Fidelity International has launched Europe’s first ‘semi-transparent’ active exchange traded fund.
The Fidelity US Fundamental Small-Mid Cap UCITS ETF is the first Irish-domiciled UCITS ETF in Europe to use the semi-transparent structure following regulatory approval by the Central Bank of Ireland.
The structure allows ETFs to avoid publishing holdings daily, allowing providers to protect their active research intellectual property. Instead, Fidelity said it will publish its full holdings on a quarterly basis.
The new ETF will primarily invest in securities with small to medium market capitalisations, while remaining unconstrained to any particular investment style.
The firm has also expanded its ETF offering with the launch of Fidelity US Fundamental Large Cap Core UCITS ETF, which will invest in equity securities of US companies with large market capitalisations.
The ETF is not constrained by any particular investment style and is fully transparent, disclosing full holdings daily.
Neil Davies, head of ETF product & capital markets for Europe and Asia Pacific at Fidelity International, said: “In Europe, the initial wave of active ETFs took the form of benchmark-aware enhanced strategies, but investors are now looking to complement that with higher-conviction strategies. This launch seeks to meet this demand by leveraging proprietary Fidelity Investments’ research through an ETF wrapper.
“We believe higher-conviction ETFs have the potential to drive the next phase of growth in the European ETF market.”
Fidelity International is currently the second-largest provider of active ETFs in Europe with $8 billion in assets under management. With these additions, its ETF range consists of 23 products, including 8 actively managed equity ETFs, 8 fixed income ETFs and 6 differentiated index ETFs.
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