Fidelity Investments of Boston last week launched the Fidelity Advantage Class shares on its five Spartan index funds, which will provide qualified investors with a bonus 30% reduction in fees, a remarkably lower price than what the rest of the industry offers on index funds. Some industry observers view the move as a strike against increasingly popular exchange-traded funds and industry rival Vanguard of Valley Forge, Pa.

John Bonnanzio, group editor of Fidelity Insight, a newsletter that tracks Fidelity, believes Fidelity slashed the fees because of "good old-fashioned competition." Fidelity has been losing its market share in recent years, and so this move is an effort to reverse that, Bonnanzio said. "They are taking advantage of their size and heft, and offering investors a deal they can't refuse," he said.

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