See how my Fidelity Go Robo-Advisor portfolio grew by 21% in 2020, beating the S&P 500 by five percentage points, with less volatility.

Fidelity Go Robo-Advisor 2020

For so many reasons and in so many ways, 2020 was a dumpster fire.

But, there was one thing that didn’t go terribly wrong in 2020. If you were an investor, and you stayed invested all year, then 2020 was likely one of the best years your portfolio has ever had. In fact, if you were an investor and you didn’t have a massive gain in 2020, you should really reassess your strategy.

2020 was not the best year I have ever had in my investments. That was 2009, as we emerged from the Great Recession, and my investments increased over 26%. Seven of the last 11 years have produced double-digit gains in my portfolio (2009, 2010, 2012, 2016, 2017, 2019, and 2020). So, 2020 wasn’t that unique.

What was unique, for me, was that I had moved into the Fidelity Go Robo-Advisor near the end of 2019. Little did I know what a stress-test 2020 was going to be! But, spoiler-alert, it worked great.

The rest of this article will dissect the performance of my Fidelity Go Robo-Advisor account in 2020. I will share how my portfolio beat the S&P 500 in 2020 and had less volatility in the process. Enjoy!

Fidelity Go Robo-Advisor – The Basics

First, a disclaimer. I am not affiliated with the Fidelity Go Robo-Advisor. I won’t get paid if you sign up. I’m not actually recommending their product. Instead, I am just describing my understanding of how it works. And, I am sharing my experience in my first calendar year as an investor with Fidelity Go.

As always, you should do your own research and be sure to understand what you are getting before you invest. Past performance is no guarantee of future results, and investments may lose money.


Fidelity Go Robo-Advisor is an investment product. Each account has exactly six investments:

  • Stocks
    • Large Cap Stock
    • Mid Cap Stock
    • Small Cap Stock
    • International Stock
  • Bonds
    • Investment Bonds
    • Conservative Bonds

Model Portfolios

There are seven model portfolios. The most conservative has 20% stock and 80% bonds. The most aggressive is 85% stock and 15% bonds.

When you sign up, you answer a series of questions and Fidelity recommends a starting model portfolio. You can override their suggestion and choose a different model portfolio. But, you cannot build your own portfolio.

After you have added money to the account, Fidelity will allocate it among the six investments.


Over time, as your investments perform differently, your portfolio will become more and more out of balance. When that happens, the Fidelity Go Robo-Advisor algorithm will automatically rebalance your portfolio.


Fidelity charges an annual fee of up to 0.35% for Robo-Advisor accounts (slightly less for smaller accounts). These charges are deducted from the account balance quarterly.

Fidelity Go Robo-Advisor vs S&P 500 in 2020

According to, the S&P 500 increased 16.26% in 2020.

According to the Fidelity website, my Fidelity Go Robo-Advisor account increased by 20.78% during the same time frame. Here is a screen-shot.

Screenshot of 2020 Fidelity Go Robo-Advisor account performance

However, these numbers don’t tell the full story. I know enough about statistics to know “there are three kinds of lies: lies, damned lies and statistics.” More important than what happened is why it happened. When we look at the full story, the truth is actually pretty impressive.

Comparing Daily Performance

Let’s look at the daily performance of my Fidelity Go Robo-Advisor account and the S&P 500.

A quick note about my methodology: the lines on these charts are the increases or decreases from the close of business on 12/31/2019, expressed as a percent. The Fidelity Go line only includes shares I already had on 12/31/2019, plus shares acquired through rebalancing during 2020. I did add money to the account in 2020, but removed those shares from this analysis.

Daily performance of Fidelity Go Robo-Advisor vs S&P 500 in 2020

Note that the S&P 500 started the year strong in 2020, increasing by 5 percentage points in the first two months. During the same time my Fidelity Go Robo-Advisor was only up 2.2%.

That is because, even though I have a lot of S&P 500 in my portfolio, I also have bonds. And, when the S&P was going up in early 2020, my bonds were very stable. This made my portfolio under-perform the S&P when it was going up.

Then, on February 20, everything changed. Between February 20 and March 23, the S&P 500 crashed, dropping 36 percentage points in a month.

Of course, during the same time, my Fidelity Go Robo-Advisor portfolio decreased as well. However, my bond holdings maintained almost 100% of their value, so my total portfolio only decreased 15 percentage points during that time.

What happened next is what makes Robo-Advisors so valuable.

Don’t Sell!

If you are a normal investor with a portfolio allocated in some mix of stock and bond funds, so far our story is the same. Your portfolio underperformed the S&P 500 as it increased in the beginning of the year, but you were protected from some of the crash.

I remember in March, 2020, all of the talking heads were warning investors not to get scared. Don’t freak out! Don’t sell your stocks! I would be willing to bet that if you had called your financial advisor, they would have told you the same thing. The best thing to do is ride this thing out.


Well, they were half right. Selling stocks in March would have definitely been the worst thing to do. But, by doing nothing and “riding it out” you were missing one of the biggest buying opportunities in the last decade.


If you read my mid-2020 performance update on Fidelity Go, you know that in March, the Stock investments were down about 30% to 35%, and the bond investments were still holding 97% to 98% of their value.

What happened next is what makes Fidelity Go Robo-Advisor worth every penny of the fee.

On March 18, 2020, the algorithm that runs Fidelity Go rebalanced my portfolio.

Chart showing the rebalance dates of Fidelity Go Robo-Advisor account in 2020

As a result of the stock market crash, my portfolio was no longer allocated in the way it was intended. I had way more bonds (as a percent of total investments) than I was supposed to. So, the algorithm at Fidelity executed enough trades to move my portfolio back into balance.

Because the stock market correction was so swift and deep, when the rebalance happened, it was huge. On March 18, 2020, the total number of shares of stock funds I own increased by 11%.

Then, when the S&P (inevitably) started its climb back up, I rode that wave with 11% more shares than I had during the crash.

As a result, my account had fully recovered from the crash by May 26. At that point, the S&P 500 was still 12 percentage points below it’s pre-crash levels. The S&P 500 didn’t recover fully until two and a half months later on August 12. And, on that date, my Fidelity Go account was 10 percentage points higher than pre-crash levels.

Chart showing how long it took to Fidelity Go Robo-Advisor account to recover from the market crash in 2020

Second Rebalance

About a month after the S&P 500 had recovered, Fidelity rebalanced my portfolio again on September 8, 2020.

Chart showing the rebalance dates of Fidelity Go Robo-Advisor account in 2020

At that point, the stocks inside my portfolio had grown significantly, while the bonds had been relatively stable. As a result, I then had a much larger percent of my investments in stocks than I should have. So Fidelity sold enough stocks and used the proceeds to buy bonds to get me back into balance.

The stocks I sold on September 18 had increased in value by nearly 40% since I bought them in March! That means that Fidelity only had to sell a bit more than half of those new shares that I had purchased in March in order to get my bond holdings up to where they should be.

After the rebalance in September, I had 5% more Stock shares than I started the year with and 4% more Bonds. I now have more shares of every single investment I own, and I did it without adding a penny of new money to my portfolio.

That is how Rebalancing manufactures new shares.

Looking Forward

As a result of the volatility in 2020, I now have nearly 5% more shares of every holding in my portfolio. And, I get to keep those share forever.

It does not matter whether the next cycle for the stock market is boom or bust. Either way I get to keep my newly minted shares. And, I did not have to add any money to my portfolio to get these new shares.

That is the magic of rebalancing. And the fact that it is automatic is the value of a Robo-Advisor.

Automatic Rebalancing is not Timing the Market

The Fidelity Go Robo-Advisor rebalanced my account three times in 2020.

  • On March 18, I missed the bottom by three trading days.
  • Then, on September 8, I missed the top by another three trading days.
  • And, on October 28 there was a market bottom that would have been an opportunity to sell some of the recently inflated shares, and I missed that.
  • The rebalance on November 25 turned out to not be necessary, because the market kept going up for the rest of the year.

Even though every single rebalance was timed wrong, I wouldn’t change a thing.

The point is not to buy at the exact bottom or to sell at the exact top. Instead, the point is to have a strategy that automatically takes advantage of market fluctuations and manufactures new shares.

Sure, if the crystal ball at Fidelity was a bit better and these trades were executed at the exact best moments, I may have a few more shares than I have now. But, I am super happy with the 5% increase in shares I received through rebalancing.

Less Volatility and Better Performance

The primary benefit of having a portfolio that is allocated across a couple of asset types is that it limits volatility. By spreading your investment across different kinds of assets, you will have some parts of your portfolio that move a lot, while others only move a little.

If your strategy is to buy-and-hold your diverse portfolio, then you won’t be able to beat the market in the long run. Your returns will always be the average of the investments inside your portfolio.

If you are 50% stock and 50% bonds, and the stock does 10% and the bonds do 2%, then your portfolio will return 6%: the average of the two.

The best way to beat the average is to systematically and regularly sell the part of your portfolio that has been doing well, and use the proceeds to buy the part of your portfolio that has been under performing.

Rebalancing Only Works with Volatility

It is important to note that the only way the Rebalancing beats a buy-and-hold strategy is if there is volatility.

Take a look at this chart where I have smoothed the fluctuations of my portfolio’s performance and the S&P 500.

Chart showing the daily performance of Fidelity Go and the S&P 500 in 2020 with variations smoothed out

Notice how the smooth blue S&P 500 line increases faster than the smooth green Fidelity Go line?

From January 1 through February 20, the S&P 500 did better than my Fidelity Go account. And, from March 23 through August 12, the S&P also outperformed.

If the stock market was always on an upward trajectory, then there would never be an opportunity for Fidelity Go to sell bonds and buy cheap stocks. In that case, a buy-and-hold of all stock would be a superior strategy.

But, this is the real world. Stock market corrections happen all the time. They have happened since the beginning of the stock market. And, I think they will probably continue.

If you think that this was the last stock market correction we will ever have, then a rebalancing strategy is probably not for you.

But, if you live in the real world with the rest of us, then you know that volatility is the name of the game. So, you should have a strategy that benefits from that volatility.

Final Thoughts

2020 was a dumpster fire year. It seems like pretty much everything that could break, did break.

For the last few years, I have been writing about the importance of having an investing strategy that creates profits from volatility. The stock market goes up sometimes. And, it goes down sometimes.

If you are hoping that it only goes up, then you are not investing, you are gambling. Your investment strategy needs to include a method for profiting from both up- and down-markets.

By the end of 2020, my investments were up 21%. But, that is much less important than the fact that I own 5% more shares than I did at the end of 2019. And, I got them without having to add a penny of new money to my account.

In late 2019, I moved into the Fidelity Go Robo-Advisor. And, I couldn’t be happier.

Before 2019, I had to rebalance on my own. I had to decide when the market had moved enough to justify making the trades. Doing the math to make the trades wasn’t too difficult, but knowing when to do it was giving me stress.

That’s the benefit of a Robo-Advisor. I no longer have to worry about when to do my rebalancing. It is automatic.

I like Fidelity Go, it works for me. There are quite a few Robo-Advisors on the market, so if you’re thinking about moving into one, you should do some research. Don’t invest this way just because I say so. Learn what you can and make an informed decision all on your own.

What to Read Next

For more information, check out these articles that offer more detail about these topics. Enjoy!

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