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Fidelity Limited Term Bond ETF FLTB

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Morningstar’s Analysis FLTB

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Changes to mandate and comanager addition at Fidelity Limited Term Bond; ratings unchanged

null Saraja Samant

Saraja Samant

Analyst Note

Effective Feb. 28, 2024, Fidelity Limited Term Bond Fund and Fidelity Limited Term Bond ETF will modify their investment strategies to allow each fund the ability to invest up to 20% of assets in non-investment-grade securities from their current 5% limit. The funds' internal composite benchmark (80% Bloomberg US 1-5 Year Credit Bond Index and 20% Bloomberg US 1-5 Year Government Bond Index), which defines their neutral allocations, will be modified to add a 10% high-yield component and reduce the investment-grade credit stake to 70%. Increasing the high-yield credit guardrails gives this team more flexibility but could result in slightly higher volatility compared with its historical risk profile. In response, the team is adding Alexandre Karam as a comanager for each of the funds to oversee the high-yield sleeve. With more than a decade of experience, Karam joined Fidelity in 2016 and is currently a portfolio manager on the firm’s high-income division. This mandate change and additional named comanager do not alter our view; both funds retain their Above Average People and Process ratings.

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Portfolio Holdings FLTB

  • Current Portfolio Date
  • Equity Holdings
  • Bond Holdings
  • Other Holdings
  • % Assets in Top 10 Holdings 10.5
Top 10 Holdings
% Portfolio Weight
Market Value USD

United States Treasury Notes 4.375%

1.90 2.8 Mil

Fidelity Cash Central Fund

1.70 2.5 Mil
Cash and Equivalents

United States Treasury Notes 4.5%

1.49 2.2 Mil

United States Treasury Notes 4.625%

1.38 2.0 Mil

United States Treasury Notes 4.625%

1.30 1.9 Mil

Goldman Sachs Group, Inc. 2.64%

0.89 1.3 Mil

Slam 2021-1 Limited / Slam 2021-1 Llc 2.434%

0.79 1.2 Mil

Niagara Park Clo Ltd / Llc

0.74 1.1 Mil

WarnerMedia Holdings Inc. 3.755%

0.70 1.0 Mil

Jbs Usa Lux SA/Jbs Usa Food Company/Jbs Usa Finance Inc 2.5%

0.69 996,569