The realm of technology disruptors, particularly artificial intelligence, continues to draw investors to the forefront of innovation, searching for the vanguards of the future. One should not overlook the acclaimed Fidelity Disruptive Technology ETF (FDTX), which offers investors a gateway into disruptive tech entities.
Illustrating the significant impact of disruptive technologies, FDTX was recently honored with the Best New U.S. Equity ETF award at the 2024 etf.com Awards in April. The ETF stood out amidst competitors that focused on a range of investment themes, including quality, equity income, and diverse strategies collectively referred to as the “Magnificent Seven.”
An actively managed fund, FDTX transitioned from a mutual fund to an ETF in June 2023 with the goal of achieving long-term capital growth by investing in companies that are revolutionizing their industries through innovative services and products. These companies challenge the established order and introduce novel business methodologies to their markets.
Inside the Disruptive Tech ETF’s Strategy
FDTX strategically selects companies that excel in various sectors such as big data, cybersecurity, software as a service (SaaS), consumer technologies, e-commerce, ride-sharing, and cutting-edge hardware. These investments are poised to disrupt their industries with new business models, competitive pricing, and inventive product delivery and services, giving them a strategic edge.
To determine its investments, FDTX employs a rigorous fundamental analysis of a company’s financial stability, industry dominance, and broader economic and market conditions. The ETF casts a wide net, investing in companies both domestically and internationally, and does not limit itself to growth or value stocks exclusively.
A few of the top investments within the ETF include Nvidia (NVDA), accounting for a 6.72% weight, Salesforce (CRM) with a 5.44% weight, and Taiwan Semiconductor Manufacturing (TSM) with a 5.14% weight as of late March 2024.
Since its inception, FDTX has seen a commendable total return of 16.86% as of April 22, 2024, showcasing the potential of investing in disruptive technology.
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For further insight and analysis, the ETF Investing Channel is a valuable resource.
