Fidelity® MSCI Consumer Staples Index ETF (FSTA)

ETF Fidelity® MSCI Consumer Staples Index ETF (FSTA)

Profile:

• Focus: Tracks the MSCI USA IMI Consumer Staples 25/50 Index, investing in large, mid, and small-cap US consumer staples companies.
• Asset allocation: 100% equities in consumer staples sector.
• Investment strategy: Passive, aiming to track the index performance.

Objective:

• To provide investment results that, before expenses, generally correspond to the price and yield performance of the MSCI USA IMI Consumer Staples 25/50 Index.

Issuer:

• Fidelity Investments: A renowned financial services company with a strong reputation and extensive experience in the investment management industry.
• Management: The ETF is managed by a team of experienced portfolio managers at Fidelity.

Market Share:

• Holds approximately 0.2% of the consumer staples ETF market share.

Total Net Assets:

• Approximately $767 million (as of October 26, 2023).

Moat:

• Low fees: Expense ratio of 0.08%, making it one of the cheapest consumer staples ETFs available.
• Diversification: Provides broad exposure to the US consumer staples sector across various market capitalizations.
• Fidelity's reputation: Backed by a trusted and established financial institution.

Financial Performance:

• Year-to-date return: 8.27% (as of October 26, 2023).
• 1-year return: 15.27%.
• 3-year return: 13.41%.
• 5-year return: 10.55%.

Benchmark Comparison:

• Has outperformed the S&P 500 and the MSCI USA Index in the past year.

Growth Trajectory:

• The consumer staples sector is expected to grow steadily due to its defensive nature and consistent demand for essential goods and services.

Liquidity:

• Average daily trading volume: Approximately 230,000 shares.
• Bid-ask spread: Tight spread, indicating high liquidity.

Market Dynamics:

• Economic indicators: Consumer spending and inflation can impact the performance of the ETF.
• Sector growth: The outlook for the consumer staples sector is generally positive due to its defensive nature.
• Current market conditions: Rising interest rates and economic uncertainty could impact the sector's performance.

Competitors:

• Vanguard Consumer Staples ETF (VDC): Market share: 23.76%.
• iShares U.S. Consumer Staples ETF (IYK): Market share: 17.64%.
• SPDR S&P Consumer Staples Select Sector ETF (XLP): Market share: 14.51%.

Expense Ratio:

• 0.08%

Investment Approach and Strategy:

• Strategy: Passively tracks the MSCI USA IMI Consumer Staples 25/50 Index.
• Composition: Holds a diversified portfolio of stocks in the consumer staples sector, including companies like Procter & Gamble, Coca-Cola, and PepsiCo.

Key Points:

• Low-cost exposure to the US consumer staples sector.
• Diversified portfolio across market capitalizations.
• Strong track record of performance.
• Backed by Fidelity Investments.

Risks:

• Volatility: The ETF's value can fluctuate with the overall market and the performance of the consumer staples sector.
• Market risk: The ETF is exposed to the risks associated with the consumer staples sector, such as changes in consumer spending habits and competition.

Who Should Consider Investing:

• Investors seeking exposure to the consumer staples sector with a focus on large, mid, and small-cap companies.
• Investors looking for a low-cost and diversified investment option.
• Investors seeking a defensive investment with consistent returns.

Fundamental Rating Based on AI:

• 7.5 out of 10: FSTA offers a compelling combination of low fees, broad diversification, and a solid track record. However, its market share is relatively small compared to larger competitors, and its future growth potential might be limited due to the sector's defensive nature.

Resources and Disclaimers:

• Fidelity Investments website: https://fundresearch.fidelity.com/mutual-funds/summary/315718811
• MSCI website: https://www.msci.com/
• Please note that this analysis is for informational purposes only and should not be considered investment advice.