Looking for broad exposure to the Consumer Staples - Broad segment of the equity market? You should consider the Fidelity MSCI Consumer Staples Index ETF (
FSTA Quick Quote FSTA - Free Report) , a passively managed exchange traded fund launched on 10/21/2013.
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
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 $990.03 million, making it one of the average sized 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.
The MSCI USA IMI Consumer Staples Index represents the performance of the consumer staples sector in the U.S. equity market.
Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining 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 3.06%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, 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 13.15% of total assets, followed by Coca Cola Co/the Common Stock Usd.25 ( KO Quick Quote KO - Free Report) and Costco Wholesale Corp Common Stock Usd.005 ( COST Quick Quote COST - Free Report) .
The top 10 holdings account for about 61.79% of total assets under management.
Performance and Risk
The ETF has lost about -11.50% and is down about -1.22% so far this year and in the past one year (as of 06/20/2022), respectively. FSTA has traded between $41.08 and $48.60 during this last 52-week period.
The ETF has a beta of 0.60 and standard deviation of 19.16% for the trailing three-year period, making it a medium risk choice in the space. With about 106 holdings, it effectively diversifies company-specific risk.
Fidelity MSCI Consumer Staples Index ETF sports a Zacks ETF Rank of 4 (Sell), which is based on expected asset class return, expense ratio, and momentum, among other factors. FSTA, then, is not a suitable option for investors seeking exposure to the Consumer Staples ETFs segment of the market. However, there are better ETFs in the space to consider.
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 $6.05 billion in assets, Consumer Staples Select Sector SPDR ETF has $14.28 billion. VDC has an expense ratio of 0.10% and XLP charges 0.10%. Bottom Line
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