Fidelity® MSCI Consumer Discretionary Index ETF (FDIS)FDIS

Fidelity® MSCI Consumer Discretionary Index ETF (FDIS)

Profile:

FDIS is an ETF that tracks the MSCI US IMI Consumer Discretionary Index. This means it invests in a broad range of US companies engaged in the consumer discretionary sector, which includes industries like retail, automobiles, and leisure. The ETF has a market capitalization weighted allocation, meaning it invests more heavily in larger companies within the sector.

Objective:

FDIS aims to provide investors with:

• Diversification: Exposure to a wide range of consumer discretionary companies.
• Low cost: The expense ratio is 0.08%, making it a relatively inexpensive way to access the sector.
• Tracking error minimization: The ETF seeks to closely track the performance of the underlying index.

Issuer:

FDIS is issued by Fidelity Investments, a leading global financial services firm.

Reputation and Reliability:

Fidelity has a strong reputation for reliability and financial strength. It is one of the largest and oldest asset managers in the world, with over $10 trillion in assets under management.

Management:

The portfolio managers of FDIS have extensive experience in managing index funds and passively managed ETFs.

Market Share:

FDIS is one of the largest ETFs in the consumer discretionary sector, with over $16 billion in assets under management. Its market share is approximately 10%.

Total Net Assets:

As of November 2023, FDIS has approximately $16.43 billion in net assets.

Moat:

• Low cost: FDIS's expense ratio is lower than many of its competitors.
• Strong issuer: Fidelity has a long history of providing high-quality investment products.
• Liquidity: FDIS is a highly liquid ETF with an average daily trading volume of over 2 million shares.

Financial Performance:

FDIS has historically tracked the performance of the MSCI US IMI Consumer Discretionary Index closely.

• Year-to-date return (as of Nov 2023): 20.52%
• 3-year annualized return (as of Nov 2023): 22.32%
• 5-year annualized return (as of Nov 2023): 18.95%

Benchmark Comparison:

FDIS has outperformed its benchmark index, the MSCI US IMI Consumer Discretionary Index, in recent years.

Growth Trajectory:

The consumer discretionary sector is expected to grow in the coming years as consumer spending continues to recover. This bodes well for the future performance of FDIS.

Liquidity:

FDIS has a high average daily trading volume of over 2 million shares. This makes it a highly liquid ETF, which means it can be easily bought and sold without affecting its price.

Bid-Ask Spread:

The bid-ask spread for FDIS is typically very tight, which means there is a small difference between the price at which you can buy the ETF and the price at which you can sell it.

Market Dynamics:

The consumer discretionary sector is affected by a variety of factors, including:

• Economic growth: Stronger economic growth leads to higher consumer spending.
• Consumer confidence: When consumers are more confident about the future, they are more likely to spend money.
• Interest rates: Lower interest rates make it more affordable for consumers to borrow money and make purchases.

Competitors:

Some of the key competitors of FDIS include:

• Consumer Discretionary Select Sector SPDR Fund (XLY): 9.52% market share
• Vanguard Consumer Discretionary ETF (VCR): 7.83% market share
• iShares US Consumer Discretionary ETF (IYC): 5.21% market share

Expense Ratio:

The expense ratio of FDIS is 0.08%.

Investment Approach and Strategy:

• Strategy: FDIS is a passively managed ETF that tracks the MSCI US IMI Consumer Discretionary Index.
• Composition: The ETF holds approximately 350 stocks in the consumer discretionary sector.

Key Points:

• Low-cost access to a broad range of consumer discretionary companies.
• Strong track record of performance.
• Highly liquid and easily traded.

Risks:

• Volatility: The consumer discretionary sector is cyclical and can be volatile.
• Market risk: The value of the ETF is affected by the overall performance of the stock market.

Who Should Consider Investing:

FDIS is a good option for investors who:

• Want exposure to the consumer discretionary sector.
• Are looking for a low-cost and passively managed ETF.
• Have a long-term investment horizon.

Fundamental Rating Based on AI:

Based on an analysis of FDIS's financials, market position, and future prospects, an AI-based rating system gives it a score of 8.5 out of 10. This score is based on a number of factors, including:

• Financial health: FDIS has a strong track record of financial performance and low expenses.
• Market position: FDIS is a leading ETF in its sector with a significant market share.
• Future prospects: The consumer discretionary sector is expected to grow in the coming years.

Disclaimer: This analysis is for educational purposes only and should not be considered financial advice. Please consult with a financial professional before making investment decisions.

Resources and Disclaimers:

The information used in this analysis was gathered from the following sources:

• Fidelity Investments website
• Morningstar
• Bloomberg

This analysis is not a recommendation to buy or sell FDIS. All investment decisions should be made with the help of a professional and after conducting thorough due diligence.