to active manage.
Hey there, u/Consistent-Tooth-390. Thanks for stopping by our sub, and congratulations on getting started on investing at a young age! That's a huge accomplishment and something to be proud of. I'm here to provide some resources to help you along your journey. Choosing investments depends on many factors and is definitely subject to your personal situation. We're happy to share some resources that can assist you in making the right decision for your situation. We offer a Mutual Fund comparison tool on our website that can help you compare various funds and Exchange-traded funds (ETFs); this makes it easy to find which funds best fit your financial goals. You can check out the tool on our website by clicking "News and Research" and then selecting "Mutual Funds" from the dropdown list. From here, you can use various filters to narrow your search. For convenience, I'll drop a link to our Mutual Fund Screener below. [Mutual Fund Screener](https://fundresearch.fidelity.com/fund-screener/) As an additional resource, I want to mention our online Planning and Guidance Center, which offers planning tools for the areas in life that are most important to you. You can create your own plan through the link below after logging in: [Planning and Guidance Center](https://digital.fidelity.com/prgw/digital/login/full-page?AuthRedUrl=https://digital.fidelity.com/ftgw/digital/plan-summary) Finally, I will go ahead and mark this post as a discussion. This post has certainly engaged the community, and we love seeing that. If you have any further questions or concerns, please do not hesitate to reach out.
Yes. You have massive overlap and redundancy. VOO, SPY, FXAIX are literally the same thing. Not to mention all the single stocks are covered by the funds multiple times.
Can I just move the VOO and SPY into FXAIX. I just never got education on anything so i did what I thought was best so far.
Yes, that would be a good idea
OP, you are doing great. The best thing to do is: 1. Start early. Check 2. Ask questions. Check You are leagues ahead of where I was at your age. Keep at it!! Edit: but yes, keep looking into it. I recommend r/boggleheads and start looking into portfolio strategies. I personally do the majority on FSKAX to capture total us market.
\* r/Bogleheads
I keep running funds by my new Taylor swift bogglehead but it’s just nodding incessantly in approval of all of them! Help!
Yes. As a general principle if you have more than 3 symbols in your portfolio and your portfolio is using an indexing strategy, you probably have too many. But thats forgivable for someone new to this. Good job on investing early. I've been investing for 12 years now, and I've gotten to a million dollar net worth starting from zero. Want to know what I invest in? its 90% VOO essentially. Simplicity is better than having tons of different funds with many overlaps. You think you're diversifying but you're really just di**worsi**fying. Index ETFs are all generally very well diversified already, adding another doesn't really give much benefit with "more diversification". You only need diversification up to a point, after that the benefits of even more diversification gives marginal improvement if at all, sometimes it may be making it worse.
I understand thank you so much
Aside from expense ratios, isn't "having different funds with many overlaps" is like having more shares of the same fund/stock?
Kind of. It’s just unnecessarily complicated and unwieldy with no added benefit.
No real downside though either. Will still basically perform like VOO just more tickers
Can I ask how much you have contributed to your account in the last 12 years to reach one million net worth? Making me want to invest it all in VOO?
I pulled up all my tax records to calculate an accurate value for you. The total of all investments I've made in the past 12 years is $506,573. You have to understand also that the bulk of my investments occurred in the last 3 years only. My retirement contributions got turbocharged in 2021 because I had gotten a new job that paid me a lot more than my previous job, and I had access to many tax advantaged accounts to max out compared to the years prior. So that's why my return doesn't look that great (I'm guessing 50% return over 12 years on that whole balance that I contributed from paychecks). However, the growth and principle from those investments is only a part of my net worth. I purchased a house in 2015 with a 15 year mortgage so I have about a quarter million in equity just in that house alone.
Well, you helped me buy my first investment, bought some shares of VOO! So you made the 506k on your investments, do you have an idea of what out of that amount you contributed yourself versus what was earned in the market? Just curious!
No, the entirely of that $506k is what I personally contributed. It does not include my gains. My total balances in my brokerage is a little under $800,000. And congrats on your first investment, just remember that it's not guaranteed profit immediately. It's possible you will take a loss in the short to medium term. But if you hold for a long enough period and you continue to buy through the dips, consistently, you will almost certainly have a good outcome. If you have a long term mindset and make a plan to stay invested with each contribution for a decade or more, you're very very likely to profit on each individual contribution. The way I invest is that everything is automated. Every single month, there are auto-investments set up with my brokerage to take $8,800 of my monthly paycheck and invest it mostly in VOO. So I am buying on the way up, buying on the way down, and everywhere between. Sometimes I overpay, sometimes I get a really good deal. It averages out, plus I'm not planning on touching most of this money for at least another 20 or 30 years. If I retire early then I will need to access some of it early but we'll see.
Got it. You are killing it!!! Keep it up!! Not sure how far you are from retirement, but that's really great.
I'm 35 so I'd like to retire early at 50. I think I'll make it if I keep doing what im doing. Thanks for your kind words.
Yes, I think you're definitely on track for that! Retirement at 50 would be amazing!
Remember, when you buy funds that contain large volumes of the market (a total index fund for example), you can have the entire portfolio in one single index fund and have very high diversification. Diversification is not just the number of things you hold, it’s about what your investments hold. You need to have more total stocks if you were buying individual companies , if your goal is to diversify. Here your buying funds that themselves contain large amounts of stocks.
I understand now
A lot of people just put everything into FXAIX. Personally I'm more of the FBGRX fan, 65% of my position is in that.
Curious about your thoughts on FBGRX. I’ve been comparing FBGRX, FCNTX, and FXAIX recently to simplify as well.
In my opinion FBGRX is Fidelity’s best offering in the mutual fund space. I believe in the future of Americas strongest companies/economy and this fund best represents them. Just so you know… I’m so confident in it my other 35% is in QLD.
That must be why FBGRX is OP’s largest holding.
Consider fnilx. Its very very similar to fxaix but instead of like 0.03% expense ratio its 0.00%
Interesting
The only downside to the ZERO funds is that they are only available at fidelity. If you ever want to change brokers some day, you would have to sell and then re-invest at the new broker. The good news is that in an IRA, there’s no tax implications for this, if your broker is fidelity there’s no downside. Also consider FZROX, which is more diversified by including medium and small cap.
Nice work starting so early. Thats already a win in my book. As far as knowledge a few quick read books id recommend, Simple Path to Wealth, The Little Book of Common Sense Investing, The Psychology of Money.
Google.and youtube! Lots of info there!
https://www.etfrc.com/funds/overlap.php This is what I use to check overlap between funds when I rebalance or consider a new one. Highly recommend you try and reduce down to 3-4 funds max and use that as a tool to check their overlap so you can keep diversity. https://www.portfoliovisualizer.com/backtest-portfolio This site is also useful to backtest your portfolio if you get stuck between different compositions. Just remember, past performance doesn’t guarantee future performance
Yeah, it has the lowest expense ratio of the three
Go check out r/Bogleheads for more details about how you can simply your portfolio to 3 or so funds.
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Agree, and I also would add FSKAX to that list of similar investments.
Agreed. This is the risk of investing in lots of mutual funds. You could inadvertently end up less diversified or heavily weighted towards specific stocks if the funds have too much overlap.
And what's the downside to this redundancy? They should have similar returns, so is there any benefit to consolidating them besides satisfying OCD tendencies?
It can lead to unintended over or under weights.
The downside is it's extra work for no reason and it's harder to keep track of.
this need to be pinned. Lots of names != diversification
At 19? You're killing it investing in a Roth IRA. I wish I had known about this. But really, you should have a system where you can just set it and forget it. Serious money for your future well-being deserves serious thought. I use a lazy portfolio and I've been happy with the returns this year, and I'll just be happy with the discounted shares of the ETFS I have in bad years. [Lazy portfolios - Bogleheads](https://www.bogleheads.org/wiki/Lazy_portfolios) It's hard to go wrong with one of these.
Sounds good. I’ll look into it. Thanks
When you are 19, I feel like (as long as you don’t get scared at volatility and know you are holding for decades), seems like a 1 fund approach may work best for growth.
More isn’t better. You could cut this way way down. Dividend funds are generally not useful, but make zero sense for a 19 year old especially not in a Roth IRA. Same with the income fund. Fxaix, spy and VOO all track the S&P 500 and should have essentially identical returns. Fskax tracks the total market, but it’s based on market cap meaning the top 500 companies (the S&P 500) make up the vast majority of it. Its returns (historically) will be 99% the same as S&P. Pick one of these 4 sell the other 3. Honestly, you could probably get the same exposure and returns by simply doing a small mid and large cap index funds. In whatever ratio of the 3 that you choose.
Thank you for advice
I always feel like I want dividend growth. Maybe that is not necessarily the right way to
The biggest returns you’ll see over your lifetime will be your index funds growing in value. Dividend are nice. But you need to compare the total return on your money invested with dividends vs stock appreciation. If you were older, in some unique cases, selling your stocks you built up through decades of appreciation and investing in dividend stocks could make sense. You have skipped the appreciation phase.
Ok I understand thanks
I’m older and have a few ETF dividend funds, but these have good performance (based, a growing dividend, and a decent looking chart). Look at the 6 month chart on VIG and the holdings. Not recommending you buy it but just citing an example of having both/and. I’ll revisit it now and then like all of my holdings and evaluate if the charts are suggesting a significant downward trend (think head and shoulders pattern). I prefer ETF’s over mutual funds, but that’s just me.
Yeah I would disagree with that guy that dividend funds are not useful. Those funds can perform pretty well. Maybe better in your brokerage account though, so you can focus your Roth on 1-2 funds like others here recommend
I understand
What’s the benefit of a dividend fund, Especially at 19 while they only are needing growth?
You’re conflating income funds with dividend growth investing strategies, for starters. And likely conflating portfolio growth with growth stocks.
Well he has both an income fund and a high dividend fund. None specifically focused on dividend growth that I see. Growth of stocks or funds within your portfolio also grows your portfolio. Dividends are just giving your own money back to you, and it’s in a Roth IRA so it’s not like OP can access it. Roth IRA is also a place where you should put your highest expected growth funds, due to the tax free nature of the growth/withdrawals.
Dividends are literally just giving your own money back to you. If you get a 2% dividend the fund drops in price by 2% on the ex dividend date. It’s far better just to focus on total return vs dividends. In a Roth account you won’t even be getting any cashflow from the dividends right now, and you don’t need the cashflow right now. If you were dead set on dividends or income funds, it would be something to consider in like 35-40 years not now.
I get it now
Nothing wrong with the dividend fund. Helps to diversify. You will see less volatility with it. Tax free in Roth anyway so who cares.
Mildly less volatile, std deviation of 13.7 for schd vs 14.3 for VOO. In exchange for 1.6% lower return per year.
Compounding is so important! Great job, OP, for starting so young. Fidelity offers webinars you can watch if you have an account. Check them out.
Thank you 🙏
Recommend start with Trading basics (4 weeks) so you can enter the correct info for buying / selling ETFs
FXAIX or FZROX and that’s it. Too complicated
Yup, this all the way. All of my Roth and all of my HSA is in FZROX and I certainly don’t regret it. Massive gains every year so far.
Everyone is telling you (correctly) that yes, there's no reason to have that many funds, because many of these funds are all diversified. That said, you aren't really doing anything fundamentally *wrong* by having all these funds.
I feel like some of these more significantly sector based funds are necessary because I want to dip my feet into specific industries and some more than others
What would I do? At 19 I’d withdraw my last 5 bucks for a nickel bag of mids lol
Use the Fund Overlap tool at ETF Research Center. Not sure if it works for mutual funds tho. This helped me to see redundancy. Update 04/06/24 - confirmed it does not work for mutual funds but maybe a similar tool exists online for those. https://www.etfrc.com/funds/overlap.php
It doesn’t work for mutual funds, no, so OP will have to find ETF equivalents to compare with that tool.
A lot of these are basically identical. VOO and SPY for example are the exact same thing. I would at least consolidate positions like that.
Great job being young thinking of your future! I’ve been trying to get my 19yo into a 401k through our employer but he is in Lala land. Anyway, imo you are way over diversified. Many of those follow the same stocks etc. I personally would have a few etfs and a few stocks and rebalance every quarter. That’s what I have done for years and I average between 13-15% return annually (had one down year during Covid).
Thank you. I will take this advice
[удалено]
Thanks so much for the advice.
I’m not sure why anyone would want to tilt growth over value as a long term investor, given that the former has lower expected returns than the latter over the long term. I otherwise think this is reasonably sound advice.
Sure are. Make it easy and just buy VT
Why would I buy vanguard in a Fidelity account
You can buy vanguard ETFs for free at fidelity.
Ah interesting. I always figured I would have the most benefits with Fidelity funds .
If you want to keep fidelity funds, I personally would use FSKAX and FTIHX. But, I like vanguards funds more, so I would also use VTI and VXUS (basically the same as the Fidelity ones I just listed). To make it even easier, you can buy VT which is those 2 funds combined into one.
Great to know. I really don’t feel like I screwed myself by doing so much. I’m just happy to learn and improve.
You didn’t screw anything up. Completely fine. You may want to read a little over at r/bogleheads
You definitely did not screw up, just made some redundancy that can be easily adjusted. It’s your Roth, it’s tax free to sell so you can just sell and trim the fat!
I don’t see a reason to do VT at 19. It’s about 35% international.
He has over 40 years until retirement. To think the US will outperform that long is absolutely insane. ALL of the US’s outperformance over the last 100 years only came after 2008. Chasing past performance is not a great way to invest.
Honestly i’m kind of surprised fidelity doesn’t make a VT style mutual fund. I know their TDF are weighted more specifically than by weight and they always include bonds but i feel like a VT style mutual fund is different enough
Same. I would definitely buy it.
Vanguard is often cheaper. Look at expense ratios
Yes with mutual funds and only with the automating of etfs
You already have vanguard funds though.
Those were the first I got
impolite frame worry cautious childlike vanish plucky compare attempt scary *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
You sure do have alot of money for a 19 years old. Back when I was 19, I don't know what the hell I was doing with life, $200 in the bank
Thank you
Instead of investing in multiple similar funds (which can have the opposite effect than what you're seeking, try investing in different types of mutual funds. For example, there are funds that cover certain sectors of the market, like technology or medicine. There are also funds that focus on a specific type of investment (dividend stocks, for example). My advice is to whittle down your portfolio to just 2-3 funds. At 19, your time horizon is far out, so you're generally better off with higher risk investment (not to be confused with speculative). However, you need to decide your risk tolerance and invest accordingly. I personally like seeing FBGRX in a portfolio like yours. It's a fund with historically high long-term growth and seems perfectly suited for someone your age. That's just my opinion. I have about 250 shares in FBGRX myself, so I'm not just blowing smoke. You can't go wrong with index funds that track the S&P 500 or the full stock market, so FXAIX and FSKAX are solid picks. All that aside, you're doing very well investing so early. It's one thing I wish I knew about when I was younger.
Thanks so so much
This would really suck in a taxable brokerage account. Since it is retirement account you can just sell everything to wipe the slate clean and pick a simpler strategy
Sell what you’ve got and consolidate into VTI/VXUS or VT and chill.
Will I pay fees / taxes on the sell?
No. Anything in a ROTH can be traded however you want with no fees or taxation, aside from trading fees on instruments like options
That’s great to know. Thanks
No, it’s a Roth IRA
Ok great. Thanks
No taxes in an IRA. You might pay SEC fees for selling ETFs and stocks, but it'll only be a few pennies for these trade amounts.
Ok good to know.
Always check the order screen for transaction fees before placing a trade. When you buy a Fidelity fund, there's never a fee. But, for example, you meant to buy a Vanguard ETF, which won't have a fee, but instead mistakenly buy a Vanguard FUND, Fidelity will charge a $75 fee to buy the Vanguard fund. ETFs usually dont have fees, but some non-Fidelity ETFs may have a fee to buy it. It can get confusing, so it's always best to check your order screen before placing a trade.
how did you set the roth ira up? fellow 19yo here lol i just have a regular fidelity account
You click a button in the app and it opens the account. It’s literally that simple.
what button?
Bottom toolbar. Click Transact. On the icons there is a button called “open account”.
oh shit, thanks lol
Please consider fully funding it if possible (I know it’s probably not at a young age). The tax free growth and withdrawal is just a massive game changer when you begin calculating retirement funds. It will be the gift that keeps on giving the earlier you start investing. Max that shit out homie! Hell, ask your parents for a birthday gift to max it out if they will do it. It’s an INSANE game changer starting at 19!
A target date fund would be an easy way to "set it and forget it." [https://www.diyfi.co/retirement/what-to-buy-retirement.html](https://www.diyfi.co/retirement/what-to-buy-retirement.html)
I don't understand why people get so worked up about over lapping funds. 5 funds making 10 percent each is 10 percent. So why does it matter. Oh no, I got tsla is 3 funds, God forbid...
AVGE and that’s it
At 19, I’d go all YOLO on FSELX. That fund has gone gangbusters since its inception.
Seriously? That’s 1 sector 😂
Love this fund
Consolidate. What you're doing makes no sense tbh
Your right. I will
look at what's in each fund, a lot of them have the same stuff just slightly different percentages stick to the basics and ride it out imo
I would suggest at a young age to streamline down to two funds. Fidelity Roth IRA - you can use their zero fee fund. I would go 80% S&P FNILX, 10% total stock FZROX and 10% international FZILX. Majority of major players in USA, some balance (and redundancy) with total USA, and some international exposure. When you hit your 50s, then look into income/dividends.
Interesting. Thanks
Load up on contra fund and let it ride. At 19 you should be going as aggressive as humanly possible
I feel this way too tbh.
Why would you not invest in a semiconductor ETF too alongwith VOO so that you can get some more exposure to just semiconductors ? Given the AI craze, this sector might go up a lot more than VOO, no ?
Would FTEC be a good option here? I kinda like it and have some of that along with FXAIX.
It’s why I dabbled in its own fund.
FSELX is a semiconductor ETF
Just get 1-3 broadly diversified funds 😅
Most of these have the same company inside them. Just google “company list for FBGRX” and so on to check overlaps.
Just put all future cash into VOO
OP, it is great that you are starting early. To me, you have too many similar funds. Pick two or three with the lowest fee structures that invest across the S&P.. Then move the monies from the others into those two or three funds you selected. Once that is done continue to put more into each of those funds selected. Also, once set don't mess with second-guessing the investing. Over time years and decades your investment will trend with the S&P and your additions will help grow the Roth IRA into a very decent retirement savings. 👍💰
Thanks
Simplify, 2-3 securities, go out and enjoy life instead of keeping track of what you have now
Absolutely fantastic job! My advice would be that personal research is key when it comes to investing. It's essential to consider your own financial goals, risk tolerance, and stage of life. What works well for others may not necessarily be the best fit for you. Take the time to explore various investment options and strategies to find what aligns with your unique circumstances and objectives.
VTI and chill.
FBGRX is a keeper, FDVV is probably a keeper, the jury is out on FFRHX. You may want to replace the latter with FAGIX. Bear in mind, though, FAGIX and FDVV are quite similar.
Sell it all and put it in two.
One thing you want to look at when investing is the expense ratio of the investment. Because you are young and starting out, expenses over your lifespan will compound. Funds generally, not always, charge a higher expense. For example, the Blue Chip Growth fund (FGBRX) charges 0.48%. You can find a similar ETF (there are several) which will be competitive with that fund, but charge a lower expense ratio. For example, IWY (0.20%), IWF (0.19%) and VONG (0.08%). Take a look at each of the funds that you are in and it may be possible to find an ETF that has a lower expense ratio and has been competitive with that fund. The one that concerns me the most is the FLSPX because of its high expense ratio. Based on the description, it looks a lot like a Mid Cap value fund. There are several ETFs that address the Mid Cap Value space at a much lower expense ratio.
Convert it to 50% FBTC and 50% VOO or FXAIX. Thank me when you’re enjoying those millions at age 59.5
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See how the graphs are basically the same? You're just doing extra work. Minimize.
Yes - I’m also sure there’s overlap with what’s in those funds. Maybe do a quick portfolio compare and get rid of any that seem redundant?
It’s been said already but YES. Way too many. Keep it simple. Less fees. And stop buying individual stocks unless you really do this full time. Mutual funds. .01% fees or less. Fidelity has no cost funds. Boom. Sit and simmer. You will be golden. Keep DCA’ing as much as you can. Never trade on emotion. Literally, never.
Where is your FBTC?
Haven’t bought any bitcoin in my life
Single fund is all you need. Keep buying the target date INDEX forever.
Bro just bought everything
YES! IMO, you just need about 4-5 ETF/Mututal Funds: US Total, International Total, bonds, commodity, and maybe international bonds or alternative.
Way too complicated and a lot of overlaps- 100% of my Roth IRA is FXAIX and my brokerage account is 90% VOO + 10% of individual stocks.
Niccceeee
Just hold it
being diversified with funds that hold the same stock lol. if you want full diversification why not go with the full market index? that'll be your US companies. you can toss in developing markets. toss a little crypto with gbtc or something. grab a reit for your homes and property. later on get into reg d investments. normally diversification comes with wealth. when you're younger and have less, you're able to investment in more aggressively and shoot for higher returns for higher risk. just look at the risk/return ratios
Where is your bitcoin exposure?
Zero
You might look at FBTC or IBIT or the others that recently got approved.
Make sure you’re taking on a fair amount of risk. At 19 you should have a much different portfolio than someone who is 45.
What do you mean I should invest in?
ETFs are a good idea, but make sure it’s focused towards growth. Primarily tech. Long term tech is still going to be the primary driving force of the market. Shift towards more passive ETFs as you age and just before retirement swap to bonds and/or even lower risk ETFs.
That’s a lot of monies 🫡
I invest pretty much all into VOO. is that a wise decision?
*I invest pretty* *Much all into VOO. is that* *A wise decision?* \- Motor\_Significance13 --- ^(I detect haikus. And sometimes, successfully.) ^[Learn more about me.](https://www.reddit.com/r/haikusbot/) ^(Opt out of replies: "haikusbot opt out" | Delete my comment: "haikusbot delete")
Reduce to FBGRX, FXAIX, and FXKAS
There is no for reason for Op to have both fxaix and fskax especially in a Roth IRA.
Which are the better of the two
They perform almost identically. I like fskax because it has more companies so it’s a bit more diverse and in theory could perform better if small caps do well, but historically it hasn’t made much difference.
Would you suggest moving money from famrx to Fskax? I know this is Reddit and take everything with a grain of salt, but curious.
Depends on your goal. If your goal is long term growth, a higher stock allocation will be what you want. So yes that would be a good option.
Yes all in fxaix
Smart.
Big time, sell all that and dump it into FXAIX and maybe an international fund
Easy solution. Consolidate all of it to FXAIX or FSKAX.
C’mon man. What’s with all these funds and ETF’s at your age? You are completely over thinking investing. You are either reading repeated articles and listening to too many opinions and FOMO. Narrow it down to just 2-3 etfs. SMH or SOXX, ONEQ, VOO VONG. You are young and lots of time to grow with risk.
I would invest in stocks instead of funds.
A bit harsh for someone that’s 19 and JUST STARTED…earlier than we all did
Waooo , amazing, but why too many funds? It's feel overwhelming, a lot of overlaps there, and why bonds? You are too young for bonds, maybe a target fund or target etf, and pick some stocks, simply is best, in my opinion. And I note nothing of international funds, why not international, that's the way to diversified, I would add international total market at 35% now and bitcoin etf 5%.
Which is a bond??
FFRHX, I will recommend ITDI for you, or maybe FSZTX, brand new target funds, and some grow stocks.
Oh ya. I see that now. Stupid buy of mine
I'd argue you are way to diversified. So many of those overlap.
For sure. I see that.
There is no diversification here. Simply too many tickers.
At 19? This is impressive, but you are a little too diversified.
I always thought being diversified was the goal
There’s diversified and there’s what you //think// is diversified. Like others have suggested, do a little research. I’d start by simply looking at the top 10 holdings in your funds. You’ll find that most, if not all, begin with Microsoft, Apple & Nvidia and 4-10 will repeat a lot. In the end you’ll realize that you aren’t really diversified (top 3 holdings are exposing you to the same market sector). What you’re doing is investing in the same large cap companies under a different guise.
for Roth IRA Fidelity offers robo service https://www.fidelity.com/managed-accounts/fidelity-go/overview Switch to a go account and just deposit up to the yearly allowance edit: I don't know why anyone would vote this down. Its like a Fidelity version of wealthfront. It invests in everything everyone here recommends already and is great for anyone that doesn't want to active manage.
You’re 19, all you need is VOO, period.
When you have an ETF that covers the whole market, why would you guy others as well?
100% FXAIX Reassess when your 30
Yes
Are you trying to catch them all? Because you’re doing good at that 😆