The Fidelity S&P 500 Index mutual fund (FXAIX) and the Fidelity ZERO Total Market Index fund (FZROX) are two of the largest mutual funds in existence. FXAIX and FZROX are the core of many investor portfolios. Many investors compare FXAIX vs FZROX in order to decide which should be the foundation of their portfolio.

A quick reminder that this site does NOT provide investment recommendations. Fund comparisons (such as this one) are not conducted to identify the “best” fund (since that will vary from investor to investor based on investor-specific factors). Rather, these fund comparison posts are designed to identify and distinguish between the fund details that matter versus the ones that don’t.

The Short Answer

There are two main differences between FXAIX and FZROX. Firstly, and perhaps most importantly, FZROX can only be bought and owned at Fidelity. Secondly, FXAIX is a large- and mid-cap fund, while FZROX is a total market fund. Despite these differences, the total return between these two funds is pretty close.

The Long Answer

Historical Performance: FXAIX vs FZROX

FXAIX was launched back in 1988, while FZROX was launched on August 2, 2018. Since then, FXAIX has outperformed by about a .75% annually. This is not a huge performance differential, but it does compound over time. The cumulative difference between the two funds since common inception is approximately 4.25%.

Of course, the outperformance of FXAIX is reflective of large-cap stocks’ dominance over the past decade. If mid-caps and/or small-caps lead, then I suspect FZROX would outperform.

Differences between FXAIX vs FZROX

The biggest difference between FXAIX and FZROX is the market cap exposure of the funds. FXAIX tracks the S&P 500 index which includes mostly large-caps and some mid-caps, while FZROX covers much more of the market by including more mid-caps and small-caps.

Geographic Exposure

Both FXAIX and FZROX hold essentially 100% stocks, so I will not dig into country exposures or market classification here. For intents and purposes, the two funds have identical exposures.

Market Cap Exposure

FXAIX focuses on the S&P 500 index and so it mostly holds large-caps with a bit of mid-cap exposure. FZROX tracks the broader Dow Jones U.S. Total Stock Market Index and so it owns many more mid-caps and small-caps (as of 11/30/2022). In other words, FXAIX is a large-cap vehicle, while FZROX is a total market vehicle. That being said, due to market cap weighting, both funds are overwhelmingly influenced by the large-cap holdings.

Source: ThoughtfulFinance.com, Morningstar

Sector Weights

The sector weights between FXAIX and FZROX are nearly identical, as of 11/30/2022. The weights are within 1% for every single sector.

Basic Materials2.40%2.67%
Consumer Cyclical10.16%10.47%
Financial Services13.80%14.01%
Real Estate2.77%3.46%
Communication Services7.46%6.90%
Consumer Defensive7.40%6.79%
Source: ThoughtfulFinance.com, Morningstar

Factors to Consider


In my view, the most important factor to consider when evaluating FXAIX vs FZROX is the fact that FZROX cannot be bought or owned outside of Fidelity. Personally, this is a non-starter for me as there are reasons to transfer assets to other custodians, such as transferring one’s accounts or making a donation. Some investors may not value flexibility as much, but they should be aware of this limitation.

Transaction Costs

Many brokers and custodians still charge commissions and/or transaction fees to buy/sell mutual funds. To my knowledge, Fidelity does not participate in the pay-to-play arrangements (with their competitor custodians) that would allow their mutual funds to trade for free on many platforms. So if an investor account is at Fidelity, it is generally free to trade FXAIX or FZROX. Other custodians will likely charge a fee to trade FXAIX and will not allow FZROX trades at all!

It is worth noting that neither fund has a minimum for initial or additional investments. That being said, investors looking for free trades may want to consider an a total market ETF or large-cap ETF, rather than FZROX or FXAIX.


FZROX grabbed headlines when Fidelity announced it, due to the 0% expense ratio. While zero expenses is great, it is only .015% less than FXAIX. So even though the difference in expenses is infinite in relative terms, its only a basis point and a half difference. At a certain level (such as this one), differences in expense ratios do not matter.

Tax Efficiency & Capital Gain Distributions

Both funds have made capital gains distributions in the past and will likely make them in the future. It is not possible to say which one will be more tax-efficient in the future. As index funds, the tax drag on both funds is very low. However, tax-sensitive taxable investors may want to consider using an ETF in lieu of either of these funds.

Final Thoughts: FZROX vs FXAIX

Both FXAIX and FZROX are large, core funds sponsored and managed by one of the largest asset managers in the world (Fidelity). Beyond market cap exposures, the funds appear and act very similar. Long-term performance has been nearly identical. I view these two funds as essentially interchangeable and would not spend too much energy splitting hairs to decide which one is “better.”

Should I invest in FZROX or FXAIX?

I believe FXAIX is the better choice for most situations, although investors may want to look at similar ETFs too.

Investors should not consider FZROX at all unless their account is at Fidelity. If my accounts were at Fidelity, I might consider FZROX in a tax-exempt or tax-deferred account. However, I would never buy FZROX in a taxable account due to the inability to transfer the assets (without realizing a potential gain) out of Fidelity if I wanted to move my accounts, donate the shares, etc.

Posted by Matt

Matt is an investor and investment adviser. He is a CFA charterholder and a CAIA charterholder. His writing on this site is purely educational; he will not make recommendations on this site since he does not know individual readers' situations.