A plethora of strategies exist for investors looking for core equity exposure, but investors may want to consider the Fidelity Enhanced ETF equity suite. These ETFs, converted from mutual funds last November, carried over 15 years of trading for the strategies while seeking to outperform their various benchmarks.
The actively managed suite offers investors the potential to capture differentiated alpha within core equities. It does so through its proprietary evaluation of equity characteristics coupled with multiple layers of risk management when determining security selection.
Fidelity’s Enhanced ETF lineup uses a research driven approach identifying long-term drivers of stock returns, such as growth, profitability, valuation, and even non-traditional factors. The diversified set of factors helps potentially provide a fuller picture of a securities return potential. The ETFs seek to deliver capital appreciation and higher total returns than their respective benchmarks.
In addition to the unique approach for identifying attractive stocks, the portfolio managers leverage a proprietary portfolio construction and risk management framework that is fine-tuned for each ETF’s investment universe. Each ETF seeks to provide diversified exposure to the drivers of long-term portfolio returns.
Fidelity currently offers six different strategies within its Enhanced ETF suite. These span the core equity exposures and allow investors the flexibility to invest in a way that aligns with their goals.
The Fidelity Enhanced Large Cap Core ETF (FELC ), the Fidelity Enhanced Large Cap Value ETF (FELV ), and the Fidelity Enhanced Large Cap Growth ETF (FELG ) offer various exposures to large-cap stocks. FELC seeks to offer higher total returns than the broad S&P 500 Index.
For investors seeking a tilt to their large-cap exposure, FELV and FELG offer two different options. FELV seeks better returns than the Russell 1000 Value Index, and FELG seeks to outperform the Russell 1000 Growth Index. All three large cap ETFs carry an expense ratio of 0.18%.
The Fidelity Enhanced Mid Cap ETF (FMDE ) offers exposure to midcap stocks. The fund seeks higher total returns than the Russell Midcap Index and has an expense ratio of 0.23%. The Fidelity Enhanced Small Cap ETF (FESM ) offers exposure to small caps and seeks to outperform the Russell 2000 Index. The fund’s expense ratio is 0.28%.
The Fidelity Enhanced International ETF (FENI ) seeks to provide returns above the MSCIFE Index. It do EAes so by investing in developed international stocks while excluding the U.S. and Canada. FENI carries an expense ratio of 0.28%.
For more news, information, and analysis, visit the ETF Investing Channel.
