VTSAX and FSKAX are both total stock market mutual funds that provide investors with low-cost exposure to all investable U.S. stocks.

However, there are subtle differences between these two funds, which might influence your choice, which we will cover in this article.

Key Features of VTSAX and FSKAX

VTSAX and FSKAX are both total stock market funds.
VTSAX has a slightly higher expense ratio than FSKAX
Both have nearly identical dividend yields.

The Vanguard Total Stock Market Index Fund Admiral Shares (VTSAX)

Launched on November 13, 2000, by Vanguard, VTSAX is a mutual fund that seeks to track the performance of the CRSP US Total Market Index, which includes large, mid, and small-cap growth and value stocks.

VTSAX also has tremendous buying power due to its enormous size, which provides an advantage in obtaining lower transaction costs.

Fidelity Total Market Index Fund (FSKAX)

FSKAX, one of Fidelity Investment’s prized offerings, came into existence in 2011.

This fund aims to replicate the performance of the Dow Jones U.S. Total Stock Market Index, providing exposure to a wider range of more than 3900 U.S. stocks.

Performance Analysis: VTSAX vs. FSKAX

When it comes to a performance comparison of VTSAX and FSKAX, they are basically identical.

The main factors to consider would be external factors that affect the returns over time, like the expense ratio of the funds.

In a bullish market scenario, where the stock market is on the rise, these funds tend to perform remarkably well due to their enormous exposure to growth and tech stocks.

However, in a market downturn or recession phase, these funds might face extensive drawdown due to the same inherent exposure, as they simply follow the overall market.

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Expense Ratio Comparison: VTSAX vs. FSKAX

FSKAX - 0.015%
VTSAX - 0.04%

A crucial difference between VTSAX and FSKAX lies in their expense ratios— the overall cost to own the fund.

FSKAX shines in terms of affordability with an exceptionally low expense ratio of 0.015%. As for VTSAX, investors are subjected to an annual cost of 0.04%.

Although both these ratios are considered extremely minimal in the mutual fund realm, the slightly lower expense ratio of FSKAX might appeal to cost-sensitive investors allocating massive sums.

It’s noteworthy that over time, and especially for large investments, even minor differences in these expense ratios can lead to significant variations in the cost of owning these funds.

Comparing Dividend Yield: VTSAX vs. FSKAX

The difference in the yield between these funds is too minimal to significantly impact the overall performance of the investment over the long term.

While the dividends are a big factor to consider when investing, both VTSAX and FSKAX will provide essentially the same payout of around 1.55%.

Holdings Comparison: VTSAX vs. FSKAX

At the core, both FSKAX and VTSAX aim to offer investors a snapshot of the U.S. equities market in its entirety.

Although they track different indexes—FSKAX follows the Dow Jones U.S. Total Stock Market Index, while VTSAX trails the CRSP US Total Market Index, their top holdings are virtually identical.

This similarity in top holdings positions these funds neck-to-neck in terms of both capital appreciation and potential risk.

Making the Decision: Which Fund is Better for You?

FSKAX and VTSAX are titans in their realm, and choosing between them often boils down to individual preferences, investment goals, and favored brokerage.

If fund expense is your primary concern and your trade-off frequency is relatively high, FSKAX might be the preferred choice with an edge in affordability due to its lower expense ratio. Additionally, its no-minimum requirement makes it easily accessible to beginners.

On the other hand, if fund performance is your dominant factor of consideration, the slightly higher returns of VTSAX should draw your attention, along with it being a more stable and established brand in the index fund space.

Investing in either of these funds results in a comprehensive, well-diversified exposure to the U.S. equities market with minimal upkeep.

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FAQ on FSKAX and VTSAX

Is FSKAX a good index fund?

Yes, FSKAX (Fidelity Total Market Index Fund) offers broad exposure to the US stock market, including large-cap, mid-cap, and small-cap companies across various sectors. It is known for its extremely low costs, with an expense ratio of just 0.015% and no minimum investment requirement.