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Freedom K

October 21st, 2009 at 12:18 am

This is interesting. Fidelity, my 401(k) provider, is changing my selected Target retirement Freedom fund to a new series called Freedom K funds.

I wonder why?

Whatever it is, they've revamped the entire product line, so it must be a big deal on their end. However, according to their "detail information" article:

"Fidelity Freedom K Funds will have the same management team, investment objectives and will invest in the same underlying funds as the Fidelity Freedom FundsĀ®"

Also, they claim that the expense ratio will be roughly 0.1% or so lower than the regular Freedom series.

Another thing is that I don't think they're phasing out the Freedom series so much as they are adding this Freedom K series to 401(k)s. The regular Freedom series should still be available to retail investors.

What I want to know is, what is the purpose behind this new series? I guess I shouldn't look the gift horse in the mouth, but I just can't imagine that such a big move is purely altruistic....

So does anyone know?

2 Responses to “Freedom K”

  1. merch Says:

    I would guess that it is probably just insitiutional money versus retail. So, the investments are the same just the expenses are less.

  2. creditcardfree Says:

    Something about it makes me think that it is just a marketing change. Maybe fees going down because it is going to be available to more investors. A guess on my part. Let us know if you hear anymore about it.

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