ETF Watch: Fidelity Adds New Direction

Fidelity Investments has put six index-based funds into registration that will take its ETF lineup into a new direction. The firm has already launched three actively managed bond ETFs and a family of cap-weighted sector ETFs, and the latest filing outlines plans for the firm to launch six factor-focused smart-beta ETFs.

The six ETFs include the following:

• Fidelity Core Dividend ETF
• Fidelity Dividend ETF for Rising Rates
• Fidelity Low Volatility Factor ETF
• Fidelity Momentum Factor ETF
• Fidelity Quality Factor ETF
• Fidelity Value Factor ETF

All of the funds cover mid- and large-cap companies, track in-house indexes and seek to lend securities as a way to increase income. The two dividend funds will target companies that are “expected to continue to pay and grow their dividends,” but the Fidelity Dividend ETF for Rising Rates will refine that to include companies that are expected to have returns that correlate positively with rising 10-year U.S. Treasury yields, according to the prospectus.

The four other funds will focus on companies providing increased exposure to their respective factors. The low-volatility fund will target companies with lower volatility than the broad market average, while the momentum fund will invest in companies that demonstrate positive momentum. The quality fund will target companies exhibiting above-average quality profiles, and the value fund will invest in companies with attractive valuations.

The filing did not include tickers or expense ratios. All of the funds are slated to list on the NYSE Arca.

Additional Updates

• Three Deutsche Bank ETFs will be delisting from the NYSE Arca exchange and moving over to Bats’ BZX Exchange. The Deutsche X-trackers Emerging Markets Bond Interest Rate Hedged ETF (EMIH), the Deutsche X-trackers Investment Grade Bond Interest Rate Hedged ETF (IGIH) and the Deutsche X-trackers High Yield Corporate Bond - Interest Rate Hedged ETF (HYIH) will begin trading on the Bats exchange on June 9. Bats is the parent company of ETF.com.
• The Direxion Daily MSCI Europe Currency Hedged Bull 2X Shares (HEGE) and Direxion Daily MSCI Japan Currency Hedged Bull 2X Shares (HEGJ) both saw their last day of trading on Friday, May 20, before they were delisted.
• Two Guggenheim ETFs have changed their names and indexes as of Friday, May 20. The Guggenheim Timber ETF, which previously tracked the Beacon Global Timber Index, is now the Guggenheim MSCI Global Timber ETF (CUT | C-15) and tracks the MSCI ACWI IMI Timber Select Capped Index. The Guggenheim Spin-Off ETF, which previously tracked the Beacon Spin-off Index, is now the Guggenheim S&P Spin¬Off ETF (CSD | D-52) and tracks the S&P U.S. Spin¬Off Index.

Contact Heather Bell at [email protected].