Fidelity Freedom Index Income Fund - Investor Class · NASDAQ:FIKFX
Fidelity Freedom Index Income Fund - Investor Class — Fidelity Investments — Debt Investor Presentation
39 slides from Fidelity Freedom Index Income Fund - Investor Class's debt investor presentation
Slide 1: Understanding Bond Pricing
INVESTMENTS s@ v" bbe a e Understanding Bond Pricing
Slide 2: By better understanding bonds, you can more confidently use them
By better understanding bonds, you can more confidently use them to strengthen your portfolio. 2 Copyright 1998-2017 FMR LLC. All Rights Reserved.
Slide 3: Develop an Ongoing Strategy with Fidelity
Education on securities Develop an Resources to help Ongoing Strategy inform and assist you in managing your assets with Fidelity Insights for helping you make more prudent and informed decisions 3 Copyright 1998-2017 FMR LLC. All Rights Reserved.
Slide 4: Common Questions
1 2 3 Common How many of you currently Ever wonder why it’s harder to get a How many of you have a grasp on what Questions have bonds in your portfolio? bond quote than a stock quote? you’re being charged per bond trade? 4 Copyright 1998-2017 FMR LLC. All Rights Reserved.
Slide 5: Today's Agenda
Comprehending the Bond Market Assessing Pricing for Individual Bonds Understanding Trading Costs Today’s Agenda 5 Copyright 1998-2017 FMR LLC. All Rights Reserved.
Slide 6: Understanding the Bond Market
Makeup Understanding the Size Bond Market Volume 6 Copyright 1998-2016 FMR LLC. All Rights Reserved.
Slide 7: The Makeup of the Bond Market Varies from the Stock Market
The Makeup of the Bond Market Varies from the Stock Market STOCK MARKET BOND MARKET Makeup Equity shares of publicly Debt securities issued by corporations, owned companies governments, government agencies, municipalities Size Limited to size of shares Relatively small and large offered by companies
Slide 8: Size
Size CHARACTERISTICS BOND STOCK Market Size1 $42 Trillion $36 Trillion Daily Trading Volumes2 $852 Billion $409 Billion Number of Securities3 1,150,000 5,334 Ford (example) $79 Billion $34 Billion Outstanding4 Ford (example) 311 1 Number of Issues4 1.Bonds—SIFMA,, Q3 2018, Equity-World Federation of
Slide 9: Volume: US Bond Markets
Volume: US Bond Markets DAILY TRADING VOLUME ($BN) AND CUSIPS OUTSTANDING $1,000 1.2M 989K $800 1.0M $589 800K $600 600K $400 400K $218 $200 109K 200K 1K 43K $30 14K $12 $4 $0 0K Treasuries MBS Corporate Municipal Agency Daily Trading Volume ($BN) # of Cusips Source: FINRA, SIFMA, Dec 2018 9 Copyrig
Slide 10: The bond market can be difficult to navigate
The bond market can be difficult to navigate because of its fragmented nature, its size, and its inconsistent trading. 10 Copyright 1998-2016 FMR LLC. All Rights Reserved.
Slide 11: Assessing Pricing for Individual Bonds
Valuation Pricing Assessing Pricing Historical for Individual Pricing Bonds Live Pricing 11 Copyright 1998-2016 FMR LLC. All Rights Reserved.
Slide 12: Valuation Pricing: Monthly Statement Bond Pricing Valuation
Valuation Pricing: Monthly Statement Bond Pricing Valuation For illustrative purposes only Source: Fidelity.com Screen-print taken on 1/30/2019 12 Copyright 1998-2017 FMR LLC. All Rights Reserved.
Slide 13: Valuation Pricing: Nightly Valuation
Valuation Pricing: Nightly Valuation For illustrative purposes only Source: Fidelity.com Screen-print taken on 12/22/2016 13 Copyright 1998-2017 FMR LLC. All Rights Reserved.
Slide 14: Valuation Pricing: Bond Details
Valuation Pricing: Bond Details For illustrative purposes only Source: Fidelity.com Screen-print taken on 12/22/2016 14 Copyright 1998-2017 FMR LLC. All Rights Reserved.
Slide 15: Valuation Pricing: Fixed Income Analytics
Valuation Pricing: Fixed Income Analytics For illustrative purposes only Source: Fidelity.com 15 Copyright 1998-2017 FMR LLC. All Rights Reserved.
Slide 16: Historical Pricing: Trading Liquidity
Historical Pricing: Trading Liquidity For illustrative purposes only Source: Fidelity.com Screen-print taken on 08/21/2019 16 Copyright 1998-2017 FMR LLC. All Rights Reserved.
Slide 17: Live Pricing: Fidelity Bond Aggregation
Live Pricing: Fidelity Bond Aggregation ~50K Unique Bonds Offered ~75K Total Offerings 17 Copyright 1998-2017 FMR LLC. All Rights Reserved.
Slide 18: Live Pricing: Live Listing of Bonds Available
Live Pricing: Live Listing of Bonds Available For illustrative purposes only Source: Fidelity.com 18 Copyright 1998-2017 FMR LLC. All Rights Reserved.
Slide 19: Live Pricing: Treasuries and Corporate Live Bid and Offer Prices
Live Pricing: Treasuries and Corporate Live Bid and Offer Prices Bid Price: 99.421 Ask Price: 99.469 Yield Spread: 0.005% Bid Price: 105.904 Ask Price: 105.999 Yield Spread: 0.011% For illustrative purposes only Source: Fidelity.com 19 Copyright 1998-2017 FMR LLC. All Rights Reserved.
Slide 20: Live Pricing: Municipal Bond Offerings
Live Pricing: Municipal Bond Offerings For illustrative purposes only Source: Fidelity.com 20 Copyright 1998-2017 FMR LLC. All Rights Reserved.
Slide 21: Live Pricing: Depth of Book
Live Pricing: Depth of Book 11 dealers offering 6 dealers bidding Different quantities and prices Different quantities and prices For illustrative purposes only Source: Fidelity.com 21 Copyright 1998-2017 FMR LLC. All Rights Reserved.
Slide 22: Live Depth of Book and Historical Recent Trades for Corporate Bonds
Live Depth of Book and Historical Recent Trades for Corporate Bonds Best Offer: 112.388 Best Bid: 111.902 Yield Spread: 0.108 Recent Trades Investor Bought earlier at 112.52 Investor Sold earlier at 112.20 For illustrative purposes only Source: Fidelity.com 22 Copyright 1998-2017 FMR LLC. All Rights
Slide 23: Live Depth of Book and Historical Recent Trades for Municipal Bonds
Live Depth of Book and Historical Recent Trades for Municipal Bonds Best Offer: 124.083 No Bids Trades often months apart Pricing increased over time, in line with general Muni market For illustrative purposes only Source: Fidelity.com 23 Copyright 1998-2017 FMR LLC. All Rights Reserved.
Slide 24: Live Pricing: Request for Bid Quote
Live Pricing: Request for Bid Quote Price discovery for securities without an “active” bid quote available on Fid.com Allows multiple dealers to competitively bid on the position Access Bid Wanted Dashboard For illustrative purposes only Source: Fidelity.com 24 Copyright 1998-2017 FMR LLC. All R
Slide 25: Live Pricing: Bid Wanted Dashboard
Live Pricing: Bid Wanted Dashboard View by Account Easily see the Best Bid: 98.012 Clearly identify the exact time a bid response will be returned Ability to Place Order directly from Dashboard For illustrative purposes only Source: Fidelity.com 25 Copyright 1998-2017 FMR LLC. All Rights Reserved.
Slide 26: Live Pricing: The Yield Curve
Live Pricing: The Yield Curve For illustrative purposes only Source: Fidelity.com 26 Copyright 1998-2017 FMR LLC. All Rights Reserved. 26 Copyright 1998-2017 FMR LLC. All Rights Reserved.
Slide 27: Live Pricing: The Yield Table
Live Pricing: The Yield Table Fidelity.com > Research > Fixed Income Bonds & CDs Quick and easy scan of 120 comparative yield data-points Derived every 15 minutes from live bond inventory Immediate, one-click, access to search results for that category For illustrative purposes only Source: Fidelity
Slide 28: Live Pricing: Using the Fidelity.com Bond Yield Table
Live Pricing: Using the Fidelity.Com Bond Yield Table View by Highest or Median yields Click on a yield to see offerings 28 Copyright 1998-2017 FMR LLC. All Rights Reserved. For illustrative purposes only Source: Fidelity.com
Slide 29: Understanding Trading Costs
Transparency Understanding Mark-up Fee Trading Costs Comparison Impact 29 Copyright 1998-2016 FMR LLC. All Rights Reserved.
Slide 30: Cost Transparency
Cost Transparency 1 2 3 PRICES SEEN BY PRICES SEEN BY OFFERINGS CUSTOMERS IN CUSTOMERS IN SEEN BY TRADERS OFFERINGS TRADE TICKET Disclosed $1 A Mark-up ($1/Bond) Bond Inventory Inventory Inventory Fidelity Process: (and prices) (and prices) (and prices) “Transparent Pricing” from dealers from dealer
Slide 31: Mark-up Fee Comparisons
Mark-up Fee Comparisons Another broker’s $21.07 per bond Mark-up (107.5036 – 105.3966) Fidelity’s $1 per bond Mark-up For illustrative purposes only (104.109 – 104.009) Source: Fidelity.com 31 Copyright 1998-2017 FMR LLC. All Rights Reserved.
Slide 32: Confirms now display Mark-up/down
Confirms now display Mark-up/down For illustrative purposes only Source: Fidelity.com 32 Copyright 1998-2017 FMR LLC. All Rights Reserved.
Slide 33: Compare Fidelity's $1 per bond mark-up with competitors
Compare Fidelity’s $1 per bond mark-up with competitors Fidelity.com/fixed-income-bonds/bond-pricing Online: Fidelity Viewpoint: How much am I paying for my bonds? Minimum markup or markdown of $19.95 applies if traded with a Fidelity representative. For U.S. Treasury purchases traded with a Fidelit
Slide 34: In Review
Comprehending the Bond Market Assessing Pricing for Individual Bonds Understanding Trading Costs In Review 34 Copyright 1998-2017 FMR LLC. All Rights Reserved.
Slide 35: Where to start: Fidelity.com > Research > Fixed Income, Bonds & CDs
Where to start: Fidelity.com > Research > Fixed Income, Bonds & CDs fixedincome.fidelity.co m/ftgw/fi/filanding For illustrative purposes only Source: Fidelity.com 35 Copyright 1998-2017 FMR LLC. All Rights Reserved. 35 Copyright 1998-2017 FMR LLC. All Rights Reserved.
Slide 36: How Fidelity Can Help
How Fidelity Can Help Meet with a Fidelity investment professional Further understand your current bond holdings Explore how you may improve your portfolio with bonds See if you’re currently paying additional mark-ups on bond transactions 36 Copyright 1998-2017 FMR LLC. All Rights Reserved.
Slide 37: Disclosures
Disclosures 1. (from pages 33) Fidelity commissioned Corporate Insight to study bond pricing, available online, for self-directed retail investors from five brokers that offer corporate and municipal bonds for comparison to Fidelity's standard online pricing. The study compared online bond prices fo
Slide 38: Disclosures
Disclosures Interest income earned from tax-exempt municipal securities generally is exempt from federal income tax, and may also be exempt from state and local income taxes if the investor is a resident in the state of issuance. A portion of the income received may be subject to federal and state i
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