6/2/2023 0 Comments Vtsax expense ratioFZROX actually reinvests those dividends internally to the fund throughout the year, and the growth is reflected in the share price. UPDATE: While FZROX does only pay dividends annually, the conclusion below is largely incorrect. The opportunity cost of reinvesting those dividends annually instead of quarterly turns out to be (relatively) expensive. Dividends make up an important part of the growth of a fund when reinvested. That means FZROX (and SWTSX) are sitting on dividends for up to a year before releasing that cash to the investor. Vanguard’s VTSAX stands alone as the only one of the bunch to distribute dividends quarterly. Quarterly (March, June, September, December) Take a look at their dividend distribution schedule. But hidden inside these new index funds is a dirty little secret. Sure it has fewer stocks, but I’m sure it tracks plenty close to the market, will improve as the assets grow, and the low expense ratio more than makes up for it. On the surface, the new Fidelity® ZERO Total Market Index Fund looks like it just won the war as best US total market index fund. Here’s a look at a US total market index fund from each of the three major discount brokerages: Brokerage ![]() The exploding popularity of low fee index index funds in recent years have been putting pressure on brokerages to push their index fund expense ratios even lower. ![]()
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