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Fidelity Investments today announced the launch of a new environmental, social, and governance ETF along with three new ESG-focused mutual funds. The Fidelity Sustainable High Yield ETF (NYSE Arca: FSYD), which begins trading on the NYSE today, normally invests at least 80% of the fund’s assets in debt securities rated below investment-grade (also referred to as high-yield debt securities or junk bonds) of issuers that Fidelity believes have proven or improving sustainability practices based on an evaluation of such issuers’ individual ESG profiles.
FSYD will use a joint quantitative and fundamental investment approach to identify bonds within that universe with strong return potential and low probability of default.
In addition to FSYD, Fidelity also launched the following mutual funds: the Fidelity Sustainable International Equity Fund (FSYRX), the Fidelity Sustainable Emerging Markets Equity Fund (FSYJX), and the Fidelity Sustainable Multi-Asset Fund (FYMRX).
The new sustainable mutual funds and ETF will have no investment minimums and are available for individual investors and financial advisors to purchase commission-free through Fidelity’s online brokerage platforms.
The ETF and each of the three mutual funds will use Fidelity’s proprietary forward-looking and historical ESG ratings frameworks in addition to third-party ESG ratings to evaluate a company’s or issuer’s sustainable business practices.
“Fidelity’s ESG ratings build on our legacy of active management and quantitative capabilities, leveraging our global experience in corporate engagement and fundamental analysis,” said Pam Holding, co-head of equity and head of sustainable investing at Fidelity Investments. “The integration of our proprietary ESG ratings into these four new products will offer our customers building block solutions to help connect their financial goals to positive themes in the broader world.”
Meanwhile, FSYRX normally invests at least 80% of assets in equity securities of companies that Fidelity believes have proven or improving sustainability practices based on an evaluation of such companies’ individual ESG profiles.
FSYJX normally invests at least 80% of assets in equity securities of companies in emerging markets, including equity investments that are tied economically to emerging markets, that Fidelity believes have proven or improving sustainability practices based on an evaluation of such companies’ individual ESG profiles.
FYMRX normally invests at least 80% of assets in Fidelity funds, including mutual funds and ETFs, that invest in securities of issuers that Fidelity believes have proven or improving sustainability practices based on an evaluation of such issuers’ individual ESG profiles, and in Fidelity index funds that track ESG indexes.
With the addition of these new funds, Fidelity now offers 15 actively managed and index sustainable mutual funds and ETFs.
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