Fidelity Investments, which has been cutting prices to compete with low-cost rivals such as Vanguard Group and Charles Schwab Corp., is trimming fees on the target date index funds it sells to retirement plans and rolling out new offerings that combine active and passive strategies.
Fees will be reduced to 14 basis points, or 0.14 percent, from 15 for the investor class of the index funds and 8 basis points from 10 on the institutional premium version, the firm said in filings on Friday.
Fidelity also said its new Freedom Blend funds incorporate both active and index investing and will be cheaper than traditional active offerings. Previously, the firm’s target-date funds focused on one approach or the other.
“We are trying to use our scale to provide value to our customers,” Eric Kaplan, head of Fidelity’s target-date lineup, said in a phone interview.