Launched on September 12, 2016, the Fidelity Value Factor ETF (FVAL Quick QuoteFVAL - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Large Cap Value segment of the US equity market.

The fund is sponsored by Fidelity. It has amassed assets over $1.08 billion, making it one of the average sized ETFs attempting to match the Large Cap Value segment of the US equity market.

Why Large Cap Value

Companies that fall in the large cap category tend to have a market capitalization above $10 billion. Considered a more stable option, large cap companies boast more predictable cash flows and are less volatile than their mid and small cap counterparts.

Value stocks have lower than average price-to-earnings and price-to-book ratios. They also have lower than average sales and earnings growth rates. Looking at their long-term performance, value stocks have outperformed growth stocks in almost all markets. They are however likely to underperform growth stocks in strong bull markets.

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 0.16%, making it one of the least expensive products in the space.

It has a 12-month trailing dividend yield of 1.46%.

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 to the Information Technology sector -- about 33% of the portfolio. Financials and Consumer Discretionary round out the top three.

Looking at individual holdings, Nvidia Corp (NVDA) accounts for about 8.03% of total assets, followed by Apple Inc (AAPL) and Microsoft Corp (MSFT).

The top 10 holdings account for about 40.08% of total assets under management.

Performance and Risk

FVAL seeks to match the performance of the Fidelity U.S. Value Factor Index before fees and expenses. The Fidelity U.S. Value Factor Index reflects the performance of stocks of large and mid-capitalization U.S. companies that have attractive valuations.

The ETF has gained about 15.49% so far this year and is up roughly 12.98% in the last one year (as of 11/17/2025). In the past 52-week period, it has traded between $52.80 and $71.36.

The ETF has a beta of 0.97 and standard deviation of 14.73% for the trailing three-year period. With about 129 holdings, it effectively diversifies company-specific risk.

Alternatives

Fidelity Value Factor 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, FVAL is a reasonable option for those seeking exposure to the Style Box - Large Cap Value area of the market. Investors might also want to consider some other ETF options in the space.

The Schwab U.S. Dividend Equity ETF (SCHD) and the Vanguard Value ETF (VTV) track a similar index. While Schwab U.S. Dividend Equity ETF has $70.39 billion in assets, Vanguard Value ETF has $150.88 billion. SCHD has an expense ratio of 0.06% and VTV charges 0.04%.

Bottom-Line

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.

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.