FFFFX vs. FFNOX

[Keyboard Ninja]

I'm still in the middle of reading my investment books, but can someone tell me if there is a big difference between Fidelity's FFFFX vs. FFNOX?

I've been thinking about moving the money from my FFFFX fund and putting it into the FFNOX. The expense ratio of the latter is much lower, but I'm not sure if there is much of a difference besides that. Any help would be awesome.

 

[ats5g]

Both are "funds of funds" meaning that they just hold other fidelity funds.

FFFFX is a Target Retirement fund, meaning it starts off with a lot of stocks, and over time transitions to a lot of bonds. From Fidelity's website:

Strategy
Investing in a combination of underlying Fidelity equity, fixed-income, and short-term funds using a moderate asset allocation strategy designed for investors expecting to retire around the year 2040. Allocating assets among underlying Fidelity funds according to an asset allocation strategy that becomes increasingly conservative until it reaches 20% in domestic equity funds, 35% in investment-grade fixed-income funds, 5% in high yield fixed-income funds, and 40% in short-term funds (approximately 10 to 15 years after the year 2040). Ultimately, the fund will merge with Freedom Income Fund.

FFNOX does not change it's makeup of stocks and bonds over time, about 15% bonds:

Strategy
Investing in a combination of four Fidelity stock and bond index funds (underlying Fidelity funds) using an asset allocation strategy designed for investors seeking a broadly diversified, index-based investment.

Also, FFFFX is made up of actively managed funds, while FFNOX is made up of all index funds. Hence FFNOX is much cheaper.


- Alec