Low Volatility ETF FDLO Attracting Interest

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Investors are increasingly looking at low volatility as a key metric for their investment strategies, especially in the face of economic and political uncertainties. The Fidelity Low Volatility Factor ETF (FDLO) is gaining attention as a potential addition to portfolios in preparation for 2024, given its potential benefits in today’s volatile market environment.

This growing volatility has sparked interest in low volatility ETFs like FDLO. The fund has attracted nearly $30 million in assets under management (AUM) over the past month, as indicated by VettaFi data. What’s noteworthy is that a significant portion of this AUM growth is attributed to fund flows, rather than price fluctuations alone. FDLO has seen $39 million in flows during the same period, bringing its total AUM close to $600 million.

ETF Newz Says:

FDLO’s investment approach involves tracking a proprietary index of large and mid-cap U.S. stocks, focusing on companies with low volatility of returns, stable earnings, and less sensitivity to market movements. The Fidelity U.S. Low Volatility Factor Index comprises approximately 100 securities. As of mid-October, the ETF has delivered a solid year-to-date return of 9%, outperforming both its ETF Database Category and Factset Segment averages.

With just 9% volatility over 200 days, ranking 47 out of 121 members in its peer group, FDLO offers investors a low volatility strategy with a 29 basis point expense ratio. This could be particularly appealing to those looking to complement their core allocation with a low volatility approach.

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