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Fidelity launched its ZERO index funds in 2018 to much fanfare. As their names suggest, these funds carry no expense ratios, a first in the industry.

As great as a “free” mutual fund may sound, however, many wonder whether there is a catch. Recently a viewer named Samir asked the following questions:

"Could you please share your thoughts on Fidelity ZERO funds vs their fee based funds?Fidelity ZERO International Index Fund (FZILX)Fidelity ZERO Total Market Index Fund (FZROX)Fidelity ZERO Large Cap Index Fund (FNILX)Fidelity ZERO Extended Market Index Fund (FZIPX)

Is FNILX + FZIPX = FZROX ?

ZERO funds have no fees, but other than cost, do you see any reason why one should invest in fee based instead of zero funds?

If you could please create video and share your thoughts, that would be very helpful."

Let’s dive into the details to get a better understanding of the Fidelity ZERO funds.