(New York)

Vanguard has been leading the race to the bottom in fund fees for years. It has also been immensely successful doing so. Until now, most fund providers had only fought back by cutting their own fees, but now they are getting more defensive. For instance, Fidelity, which is the largest 401(k) manager, will now charge clients an extra 0.05% fee for all funds invested in Vanguard products. Fidelity says that “A small number of fund families have not compensated Fidelity for certain services, and this pricing change is designed to address that disparity with the intention of providing fairness across all of our business relationships … This is about leveling the playing field”.

FINSUM: This is a good way to push back against Vanguard, but considering it is retaliatory, the fee does seem quite minor!