Total Stock market fund or index funds for retired

[Lowexpectations]

Originally Posted by GWoodle

https://www.spglobal.com/en/


SPGlobal manages many stock index. Doubt if they disclose what charges may be to use one of their products. They don't do it for free.

If I setup a S&P 500 index fund I manage it though not spglobal, that’s why I was curious on the fees.

[mathjak107]

any etf or fund that follows the s&p index as layed out by s&p pays licensing fees to standard and poor for the use.

“For example, the SPY AUM totaled about $400 billion in 2021, implying that the total fees collected by State Street from SPY investors were roughly $360 million in 2021, with more than $120 million paid to S&P in index licensing fees.”

https://corpgov.law.harvard.edu/2023...censing%20fees.

[GWoodle]

Originally Posted by Lowexpectations

If I setup a S&P 500 index fund I manage it though not spglobal, that’s why I was curious on the fees.

With hundreds of ETF, thousands of funds, who knows how many annuity contracts, each & every one tied to some index. Good business for S&P. This is part of the fund management fees everyone pays.

Going back to the OP, any fund you invest in will be tied to some index. Performance can be better or worse than the index.

For an individual could be fine. But the minute you start to sell it could be different.

[Lowexpectations]

Originally Posted by GWoodle

With hundreds of ETF, thousands of funds, who knows how many annuity contracts, each & every one tied to some index. Good business for S&P. This is part of the fund management fees everyone pays.

Going back to the OP, any fund you invest in will be tied to some index. Performance can be better or worse than the index.

For an individual could be fine. But the minute you start to sell it could be different.

You are missing the point of my questioning. It’s purely licensing, S&P isn’t managing funds

So it’s a question I’d guess of marketing cost because you don’t need to actually replicate the 500 names to come close to the performance of the S&P 500 so why pay the fee? Marketing is the only thing that makes sense, that’s where my curiosity is

[mathjak107]

s&p is managing the index itself .

they decide who gets dropped and when and who replaces them

[Lowexpectations]

Originally Posted by mathjak107

s&p is managing the index itself .

they decide who gets dropped and when and who replaces them

I’m aware they manage the index which is simply a data set, but managing close to an index is that difficult with nominal performance tracking error so again why pay S&P when?

[mathjak107]

Originally Posted by Lowexpectations

I’m aware they manage the index which is simply a data set, but managing close to an index is that difficult with nominal performance tracking error so again why pay S&P when?

no idea , except to claim to be an S&p fund you have to license ….fidelity calls it a large cap index fund



“The ZERO funds consist of four index funds. These funds charge no fees in the form of an Expense Ratio, although they do pass on transaction costs to investors.

The catch, if you want to call it that, is that the funds track proprietary indexes Fidelity created. That means, for example, that the Fidelity ZERO Large Cap index fund does NOT track the S&P 500, as one might expect.

Here are the details on each fund's tracking index.

Fidelity ZERO Large Cap Index Fund (FNILX)

The Fidelity ZERO Large Cap Index Fund tracks the Fidelity U.S. Large Cap Index. The index is a float-adjusted market capitalization-weighted index. That simply means it tracks companies based on the number and value of shares outstanding in the market. Its focus is on the U.S. large capitalization equity market.

The index tracks the top 500 companies. It can, however, have fewer companies based on liquidity and investing screens that Fidelity uses. For example, the index (and the other two U.S. indexes discussed below) exclude companies with capitalizations under $75 million or with limited trading volume.

It can also have more than 500 stocks if some companies have multiple share classes. Fidelity rebalances the index annually on the third Friday in February (so mark your calendars!).

The index is similar to the S&P 500 index, but there are some differences, as we'll see below.

Fidelity ZERO Extended Market Index Fund (FZIPX)

The Fidelity ZERO Extended Market Index Fund (FZIPX) tracks the Fidelity U.S. Extended Investable Market Index. Its designed to track U.S. mid- and small-cap stocks. It is a subset of the Fidelity U.S. Total Investable Market Index (see below), excluding the 500 largest companies.

Perhaps the closest comparison of this index is the the Dow Jones U.S. Completion Total Stock Market Index. The primary difference is that the Fidelity index is limited to 2,500 companies, whereas the Dow Jones index has just under 3,500 companies.

Fidelity ZERO Total Market Index Fund (FZROX)

The Fidelity ZERO Total Market Index Fund (FZROX) tracks the Fidelity U.S. Total Investable Market Index. This index is effectively a combination of the Large Cap and Extended Market indexes described above. As such, it is limited to 3,000 companies.

Its closest comparison is the Dow Jones U.S. Total Stock Market Index. It's not an exact match, however, as the Down Jones index tracks nearly 4,000 companies.”