Fidelity vs. Principal: Investment Platform Comparison

Both Fidelity Investments and the Principal Financial Group are finance firms that specialize in a range of investment products. Although both offer similar products, such as individual retirement accounts (IRAs) and certificates of deposit (CDs), Fidelity Investments tends to offer additional, more liquid products, such as stocks, bonds and options, in addition to online trading.

Fidelity Investments

Fidelity Investments can trace its history back to 1930 as the Fidelity Fund. Headquartered in Boston, the company began to expand from mutual funds in 1943. The firm has expanded rapidly since 1973. In 2011, it manages roughly $1.5 trillion in assets for more than 20 million clients. Fidelity Investments tends to specialize in online investment brokerage, but operates offices in the United States, Canada, Europe and Asia.

Fidelity Investment Products

Fidelity investments offer a range of funds geared for retirement and savings, including IRAs and 529 College Savings programs. In addition, it offers investment products such as mutual funds, money market funds, exchange-traded funds (ETFs), equity such as stocks and options, bonds and annuities. The company provides online trading facilities and retirement fund consulting. The firm also carries out independent financial research and develops trading strategies for a variety of clients.

Principal Financial Group

The Principal Financial Group was founded by Edward Temple in 1879 in Chariton, Iowa, as the Bankers Life Association. Historically, the company had specialized in life insurance policies for bankers. Gradually, the company began to offer other investment products and eventually changed its name to The Principal Financial Group in 1985, after which it expanded into global markets such as Hong Kong, India, Mexico and Brazil. The company became public in 2001. The company serves 15 million customers in 2011 and manages a combined $144.9 billion worth of assets. It is headquartered in Des Moines, Iowa.

Principal Investment Products

The Principal Financial Group tends to offer more long-term investment products than Fidelity Investments. Principal investments, therefore, are more focused on savings accounts, CDs, IRAs, annuities, health savings accounts and mutual funds. Academic products such as 529 plans and Coverdell education savings accounts are also available. It also offers a range of insurance products, such as life insurance and disability insurance.