Designed to provide broad exposure to the Consumer Discretionary - Broad segment of the equity market, the Fidelity MSCI Consumer Discretionary Index ETF (FDIS - Free Report) is a passively managed exchange traded fund launched on 10/21/2013.
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.
Sector ETFs also provide investors access to a broad group of companies in particular sectors that offer low risk and diversified exposure. Consumer Discretionary - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 6, placing it in top 38%.
The fund is sponsored by Fidelity. It has amassed assets over $628.14 million, making it one of the larger ETFs attempting to match the performance of the Consumer Discretionary - Broad segment of the equity market. FDIS seeks to match the performance of the MSCI USA IMI Consumer Discretionary Index before fees and expenses.
MSCI USA IMI Consumer Discretionary Index represents the performance of the consumer discretionary 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 1.28%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Consumer Discretionary sector--about 99.10% of the portfolio.
Looking at individual holdings, Amazon.com Inc (AMZN - Free Report) accounts for about 35.13% of total assets, followed by Home Depot Inc (HD - Free Report) and Mcdonald S Corp (MCD - Free Report) .
The top 10 holdings account for about 65.93% of total assets under management.
Performance and Risk
So far this year, FDIS has lost about -8.33%, and is down about -3.68% in the last one year (as of 04/27/2020). During this past 52-week period, the fund has traded between $33.25 and $52.19.
The ETF has a beta of 1.10 and standard deviation of 22.25% for the trailing three-year period, making it a medium risk choice in the space. With about 290 holdings, it effectively diversifies company-specific risk.
Fidelity MSCI Consumer Discretionary 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, FDIS is a good option for those seeking exposure to the Consumer Discretionary ETFs area of the market. Investors might also want to consider some other ETF options in the space.
Vanguard Consumer Discretionary ETF (VCR - Free Report) tracks MSCI US Investable Market Consumer Discretionary 25/50 Index and the Consumer Discretionary Select Sector SPDR ETF (XLY - Free Report) tracks Consumer Discretionary Select Sector Index. Vanguard Consumer Discretionary ETF has $2.52 billion in assets, Consumer Discretionary Select Sector SPDR ETF has $11.36 billion. VCR has an expense ratio of 0.10% and XLY charges 0.13%.
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.