Investment firm bolsters factor-fund shelf and unveils new global fixed-income ETF
Fidelity Investments Canada has expanded its ETF menu with new value- and momentum-based strategies along with the launch of a global fixed-income fund, all listed on the TSX.
“We are excited to introduce these two new factors which builds out the Fidelity Factor ETF line-up,” said Kelly Creelman, senior vice president, Products, Fidelity Investments Canada.
The new value-based ETFs, which allow investors to systematically target large- and mid-cap company stocks that are priced cheaply relative to their fundamentals and can potentially outperform in the long term, include:
- Fidelity Canadian Value Index ETF (FCCV);
- Fidelity U.S Value Index ETF (FCUV);
- Fidelity U.S. Value Currency Neutral Index ETF (FCVH); and
- Fidelity International Value Index ETF (FCIV)
On the other hand, the new momentum-based ETFs, which promise to systematically capitalize on large- and mid-cap companies with positive returns and investor sentiment that can potentially outperform over the medium term, are:
- Fidelity Canadian Momentum Index ETF (FCCM);
- Fidelity U.S. Momentum Index ETF (FCMO);
- Fidelity U.S. Momentum Currency Neutral Index ETF (FCMH); and
- Fidelity International Momentum Index ETF (FCIM)
The management fees for both the value and momentum ETFs range from 0.35% to 0.45%.
Fidelity has also announced the Fidelity Global Investment Grade Bond ETF (FCIG) and Fidelity Global Investment Grade Bond ETF Fund ("ETF Fund"), which are driven by a strategy run by fixed-income experts Jeff Moore and Michael Plage. Aside from being geographically unconstrained, it follows a tactical approach that combines investment-grade and high-yield debt in an active ETF vehicle.
“This fund builds off the success of Global Core Plus Bond ETF (FCGB), also actively managed by Jeff Moore and Michael Plage,” Creelman said, noting that the strategy has been a top-selling active ETF among Canadian investors since its September 2019 launch.
Made to accommodate more risk-averse investors, FCIG is designed to be a core fixed-income solution that invests globally in high-quality investment-grade fixed-income securities. It’s allowed a maximum exposure of 25% to non-investment-grade, compared to FCGB’s maximum 70% exposure.
