FGRTX

Far-Doctor3527

TLDR: VT and chill Hello, responding here because I am also unhappy that my passive funds will buy SpaceX. I have decided to not take any action regarding the SpaceX IPO, and accepting that my funds will buy it even though this IPO seems like an obvious grift. I am not trying to convince you to take action or not take action, just explaining my reasoning because this IPO has made me worry about my portfolio and maybe this will be helpful to you in your own decision. First let's understand what types of funds could be affected by the IPO: \- Total world market funds (VT and the like). These track the total world's equities market, which is roughly $154 trillion in market cap. \- Total US market funds (FSKAX, FZEROX, VTI, VTSAX, and the like). These track the total US equities market, which is roughly $77 trillion in market cap. \- S&P 500 funds (FXAIX, VOO, and the like). These track the largest 500 companies in the US by market cap, which total to about $62 trillion. Note that this is about 80% of the total market. \- S&P 100 funds / Mega cap funds (FGRTX, QQQ, and the like). These track roughly the top 100 companies in the US, totaling roughly $55 trillion. Note that this is roughly 70% of the total market, and roughly 89% of the S&P 500 \- Large cap funds (FNILX, FSPGX, and the like). These are functionally equivalent to the S&P 500 so I will not add anything here, they may be slightly larger or smaller percent of the total market than the S&P 500 depending on holdings. \- Mid cap, small cap, and international funds: unaffected The first thing you want to think about is: what are you invested in? You don't have to go super granular but most passive investors have their investments in some version of the above funds. Are you more of a total market person, or more S&P 100? It doesn't matter which one you are, but take a look at your portfolio and understand what you are invested in. Now let's assume SpaceX does IPO at $2 trillion and let's look at how the SpaceX IPO affects the broad categories: \- Total World Market Funds: 2 / 154 = 1.2% of the total world market \- Total US Market Funds: 2 / 77 = 2.6% of the total US market \- S&P 500 and other large caps: 2 / 62 = 3.2% of the S&P 500 \- S&P 100 and other mega caps: 2 / 55 = 3.6% of the S&P 100 Now let's assume that the worst case happens: SpaceX IPOs at 2 trillion, and then the price goes literally to 0. If you are mostly in total market funds, your portfolio would go down by 2.6%. If you are mostly in large cap funds, your portfolio would go down by 3.2%. If you are mostly in mega caps, your portfolio would go down by 3.6%. But let's be realistic, even with this IPO likely being an Elon grift, do we really think this is going to 0? I don't. Maybe it loses 50% of its price, maybe 80%, I don't know. But it's a real company with real revenue (though small revenue compared to its huge valuation), so it's not going to 0. I'm not going to redo all the calcs but just for example, assuming it goes down by 50% and you are mostly in S&P 500 funds, your portfolio would go down by 1.6%. But here is the biggest consideration: 100% of SpaceX is not going to be publicly tradable. We don't know exactly what the percent it is going to be but likely only like 5%. This means that the indexes will only track 5% of SpaceX's market cap. So assuming SpaceX IPOs at 2 trillion and goes down by 50% and you are mostly in S&P 500 funds, your portfolio would go down by (2 \* .05)/62 = .16%. To be clear, this is like a fifth of a percent, which is inconsequential, the market moves more than this on a daily basis. Another point: I don't know what is going to happen in the future: I don't know if SpaceX's price will actually shoot up for whatever reason, so as an uninformed person, I think actively shorting SpaceX is not a good idea. Remember the famous quote "the market can remain irrational longer than you can remain solvent". I am a regular person and don't have any privileged information about what is going on with SpaceX so I think shorting it would be equally risky to shorting any other company that doesn't have a high-profile controversial figurehead as Elon Musk, which is something I wouldn't do (and likely something other passive investors wouldn't do either). At the end of the day, passive investors get to benefit from all of the companies in the market without having to do the work of researching and understanding each business, and making bets about which one will go up or down. We have benefitted from all the other great businesses that have continued to skyrocket without having to use a second of time to evaluate them. If you want to take action against the SpaceX IPO that is totally ok, but you could be introducing complexity to your portfolio, and spending your valuable time thinking about how to hedge against something that will impact your portfolio less than regular daily market fluctuations. Again, not trying to convince you one way or another, and to reiterate, I am not happy that I will be buying into this IPO passively because I do think it is a grift, but by looking at the actual numbers I have decided that this is not consequential. So to summarize all of this information, even though I am more of a Fidelity stan than Vanguard, "VT and chill".

2Ruler

Yes. Dividend equally in FAGIX. FDGFX FGRTX. FMAGX. FNILX. FULVX I own all and have nice gains. You will too. Buy and forget

Revolutionary-Week43

Use a mutual fund like Fidelity Mega Cap Stock Fund (FGRTX). It stays in large companies but alternates between value and growth. It's not so well known as other funds or expensive or try a money market fund. Just remember that you can only do two things with money: make it work or spend it.

kad5554

Fidelity Investment Portfolio Rate My Fidelity Investments 31, married, no kids: high risk tolerance/aggressive portfolio Just getting into mutual fund investing; looking to see if the funds I picked are sound choices. All are morning star 4 or 5 star rated. Going to ride the wave for 20-30 years FBGRX 10% FBNDX. 8% FCNTX. 20% FGRTX. 15% FIVFX. 12% FMILX. 10% FSELX. 15% FSPGX. 10%

dinkydawg

I personally use Fidelity as a brokerage - I sort mutual funds by their 10-year performance and their Morning Star rating. I look for expense ratios under 0.5-1% (the smaller the better). Just as an example, not recommended per se --- I have FSELX, SPY, FGRTX, FSKAX, SWTSX. Fidelity offers zero expense funds like FZROX too

SnS2500

I typed them into Seeking Alpha's total return charting. The numbers on the right for STSEX are as of are as of 3/31/23, while the ones for FGRTX are to 4/30/2023. In both cases, we can't see what footnote "2" says but presumably that will say these are "annualized" returns... meaning the average for each year of five years, 12+12+12+12+12, and so about 60%. The big divergence with STSEX being 86 versus about 60, may be due to that month difference... as you can see the one year difference between the two is huge while the other numbers are similar. The price return for both as shown here on Google is also hugely different. https://www.google.com/finance/quote/FGRTX:MUTF?comparison=MUTF%3ASTSEX&window=5Y If you were thinking these two were offered similar returns then my comment is off base, and you basically had the right idea, but the point is still right, that expense ratios are tiny compared to return differences. And, in this case if you look more under the hood you can see these two aren't as close peers as the two graphics would suggest.

SnS2500

You're missing almost everything. Expense ratio is only a very, very minor thing to pay attention to. The thing that matters is the total return on a stock or mutual fund. In this case STSEX is up 86% the past past five years while FGRTX is up only 60%.

Apishamnesia56

STSEX and FGRTX are mutual funds It is important to note that expense ratios and transaction fees can affect the overall return of a fund. FGRTX does have a lower expense ratio compared to STSEX, which means investors can retain a greater percentage of their investment returns. However, transaction fees may also be a consideration, as there may be fees associated with buying and selling shares of a mutual fund, depending on the brokerage firm or platform used. You start by consulting with

ElectricBullet

New to stocks, looking to open a Roth IRA. Don't plan to withdraw for decades. Between these two stocks, the latter (FGRTX) seems like a much better option because of the lower Exp. Ratio and no transaction fee(?). Am I missing something? [Option 1](https://imgur.com/gMO0Pmq) \-- [Option 2](https://imgur.com/7YhEy67)