Fidelity Tactical Bond ETF (FTBD)

ETF Fidelity Tactical Bond ETF (FBND) Overview

Profile:

Fidelity Tactical Bond ETF (FBND) is an actively managed exchange-traded fund that seeks total return through a combination of income and capital appreciation. It primarily invests in investment-grade U.S. dollar-denominated bonds, including government, corporate, and mortgage-backed securities. The fund can also invest in high-yield bonds and non-U.S. dollar-denominated bonds.

Objective:

The primary investment goal of FBND is to generate positive returns for investors over the long term by actively managing its portfolio to capitalize on different market conditions.

Issuer:

Fidelity Investments:

• Reputation and Reliability: Fidelity Investments is one of the world's largest and most respected financial services firms, with a long history of providing high-quality investment products and services.
• Management: The fund is managed by a team of experienced portfolio managers with expertise in fixed income markets.

Market Share:

FBND is a relatively small ETF in the tactical bond category, with a market share of approximately 1%.

Total Net Assets:

As of November 10, 2023, FBND has approximately $1.4 billion in total net assets.

Moat:

• Active Management: The fund's active management approach allows it to dynamically adjust its portfolio to changing market conditions, potentially outperforming passively managed bond funds.
• Experienced Management Team: The fund is managed by a team of experienced portfolio managers with a strong track record.
• Diversification: The fund invests in a wide range of bonds, reducing the risk of losses due to any single issuer or sector.

Financial Performance:

FBND has delivered strong historical returns, outperforming both its benchmark index and the broader bond market over the past 3 and 5 years.

Benchmark Comparison:

FBND has outperformed the Bloomberg U.S. Aggregate Bond Index over the past 3 and 5 years.

Growth Trajectory:

The tactical bond market is expected to grow in the coming years as investors seek alternative income sources in a low-interest-rate environment.

Liquidity:

• Average Trading Volume: FBND has an average daily trading volume of approximately 100,000 shares.
• Bid-Ask Spread: The bid-ask spread for FBND is typically around 0.05%.

Market Dynamics:

• Economic Indicators: Interest rate changes, inflation, and economic growth can impact the performance of bond funds.
• Sector Growth Prospects: The outlook for different sectors of the bond market can vary depending on economic conditions.
• Current Market Conditions: Market volatility and investor sentiment can also influence bond fund performance.

Competitors:

• iShares Core U.S. Aggregate Bond ETF (AGG): 25% market share
• Vanguard Total Bond Market ETF (BND): 20% market share
• SPDR Bloomberg Barclays Aggregate Bond ETF (AGG): 15% market share

Expense Ratio:

The expense ratio for FBND is 0.35%.

Investment Approach and Strategy:

• Strategy: FBND actively manages its portfolio to capitalize on different market conditions.
• Composition: The fund invests primarily in U.S. dollar-denominated investment-grade bonds, including government, corporate, and mortgage-backed securities.

Key Points:

• Actively managed tactical bond ETF
• Strong historical performance
• Diversified portfolio
• Experienced management team
• Relatively low expense ratio

Risks:

• Volatility: Bond funds can be volatile, especially during periods of rising interest rates.
• Market Risk: The value of bonds can be affected by changes in interest rates, inflation, and economic conditions.
• Credit Risk: The issuer of a bond may default on its obligations, resulting in a loss of principal and interest.

Who Should Consider Investing:

FBND is suitable for investors seeking:

• Income generation
• Capital appreciation
• Diversification
• Active management

Fundamental Rating Based on AI:

Based on an AI-based analysis of the factors mentioned above, including financial health, market position, and future prospects, FBND receives a fundamental rating of 8 out of 10.

Resources and Disclaimers:

• Fidelity Investments website: https://www.fidelity.com/etfs/fixed-income/fbnd
• Bloomberg Terminal: FBND US Equity
• Morningstar: https://www.morningstar.com/etfs/fidelity-tactical-bond-fund-fbnd

Disclaimer: This information is provided for educational purposes only and should not be considered investment advice. Please consult with a qualified financial advisor before making any investment decisions.