Fidelity Spartan name change

[UpAnchor]

I'm sure I'm not the only one here to receive an email today from Fido advising of the forthcoming disappearance of the "Spartan" designation from certain low-ER funds. In part:

"Effective June 14, Fidelity will remove "Spartan" from the name of each fund and replace it with "Fidelity." For example, the Spartan® 500 Index Fund will be named the Fidelity® 500 Index Fund. The ticker symbols and CUSIPs for the funds will not change."

Taken literally, I guess the full name will soon be, "Fidelity Fidelity 500 Index Fund". Really though, I wonder what prompted this. Being able to just search under "Spartan" to list their various low-cost funds, several of which I own, was quite handy. I suppose the alternative will be to list all funds and sort on exp. ratio. A bit more clumsy but not a big chore given that I infrequently need to do so. Still, I'm tempted to print or screen-grab the current Spartan list, with ticker symbols, for future reference.

 

[braumeister]

Don't forget to send your Fidelity rep a copy of your official form they will have to fill out and return to you in order to make this name change effective in your personal records. You may want to require them to get a Medallion guarantee before you will accept it.

 

[frayne]

I got the email as well. No big deal.

 

[audreyh1]

They also mentioned the name change from Advantage to Premium for the lower cost shares, and said something about change in eligibility requirements. I reviewed the prospectus for one of the funds - the new language is at the front - and I don't see any changes that affect a direct investor. Still same minimum of $10K.

 

[UpAnchor]

...I don't see any changes that affect a direct investor. Still same minimum of $10K.

Good to know as I intended to check that out but hadn't done so yet.

 

[MBSC]

Really though, I wonder what prompted this.

It's a technical change to access additional investors who favor index funds.

“Spartan” index funds are currently available through Fidelity brokerage and 401(k) plans Fidelity administers. Starting in June the funds will transition to “Fidelity” funds and become available through other channels, such as competing discount brokerages and retirement plans not overseen by Fidelity.

The move comes as the investment management landscape has been shifting away from active management in recent years. Academic studies have shown how difficult it is for active managers to beat the market, leading investors to shift investment dollars to index funds and ETFs.

Meanwhile, so-called robo-advisers, which use computer algorithms to help investors pick a suitable portfolio of index funds, have been winning fans with young investors.

Reference: Fidelity Index Funds to Be Sold by Competing Brokerages

 

[UpAnchor]

It's a technical change to access additional investors who favor index funds.

Reference: Fidelity Index Funds to Be Sold by Competing Brokerages

Thanks, MBSC. While I may not understand why this requires dropping "Spartan" from the name, it certainly does look like a positive move for investors as well as Fidelity. I'd be delighted to see some of these show up as alternatives under DW's 401k.

 

[H2ODude]

This bothers me less than the announced shift from Amex to Visa for the 2% cash back. Have to change all the auto pay.

 

[MRG]

Thanks, MBSC. While I may not understand why this requires dropping "Spartan" from the name, it certainly does look like a positive move for investors as well as Fidelity. I'd be delighted to see some of these show up as alternatives under DW's 401k.

I think it's just plain old marketing. Perhaps the name will suggest to some(unknowing) who will believe Fidelity led the way in index funds.

Thanks for the info.

Re: finding the old Spartan funds. IIRC on Fidelitys site you can separate by fund type i.e. index funds.

 

[DrRoy]

I got it too. People that did not know Fidelity already may have found Spartan to be confusing. Just a guess.

 

[scrabbler1]

I got the email the other day, too. Over the years, I have had a similar name change on individual Spartan funds now called "Fidelity" (but they had account rule changes such as minimum balances and additional investment minimums) so this is familiar territory.

 

[Markola]

This bothers me less than the announced shift from Amex to Visa for the 2% cash back. Have to change all the auto pay.

Which VISA pays 2%, please? I might update the auto pay for 2%!

 

[MRG]

Which VISA pays 2%, please? I might update the auto pay for 2%!

It's Fidelity's new 2% Visa that replaces the old Fidelity AMEX. Didn't look to see who services the new card, they don't come out till June or July. FIA serviced the old card, I'm hoping they're moving anywhere else..

 

[FrankiesGirl]

I got the email as well and was just a bit sad, as it did make things so much easier to recommend looking for the "Spartan" series when referring to their lower cost index funds so older posts and references won't make as much sense to the new investors looking for help on forums like this one. Otherwise, not really a big deal.

 

[samclem]

It does "blur the lines" a bit between these very low-cost Fidelity offerings and the rest of the funds under their roof, which is inconvenient.

Confirming MBSC's post, according to this article, this is being done so they''ll have the "Fidelity" right in the name as Fido increases their efforts to sell them through a larger number of outlets outside Fidelity.

 

[Senator]

It's Fidelity's new 2% Visa that replaces the old Fidelity AMEX. Didn't look to see who services the new card, they don't come out till June or July. FIA serviced the old card, I'm hoping they're moving anywhere else..

I have had the 2% Visa card since January 10, 2016. Right when they came out. I have already earned $218 in just ~4 months.

It is serviced by US Bank.

 

[audreyh1]

Good to know as I intended to check that out but hadn't done so yet.

It was pretty obscure. But at the front of the new prospectus they inform of the language changes that are going to happen. And there was just a lot of discussion of different ways people may hold Fidelity funds.

 

[audreyh1]

It does "blur the lines" a bit between these very low-cost Fidelity offerings and the rest of the funds under their roof, which is inconvenient.

Confirming MBSC's post, according to this article, this is being done so they''ll have the "Fidelity" right in the name as Fido increases their efforts to sell them through a larger number of outlets outside Fidelity.

I think the thing is that these are all now index funds. And the Fidelity index funds have much, much lower costs compared to the non-index funds. So "index" in the name is the key.

 

[audreyh1]

It's Fidelity's new 2% Visa that replaces the old Fidelity AMEX. Didn't look to see who services the new card, they don't come out till June or July. FIA serviced the old card, I'm hoping they're moving anywhere else..

Here is the FAQ from Fidelity that goes over all the details including the issuer - https://www.fidelity.com/cash-management/cardmember-faqs

Some folks report getting letters this week announcing that the new card will be sent out between mid-June and mid-July.

If you don't already have the Fidelity 2% AMEX, you can sign up for the new Fidelity 2% VISA now. It's just those of use waiting for the conversion who have to wait.....

 

[UpAnchor]

I got it too. People that did not know Fidelity already may have found Spartan to be confusing. Just a guess.

I can see that. And digging into this a bit, I see that these funds have simply been called "Spartan Total Mkt Index", etc. so replacing "Spartan" with "Fidelity" makes perfect sense. Somehow I've had it in my mind that they've been called "Fidelity Spartan..." such that Fidelity was already in the name and I didn't get why dropping the word "Spartan" would accomplish anything. So I get it now.

I got the email as well and was just a bit sad, as it did make things so much easier to recommend looking for the "Spartan" series when referring to their lower cost index funds so older posts and references won't make as much sense to the new investors looking for help on forums like this one. Otherwise, not really a big deal.

Exactly. So now we'll just point out to interested parties that Fidelity does indeed offer a line of very low-cost index funds and leave it at that.

Confirming MBSC's post, according to this article, this is being done so they''ll have the "Fidelity" right in the name as Fido increases their efforts to sell them through a larger number of outlets outside Fidelity.

Agree, now that I understand "Fidelity" wasn't - up till now- part of the official fund name. (Although, I believe that if I look up a Spartan fund ticker symbol on M*, I see the name "Fidelity Spartan blah blah blah" so that could be the source of my original confusion.)

 

[UpAnchor]

Here is the FAQ from Fidelity that goes over all the details including the issuer - https://www.fidelity.com/cash-management/cardmember-faqs



Some folks report getting letters this week announcing that the new card will be sent out between mid-June and mid-July.

This timing coincides quite nicely with Costco's switch from Amex to Visa. As I've always used my Fido Amex for Costco purchases, I had thought for awhile that I'd use the Amex to buy one or more good-sized Costco cash cards prior to the switchover in order to prolong getting my 2% discount. (I don't carry Costco's house Amex card so wouldn't be subject to receiving their new Visa replacement.) The new Fido Visa eliminates any workaround and I welcome it for this as well as for a number of other reasons.

 

[target2019]

I hope this doesn't turn out like New Coke.

 

[MBSC]

Effective July 1, 2016 Fidelity will reduce expenses on 16 index mutual funds (formally Spartan funds) and 11 sector index ETFs.

Among the changes, the ER for the 500 Index fund (premium) and Total Market Index fund (premium) will drop from 0.05% to 0.045%. Their "institutional premium" class offered in some 401k plans will drop to 0.015%.

The ER for U.S. Bond Index Fund (premium) will drop from 0.07% to 0.05%. The "institutional premium" class will drop to 0.03%.

Reference: https://www.fidelity.com/about-fide...rs-expenses-on-27-index-mutual-funds-and-etfs

 

[audreyh1]

Wow. They also introduced large cap growth and value index funds.

I guess there is a fight for the instutional 401K plans now that they are cost conscious due to recent lawsuits.