SPAXX, FZFXX or FCASH: Picking a Fidelity Core Position

Fidelity offers three different types of core positions: SPAXX, FZFXX, and FCASH.

The Fidelity Government Money Market Fund (SPAXX) is a mutual fund that invests in short-term debt obligations issued by the U.S. government. The fund has a $1.00 per share net asset value.

All the other Fidelity core positions also have the same feature.

So, which Fidelity core position should you choose when starting your portfolio?

What Is a Fidelity Core Position?

A Fidelity core position process cash transactions and hold uninvested cash in your investment account.

You are automatically assigned a core position when you open a Fidelity account. By default, SPAXX will hold your uninvested cash.

Think of the core position as your virtual wallet.

When you are ready to invest, the cash in your core position will be used to cover the transaction.

In addition to SPAXX, you have other money market funds to choose from.

Here’s a complete list of available money market funds for your Fidelity’s core position.

how-fidelity-core-position-works

Which Fidelity Core Position Should I Pick?

It doesn’t matter which fund you pick as your “Core Position.” You should be investing your money into securities such as stocks, options, and/or index funds.

Your money is losing to inflation just by sitting in one of Fidelity’s money market funds.


Comments

Sean C:

SPAXX is Fidelity’s Government Money Market Fund, and it’s there for your settlement fund.

Your settlement fund is your “holding” account, where your money is parked before you invest it. It’s normal for your contributions to show as being in SPAXX until it’s put into other investments.

Joe B:

Three different funds with investments that are slightly similar. Basically unless the financial world falls into the crapper, they all offer a pretty much but not completely safe area to park cash in.

Andrew B:

SPAXX is held in government securities. If it breaks the buck, the concept of the dollar itself is in question. You’ll be fine in that fund for the time being. If you prefer, you can open a cash management account with FDIC insurance.

Aaron C:

Since the Fed cut interest rates, all money markets have become essentially the same. The only thing the FDIC guarantees is the lowest possible rate.

Justin L:

Which is the preferred core position? FZFXX? And how much does this truly matter? Not much money is usually there. I’ve read some of the prospectuses, but they don’t seem all that different.

SC Francis:

My friend asked me what the differences were between these three core positions. I didn’t have the correct answer until I came across this thread. Thank you. I have FCASH.

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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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