The 13 new ETFs and mutual funds offer investors new income-generating options
Following its previous announcement last week, Fidelity Investments Canada has launched a new suite of six dividend-factor ETFs on the TSX, each of which has a mutual-fund equivalent that invests in the underlying ETF. The decision to launch the strategies as ETFs and mutual funds means that they’re available to both IIROC and MFDA advisors.
“With today's aging demographic, we know one of the big demands in the marketplace is the need to generate income from investments,” said Fidelity Investments Canada President Rob Strickland. “Our new Fidelity Dividend Factor ETFs and mutual funds are intelligently designed to deliver exactly that – monthly income.”
The ETFs, along with their mutual fund equivalents, include:
- Fidelity Canadian High Dividend Index ETF (FCCD) and Mutual Fund - they offer single-factor exposure to high-quality, tax-preferred Canadian dividend-paying companies;
- Fidelity U.S. Dividend for Rising Rates Index ETF (FCRR) and Mutual Fund – available in currency-hedged versions (the hedged ETF trades as FCRRH), they provide exposure to US dividend-paying companies with positive correlation to rising interest rates;
- Fidelity U.S. High Dividend Index ETF and Mutual Fund (FCUD) and Mutual Fund – also available as currency-hedged versions (the currency-neutral ETF is FCUH), they offer single-factor exposure to high-quality US dividend-paying companies; and
- Fidelity International High Dividend Index ETF and Mutual Fund - they provide single-factor exposure to high-quality dividend-paying companies in international developed markets
Fidelity Investments Canada has also launched the Fidelity Tactical Global Dividend ETF Fund, a single-ticket global dividend solution that comes with a tactical asset-allocation overlay. Designed to generate income in various market environments, the fund is able to invest in underlying funds not managed by Fidelity, as well as funds that do not invest in global dividend-paying equity securities.
The ETFs come with management fees ranging from 0.35% to 0.45%. The mutual funds come in series F, which has management fees from 0.35% to 0.6%, as well as a series B options, whose management fees are 100 basis points more than the corresponding series F equivalents.