Designed to provide broad exposure to the Consumer Staples - Broad segment of the equity market, the Fidelity MSCI Consumer Staples Index ETF (
FSTA Quick Quote FSTA - Free Report) is a passively managed exchange traded fund launched on 10/21/2013.
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
Investor-friendly, sector ETFs provide many options to gain low risk and diversified exposure to a broad group of companies in particular sectors. Consumer Staples - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 11, placing it in bottom 31%.
The fund is sponsored by Fidelity. It has amassed assets over $804.53 million, making it one of the larger ETFs attempting to match the performance of the Consumer Staples - Broad segment of the equity market. FSTA seeks to match the performance of the MSCI USA IMI Consumer Staples Index before fees and expenses.
MSCI USA IMI Consumer Staples Index represents the performance of the consumer staples sector in the U.S. equity market.
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
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 2.52%.
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 Consumer Staples sector--about 100% of the portfolio.
Looking at individual holdings, Procter + Gamble Co/the Common Stock (
PG Quick Quote PG - Free Report) accounts for about 14.90% of total assets, followed by Walmart Inc Common Stock Usd.1 ( WMT Quick Quote WMT - Free Report) and Coca Cola Co/the Common Stock Usd.25 ( KO Quick Quote KO - Free Report) .
The top 10 holdings account for about 63.26% of total assets under management.
Performance and Risk
So far this year, FSTA has lost about -1.27%, and is up roughly 10.93% in the last one year (as of 03/09/2021). During this past 52-week period, the fund has traded between $28.75 and $40.78.
The ETF has a beta of 0.63 and standard deviation of 18.80% for the trailing three-year period, making it a medium risk choice in the space. With about 99 holdings, it effectively diversifies company-specific risk.
Fidelity MSCI Consumer Staples 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, FSTA is a good option for those seeking exposure to the Consumer Staples ETFs area of the market. Investors might also want to consider some other ETF options in the space.
Vanguard Consumer Staples ETF (
VDC Quick Quote VDC - Free Report) tracks MSCI US Investable Market Consumer Staples 25/50 Index and the Consumer Staples Select Sector SPDR ETF ( XLP Quick Quote XLP - Free Report) tracks Consumer Staples Select Sector Index. Vanguard Consumer Staples ETF has $5.44 billion in assets, Consumer Staples Select Sector SPDR ETF has $10.52 billion. VDC has an expense ratio of 0.10% and XLP charges 0.12%. Bottom Line
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