Fidelity Auto Invest ETFs: A Comprehensive Guide

Fidelity Auto Invest ETFs are a popular choice for investors looking for a hands-off approach to building a diversified portfolio. These ETFs automatically adjust your portfolio based on your investment goals, risk tolerance, and time horizon. This guide will provide a comprehensive overview of Fidelity Auto Invest ETFs, covering their key features, benefits, and drawbacks, and how to get started.

What are Fidelity Auto Invest ETFs?

Fidelity Auto Invest ETFs are exchange-traded funds (ETFs) that are managed by Fidelity Investments. They are designed to simplify investing by automatically adjusting your portfolio based on your individual preferences. Fidelity offers a range of Auto Invest ETFs, each with its own investment strategy and risk profile.

Here are some key features of Fidelity Auto Invest ETFs:

• Automated rebalancing: The ETFs automatically rebalance your portfolio based on your chosen risk level, ensuring that your investments remain aligned with your goals.
• Diversification: Auto Invest ETFs invest in a diversified basket of assets, including stocks, bonds, and real estate, to reduce risk and enhance potential returns.
• Low fees: Fidelity Auto Invest ETFs have low expense ratios, making them an attractive option for cost-conscious investors.
• No minimum investment: You can start investing with as little as $0, making them accessible to investors of all levels.
• Customizable investment strategies: You can choose from a variety of investment strategies based on your risk tolerance and time horizon.

Benefits of Fidelity Auto Invest ETFs

Fidelity Auto Invest ETFs offer several benefits for investors, including:

• Convenience: They simplify investing by automating portfolio management, freeing up your time and effort.
• Low cost: Their low expense ratios make them a cost-effective investment option.
• Diversification: They provide instant diversification by investing in a wide range of assets.
• Accessibility: With no minimum investment required, they are accessible to everyone.
• Flexibility: You can customize your investment strategy based on your individual needs and goals.

Drawbacks of Fidelity Auto Invest ETFs

While Fidelity Auto Invest ETFs offer many benefits, they also have some drawbacks:

• Limited control: As the portfolio is managed automatically, you have limited control over individual investments.
• Potential for underperformance: The automated investment strategy may not always align with market conditions, leading to potential underperformance.
• No tax loss harvesting: Fidelity does not engage in tax loss harvesting, which can potentially reduce your tax liability.

How to Get Started with Fidelity Auto Invest ETFs

Getting started with Fidelity Auto Invest ETFs is simple:

1. Open a Fidelity account: If you don't already have one, open a Fidelity brokerage account.
2. Choose an Auto Invest ETF: Select the Auto Invest ETF that aligns with your investment goals and risk tolerance.
3. Fund your account: Deposit funds into your brokerage account to begin investing.
4. Monitor your portfolio: Regularly review your portfolio and make adjustments as needed to ensure it continues to meet your investment goals.

Conclusion

Fidelity Auto Invest ETFs offer a convenient and cost-effective way to build a diversified investment portfolio. Their automated rebalancing features and low expense ratios make them an attractive option for investors of all levels. However, it's important to be aware of their limitations, such as limited control over individual investments and the potential for underperformance.

Before investing in Fidelity Auto Invest ETFs, carefully consider your investment goals, risk tolerance, and time horizon. If you are looking for a hands-off approach to investing, Fidelity Auto Invest ETFs may be a good option for you.