Fidelity Adds Managed Futures ETF to Growing Lineup
- Fidelity has launched FFUT, with a 0.8% expense ratio, targeting capital appreciation.
- The fund uses trend-following strategies across equity, fixed income, currency and commodity markets.
- The new ETF expands Fidelity's $41 billion alternative investment platform.
Fidelity Investments launched the Fidelity Managed Futures ETF (FFUT) on Thursday, adding a trend-following strategy to its rapidly expanding alternatives platform.
The Boston-based asset manager designed the new ETF to capture price trends across equity, fixed income, currency and commodity markets through derivative instruments, according to the fund's prospectus. Portfolio manager Roberto Croce will oversee the fund's strategy.
The FFUT Strategy
The managed futures strategy provides investors exposure to trend-following techniques that attempt to profit from persistent price movements in multiple asset classes, according to the press release announcing the fund. The launch expands Fidelity's alternative investment offerings, which now total more than $41 billion in assets under management across 60 funds.
FFUT charges a 0.8% management fee after fee waivers through May 31, 2026, according to the prospectus. The fund's total annual operating expenses reach 0.83% before the waiver arrangement.
The ETF employs quantitative measures to evaluate price trends and uses derivatives, including futures, options and swaps, to create long and short positions, according to the filing. The strategy may also utilize non-trend factor strategies focusing on fundamental data like carry and volatility.
Up to 25% of the fund's assets will flow through Fidelity Managed Futures Cayman, a wholly owned subsidiary that invests in commodity-linked derivatives, according to the prospectus. The subsidiary structure also enables small allocations to cash-settled Bitcoin and Ether futures traded on Commodity Futures Trading Commission-registered exchanges.
Fidelity Expands ETF Platform
The fund maintains collateral through U.S. government securities, short-term investment funds and cash equivalents to cover derivative positions, according to the filing. Fidelity's exchange-traded lineup now comprises 79 ETFs and ETPs, with $111 billion in assets under management.
The company recently added the Fidelity Municipal Bond Opportunities ETF (FMUB) and the Fidelity Systematic Municipal Bond Index ETF (FMUN), along with three options-based ETFs, including the Fidelity Dynamic Buffered Equity ETF (FBUF), according to the release.
The managed futures ETF trades on NASDAQ and seeks capital appreciation through its trend-following approach, according to the prospectus. The fund is classified as non-diversified, allowing greater concentration in fewer securities than traditional diversified funds.
