Fidelity auto invest

Fidelity Recurring Investment

2023: Can I use automatic investment plan (AIP, recurring investment) on Fidelity? Does Fidelity have dollar cost averaging program (DCA)?

Does Fidelity Offer an Recurring Investment?

Fidelity customers have access to a user-friendly automatic investing plan (AIP) service. The brokerage company provides both a pdf form and a website enrollment form, and signing up takes only a few minutes.

Eligible Products

Fidelity’s automatic investment plan can be used to purchase additional shares of mutual funds that you already own. Both transaction-fee funds and no-transaction-fee funds are eligible.

Stocks and ETF’s cannot be purchased with Fidelity’s AIP.

Fidelity Automatic Investing Fee

NTF funds are free to purchase in an automatic investment plan, although transaction-fee funds carry a $5 charge. There are 3,746 funds on the Fidelity website that carry no transaction fee, and a total of 11,191 products. Mutual funds with front-end sales charges (typically these are Class A funds) are ineligible.

Fidelity Dollar-Cost Averaging

Fidelity’s automatic investment plan is a type of dollar-cost averaging. It uses a fixed-purchase amount each month instead of a fixed amount of shares. Using this method results in more shares being purchased when the NAV is low. It also allows fractional shares to be purchased, something that mutual funds have always offered, but which is not available with stocks and ETF’s.

For example, you could buy $100 each month of JAGTX, the Janus Henderson Global Technology Fund. It carries no transaction fee normally, so AIP purchases would cost nothing.

Fidelity Automatic Investing Comparison

Charles Schwab also has an automatic investment plan. The broker allows any type of mutual fund to be registered for automatic purchases. Both load and no-load funds, and both transaction-fee and no-transaction-fee funds can be enrolled. Over 13,000 mutual funds are available on the Charles Schwab of which 4,200 are commission-free.

Funding the Recurring Purchases

In order to pay for regular mutual fund purchases, you will need to supply regular deposits into your Fidelity brokerage account. To do this, simply go to ‘Accounts & Trade’ at the top of the broker’s website. In the drop-down menu, click on ‘Account Features’ and choose ‘Automatic Investments’. Here you will be able to establish a regular transfer from an external bank account.

The same on-line form also allows you to set an investment schedule for a specific fund. A stop date can be added if you want the program to end at some point in the future. The purchase frequency can set to monthly, quarterly, or certain months. The purchase date can be any date of the month.

Fidelity recurring investment

Fidelity and Competitots

Broker Review Promotion
Mutual Fund
Annual IRA
Charles Schwab Get $0 commissions + satisfaction guarantee at Charles Schwab. $0 $49.95 ($0 to sell) $0 $0
Robinhood Free stock up to $200 when you open an account. $0 na $0 na
WeBull Get 12 free stocks when you deposit $100 with Webull! $0 na $0 $0
Fidelity Get $0 trades + 65₵ per options contract at Fidelity. $0 $49.95 $0 $0

Other Fidelity AIP Information

Fidelity’s automatic investment plan can be used with a regular brokerage account or an Individual Retirement Account. All deposits into an IRA are coded for the current year. Also available are 529 and HAS accounts.

The broker provides a pdf form that can be used to sign up as well. You simply need to supply the mutual fund ticker symbol, along with the regular purchase amount, and the purchase frequency. An external bank account needs to be added to the form along with a deposit slip or voided check. Finally, the form needs to be mailed to the broker or taken to one of its branch locations.