Important Considerations Before Investing with Fidelity
Fidelity Investments provides valuable tools and resources for self-directed investors to evaluate mutual funds and exchange-traded funds before making investment decisions. These tools, known as Fidelity screeners, allow users to input criteria and analyze various securities based on their individual preferences.
It is important for investors to carefully consider the investment objectives, risks, charges, and expenses associated with any mutual fund or ETF before investing. Fidelity recommends contacting them for a prospectus or offering circular to obtain detailed information about a particular security.
Expert screeners provided by independent companies offer additional insights, but it is essential for investors to conduct their own evaluation based on their investment objectives, risk tolerance, and financial situation. Fidelity does not endorse any specific investment strategy or approach to screening securities.
Market conditions can impact investment decisions, and past performance is not a guarantee of future results. It is crucial for investors to regularly reevaluate their investments and make informed decisions based on their individual circumstances.
Diversification is key to managing risk in an investment portfolio, and Fidelity offers resources to help investors understand the effects of diversification on their investments. The Bloomberg Barclays US Aggregate Bond Index and the S&P 500 Index are commonly used benchmarks to measure performance in the bond and equity markets, respectively.
Investing in bonds carries various risks, including interest rate risk, inflation risk, and credit risk. High-yield bonds involve greater price volatility and default risk compared to investment-grade bonds. Investors should be aware of the risks associated with different types of securities and make informed decisions based on their risk tolerance and financial goals.
Mortgage-backed securities (MBS) also come with risks such as prepayment risk and extension risk, which can impact the performance of these securities in different interest rate environments. It is important for investors to understand these risks and carefully evaluate the characteristics of MBS before investing.
Overall, investing involves risk, and it is important for investors to educate themselves and make informed decisions based on their individual circumstances. Fidelity provides valuable resources and tools to help investors navigate the complexities of the financial markets and make sound investment decisions.