Side-by-side
| Feature | FXAIX | VOO |
|---|---|---|
| What it is | Fidelity mutual fund (index) | Vanguard ETF |
| Tracks | S&P 500 | S&P 500 |
| Expense ratio | ~0.015% — among the cheapest anywhere | ~0.03% — among the cheapest ETFs |
| When it trades | Once a day, at closing NAV | Intraday, like a stock |
| Where to buy | Fidelity (fee-free); elsewhere usually costs extra | Any major broker, commission-free |
| Fractional | Dollar-based by design | Fractional at most brokers |
| Tax efficiency (taxable) | Very good (index fund) | Slightly better (ETF structure) |
| Best fit | Fidelity accounts, 401(k)s | Taxable accounts, any broker |
Expense ratios change occasionally — confirm current figures on Fidelity and Vanguard's pages before buying.
The structural differences that matter
How they trade. FXAIX is a mutual fund: orders accumulate through the day and execute once, at the closing net asset value. VOO is an ETF: it trades continuously like a stock. For a long-term investor buying and holding, this difference is close to irrelevant — you were not going to time the market anyway.
Where they live. This is the practical decider. FXAIX is a Fidelity fund: frictionless inside Fidelity accounts, awkward elsewhere. VOO is portable — every major broker offers it commission-free. A Fidelity 401(k) with FXAIX and a Schwab taxable account with VOO is the natural setup many investors end up with.
Minimums. Neither blocks small investors anymore: mutual funds are dollar-based by nature, and VOO supports fractional shares at most brokers. With $50 you can own either.
Taxes: where VOO has an edge
In a taxable account, the ETF structure gives VOO a small but genuine advantage. ETFs can expel low-basis shares through in-kind creation and redemption, which typically keeps capital gains distributions at or near zero. Broad index mutual funds are also tax-efficient, but they have occasionally distributed gains when facing large redemptions.
In an IRA or 401(k), none of this matters — nothing is taxed along the way. Pick whichever fund your plan offers cheapest and stop thinking about it.
Which should you buy?
- →Account at Fidelity? FXAIX — rock-bottom fee, automatic investing, nothing to think about.
- →Taxable account at any broker? VOO — portable, slightly more tax-efficient, commission-free everywhere.
- →Fidelity 401(k) at work? Use whatever institutional S&P 500 index fund the plan offers (often FXAIX or its institutional twin at even lower cost).
- →Own both already? That is not a mistake to fix. They are the same exposure; consolidating is optional tidiness, not strategy.
Frequently asked questions
Are FXAIX and VOO the same thing?▾
They track the same index (the S&P 500) with nearly identical performance, but they are different vehicles: FXAIX is a Fidelity mutual fund, VOO is a Vanguard ETF. Differences in structure, trading, availability, and tax treatment matter more than the near-identical returns.
Which has lower fees, FXAIX or VOO?▾
Both are among the cheapest funds in existence. FXAIX charges roughly 0.015% per year and VOO roughly 0.03%. On a $100,000 investment, that difference is about $15 per year — real, but small enough that account type and availability should drive the decision more than fees.
Can I buy FXAIX outside Fidelity?▾
FXAIX is available primarily at Fidelity. Other brokerages can technically offer it, but most charge a transaction fee to buy a no-transaction-fee Fidelity fund — which defeats the purpose. If your account is not at Fidelity, a broad S&P 500 ETF (VOO, IVV, or SPY) is usually the practical equivalent.
Is an ETF more tax-efficient than a mutual fund?▾
Generally, yes — in taxable accounts. ETFs can shed appreciated holdings through in-kind redemptions, which typically results in little or no capital gains distributions. Broad index mutual funds are also quite tax-efficient, but they occasionally distribute gains. In tax-advantaged accounts (401(k), IRA), this difference disappears entirely.
Can I buy fractional shares of VOO or FXAIX?▾
FXAIX is bought in dollar amounts — mutual funds have always worked that way. VOO can be traded as fractional shares at most major brokers, so both are accessible with small amounts. Neither has a meaningful minimum at their home institutions.
Which one should I pick?▾
Simple rule of thumb: if your account is at Fidelity (especially a Fidelity 401(k)), FXAIX is the natural, cheapest choice. If you are at another broker or investing in a taxable account, VOO (or an equivalent S&P 500 ETF) is more flexible and slightly more tax-efficient. If you own FXAIX in retirement and VOO in taxable, that is a perfectly good combination — not a conflict.
Related guides & tools
Disclaimer: For informational and educational purposes only; not financial or tax advice. Fund fees and availability change — verify with the issuer before investing. Past performance does not guarantee future results.