Fidelity Investments is converting six thematic mutual funds into transparent actively managed ETFs, moving the Boston-based asset manager another step into the exchange-traded fund space.
The conversions, which are expected to be completed by June, will add to Fidelity’s current active equity ETF lineup of nine funds that combine for approximately $720 million in assets. Including the announced conversions, Fidelity will have 57 ETFs.
“Fidelity is a large player in the active mutual fund world, and this will be a key milestone and will further push Fidelity into the ETF space,” said Todd Rosenbluth, head of research at VettaFi.
The mutual funds being converted include Fidelity Disruptive Automation (FBOTX), Fidelity Disruptive Communications (FNETX), Fidelity Disruptive Finance (FNTEX), Fidelity Disruptive Technology (FTEKX), and Fidelity Disruptors (FGDFX).
Launched in April 2020, Fidelity’s disruptive mutual funds were designed to invest in innovative business models, emerging industries, and technologies that are changing the status quo.
Rosenbluth said Fidelity’s disruptive series taps into a growing interest among investors to dedicate small slices of their portfolios to targeted growth strategies.
Fidelity said the converted ETFs will maintain the same investment objectives as the mutual funds had. The new ETF vehicles are designed to provide shareholders access to the lowest pricing tier available in the disruptive funds’ time-based pricing program, with a total expense ratio of 0.50%.
In advance of the conversion, the mutual funds’ expense ratio will be reduced to 0.50% for all shareholders, on or about April 1.
“Fidelity has been an innovator in the active ETF space for years and today’s announcement reinforces our commitment to growing our lineup with innovative strategies that help meet the evolving needs of investors,” Greg Friedman, Fidelity’s head of ETF management and strategy, said in a statement.
“A growing number of investors are seeking the tax efficiency, trading flexibility and potential cost efficiency benefits of ETF vehicles,” Friedman added. “These ETF conversions deliver new opportunities and value for our existing shareholders while also expanding our solutions to help meet demand for access to thematic strategies in an ETF wrapper.”
A new proposal could end the ban on promoting client reviews in states like California and Connecticut, giving state-registered advisors a level playing field with their SEC-registered peers.
Morningstar research data show improved retirement trajectories for self-directors and allocators placed in managed accounts.
Some in the industry say that more UBS financial advisors this year will be heading for the exits.
The Wall Street giant has blasted data middlemen as digital freeloaders, but tech firms and consumer advocates are pushing back.
Research reveals a 4% year-on-year increase in expenses that one in five Americans, including one-quarter of Gen Xers, say they have not planned for.
Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.
Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.
