1.Fidelity ZERO Large Cap Index
FNILX (NASDAQ)
Fidelity ZERO Large Cap Index (FNILX) is an excellent choice for investors looking for a cost-effective core holding, boasting a 0% expense ratio. With a solid 1-year return of 19.63% and a remarkable 5-year return of 82.66%, this fund offers attractive growth potential. Recognized with a 4-star rating from Morningstar, FNILX effectively tracks a large-cap index akin to the S&P 500, making it a top-rated option in its category.
Pros:
- 0% expense ratio
- Tracks large-cap index similar to S&P 500
Cons:
- Annual distribution may be less attractive for some
- Market risk exposure
2.iShares Core S&P 500 ETF
IVV (AMEX)
The iShares Core S&P 500 ETF (IVV) is an attractive option for investors seeking low-cost exposure to the broader U.S. market, boasting an impressive 19.53% return over the past year and an 83.66% return over five years. With a minimal expense ratio of just 0.03% and a dividend yield of 1.18%, this ETF stands out as a top-rated choice among investors. Additionally, it holds a strong position in the market, often compared favorably to its peers like VOO, making it a solid investment vehicle for long-term growth.
Pros:
- Low-cost ETF with a 0.03% expense ratio
- Strong 5-year annualized return
Cons:
- Market volatility risk
- Dependence on large-cap performance
3.Fidelity 500 Index Fund
FXAIX (NASDAQ)
The Fidelity 500 Index Fund (FXAIX) is an attractive option for investors looking for a cost-effective way to gain exposure to the S&P 500, featuring no minimum investment and impressively low fees. With a solid 1.12% dividend yield and remarkable 19.59% return over the past year, this fund stands out as a highly rated choice, earning a consensus rating of Moderate Buy. Its performance is on par with other top competitors like VOO and SPY, making it a reliable vehicle for long-term growth in the stock market.
Pros:
- Cost-effective with no minimum investment
- Tracks S&P 500 performance
Cons:
- Market risk exposure
- Dependence on large-cap performance
4.Vanguard Russell 2000 ETF
VTWO (NASDAQ)
The Vanguard Russell 2000 ETF (VTWO) offers an attractive option for investors seeking diversified exposure to small-cap companies, tracking the well-regarded Russell 2000 index with an impressively low expense ratio of 0.07%. With a solid 1-year return of 20.30% and a 5-year return of 23.92%, it demonstrates strong growth potential, though investors should be aware of its sensitivity to macroeconomic conditions. Historically, VTWO has delivered a remarkable 140.88% total return over the past decade, translating to an annualized return of 9.19%, making it a compelling choice for long-term investment strategies.
Pros:
- Diversified small-company exposure
- Tracks small-cap Russell 2000 index
Cons:
- More sensitive to macroeconomic factors
- Historically underperformed during economic stress
5.Vanguard S&P 500 ETF
VOO (AMEX)
The Vanguard S&P 500 ETF (VOO) stands out as a top-rated investment option, boasting a low expense ratio of just 0.03%. With a remarkable 5-year return of 83.63% and a solid 1-year return of 19.60%, it continues to attract investors looking for long-term growth. Analysts project a 12-month price target of $738.55, reinforcing the ETF's reputation as a reliable choice for those aiming to build wealth over time.
Pros:
- Popular S&P 500 tracker
- Strong 5-year returns
Cons:
- Lower yield compared to some other funds
- Market risk exposure
6.Schwab U.S. Large-Cap ETF
SCHB (AMEX)
The Schwab U.S. Large-Cap ETF (SCHB) offers an attractive option for investors seeking broad large-cap exposure, highlighted by an impressively low expense ratio of just 0.02%. With a solid dividend yield of 1.10% and an impressive one-year return of 19.08%, this fund demonstrates strong performance potential. Furthermore, SCHB is recognized for its efficient structure, making it a favorable choice compared to other ETFs like SPY, particularly due to its higher yield and lower tax implications.
Pros:
- Razor-thin 0.02% expense ratio
- Broad large-cap exposure
Cons:
- High tech stock concentration risk
- Potential market corrections
Final Words
As you consider your investment options this January, remember that low-cost index funds like the iShares Core S&P 500 ETF can provide significant long-term value. Take time to compare different funds and conduct your own research to ensure you make informed decisions that align with your financial goals.
Frequently Asked Questions
The iShares Core S&P 500 ETF (IVV) is a low-cost exchange-traded fund that tracks the performance of the S&P 500 index. It has a 0.03% expense ratio and a 14.44% 5-year annualized return.
The iShares Core S&P 500 ETF (IVV) has a dividend yield of approximately 1.18%, with distributions occurring quarterly. The next dividend is $2.4136.
Over the last year, the iShares Core S&P 500 ETF (IVV) has shown a return of 19.53%. This performance is part of a longer trend, with a 5-year return of 83.66%.
Both IVV and Vanguard S&P 500 ETF (VOO) are excellent choices for tracking the S&P 500, as they have the same expense ratio of 0.03% and similar returns. The decision often comes down to personal preference and pricing at the time of investment.
When investing in low-cost index funds, it's crucial to consider the expense ratio, as lower fees can lead to higher net returns over time. Additionally, understand the historical performance and dividend distributions of the fund.
Investing in index funds like IVV carries market risk, meaning the value of your investment can fluctuate based on the overall market performance. It's important to maintain a diversified portfolio to mitigate these risks.
