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

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In this article:
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  • CMCSA
  • XLY
  • VCR
  • FDIS
  • HD
  • AMZN

Launched on 10/21/2013, the Fidelity MSCI Consumer Discretionary Index ETF (FDIS) is a passively managed exchange traded fund designed to provide a 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 11, placing it in bottom 31%.

Index Details

The fund is sponsored by Fidelity. It has amassed assets over $646.84 M, 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 1.02%.

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 77.30% of the portfolio, followed by Telecom.

Looking at individual holdings, Amazon.com Inc (AMZN) accounts for about 17.76% of total assets, followed by Home Depot Inc (HD) and Comcast Corp Class A (CMCSA).

The top 10 holdings account for about 50.77% of total assets under management.

Performance and Risk

The ETF has added roughly 5.22% and it's up approximately 10.13% so far this year and in the past one year (as of 11/27/2018), respectively. FDIS has traded between $37.91 and $45.63 during this last 52-week period.

The ETF has a beta of 1.13 and standard deviation of 13.63% for the trailing three-year period, making it a medium risk choice in the space. With about 352 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 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) tracks MSCI US Investable Market Consumer Discretionary 25/50 Index and the Consumer Discretionary Select Sector SPDR Fund (XLY) tracks Consumer Discretionary Select Sector Index. Vanguard Consumer Discretionary ETF has $2.77 B in assets, Consumer Discretionary Select Sector SPDR Fund has $13.03 B. 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.


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FID-CON DIS (FDIS): ETF Research Reports
 
Amazon.com, Inc. (AMZN) : Free Stock Analysis Report
 
The Home Depot, Inc. (HD) : Free Stock Analysis Report
 
Comcast Corporation (CMCSA) : Free Stock Analysis Report
 
SPDR-CONS DISCR (XLY): ETF Research Reports
 
VIPERS-CONS DIS (VCR): ETF Research Reports
 
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