ETF | Fidelity Exchange-Traded Funds | Fidelity (2024)

Free commission offer applies to online purchases of Fidelity ETFs in a Fidelity retail account. The sale of ETFs is subject to an activity assessment fee (historically from $0.01 to $0.03 per $1,000 of principal).

ETFs are subject to market fluctuation and the risks of their underlying investments. ETFs are subject to management fees and other expenses.

FBTC is not an investment company registered under the Investment Company Act of 1940 (the “1940 Act”) and is not subject to regulation under the Commodity Exchange Act of 1936 (the “CEA”). As a result, shareholders of FBTC do not have the protections associated with ownership of shares in an investment company registered under the 1940 Act or the protections afforded by the CEA.

Digital assets are highly volatile, and their market movements are very difficult to predict. Various market forces may impact their value including, but not limited to, supply and demand, investors’ faith and their willingness to purchase it using traditional currencies, investors’ expectations with respect to the rate of inflation, interest rates, currency exchange rates, an evolving legislative and regulatory environment in the U.S. and abroad, and other economic trends. Investors also face other risks, including significant and negative price swings, flash crashes, and fraud and cybersecurity risks. Digital assets may also be more susceptible to market manipulation than securities.

The performance of FBTC will not reflect the specific return an investor would realize if the investor actually purchased bitcoin. Investors in FBTC will not have any rights that bitcoin holders have and will not have the right to receive any redemption proceeds in bitcoin.

Additional Active ETF Disclosure: The objective of the actively managed ETF Tracking Basket is to construct a portfolio of stocks and representative index ETFs that tracks the daily performance of an actively managed ETF without exposing current holdings, trading activities, or internal equity research. The Tracking Basket is designed to conceal any nonpublic information about the underlying portfolio and only uses the Fund’s latest publicly disclosed holdings, representative ETFs, and the publicly known daily performance in its construction. You can gain access to the Tracking Basket and the Tracking Basket Weight overlap on Fidelity.com or i.Fidelity.com. Although the Tracking Basket is intended to provide investors with enough information to allow for an effective arbitrage mechanism that will keep the market price of the Fund at or close to the underlying NAV per share of the Fund, there is a risk (which may increase during periods of market disruption or volatility) that market prices will vary significantly from the underlying NAV of the Fund; ETFs trading on the basis of a published Tracking Basket may trade at a wider bid/ask spread than ETFs that publish their portfolios on a daily basis, especially during periods of market disruption or volatility, and, therefore, may cost investors more to trade, and although the Fund seeks to benefit from keeping its portfolio information secret, market participants may attempt to use the Tracking Basket to identify a Fund’s trading strategy, which, if successful, could result in such market participants engaging in certain predatory trading practices that may have the potential to harm the Fund and its shareholders. Because shares are traded in the secondary market, a broker may charge a commission to execute a transaction in shares, and an investor may incur the cost of the spread between the price at which a dealer will buy shares and the price at which a dealer will sell shares.

Metaverse companies are subject to various risks, including those associated with limited product lines, markets, financial resources or personnel, intense competition, potentially rapid product obsolescence, impairment of intellectual property rights, disruptions in service, cybersecurity attacks, and changes in regulation. Although the fund's underlying index uses a rules-based proprietary index methodology that seeks to identify such companies, there is no guarantee that this methodology will be successful.

1. The Fidelity ETF Screener is a research tool provided to help self-directed investors evaluate these types of securities. The criteria and inputs entered are at the sole discretion of the user, and all screens or strategies with preselected criteria (including expert ones) are solely for the convenience of the user. Expert Screeners are provided by independent companies not affiliated with Fidelity. Information supplied or obtained from these Screeners is for informational purposes only and should not be considered investment advice or guidance, an offer of or a solicitation of an offer to buy or sell securities, or a recommendation or endorsement by Fidelity of any security or investment strategy. Fidelity does not endorse or adopt any particular investment strategy or approach to screening or evaluating stocks, preferred securities, exchange-traded products, or closed-end funds. Fidelity makes no guarantees that information supplied is accurate, complete, or timely, and does not provide any warranties regarding results obtained from its use. Determine which securities are right for you based on your investment objectives, risk tolerance, financial situation, and other individual factors, and reevaluate them on a periodic basis.

High-yield/non-investment-grade bonds involve greater price volatility and risk of default than investment-grade bonds. In general, fixed income ETPs carry risks similar to those of bonds, including interest rate risk (as interest rates rise, bond prices usually fall, and vice versa), issuer or counterparty default risk, issuer credit risk, inflation risk, and call risk. Unlike individual bonds, many fixed income ETPs do not have a maturity date, so holding a fixed income security until maturity to try to avoid losses associated with bond price volatility is not possible with these types of ETPs. Certain fixed income ETPs may invest in lower-quality debt securities, which involve greater risk of default or price changes due to potential changes in the credit quality of the issuer.

Application of FMR's ESG ratings process and/or its sustainable investing exclusion criteria may affect the fund’s exposure to certain issuers, sectors, regions, and countries and may affect the fund’s performance depending on whether certain investments are in or out of favor.

Before investing in any exchange-traded product, you should consider its investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus, offering circular or, if available, a summary prospectus containing this information. Read it carefully.

Fidelity Brokerage Services LLC, Member NYSE, SIPC, 900 Salem Street, Smithfield, RI 02917

As an experienced financial analyst and enthusiast, I'm well-versed in the intricacies of investment products and the underlying principles of the financial markets. My expertise spans various asset classes, from traditional securities like stocks and bonds to more complex instruments such as exchange-traded funds (ETFs) and digital assets.

Let's delve into the concepts mentioned in the provided article:

  1. Commission-Free Trading: The article mentions a free commission offer for online purchases of Fidelity ETFs in a Fidelity retail account. Commission-free trading has become increasingly common in the brokerage industry, aimed at attracting investors by eliminating the cost barrier associated with buying and selling certain securities.

  2. Activity Assessment Fee: This fee, historically ranging from $0.01 to $0.03 per $1,000 of principal, is applied to the sale of ETFs. It's a nominal fee calculated based on the value of the transaction and is separate from the commission charges.

  3. Market Fluctuation and Risks: ETFs are subject to market fluctuation and inherit the risks associated with their underlying investments. These risks include volatility, economic downturns, and geopolitical events, among others.

  4. Management Fees and Expenses: Investors in ETFs incur management fees and other expenses, which are deducted from the fund's assets to cover operational and administrative costs.

  5. Regulatory Framework: The article mentions that FBTC (presumably referring to Bitcoin) is not registered under the Investment Company Act of 1940 or regulated under the Commodity Exchange Act of 1936. This lack of regulation implies that shareholders of FBTC do not have certain protections afforded to investors in regulated investment products.

  6. Volatility and Risks of Digital Assets: Digital assets like Bitcoin are highly volatile, and their value is influenced by various factors such as supply and demand dynamics, regulatory changes, and investor sentiment. Investors in digital assets face risks like price swings, fraud, and cybersecurity threats.

  7. Active ETF Disclosure: Active ETFs employ a strategy where the portfolio holdings are actively managed to achieve specific investment objectives. The article mentions a tracking basket designed to conceal nonpublic information about the underlying portfolio, aiming to prevent front-running and preserve the fund's trading strategy.

  8. Risks Associated with Metaverse Companies: Metaverse companies are subject to various risks, including limited product lines, intense competition, cybersecurity threats, and changes in regulation. Investors should consider these risks when investing in funds exposed to the metaverse sector.

  9. Fixed Income ETPs: Fixed income exchange-traded products (ETPs) carry risks similar to bonds, including interest rate risk, issuer default risk, and credit risk. These products provide exposure to a diversified portfolio of bonds but lack a maturity date, making them susceptible to price volatility.

  10. ESG Ratings and Sustainable Investing: Some funds apply environmental, social, and governance (ESG) criteria in their investment process. These criteria may affect the fund's exposure to certain issuers, sectors, and regions, potentially impacting its performance based on market trends and investor preferences.

Understanding these concepts is essential for making informed investment decisions and navigating the complexities of the financial markets. If you have any further questions or need clarification on specific topics, feel free to ask!

ETF | Fidelity Exchange-Traded Funds | Fidelity (2024)
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