FQAL Profile
The Fidelity Quality Factor ETF is strategically designed to provide investors with exposure to U.S. large- and mid-cap stocks that exhibit superior quality characteristics compared to the broader market. Under normal market conditions, the fund allocates at least 80% of its assets to securities that are included in the Fidelity U.S. Quality Factor Index. This index is specifically engineered to reflect the performance of high-quality stocks within the U.S. equity market, focusing on companies with strong financial metrics and operational efficiency.
The Fidelity U.S. Quality Factor Index identifies stocks based on a set of rigorous quality criteria, including high return on equity, stable earnings growth, and low financial leverage. By targeting companies that demonstrate these superior quality attributes, the ETF aims to offer a more stable investment profile with potentially lower risk compared to the broader market. The underlying index emphasizes companies that not only exhibit high profitability but also maintain robust financial health, which is critical for sustained performance.
The ETF's investment strategy may also include lending securities to generate additional income for the fund, leveraging its holdings to enhance overall returns. This approach allows the fund to capitalize on lending opportunities while still focusing on its core objective of investing in high-quality, large- and mid-cap U.S. stocks. The ability to generate income from securities lending provides an added layer of potential return enhancement, aligning with the fund's broader investment goals.
Overall, the Fidelity Quality Factor ETF offers investors a targeted approach to accessing U.S. equities with a focus on high-quality characteristics. By concentrating on large- and mid-cap companies with proven financial strength and operational excellence, the fund aims to provide a more resilient investment option. Investors looking to capitalize on high-quality stocks and benefit from the potential stability and growth of such companies may find this ETF an attractive addition to their portfolio.
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