Fidelity Debuts 2 Active ESG Bond Funds

The launches follow the issuer’s ESG high yield fund launch in February.

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Reviewed by: Dan Mika
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Edited by: Dan Mika

Fidelity is adding two active fixed income ETFs to its lineup, both with an ESG slant. 

The Fidelity Sustainable Core Plus Bond ETF (FSBD) and the Fidelity Sustainable Low Duration Bond ETF (FSLD) debuted on the NYSE Arca Thursday with expense ratios of 0.36% and 0.30%, respectively. 

Neither fund has limits in their prospectuses on what types of bonds their managers can use, but they prioritize target debt instruments from issuers deemed by Fidelity to have solid ESG track records. 

FSBD aims to match the interest rate risk of the Bloomberg MSCI U.S. Aggregate ESG Choice Bond Index, while FSLD aims to keep its duration below one year and its average maturity below two years. 

Fidelity launched its first ESG bond fund in February with the Fidelity Sustainable High Yield ETF (FSYD), which is also actively managed. There are now 10 active ESG bond funds on the U.S. market with just over $690 million in combined assets, according to ETF.com data provider FactSet. 

 

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Dan Mika is a reporter for etf.com. He has previously covered business for the Ames Tribune and Cedar Rapids Gazette in Iowa, and BizWest Media in Fort Collins, Colorado. Dan holds a bachelor's degree in journalism from Truman State University.