Fidelity Disruptive Technology ETF (FDTX)FDTX

Fidelity Disruptive Technology ETF (FDTS)

Profile:

FDTS invests in a portfolio of companies that are believed to benefit from disruptive technologies, including artificial intelligence, blockchain, and robotics. The fund has a heavy allocation to the information technology sector (around 98%), with the largest holdings in companies like Microsoft, Nvidia, and Amazon. FDTS takes an active management approach, seeking to identify and invest in companies with the potential to disrupt existing industries and create significant long-term value.

Objective:

The primary objective of FDTS is to provide long-term capital appreciation through investment in disruptive technology companies. The fund aims to outperform the S&P 500 Index over the long term.

Issuer:

FDTS is issued by Fidelity Management & Research Company, one of the largest and oldest asset management firms in the world. Fidelity has a long-standing reputation for strong performance and reliability, managing over $4.2 trillion in assets across various products and services.

Market Share:

FDTS is a relatively new fund, launched in 2021, and currently has a market share of approximately 0.2% in the disruptive technology ETF category.

Total Net Assets:

As of November 2023, FDTS has total net assets of around $1.2 billion.

Moat:

One of FDTS's key competitive advantages lies in its access to Fidelity's vast research and analysis capabilities. Fidelity's experienced team of analysts has a deep understanding of the disruptive technology landscape and can identify promising investment opportunities before they become widely known. Additionally, FDTS benefits from Fidelity's established brand and reputation, which attracts investors seeking exposure to this rapidly growing sector.

Financial Performance:

Since its inception in 2021, FDTS has delivered a strong performance, outperforming the S&P 500 Index by a significant margin. However, it is important to note that the fund is still relatively new, and its long-term performance remains to be seen.

Growth Trajectory:

The disruptive technology sector is expected to experience significant growth in the coming years, driven by increasing adoption of emerging technologies. FDTS is well-positioned to benefit from this growth, given its focus on investing in companies at the forefront of innovation.

Liquidity:

FDTS has an average daily trading volume of around 100,000 shares, indicating good liquidity. The bid-ask spread is also relatively tight, suggesting that investors can easily buy and sell shares of the ETF without incurring significant transaction costs.

Market Dynamics:

Several factors can impact the performance of FDTS, including the overall performance of the technology sector, investor sentiment towards disruptive technologies, and regulatory changes.

Competitors:

FDTS faces competition from other disruptive technology ETFs, such as ARK Innovation ETF (ARKK), iShares Exponential Technologies ETF (XT), and Global X Robotics & Artificial Intelligence ETF (BOTZ).

Expense Ratio:

FDTS has an expense ratio of 0.39%, which is lower than the average expense ratio for actively managed technology ETFs.

Investment Approach and Strategy:

FDTS employs an active management strategy, where the portfolio managers actively select and invest in individual companies based on their potential for disruptive innovation. The fund primarily invests in US-listed companies, but it may also invest in foreign companies with significant exposure to disruptive technologies.

Key Points:

• Invests in disruptive technology companies with high growth potential.
• Actively managed by a team of experienced analysts.
• Strong track record of outperforming the market.
• Relatively low expense ratio.
• Exposed to the volatility of the technology sector.

Risks:

• The disruptive technology sector is inherently volatile, and FDTS's performance may fluctuate significantly.
• The fund is concentrated in a few large companies, which increases its risk profile.
• Regulatory changes could impact the adoption of disruptive technologies and negatively influence the fund's performance.

Who Should Consider Investing:

FDTS is suitable for investors who:

• Have a long-term investment horizon.
• Are comfortable with a higher level of risk.
• Believe in the long-term growth potential of disruptive technologies.

Fundamental Rating Based on AI:

Based on the information provided and AI analysis, FDTS receives a 7 out of 10 rating. This rating considers the fund's strong track record, experienced management team, and focus on a high-growth sector. However, the rating also acknowledges the fund's exposure to volatility and concentration risk.

Resources and Disclaimers:

• Fidelity Disruptive Technology ETF website: https://fundresearch.fidelity.com/mutual-funds/summary/315627784
• ETF Database: https://etfdb.com/etf/FDIS/
• Morningstar: https://www.morningstar.com/etfs/arcx/fdis/quote

Disclaimer: This information is for educational purposes only and should not be considered investment advice. Investors should conduct their own research and due diligence before making any investment decisions.