Of the myriad storylines markets produced in 2025, foreign equities success was one of the biggest. Only overshadowed, perhaps, by the continued ascent of AI-related technology stocks, ex-U.S. equities saw strong returns for investor portfolios. With growing headwinds in 2026, the right foreign equities ETF could step up to the moment, and FENI could be a strong candidate to consider with its quantitative data-driven approach.
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The Fidelity Enhanced International ETF (FENI ) charges a 28 basis point fee to actively invest in ex-U.S. equities. The strategy will celebrate its key three-year ETF milestone later on in 2026. That would give it the three-year track record desired for consideration by many brokerages. FENI has a track record back to 2007, having converted from a mutual fund and retained the same investing process since then The foreign equities ETF performed well in 2025’s foreign equities success story, returning 37.25% over the last one year per Fidelity Investments data as of December 31.
Foreign Equities ETF FENI: Managers Chime In
How, then, does the fund invest and what might the fund do in 2026? Fidelity leaders recently answered questions about the fund in a Q&A. An interview with Shashi Naik, Anna Lester and George Liu, co-managers on Fidelity’s systematic equity strategies team, explored the topic. Asked why the team leans into quantitative investment approaches, Lester and Naik shared their thoughts.
“Ultimately, we’re seeking good businesses with durable competitive advantages, selling at prices we consider to be reasonable,” Lester wrote. “In pursuit of this, our investment process relies upon computer-aided analytical models to help us try to objectively examine and rank individual securities.”
“We favor a data-driven approach because we believe that financial markets are less than 100% efficient, primarily due to investors’ behavioral tendencies,” Naik said. “So, in an attempt to mitigate the impact of human emotion – and potentially remove some common investing biases that come with it – we apply a systematic investment process grounded in logic and backed by empirical evidence to make the process, in our view, more objective.”
The foreign equities ETF’s managers actively invest in stocks from the MSCI EAFE index, excluding the U.S. and Canada. It emphasizes metrics like growth, profitability, historical valuation, and more, aided by that quantitative approach. Looking ahead, FENI’s approach could set it apart as it looks for continued outperformance in foreign equities.
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Fidelity Investments® is an independent company unaffiliated with VettaFi LLC (“VettaFi”). These articles do not form any kind of legal partnership, agency affiliation, or similar relationship between VettaFi and Fidelity Investments, nor is such a relationship created or implied by the articles herein. VettaFi LLC is the author and owner of these articles.
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