Fidelity Reportedly Preparing Active ETFs

ETF Trends

ETF industry observers have speculated for years that at some point Fidelity Investments will expand its lineup beyond its current single offering, Fidelity Nasdaq Composite Index (ONEQ).

The Boston-based firm has plans to become the first mainline fund company to launch ETFs managed by active stock pickers with products based on its popular sector funds, Bloomberg News reports, citing an unnamed source familiar with the matter.

The Fidelity unit that would oversee the ETFs is headed by Anthony Rochte, who was hired from State Street in March, according to the report.

At State Street, Rochte helped manage the firm’s ETF business. State Street is the second-largest ETF provider.

Rochte previously worked for Fidelity between 1996 and 2000. [Fidelity Hires State Street ETF Exec Rochte]

“Fidelity has the ingredients to make actively managed ETFs successful,” said Paul Justice, director of ETF research in North America for Morningstar, in the Bloomberg story. “They have a household name, a distribution machine and a history of outperformance with the sector funds.”

“At this time we’re not focused on specific products, but rather on how we can best position Fidelity to further develop its sector-investing capabilities in a manner that best meets the needs of our clients,” added Vincent Loporchio, a Fidelity spokesman, in the report.

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