I’m planning to put 2k into SWPPX for my Roth IRA, but is there a better choice in your opinion? I heard VOO from Vanguard is also good. I’m looking for stable long-term returns.
|Funds||Schwab® S&P 500 Index Fund||Vanguard S&P 500 ETF|
|3-year total return||+18.23%||+18.21%|
|3-year standard deviation||17.72%||17.73%|
|Min. initial investment||0.00 USD||–|
|Net expense ratio||0.02%||0.03%|
|Total net assets||66.57bn USD||277.45bn USD|
|Morningstar category||Large Blend||Large Blend|
SWPPX is Schwab’s S&P 500 mutual fund with a 0.02% expense ratio. I have about 10% of my overall portfolio between this and VOO. I believe it’s a great buy, hold and continue to buy for many years.
Well, it’s easy to say SWPPX is a good buy because of its annualized return rate over the past 3-5 years, without considering the fund volatility over the past half-decade.
SWPPX lost over 50% in its most recent bear market, with underperformed comparable funds by 5.18%, which could be a possible wrong choice in a sliding market environment.
I have Vanguard 500 Index VFINX, and they perform pretty much the same. It isn’t terrible to have some S&P Index 500, especially if you are learning about funds and not ready to invest in managed funds or less all-encompassing indexes.
There might be a slight difference in expenses, but SWPPX and VOO are the same. It depends on which brokerage you use. They both are designed to approximate the index as best as possible.
SWPPX is a Schwab mutual fund. If you have a Schwab account, the minimum investment is $1. If you don’t have a Schwab account, it’ll cost you (depending on your brokerage firm).
Having said that, VOO (Vanguard 500 ETF) serves the same purpose. Fee: 0.03% net expense ratio. VOO has a quarterly dividend payout. SWPPX has an annual dividend payout.
The only good thing with mutual funds, in general, is that you can automate investing. Automatically invest X amount of dollars towards the fund every two weeks, every month, whatever. It takes the “emotions” out of it and helps you DCA (Dollar Cost Average) without even thinking about it. You can’t do this with ETFs for most brokerages. I believe M1 Finance allows it, though.
FXAIX is the Fidelity equivalent of SWPPX and VOO.
It tracks the S&P 500 Index and has an expense ratio of 0.02%.
- 3-year total return: +18.23%
- Total net assets: 370.73 billion
- Min. initial investment: $0.00