Should You Invest in the Fidelity MSCI Industrials Index ETF (FIDU)?

If you're interested in broad exposure to the Industrials - Broad segment of the equity market, look no further than the Fidelity MSCI Industrials Index ETF (FIDU), a passively managed exchange traded fund launched on 10/21/2013.

An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.

Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Industrials - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 10, placing it in bottom 38%.

Index Details

The fund is sponsored by Fidelity. It has amassed assets over $1.32 billion, making it one of the larger ETFs attempting to match the performance of the Industrials - Broad segment of the equity market. FIDU seeks to match the performance of the MSCI USA IMI Industrials Index before fees and expenses.

The MSCI USA IMI Industrials 25/25 Index represents the performance of the industrial sector in the U.S. equity market.

Costs

When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.

Annual operating expenses for this ETF are 0.08%, making it one of the least expensive products in the space.

It has a 12-month trailing dividend yield of 1.39%.

Sector Exposure and Top Holdings

ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.

This ETF has heaviest allocation in the Industrials sector--about 100% of the portfolio.

Looking at individual holdings, General Electric Common Stock Usd.01 (GE) accounts for about 4.27% of total assets, followed by Rtx Corp Common Stock Usd1.0 (RTX) and Uber Technologies Inc Common Stock Usd.00001 (UBER).

The top 10 holdings account for about 28.18% of total assets under management.

Performance and Risk

So far this year, FIDU has gained about 5.06%, and is up about 12.15% in the last one year (as of 05/26/2025). During this past 52-week period, the fund has traded between $60.99 and $77.39.

The ETF has a beta of 1.09 and standard deviation of 18.83% for the trailing three-year period, making it a medium risk choice in the space. With about 371 holdings, it effectively diversifies company-specific risk.

Alternatives

Fidelity MSCI Industrials Index ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, FIDU is a good option for those seeking exposure to the Industrials ETFs area of the market. Investors might also want to consider some other ETF options in the space.

Vanguard Industrials ETF (VIS) tracks MSCI US Investable Market Industrials 25/50 Index and the Industrial Select Sector SPDR ETF (XLI) tracks Industrial Select Sector Index. Vanguard Industrials ETF has $5.35 billion in assets, Industrial Select Sector SPDR ETF has $20.50 billion. VIS has an expense ratio of 0.09% and XLI charges 0.08%.

Bottom Line

To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.

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This article originally published on Zacks Investment Research (zacks.com).

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