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Should You Invest in the Fidelity MSCI Materials Index ETF (FMAT)?
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The Fidelity MSCI Materials Index ETF (FMAT - Free Report) was launched on 10/21/2013, and is a passively managed exchange traded fund designed to offer broad exposure to the Materials - Broad segment of the U.S. equity market.
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Materials - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 5, placing it in top 31%.
Index Details
The fund is sponsored by Fidelity. It has amassed assets over $291.67 M, making it one of the average sized ETFs attempting to match the performance of the Materials - Broad segment of the U.S. equity market. FMAT seeks to match the performance of the MSCI USA IMI Materials Index before fees and expenses.
MSCI USA IMI Materials Index represents the performance of the materials sector in the U.S. equity market.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
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 1.56%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Materials sector--about 99.90% of the portfolio.
Looking at individual holdings, Dowdupont Inc accounts for about 16.69% of total assets, followed by Monsanto Co and Praxair Inc (PX - Free Report) .
The top 10 holdings account for about 51.07% of total assets under management.
Performance and Risk
So far this year, FMAT has gained about 0.13%, and is up roughly 16.85% in the last one year (as of 05/22/2018). During this past 52-week period, the fund has traded between $30.54 and $37.07.
The ETF has a beta of 1.29 and standard deviation of 16.64% for the trailing three-year period, making it a medium risk choice in the space. With about 119 holdings, it effectively diversifies company-specific risk.
Alternatives
Fidelity MSCI Materials 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, FMAT is a sufficient option for those seeking exposure to the Materials ETFs area of the market. Investors might also want to consider some other ETF options in the space.
Materials Select Sector SPDR Fund (XLB - Free Report) tracks Materials Select Sector Index and the FlexShares Morningstar Global Upstream Natural Resources Index Fund (GUNR - Free Report) tracks Morningstar Global Upstream Natural Resources Index. Materials Select Sector SPDR Fund has $5.13 B in assets, FlexShares Morningstar Global Upstream Natural Resources Index Fund has $5.84 B. XLB has an expense ratio of 0.13% and GUNR charges 0.46%.
Bottom Line
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.
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Should You Invest in the Fidelity MSCI Materials Index ETF (FMAT)?
The Fidelity MSCI Materials Index ETF (FMAT - Free Report) was launched on 10/21/2013, and is a passively managed exchange traded fund designed to offer broad exposure to the Materials - Broad segment of the U.S. equity market.
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Materials - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 5, placing it in top 31%.
Index Details
The fund is sponsored by Fidelity. It has amassed assets over $291.67 M, making it one of the average sized ETFs attempting to match the performance of the Materials - Broad segment of the U.S. equity market. FMAT seeks to match the performance of the MSCI USA IMI Materials Index before fees and expenses.
MSCI USA IMI Materials Index represents the performance of the materials sector in the U.S. equity market.
Costs
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
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 1.56%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Materials sector--about 99.90% of the portfolio.
Looking at individual holdings, Dowdupont Inc accounts for about 16.69% of total assets, followed by Monsanto Co and Praxair Inc (PX - Free Report) .
The top 10 holdings account for about 51.07% of total assets under management.
Performance and Risk
So far this year, FMAT has gained about 0.13%, and is up roughly 16.85% in the last one year (as of 05/22/2018). During this past 52-week period, the fund has traded between $30.54 and $37.07.
The ETF has a beta of 1.29 and standard deviation of 16.64% for the trailing three-year period, making it a medium risk choice in the space. With about 119 holdings, it effectively diversifies company-specific risk.
Alternatives
Fidelity MSCI Materials 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, FMAT is a sufficient option for those seeking exposure to the Materials ETFs area of the market. Investors might also want to consider some other ETF options in the space.
Materials Select Sector SPDR Fund (XLB - Free Report) tracks Materials Select Sector Index and the FlexShares Morningstar Global Upstream Natural Resources Index Fund (GUNR - Free Report) tracks Morningstar Global Upstream Natural Resources Index. Materials Select Sector SPDR Fund has $5.13 B in assets, FlexShares Morningstar Global Upstream Natural Resources Index Fund has $5.84 B. XLB has an expense ratio of 0.13% and GUNR charges 0.46%.
Bottom Line
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.