U.S. Markets open in 5 hrs 18 mins
  • S&P Futures

    3,664.50
    -2.75 (-0.07%)
     
  • Dow Futures

    29,852.00
    -16.00 (-0.05%)
     
  • Nasdaq Futures

    12,476.75
    +22.50 (+0.18%)
     
  • Russell 2000 Futures

    1,835.50
    -2.00 (-0.11%)
     
  • Crude Oil

    45.36
    +0.08 (+0.18%)
     
  • Gold

    1,843.90
    +13.70 (+0.75%)
     
  • Silver

    24.26
    +0.18 (+0.75%)
     
  • EUR/USD

    1.2115
    0.0000 (-0.0000%)
     
  • 10-Yr Bond

    0.9480
    0.0000 (0.00%)
     
  • Vix

    21.15
    +0.38 (+1.83%)
     
  • GBP/USD

    1.3405
    +0.0029 (+0.2158%)
     
  • USD/JPY

    104.2730
    -0.1510 (-0.1446%)
     
  • BTC-USD

    19,257.23
    +307.97 (+1.63%)
     
  • CMC Crypto 200

    377.81
    +12.90 (+3.53%)
     
  • FTSE 100

    6,464.02
    +0.63 (+0.01%)
     
  • Nikkei 225

    26,809.37
    +8.39 (+0.03%)
     

Should You Invest in the Fidelity MSCI Consumer Discretionary Index ETF (FDIS)?

Zacks Equity Research
·3 min read

The Fidelity MSCI Consumer Discretionary Index ETF (FDIS) was launched on 10/21/2013, and is a passively managed exchange traded fund designed to offer broad exposure to the Consumer Discretionary - Broad segment of the equity market.

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.

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 12, placing it in bottom 25%.

Index Details

The fund is sponsored by Fidelity. It has amassed assets over $1.08 billion, 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.

Costs

When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.

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 0.71%.

Sector Exposure and Top Holdings

Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, 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 98.60% of the portfolio.

Looking at individual holdings, Amazon.com Inc (AMZN) accounts for about 32.30% of total assets, followed by Tesla Inc (TSLA) and Home Depot Inc (HD).

The top 10 holdings account for about 65.37% of total assets under management.

Performance and Risk

The ETF has added roughly 35.90% so far this year and it's up approximately 41.04% in the last one year (as of 11/08/2020). In that past 52-week period, it has traded between $33.25 and $66.29.

The ETF has a beta of 1.27 and standard deviation of 24.41% for the trailing three-year period, making it a medium risk choice in the space. With about 261 holdings, it effectively diversifies company-specific risk.

Alternatives

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 reasonable 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) tracks MSCI US Investable Market Consumer Discretionary 25/50 Index and the Consumer Discretionary Select Sector SPDR ETF (XLY) tracks Consumer Discretionary Select Sector Index. Vanguard Consumer Discretionary ETF has $3.98 billion in assets, Consumer Discretionary Select Sector SPDR ETF has $16.61 billion. VCR has an expense ratio of 0.10% and XLY charges 0.13%.

Bottom Line

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.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Fidelity MSCI Consumer Discretionary Index ETF (FDIS): ETF Research Reports
 
The Home Depot, Inc. (HD) : Free Stock Analysis Report
 
Amazon.com, Inc. (AMZN) : Free Stock Analysis Report
 
Tesla, Inc. (TSLA) : Free Stock Analysis Report
 
Vanguard Consumer Discretionary ETF (VCR): ETF Research Reports
 
Consumer Discretionary Select Sector SPDR ETF (XLY): ETF Research Reports
 
To read this article on Zacks.com click here.
 
Zacks Investment Research