Fidelity Low Duration Bond ETF

FLDB

Valor de mercado US$ 432 mi

The yield curve has seen some major movement in recent weeks, as a combination of debt, carry trade fear, and geopolitics have pressured both 10- and 30-year yields. It's possible investors may turn toward short duration offerings if that movement continues, as rising yields drop bond prices.

For the most part, financial advisors will tell their clients that it's better to stay invested than to let cash sit idle. One way to consider staying invested is through short-term bond funds — and Fidelity has a trio of ETFs that are worth considering just for this purpose.

Investors shifting their focus to long-duration bonds may be overlooking a compelling opportunity in ultra-short and short-duration bonds. In the current economic environment, many investors are naturally drawn to the allure of long-duration bonds.

In the current environment, characterized by heightened volatility, now is the time to focus on greater portfolio diversification. The diversifying power of bonds has waned, underscored by bonds' correlation with equities during the recent market sell-off.

Many investors are still sitting on the sidelines in cash, potentially missing out on the short duration fixed income segment. Importantly, investors sitting in cash via money market funds have earned a compelling rate without taking on much risk.

Many investors have been keeping money on the sidelines or utilizing money market funds due to high money market rates. This strategy may prove less effective when the Federal Reserve begins cutting rates, opening up avenues for short duration bond funds.

Fidelity Investments is deepening its focus on the active ETF landscape as part of its core, Fundamental ETF equity suite.