U.S. Markets open in 8 hrs 15 mins
  • S&P Futures

    4,262.25
    +6.25 (+0.15%)
     
  • Dow Futures

    34,215.00
    +133.00 (+0.39%)
     
  • Nasdaq Futures

    14,367.00
    +12.75 (+0.09%)
     
  • Russell 2000 Futures

    2,335.20
    +4.00 (+0.17%)
     
  • Crude Oil

    73.33
    +0.03 (+0.04%)
     
  • Gold

    1,775.60
    -1.10 (-0.06%)
     
  • Silver

    26.06
    +0.01 (+0.02%)
     
  • EUR/USD

    1.1939
    +0.0004 (+0.0358%)
     
  • 10-Yr Bond

    1.4870
    0.0000 (0.00%)
     
  • Vix

    15.97
    -0.35 (-2.14%)
     
  • GBP/USD

    1.3922
    +0.0001 (+0.0056%)
     
  • USD/JPY

    110.8700
    +0.0350 (+0.0316%)
     
  • BTC-USD

    34,654.72
    +1,983.67 (+6.07%)
     
  • CMC Crypto 200

    833.50
    +46.88 (+5.96%)
     
  • FTSE 100

    7,109.97
    +35.91 (+0.51%)
     
  • Nikkei 225

    29,088.72
    +213.49 (+0.74%)
     

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

·4 min read

If you're interested in broad exposure to the Consumer Discretionary - Broad segment of the equity market, look no further than the Fidelity MSCI Consumer Discretionary Index ETF (FDIS), 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 are also funds of convenience, offering many ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Consumer Discretionary - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 8, placing it in top 50%.

Index Details

The fund is sponsored by Fidelity. It has amassed assets over $1.59 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

Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are 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 0.48%.

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 65.80% of the portfolio, followed by Information Technology.

Looking at individual holdings, Amazon.com Inc Common Stock Usd.01 (HDB) accounts for about 22.02% of total assets, followed by Tesla Inc Common Stock Usd.001 (AMZN) and Home Depot Inc Common Stock Usd.05 (TSLA).

The top 10 holdings account for about 54.34% of total assets under management.

Performance and Risk

So far this year, FDIS has added about 10.36%, and is up about 73.18% in the last one year (as of 05/17/2021). During this past 52-week period, the fund has traded between $47.24 and $81.40.

The ETF has a beta of 1.25 and standard deviation of 24.72% for the trailing three-year period, making it a medium risk choice in the space. With about 276 holdings, it effectively diversifies company-specific risk.

Alternatives

Fidelity MSCI Consumer Discretionary Index ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, FDIS is an excellent option for investors seeking exposure to the Consumer Discretionary ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.

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 $5.72 billion in assets, Consumer Discretionary Select Sector SPDR ETF has $19.75 billion. VCR has an expense ratio of 0.10% and XLY charges 0.12%.

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
 
FID-CON DIS (FDIS): ETF Research Reports
 
Amazon.com, Inc. (AMZN) : Free Stock Analysis Report
 
HDFC Bank Limited (HDB) : Free Stock Analysis Report
 
Tesla, Inc. (TSLA) : Free Stock Analysis Report
 
VIPERS-CONS DIS (VCR): ETF Research Reports
 
SPDR-CONS DISCR (XLY): ETF Research Reports
 
To read this article on Zacks.com click here.