Fidelity wades into the managed futures space with new ETF

Fidelity Investments has launched a new managed futures exchange-traded fund, joining a narrow field of asset managers offering such liquid alternatives designed to perform well regardless of market direction.

The firm announced on Thursday that the Fidelity Managed Futures ETF has begun trading on the Nasdaq.

With an estimated net expense ratio of 0.80%, the fund aims to deliver capital appreciation through a systematic long-short strategy that trades across equity, fixed income, currency, and commodity markets using derivatives such as futures and forwards.

“The new managed futures strategy is designed to provide clients with an investment option that can help diversify their portfolios with the ease of an ETF wrapper,” Roberto Croce, portfolio manager of the fund at Fidelity, said in the statement announcing the launch.

The product enters a still-small corner of the ETF industry. Managed-futures strategies have historically struggled to gain traction in ETFs, but recent market volatility has fueled renewed interest.

According to Morningstar, total assets in the eight US-listed managed-futures ETFs that existed as of June last year – which were predominantly trend-following strategies – stood at $2.1 billion, up nearly tenfold over the previous three years. That compares with $18 billion in trend-following mutual funds and more than $300 billion in managed-futures hedge funds.

Investors have increasingly turned to the space during periods of equity and bond drawdowns. In 2022, when both asset classes slumped, managed-futures ETFs delivered gains and attracted fresh inflows. The trend waned in 2023, but picked up again in the first half of 2024, when the segment saw roughly $420 million in net inflows.

Managed futures strategies also got a nod from LPL Research's Outlook 2025 paper published last December, which noted in part that "managed futures strategies are well-positioned to capitalize on increased volatility."

Fidelity’s new fund seeks to capture the persistence of market trends – upward or downward – by employing a rules-based approach to identify and act on price signals across a global basket of assets. The firm emphasizes its quantitative depth as a differentiator.

“Our team has access to enormous amounts of data, world-class research, and top talent to help uncover new investing opportunities and build advanced systematic strategies,” said Neil Constable, head of quantitative research and investments at Fidelity.

Despite the recent uptick in interest, managed-futures strategies are known for uneven performance, often marked by long periods of underperformance punctuated by short-term bursts. Morningstar noted that from 2000 through mid-2024, the Societe Generale CTA Index, which is a basket of equal-weighted popular managed futures strategies, outdid global equities in just over one-third of rolling three-year windows.

Still, boosters of the strategy point to the potential diversification benefits and low correlation to traditional assets. Fidelity’s decision to launch its first managed futures ETF may reflect broader industry recognition of the need for more tools in portfolio construction as advisors seek to navigate a complex and often uncertain investment landscape.