Index mutual funds invest in diverse companies and track a specific market index, like the S&P 500 (SPX) or Nasdaq 100 (NDX). Furthermore, these funds typically have lower expense ratios compared to actively managed funds. Today, we have focused on two such funds – FNILX and SWPPX – with at least 10% upside potential projected by analysts over the next twelve months.
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Let’s take a closer look at both funds.
Fidelity ZERO Large Cap Index Fund (FNILX)
The FNILX mutual fund invests at least 80% of its assets in stocks of large-capitalization companies included in the Fidelity U.S. Large Cap Index. As of today’s date, FNILX has 518 holdings with total assets of over $6.44 billion. Interestingly, it has a 0% expense ratio and no minimum investment requirement. Also, FNILX has generated a return of 30.6% over the past year.
Overall, FNILX has a Moderate Buy consensus rating. This is based on the weighted average consensus rating of each stock held in the portfolio. Of the total stocks held, 397 have Buys, 116 have a Hold rating, and five have a Sell rating. The analysts’ average price target on FNILX of $20.14 implies an 11.08% upside potential from the current levels.
Schwab S&P 500 Index Fund (SWPPX)
The SWPPX fund invests at least 80% of its assets in the stocks included in the S&P 500 Index, which broadly represents the performance of U.S. stocks. The SWPPX fund has 502 holdings with total assets of $70.18 billion. Additionally, the fund has a low expense ratio of 0.02%. The SWPPX fund has returned about 32% in the past year.
On TipRanks, SWPPX has a Moderate Buy consensus rating. This is based on 386 stocks with a Buy rating, 109 stocks with a Hold rating, and seven with a Sell rating. The average SWPPX mutual fund price target of $87.24 implies about 10.89% upside potential from the current levels.
Concluding Note
Mutual funds offer diversification and potentially lower risk compared to individual stocks. Further, they come with several benefits, such as higher liquidity and low minimum investment requirements. However, it would be wise to research well before investing in any of these mutual funds.
