Launched on 10/21/2013, the Fidelity MSCI Consumer Discretionary Index ETF (FDIS) is a passively managed exchange traded fund designed to provide a broad exposure to the Consumer Discretionary - Broad segment of the equity market.
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
Sector ETFs are also funds of convenience, offering many ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Consumer Discretionary - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 11, placing it in bottom 31%.
The fund is sponsored by Fidelity. It has amassed assets over $763.97 million, making it one of the larger ETFs attempting to match the performance of the Consumer Discretionary - Broad segment of the equity market. FDIS seeks to match the performance of the MSCI USA IMI Consumer Discretionary Index before fees and expenses.
MSCI USA IMI Consumer Discretionary Index represents the performance of the consumer discretionary sector in the U.S. equity market.
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for this ETF are 0.08%, making it the least expensive product in the space.
It has a 12-month trailing dividend yield of 0.96%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Consumer Discretionary sector--about 98.70% of the portfolio.
Looking at individual holdings, Amazon.com Inc (AMZN) accounts for about 30.56% of total assets, followed by Home Depot Inc (HD) and Mcdonald S Corp (MCD).
The top 10 holdings account for about 61.62% of total assets under management.
Performance and Risk
The ETF has gained about 10.06% so far this year and it's up approximately 15.87% in the last one year (as of 07/02/2020). In that past 52-week period, it has traded between $33.25 and $52.87.
The ETF has a beta of 1.20 and standard deviation of 23.15% for the trailing three-year period, making it a medium risk choice in the space. With about 262 holdings, it effectively diversifies company-specific risk.
Fidelity MSCI Consumer Discretionary Index ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, FDIS is a reasonable option for those seeking exposure to the Consumer Discretionary ETFs area of the market. Investors might also want to consider some other ETF options in the space.
Vanguard Consumer Discretionary ETF (VCR) tracks MSCI US Investable Market Consumer Discretionary 25/50 Index and the Consumer Discretionary Select Sector SPDR ETF (XLY) tracks Consumer Discretionary Select Sector Index. Vanguard Consumer Discretionary ETF has $3.23 billion in assets, Consumer Discretionary Select Sector SPDR ETF has $13.17 billion. VCR has an expense ratio of 0.10% and XLY charges 0.13%.
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Fidelity MSCI Consumer Discretionary Index ETF (FDIS): ETF Research Reports
The Home Depot, Inc. (HD) : Free Stock Analysis Report
Amazon.com, Inc. (AMZN) : Free Stock Analysis Report
McDonalds Corporation (MCD) : Free Stock Analysis Report
Vanguard Consumer Discretionary ETF (VCR): ETF Research Reports
Consumer Discretionary Select Sector SPDR ETF (XLY): ETF Research Reports
To read this article on Zacks.com click here.