FSKAX vs VTSAX - Which ETF To Choose? (Which ETF Is Best For You?)

FSKAX vs VTSAX - Which ETF To Choose? (Which ETF Is Best For You?). In this comparison video I will talk about FSKAX vs VTSAX.

So, the main difference between them is their return-based performances.
FSKAX has a slightly higher return-based performance compared to VTSAX. This year, FSKAX’s performance has already achieved a 6.22% return, which is relatively higher than VTSAX’s 5.77%. However, comparing their performances over a long timeframe shrinks their difference to a negligible value. For instance, assessing their average annual returns over a decade yields a 0.01% disparity in their return performances.
Therefore, FSKAX presents higher return-based performance than VTSAX.

Expense ratio
FSKAX has a relatively lower expense ratio compared to VTSAX. In fact, VTSAX’s expense ratio is twice what FSKAX charges its investors; the VTSAX’s and FSKAX’s expense ratios are 0.04% and 0.02%. This means that VTSAX investors will pay double the cost of what their FSKAX counterparts pay for the same stock shares.
Therefore, FSKAX outshines VTSAX in this category.

Drawdowns
FSKAX has experienced lower drawdowns in its entire existence compared to the drawdown VSAX encountered. FSKAX’s maximum drawdown fell to -35.01%, whereas VTSAX encountered a whooping -55.34% drawdown. The 20.33% disparity in their drawdowns significantly impacts their investment risk comparison. Lower drawdown values are usually associated with low investment risk. However, other metrics, such as volatilities and Sharpe ratio, are employed in calculating ETF's investment risks for more comprehensive results.
Therefore, FSKAX wins in this category as it has a lower drawdown value than VTSAX.

But do they have similarities?
Of course, they do. The ETFs are similar in that they have almost identical price fluctuations. This comparison between funds' price fluctuation is called correlation. Higher fluctuations of about 1.00, like the one presented with the two ETFs, indicate a lack of diversification, which may be risky in market downturns. The ETFs have also presented identical Sharpe ratios for the better part of the trailing twelve months.

To sum up, which is better – FSKAX or VTSAX?
While still a novice in EFT investment, I held assets in VTSAX due to peer influence by a friend already investing in the fund. Upon becoming a seasoned EFT investor, I shifted to FSKAX as it presented better returns, a low investment ratio, and relatively lower investment risk. For these reasons, I choose FSKAX as the better choice.

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