FDLO Profile
The Fidelity Low Volatility Factor ETF is strategically designed to provide investors with exposure to U.S. equities that exhibit lower volatility compared to the broader market. Under normal market conditions, the fund allocates at least 80% of its assets to securities that are constituents of the Fidelity U.S. Low Volatility Factor Index. This index is specifically constructed to track the performance of large- and mid-cap U.S. companies that demonstrate lower price volatility, aiming to offer a more stable investment option within the equity market.
The ETF's approach focuses on investing in stocks that have historically shown less price fluctuation, which can be appealing to investors seeking to mitigate risk while achieving capital appreciation. By targeting companies with lower volatility, the fund seeks to reduce the impact of market swings on the portfolio, potentially offering a smoother performance trajectory compared to more volatile stocks. This strategy aligns with the goal of providing investors with a steadier return profile.
In addition to its core investment strategy, the Fidelity Low Volatility Factor ETF may engage in securities lending. This practice involves temporarily loaning out securities held by the fund to other financial institutions in exchange for a fee. The income generated from securities lending can be reinvested to enhance the fund's overall returns. This additional revenue stream helps to further support the fund's investment objective and potentially improve its performance.
Overall, the Fidelity Low Volatility Factor ETF is designed for investors who prioritize stability and reduced market risk in their equity investments. By focusing on low-volatility stocks and employing securities lending to boost returns, the fund aims to offer a balanced approach to equity investing, combining stability with the potential for moderate growth. This ETF is well-suited for investors looking to navigate market uncertainties with a focus on minimizing volatility while maintaining exposure to large- and mid-cap U.S. equities.
|
