FILE / SWPPX-FZROX
2026 edition
CROSS-FAMILY PROPRIETARY PAIR
SWPPX vs FZROX: cheapest mutual funds at two different brokerages
Schwab and Fidelity each ship a flagship near-zero-cost index mutual fund tied to their own platform. SWPPX (S&P 500, 0.02%) and FZROX (total US market, 0.00%) are not the same index, not transferable, and not interchangeable.
QUICK VERDICT
read this if nothing elsePick the ETF if
SWPPX is the cleaner pick if your brokerage is Schwab and you want pure S&P 500 exposure. FZROX is for Fidelity-only investors who want a total-market position at literally zero stated expense and accept that the fund cannot leave Fidelity.
Pick the index fund if
If you may switch brokerages in the next decade, neither is a good buy. Pick a portable ETF instead, like VOO, IVV, VTI, or ITOT.
Both funds are proprietary index mutual funds at zero or near-zero expense. They look similar on the headline number, but the resemblance is structural marketing rather than substitutability. SWPPX tracks the S&P 500 at roughly 0.02% per the Schwab fund product pages, while FZROX tracks the proprietary Fidelity US Total Investable Market Index at a stated 0.00% expense per the Fidelity mutual fund overview. The portability rule is the same at both: you cannot transfer either fund in kind to a brokerage that does not run the same fund family.
Expense ratios and minimums shown reflect typical figures from the issuers' published prospectuses on SEC EDGAR. Confirm the current figure with the issuer before buying.
FIG. A / SPEC SHEET
Side by side
SECTION 02 / DIFFERENT INDEXES, NOT JUST DIFFERENT WRAPPERS
These are not the same fund in two wrappers
The other comparisons on this site (e.g. VOO versus VFIAX or VTI versus VTSAX) are pure wrapper choices: identical underlying portfolio, identical issuer, identical stocks. SWPPX versus FZROX is different. SWPPX holds the 500 large-cap names of the S&P 500. FZROX holds approximately 2,500 stocks across large, mid, and small caps using a Fidelity-built proprietary index. The composition difference matters more than the 0.02 percentage-point fee gap.
Historically, total-market funds and S&P 500 funds produce similar long-run returns because the S&P 500 makes up roughly 80 percent of US equity market cap. Bogleheads have argued the small-cap and mid-cap weighting in total-market funds gives a slight long-term edge through the size factor. The empirical record is mixed; see the Bogleheads three-fund portfolio wiki for a community survey of the debate. The mechanical truth: if you want the S&P 500, pick SWPPX or VOO or IVV. If you want the total US market, pick FZROX or VTI or ITOT. Choosing between them on the basis of a 0.02 percent fee difference is the wrong primary criterion.
For more context on what 1 basis point of expense ratio actually compounds to in dollars over a multi-decade hold, see the expense ratios deep dive. The summary: at 0.02 percent versus 0.00 percent on a $100,000 balance, you give up roughly $20 per year. Over thirty years with compounding that is meaningful but not decisive against a portability constraint.
SECTION 03 / THE PROPRIETARY-FUND PORTABILITY TRAP
What "non-portable" really means
Both Schwab and Fidelity offer their proprietary index mutual funds at near-zero expense because they are loss-leaders that lock you into the brokerage. The fund is a feature of the platform, not a tradable instrument. If you ever want to leave Schwab for Fidelity (or vice versa) and you hold a sizeable SWPPX or FZROX position in a taxable account, you face one of two choices, and neither is good.
Option 1: Sell at the source brokerage. Selling realises any embedded capital gains. In a taxable account on a position held five-plus years that gains have doubled, this can produce a significant tax bill. The relevant rates live in IRS Topic 409, typically 15 percent for most filers. On $50,000 of long-term gains that is $7,500. That is the price of having held a non-portable proprietary fund.
Option 2: Stay at the source brokerage. If you are happy at Schwab or Fidelity for life, this is fine. Most retail investors are not certain about twenty-year-plus brokerage choice, and a proprietary mutual fund quietly tilts the decision in the broker's favour every year you hold it. ETFs (VOO, IVV, VTI, ITOT) do not have this constraint. They transfer in kind to any other brokerage with no taxable event.
In a tax-advantaged account (IRA, 401(k), Roth IRA, HSA, 529), this constraint matters far less because there is no capital-gains realisation when you sell to switch brokerages. See the Roth IRA guide and Traditional IRA guide for the in-account analysis.
When to pick SWPPX
- You are a Schwab customer who specifically wants S&P 500 exposure (not total US market).
- You are inside a Schwab Roth IRA, Traditional IRA, or 401(k) where the proprietary lock-in does not realise taxable gains on a future broker move.
- You want true zero-friction recurring contributions in dollars (Schwab supports auto-invest natively for SWPPX).
- You have a horizon under ten years and are confident you will stay at Schwab.
When to pick FZROX
- You are a Fidelity customer and you want total US market (large + mid + small caps), not just the S&P 500.
- You are inside a Fidelity HSA, IRA, Roth IRA, or 401(k) where the proprietary lock-in does not produce a taxable gain on a future move.
- You want literally zero stated expense ratio and you are willing to accept a Fidelity-built index methodology rather than a third-party benchmark.
- You are confident you will stay at Fidelity for the duration of the hold.
SECTION 05 / THE ETF ALTERNATIVE
What you give up versus a portable ETF
For most retail investors, the cleaner long-run answer is a portable ETF that trades anywhere. Three direct alternatives:
- VOO at 0.03 percent tracks the S&P 500, three basis points more expensive than SWPPX. Listed on Vanguard. Tradable at every brokerage. See the VOO versus VFIAX page for the same-issuer comparison.
- IVV at 0.03 percent from iShares. Same S&P 500 exposure, more tax-efficient than any mutual fund in a taxable account because of the in-kind redemption mechanism.
- VTI at 0.03 percent or ITOT at 0.03 percent for total US market exposure equivalent to FZROX, both portable. ITOT lives at iShares. VTI is on Vanguard. See the VTI versus SCHB page for the cross-issuer ETF comparison.
The 1 to 3 basis-point premium versus the proprietary mutual fund buys you portability, in-kind tax efficiency in taxable accounts, and intraday tradability. For most multi-decade taxable holdings the trade is worth it. For a 401(k) or IRA where you will not switch brokerages mid-stream, the proprietary mutual fund is fine. Read the tax efficiency deep dive for the mechanism behind the in-kind redemption advantage.
DESK Q&A
Frequently asked
Q01Does FZROX really have a 0.00 percent expense ratio?
Stated, yes. The Fidelity ZERO funds (FZROX, FNILX, FZILX, FZIPX) carry zero stated expense ratios per Fidelity's published prospectuses. The trade-off is that the funds are proprietary, use Fidelity-constructed indexes rather than industry-standard benchmarks like the S&P 500 or CRSP indexes, and cannot be transferred in kind to other brokerages. The lower headline cost is real, the structural lock-in is also real.
Q02Can I move SWPPX from Schwab to Fidelity?
Not in kind. SWPPX is a Schwab proprietary mutual fund that does not exist on Fidelity's platform, so an in-kind transfer is not supported. You would have to sell at Schwab (potentially realising taxable gains in a taxable account), transfer cash to Fidelity, and buy a Fidelity-available equivalent like FXAIX. Inside a Roth IRA or Traditional IRA the sale does not realise tax, so the practical friction is much smaller.
Q03Is FZROX more tax-efficient than SWPPX in a taxable account?
Both are mutual funds, so both produce capital-gains distributions through the year as the fund manager rebalances. Neither uses the in-kind creation-and-redemption mechanism that makes ETFs structurally more tax-efficient. For a taxable account, both are at a disadvantage versus an ETF like VOO or VTI. See the tax efficiency deep dive for the mechanism.
Q04Why does Fidelity offer FZROX at zero cost?
Because the fund is a customer-acquisition tool. A zero-stated-expense fund attracts new accounts. Once you are inside Fidelity with a meaningful FZROX position in a taxable account, the cost of leaving (selling and realising taxable gains) makes you stickier. Fidelity also earns money on uninvested cash sweeps, securities lending on the underlying holdings, and on order flow for trades made elsewhere on the platform. Zero stated expense is a marketing surface, not the firm's economics.
Q05If I want to be brokerage-independent, what should I buy instead of either of these?
A portable ETF: VOO or IVV for the S&P 500 (about 0.03 percent), VTI or ITOT for the total US market (about 0.03 percent). All four trade at every major US brokerage and transfer in kind via ACATS to a new brokerage with no taxable event. The 1 to 3 basis-point premium versus the proprietary mutual fund is what you pay for not being locked in.
Q06Are SWPPX and FZROX available in 401(k) plans?
Generally no, unless your plan happens to be administered by Schwab or Fidelity respectively. 401(k) plan menus are picked by your employer's plan sponsor, and most plans offer a small set of share-class-specific institutional funds rather than the retail proprietary mutual funds you can buy in your taxable account. See the 401(k) guide for how to read your plan menu.
DESK ROUTING
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What this page is, and is not
Investment disclaimer
This site provides education and reference. It is not investment advice and is not a substitute for advice from a licensed financial advisor. For licensed advice, search NAPFA or XY Planning Network for fee-only fiduciary CFPs near you.
Tax disclaimer
This page summarises IRS published guidance. Tax outcomes depend on your specific circumstances. Consult a CPA or licensed tax professional for tax decisions about your accounts.
ETFvsIndexFund.com is independent and not affiliated with Vanguard, Fidelity, Schwab, BlackRock, iShares, Invesco, SPDR, the SEC, FINRA, the IRS, the Investment Company Institute, or Morningstar. Expense ratios, fund minimums, and tax-rate figures cited reflect publicly filed prospectuses and IRS publications and may change. Past performance does not predict future returns.