Fidelity Investments is making 401(k) advisers’ lives a little more complicated.
The Boston-based behemoth dropped some eye-popping news Wednesday: as of Friday, it will begin offering two index mutual funds with a price tag of 0.00%. Yes, funds free of cost to investors — the industry’s first.
The funds, in the total-market and international equity categories, will be available to retail investors. They won’t be offered to participants in defined-contribution plans, at least initially. But let’s not kid ourselves — it’s only a matter of time before Fidelity or another index-fund giant, perhaps BlackRock Inc. or Vanguard Group, brings a no-cost fund to 401(k) investors.