FXAIX vs VOO: ETF Comparison, Fees, and Better Buy?

Someone asks:

I have a quick question about index funds FXAIX and VOO. They are pretty much the same, from core holdings to performances. But why are the prices different? VOO is around $306 and FXAIX is about $114. I’m just kind of confused why and if I should pick one over the other.

FXAIX vs. VOO: Highlights

  • FXAIX is a mutual fund from Fidelity, while VOO is an ETF from Vanguard.
  • Fidelity 500 Index (FXAIX) is cheaper than Vanguard S&P 500 (VOO) in expense fees.
  • Both funds have a minimum initial investment of $0. This means you can start with as little as $1.
  • FXAIX and VOO pay dividends every quarter.

FXAIX vs. VOO: Which one should you invest in?

We asked our community of Fidelity investors and here’s what they have to say about FXAIX and VOO.

Let’s find out which fund is a better investment for your portfolio.

Harrison K:

Vanguard’s VOO has been around since 2010 and has total assets of 597 billion. Fidelity’s FXAIX was begun in 2011 and had net assets of 259 billion. Because VOO has more people, it drove the price up. Basic supply and demand concept.

Michael O:

Like others have said, FXAIX and VOO are the same investment. However, VOO is an ETF and FXAIX is a mutual fund. I prefer mutual funds because you can invest any amount. You can also buy fractional shares.

With ETFs like VOO, you need to buy at least one share. So, in my opinion, mutual funds are better for long-term and consistent investing.

Honuman C:

While doing research, I found that Vanguard’s S&P 500 ETF (VOO) is much more popular than Fidelity’s Mutual Fund FXAIX.

If you compare the two, FXAIX has a much lower expense ratio and a much bigger dividend yield than VOO. Their compositions are identical. The only difference is VOO is an ETF (and thus traded as a stock), whereas FXAIX is a mutual fund.

Gerry S:

They are about the same from a returns standpoint. Jack Bogle warned that an ETF is like handing a match to an arsonist; because ETFs can be traded throughout the day, one is tempted to use them to time the market.

You will get similar returns if you buy and hold without getting in and out. VOO is popular because a good 80% or so of the people having it don’t buy and hold.


Honuman C:

Thanks all. I will be holding it for the long term only. So, I guess I will go with FXAIX since it has a lower expense ratio and higher dividend yield.

Steve R:

I have FXAIX in my Roth IRA and VOO in my taxable brokerage account.

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Hi! I'm Diego, 38, and I currently reside in New York. I work as a financial analyst. I primarily focus on initiatives involving research and data analysis.

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